A Step Into the Future of Retail

Today’s consumers don’t differentiate between retail channels. They’ll jump between mobile, online and in-store to curate each individual purchasing journey according to their needs. It's becoming clear to retailers that shopping for them is all about ease, immediacy and the instant gratification of desires.

For these empowered multichannel shoppers, convenience conquers all. Whether that’s finding quicker and easier ways to receive goods purchased, fast and expedient checkout and payment processes, or just-in-time access to the information they seek.

With consumers switching between shopping channels on a whim, retailers need to position themselves at the intersection of physical and digital realities to deliver elevated levels of interaction and value-add.

With customer demand for state-of the-art “blended” shopping experiences that are relevant, compelling and personally curated on the rise, Periscope By McKinsey conducted research with consumers in the U.S., U.K., France and Germany to understand their current cross-channel preferences and future shopping intentions.

The survey of 2,624 consumers highlighted the speed with which cross-channel retail is evolving, and how consumers are eager to try new digital channels that eliminate friction or frustration from their in-store shopping journeys.

Consumers Take a Resolutely Multichannel Approach

In the survey we found that 60 percent or more of consumers in the U.S., U.K. and Germany say they engage equally with online and offline shopping channels, suggesting that multichannel is certainly becoming the new norm.

Despite this surge in multichannel behavior, the physical store still remains king. Fifty percent of consumers in all countries surveyed said that the bulk of their shopping activity in the past year was in-store. Computers are the second most popular method for shoppers in France, Germany and the U.K.; however, in the U.S., the immediacy of smartphone shopping (19 percent) has caught up with the popularity of the computer (19 percent).

Virtually Augmented

New virtual reality (VR) and augmented reality (AR) technologies are enabling consumers to interact digitally within the physical store environment to address immediate needs and preferences.

Over 60 percent of consumers in all countries surveyed had yet to encounter VR or AR applications in-store, yet the majority had future plans to use a virtual shelf for a number of activities that they say would improve their in-store shopping experience. When asked which AR/VR applications they would definitely/probably utilize, those that made it easy to access additional product information or “virtually” explore product functionality/suitability scored highest with consumers in all markets.

The Future of Retail

Consumers are eager to embrace innovative retail technologies and are demanding more from retailers. Our research found consumers are exploring technologies including smartphone payments and virtual shelves, yet they're concerned about how their data is used. In the U.S., the top security concerns were the need to surrender phone and email information (38 percent), followed closely by putting payment card information online (37 percent).

It's clear and exciting that in-store experiences are getting a new lease on life. Those retailers that are able to bridge their online and offline channels in a way that consumers can seamlessly interact will be the winners. The real challenge for retailers is learning how to personalize the experience for individual consumers by powering cross-channel analytics using the data available to them, without neglecting customers’ security and privacy.

To read more about the survey’s findings, download the The Future of Shopping: connected, virtual and augmented report.

Brian Elliott is partner, founder and head of innovation at Periscope® By McKinsey.