Beyond transactions Building a compelling retail experience An Economist Intelligence Unit white paper Sponsored by SAP Beyond transactions Building a compelling retail experience Preface Beyond transactions: Building a compelling retail experience is an Economist Intelligence Unit report sponsored by SAP The Economist Intelligence Unit bears sole responsibility for this report The Economist Intelligence Unit’s editorial team conducted the interviews and wrote the report The findings and views expressed in this report not necessarily reflect the views of the sponsor Dan Armstrong was the editor of the report and Sylvia Helm as the author Mike Kenny was responsible for layout and design Our thanks are due to all of the executives who responded to the survey October 2009 © Economist Intelligence Unit Limited 2009 Beyond transactions Building a compelling retail experience Contents Introduction Key findings Conclusion Appendix 1: Overall survey results Appendix 2: Americas survey results 13 Appendix 3: Asia-Pacific survey results 18 Appendix 4: Europe Middle East and Africa survey results 23 © Economist Intelligence Unit Limited 2009 Beyond transactions Building a compelling retail experience Introduction Global recession, the accompanying fall in demand and the proliferation of shopping choices have combined in the last year to make retailing a tough business in which to succeed Shoppers can buy the same goods from any number of interchangeable sources, including competing chains and multiple web commerce sites They can use their mobile phones to scan bar codes and instantly obtain a list of stores and website where the product is available and how much it costs at each They can reject a retailer for any number of reasons: a price that may be only pennies higher than competitors, the level of convenience, the friendliness of the sales staff, even the store’s décor When products are delivered to the door at a low price with a click of the mouse, there is no reason to even leave the house To differentiate in this environment, retailers need to provide something special—something informed by the qualities that the customer values If it is not price, the key is customer experience Regardless of channel, the retailer needs to provide a consistently enjoyable and convenient shopping experience, ensuring that everything—from the feel of the store or website to the return and exchange policy and the promotions extended to the customer—is carefully matched with the traits that the customer values In this difficult economy, retailers would be well-advised to focus on the elements within their control, especially building customer loyalty among the most valuable customers who account for the bulk of the revenues and profits Getting these customers to keep coming back requires gathering information from customer transactions, sharing that information across customer-facing units, and ultimately measuring and taking actions based on the value of each customer About the survey In September 2009, the Economist Intelligence Unit surveyed 89 executives of retail organisations on the challenges of getting customer-facing departments to work together more consistently and effectively Survey respondents spanned the globe, with 34% from the Asia-Pacific region, 32% from the Americas and 34% from EMEA Respondents’ annual revenue ranged from less than US$500m to more than US$10bn The level of seniority of respondents was high: 31% were C-level or board members and another 17% were VPs or heads of business units © Economist Intelligence Unit Limited 2009 Beyond transactions Building a compelling retail experience Key findings Estimating customer lifetime value Most retail organisations in the survey consider customer loyalty their strong suit Despite the recession, 65% say they have greatly strengthened customer relationships over the past 12 months What they have not done is figure out a way to measure the lifetime value of their customers and use that information to prioritise their sales and marketing efforts Regardless of industry or region, very few executives can honestly say that their companies can quantify the value of their best customers—or any customers, for that matter Measuring the value of customers (% of respondents who agree minus % who disagree) Disagree Agree Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months My organisation has an accurate way to estimate the lifetime value of customers My organisation has an accurate way to estimate the lifetime value of customers -30 -20 -10 10 20 30 40 50 Source: Economist Intelligence Unit survey, September 2009 Targeting the customers As to which customer-related areas need to be improved the most, the number-one response is targeting the right customer to meet sales goals Retailers point to segmenting and profiling shoppers, reducing the cost of sales and cross-selling or upselling shoppers as areas in need of improvement They also