New York—It seems that many consumers may be just as mystified about whether to shop online or in store as retailers are. According to a new IBM study of 26,000 global consumers, they are in a “transitional state.”
The study, which was released during the National Retail Federation’s convention held in New York City this week, found 35% of consumers are unsure whether they would next shop at a store or online. But 9% are sure they will be making future purchases online.
Of all eight product categories tracked in the survey, the two most popular categories chosen by consumers for an online shift are consumer electronics and luxury items, including jewelry and designer apparel.
“Today’s consumer is sophisticated and opportunistic, navigating between store and online environments interchangeably to meet their shopping needs of the moment,” said Jill Puleri, global retail leader at IBM Global Business Services. “To satisfy clients, retailers must deliver a consistent, convenient shopping experience across each consumer touch point, extending from the store to online and back again. The key is using data and analytics to better understand the behavior and preferences of shoppers to close the sale.”
And while 80% of shoppers told IBM that they chose a store to make their last non-grocery purchase, only half said they are committed to returning there next time to buy.
Understanding the Challenge–and Opportunity–of Showrooming
This brings to mind the phenomenon of “showrooming,” where consumers browse merchandise in a store location, but ultimately buy them online. The IBM study found that nearly half of online pushes in studied categories resulted from showrooming.
In fact, the study found that nearly a quarter of these online shoppers had intended to buy their item in the store, but ultimately purchases online—primarily due to price and convenience.
Retailers must better connect their store and online presence to capture the sale to showroomers, Puleri said, noting that online-only retailers account for one-third of showroomer purchases.
IBM Retail Analytics have evolved to give retailer insight into how to treat each consumer as an individual, meeting their growing expectation for personalization.
“Analytics can also be used to identify why showroomers are shifting purchases online so retailers can act and adjust accordingly,” Puleri added.
Some other trends in showrooming: younger, male and affluent shoppers are most likely to showroom. But that incidence of showrooming varies by country. The highest incidence of showrooming is in China (26%) and India (13%) while U.S. showroomers clock in at 7%.
Another finding in the IBM study revealed that consumers are seeking a truly integrated shopping experience. Retailers must better connect their online and physical stores, blending benefits into both at various points in the shopping cycle–from research to purchase–to build brand loyalty and repeat sales.
At the store level, retailers must infuse digital experiences, enable store associates with the technology to save the sale and embrace consumer-owned technology. Online, retailers most optimize their websites for various devices from smartphones to tablets, Puleri added.
The IBM Digital Analytics benchmark found that 70% more consumers used a mobile device to visit a retailer’s site on Cyber Monday in 2012 than 2011. However, the IBM study found that only 3% of shoppers are using retailers’ mobile apps.
About IBM Retail Analytics
IBM Retail Analytics solutions can provide the fact-based insight retailers need to treat each consumer as an individual, meeting their growing expectation for personalization. IBM researchers have been working on inventions that will improve the shopping experience–both in store and out. Last week, IBM announced that it was the leading recipient of U.S. patents in 2012, marking the company’s 20th consecutive year as “the world’s most inventive company.” IBM’s 2012 patents include inventions for retail, including a patent that would allow consumers to identify a product using just a photo and a patent to enable retailers to capture in 3D the movement of a consumer as they navigate the store in order to provide them a more personalized shopping experience. www.ibm.com/iibv.
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