The past few years have been rough for brick-and-mortar retailers.
From high-end department stores to fast-fashion outlets, businesses in every retail category have closed stores and in some cases closed their doors altogether.
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For decades, shopping was pretty much the same experience — whether we needed groceries, home goods, or lip gloss, we’d hop in the car, or on a train or bus, and head to the mall or main street.
Then we met the internet.
It seemed like one week we were excited that we could buy books on Amazon or shoes on Zappos and then practically overnight, it was possible to buy literally everything else 24/7.
Then the Covid-19 pandemic came along and converted plenty of us from occasional online shoppers to diehards.
While it still only accounts for a fraction of overall retail sales — around 16%, according to the most recent U.S. Department of Commerce data — online retail continues to grow year after year. Online shopping is expected to account for 29% of retail sales by 2029.
Amazon changed the game
No company has profited more from the shift than Amazon. During the pandemic, Amazon’s profits tripled and sales increased by 37%. In the years since, the company has been sued by the Federal Trade Commission which alleged the company is a “monopolist” that engages in anticompetitive practices.
Nearly 40% of online sales are Amazon’s. Coming in a distant second is Walmart, followed by a handful of others like Target and Apple.
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Remember the concept of delayed gratification? Getting something in your hands “now” has always been one of the best parts of shopping in real life, but in the last couple of years, shipping has become so efficient that instant gratification is barely a reason to go to the mall.
But what happens when retail therapy becomes retail drudgery?
Customers are looking for more personalized experiences
More than three in four consumers say that e-commerce is functional but not fun, according to Criteo, a commerce media company.
Criteo partnered with Harvard PR and market research specialist Vitreous World to poll 6000 consumers and 600 brand leaders across six markets: the UK, U.S., France, Germany, Japan, and South Korea.
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Stats that Amazon and Walmart should pay attention to:
- 76% of respondents said online shopping lacks excitement
- 29% describe it as a “chore”
- 78% said they feel overwhelmed by too many product choices
In the meantime, brick-and-mortar retailers are enticing customers to their locations with pop-up shops, creative collaborations, and personalized experiences.
If they hope to win shoppers’ loyalty, online retailers need to create more emotionally engaging experiences.
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Around 36% of the people who participated in Criteo’s survey said online shopping lacks the “thrill of unexpected finds” that can happen in person.
Shopping used to be about excitement and “the thrill of the unexpected, the delight of discovery,” said Criteo Executive Managing Director Marc Fischli. “Today, we no longer ‘go shopping’ – we are always shopping – but that hasn’t made the experience more exciting,” he told ChainStore Age.
Fischli believes AI could play a role in making online shopping more enticing and showing shoppers things they weren’t necessarily looking for.
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