mention enhancing their ability to drill down to the individual sales level to understand what each customer is likely to buy, estimate how much revenue will be produced, and what to promote or cross sell each © Economist Intelligence Unit Limited 2009 Beyond transactions Building a compelling retail experience customer To this, retailers have moved beyond traditional demographic criteria to frequency and size of purchases, lifestyle information and the last product bought For instance, the US women’s clothing retailer Coldwater Creek—which sells through retail stores, a web site and direct-mail catalogs—recently announced the launch of the “Onecreek” loyalty program aimed at the top 5% of the company’s active customers It offers early peeks at new merchandise, a personal shopper, free shipping on returns and a gift on the customer’s birthday Eligible customers are those who purchase three times as frequently and spend four times as much as an average customer “The program is designed to improve retention and overall spend within this very important and profitable segment of our customer base,” said Dennis Pence, the company’s CEO, in a press release Targeting resources Survey respondents say big benefits can be gained from integrating marketing, sales and service activities If all customer-facing service units share the results of every customer interaction, they should receive a detailed picture of shopper behavior from all angles Then resources could be prioritised based on total value of each customer over the life of the relationship Many companies, including Sony Ericsson, Bell Canada, Samsung, Apple and Amazon have distinct customer service numbers for so-called “executive” customers—those whose spending surpasses a certain level, whether for their companies or on their own behalf These customer service agents have information on each customer at the touch of a button, and are empowered to offer discounts and provide extras on depending on the value of the relationship Top three benefits from integrating marketing, sales and service activities? (% respondents) Developing and sharing a detailed picture of shopper behavior and preferences Making each unit aware of how the others have interacted with a given shopper Prioritising resources directed towards shoppers by total value over the life of the relationship 10 15 20 25 30 35 40 Source: Economist Intelligence Unit survey, September 2009 © Economist Intelligence Unit Limited 2009 Beyond transactions Building a compelling retail experience How the three regions differ The three regions surveyed—the Americas, Asia-Pacific and EMEA –all give themselves top marks for excellent customer service All pride themselves on the loyalty of their customers And all admit that their organisations cannot accurately measure the value of—or even identify, in many cases—their most profitable customers The challenges faced in each region include the following Americas Reducing the cost of sales—necessary to keep margins low and prices competitive—is a top priority for Americas retail organisations In the Americas, customer feedback tends to be filtered through the less expensive e-commerce channels, rather than from direct response feedback (as is the case in the two other regions) Asia-Pacific Asia-Pacific retail organisations get most of their customer feedback in stores, through retail sales staff, and at the point of sale They are the lowest users of e-commerce, and call centers are used by only 17% of respondents EMEA Of all regions surveyed, EMEA retail organisations are the least able to gauge the lifetime value of customers Most in need of improvement: profiling, targeting, and cross selling or up selling existing customers EMEA retailers use call centers the least and direct response (direct mail, e-mail) the most © Economist Intelligence Unit Limited 2009 Beyond transactions Building a compelling retail experience Conclusion Few survey respondents say they can accurately measure the value of customers Faced with challenges they cannot control—global economic trends, rapid shifts in product demand, commoditization of the retail channel—they have to focus on what they can control, working to understand the customer and provide a pleasant and convenient retail experience Retailer organisations should consider how to: l Do a better job of analysing the customer base and measuring the value of individual customers l Share and act on customer information in all customer-facing units, making sure to improve the weak links l Differentiate customers by products purchased, services used and revenues generated l Provide distinct service to high-value customers, building their trust, increasing their loyalty, and generating more revenues © Economist Intelligence Unit Limited 2009 Appendix Overall survey results Beyond transactions Building a compelling retail experience Appendix: Overall survey results In your view, which of the following