One might think that after multiple years of inflation and a scarcity mindset that consumers would have adjusted their expectations of retailers to allow for more leniency and to ensure they’re just able to get the products they want. CI&T’s 2024 Connected Retail Report told a very different story. In our fourth year collecting consumer insights for the report, we found that shoppers are very aware of the impact the economy has had on their spending abilities, but instead of lowering their standards of retailers while spending as little as possible, they’re ensuring they spend as little money and time as possible while expecting the best shopping experience.
Price is Always Top of Mind
According to the survey results, consumers feel they’re shopping the same, but spending more than last year. In fact, 80 percent of participants said the economy has changed their spending habits. This heightened price-sensitivity is at the root of channel decisions, with “more expensive than other retailers” as the top reason respondents said they wouldn’t shop at a particular physical or online store. “Better prices” was the top reason they said they would download a retailer’s app. Just as shoppers are strategic, retailers should be getting extremely creative with how they issue deals. Personalized discounts, dynamic pricing, and group discounts are useful tools to cater to this shopper requirement.
But despite being so price-motivated, 71 percent of respondents reported that they expect all retailers, regardless of price, to provide an equally impressive shopping experience. Additionally, 70 percent said they expect retailers to understand their most complex search queries. There’s an orientation that retailers will evolve at the pace of sophistication shoppers have when on their journeys. Aesthetically pleasing channels, easy return policies and processes, natural language search functions, and educational services (e.g., consultations, guides, etc.) would all elevate the shopping experience and should happen regardless of price point.
There’s Value in Convenience
After being more expensive than others, inconvenience-based reasons were the most common reasons respondents said they wouldn’t shop at a store or website. For physical stores, the location being too far away was the second most frequently chosen reason, and for online, it was the website being hard to navigate. Similarly, the third most common selection for why consumers would shop via app was “I shop the retailer so much that it’s just more convenient.” Every channel should be constructed in the most straightforward way, and merchandising plays a key role here. Intuitively organized assortments, the ability to reorder something quickly, and the opportunity to document what one liked or disliked about a purchase would be beneficial, a la Crumbl Cookies (as highlighted in our Retailer Audit portion of the report).
AI’s Benefits Must Be Shown
The respondent pool was split exactly 50/50 as to whether they felt retailers should use artificial intelligence to improve the shopping experience, uncovering a significant amount of trepidation. To avoid biasing participants, we listed off potential use cases for AI and generative AI, asking which were the top three capabilities they felt would most improve the retail experience, without saying they would be facilitated by AI. Better product descriptions, followed by knowing the retailer will get them their items in the fastest way possible, and wide-ranging product photos were the three most preferred retailer improvements. If retailers demonstrate to shoppers that AI is responsible for helping them find what they’re looking for faster, getting it to them more quickly, and at better prices, they should warm up to its use moving forward. It would be creative and educational to show consumers the paths to purchase with and without AI to build appreciation for its integration.
Melissa Minkow is director of retail strategy at CI&T, a firm that partners with the world’s most valuable brands to build AI-powered digital solutions that transform businesses.
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