best represents the core strength of your overall business? Select only one (% respondents) Customer service: Providing superior service to customers 65 Operational excellence: Creating highly efficient processes 15 Product innovation: First to market with groundbreaking new products or services 12 Other Each of the organisation’s customer-facing departments influences the shopper via different channels For each of the processes below, how closely your marketing, sales and customer service units work together? Please rate on a scale of to (% respondents) No coordination; units are completely separate Ad hoc coordination; not systematic or consistent Some procedures established, but not consistently followed Procedures established, regular interaction Broad, systematic and consistent integration of information and strategies Don’t know Planning promotions/campaigns 26 30 27 36 27 Executing promotions/campaigns 19 Measuring effectiveness of promotions/campaigns 16 20 40 16 Developing and launching new products 16 21 34 21 Analysing and segmenting shoppers 23 26 33 Gauging shopper satisfaction 22 25 33 16 Responding to shopper demands or complaints 28 40 20 Incorporating shopper feedback into products/services 11 30 39 11 Other 9 13 66 Economist Intelligence Unit 2009 Appendix Overall survey results Beyond transactions Building a compelling retail experience Do you agree or disagree with the following statements? (% respondents) Agree Disagree Don’t know In chosing to business with my organisation, price is the single most important factor most shoppers consider 27 70 Compared to our competitors, my organisation’s shoppers are more loyal 64 20 16 My organisation has an accurate way to estimate the lifetime value of customers 34 49 17 My organisation prioritises sales and marketing resources based on each customer’s lifetime value 34 52 14 We are currently developing a social media strategy 36 41 23 My organisation has more flexibility than its competitors in pricing its products 60 31 Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months 65 25 10 We are more engaged in developing products or services collaboratively with customers than we were 12 months ago 52 40 Shoppers view my organisation’s products and services more as commodities now than five years ago 51 30 19 Our margins are higher than the margins of most of our competitors 40 46 13 If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles 76 In your view, which of your organisation’s activities are most in need of improvement? Select up to four (% respondents) 17 Which of the following would provide the biggest benefits in integrating your organisation’s marketing, sales and service activities? Select up to three (% respondents) Targeting the right shoppers to achieve sales volume and revenue objectives 43 Segmenting and profiling shoppers Developing and sharing a detailed picture of shopper behavior and preferences 40 34 Reducing the cost of sales 34 31 Cross-selling or upselling shoppers 33 Measuring/optimising effectiveness of marketing and promotional campaigns 28 Maximising repeat purchases and building loyalty among shoppers 28 Gathering shopper intelligence in the course of providing service 27 Measuring the satisfaction of shoppers 26 Generating promotions/campaigns 18 Involving shoppers in product/service development (eg, co-creation) 18 Building long-term relationships with store management 13 Ensuring that shopper complaints are resolved quickly 10 Creating effective collateral Other Don’t know Making each unit aware of how the others have interacted with a given shopper Prioritising resources directed towards shoppers by total value over the life of the relationship 30 Measuring the probability that shoppers will turn into buyers, and using these scores to guide sales 27 Establishing common definitions, assumptions and data 26 Helping each function find and act on ways to support the others 25 Integrating tracking of shoppers from initial contact through to post-sales service 22 Presenting shoppers with a consistent picture of the organisation 20 Our company sees no need to integrate our marketing, sales and service activities Other Don’t know/Not applicable Economist Intelligence Unit 2009 Appendix Americas survey results Beyond transactions Building a compelling retail experience Which of the following trends have had the greatest impact on your business over the past 12 months? Select up to three In which of the following ways does your organisation empower shoppers? Select all that apply (% respondents) (% respondents) Global economic downturn 71 Offering additional value along with products (eg, in-store service, merchandising improvements, sustainable packaging) 50 Significant demand shifts for our products/services Creating educational forums for shoppers (eg, online content, in-store content, communities of interest, direct-to-consumer outreach) 36 Emergence of new competitors 50 32 Improving usability, search and navigation of shopper-facing websites Changing needs of shoppers 43 29 Building or supporting online communities of shoppers Finding access to credit/capital 25 14 Other Disruptive technology developments 14 Don't know Emergence of new markets for our products and services 11 Changing needs of store management 11 Focusing on sustainability efforts What avenues of customer feedback is your organisation best and worst at collecting and using to improve the experience of shoppers? Select up to three from each column 11 Accessing key components or resources through our supply chain Other (% respondents) We are best at collecting and using We are worst at collecting and using Don’t know Point of sale feedback 50 21 In-store sales staff In which of the following ways does your organisation empower store management? Select all that apply 39 21 (% respondents) Our own e-commerce site(s) 36 Improving online or self-service support tools for store managers 43 Making prices and sales terms more transparent for easy comparability by store management 29 Third-party e-commerce sites 18 32 32 Phone order interaction Improving usability, search and navigation of store-facing websites 29 Investing in self-service tools for store employees across multiple channels (web, mobile devices, e-mail) 21 Building or supporting online communities 18 21 Direct response feedback 14 11 Call center customer service interactions 36 14 Other 25 Targeted focus groups 21 Don’t know/Not applicable 14 25 Online social media efforts 46 Other Don’t know 11 15 Economist Intelligence Unit 2009 Appendix Americas survey results Beyond transactions Building a compelling retail experience How well is information from all sources used to accomplish the following goals? (% respondents) Consistently and systematically Not at all Don’t know Empower salespeople 11 37 26 11 15 Empower customer service 26 30 26 11 Create effective marketing campaigns 18 25 39 14 Refine product development process 12 19 38 15 15 Forecast demand 11 29 36 18 4 Improve service to shoppers 14 29 32 25 Improve retail offerings and selections 14 32 39 11 Adjust pricing 30 22 My organisation’s greatest challenges in using information from store management employees and shoppers to improve the customer experience are: Select up to three 30 19 In which region are you personally based? (% respondents) North America (% respondents) 82 Latin America Persuading store employees to share feedback from shoppers, both positive and negative 18 Asia-Pacific 46 Putting recommendations into action Eastern Europe 36 Synthesising information from retail outlets into coherent recommendations 32 Persuading shoppers to share experiences, both positive and negative 29 Western Europe Middle East and Africa Synthesising information from customer service into coherent recommendations 29 Monitoring the results of actions in terms of shopper behaviour and marketing metrics 25 Who are your organisation’s primary customers? (% respondents) Distinguishing relevant from irrelevant shopper information 21 Dealing systematically with extremely high volumes of information from stores 21 Demonstrating to shoppers that their comments are being addressed 14 Synthesising information from online channels into coherent recommendations Individuals (eg, retail) 64 Businesses or other organisations (eg, business-to-business) 18 An equal mix of both 18 Other Don’t know 16 Economist Intelligence Unit 2009 Appendix Americas survey results Beyond transactions Building a compelling retail experience What are your main functional roles? Please choose no more than three functions Which of the following best describes your title? (% respondents) (% respondents) Board member General management 46 CEO/President/Managing director Strategy and business development 21 CFO/Treasurer/Comptroller Finance 18 CIO/Technology director Customer service 18 Other C-level executive Operations and production 11 14 SVP/VP/Director Marketing 14 14 Head of Business Unit Sales 14 Head of Department IT 18 11 Manager Risk 32 Other Procurement Supply-chain management Human resources What are your organisation’s global annual revenues in US dollars? Information and research (% respondents) R&D $500m or less $500m to $1bn 17 39 Legal Other $1bn to $5bn 25 $5bn to $10bn 14 $10bn or more 18 0 Economist Intelligence Unit 2009 Appendix Asia-Pacific survey results Beyond transactions Building a compelling retail experience Appendix: Asia-Pacific survey results In your view, which of the following best represents the core strength of your overall business? Select only one (% respondents) Customer service: Providing superior service to customers 70 Operational excellence: Creating highly efficient processes 13 Product innovation: First to market with groundbreaking new products or services 10 Other Each of the organisation’s customer-facing departments influences the shopper via different channels For each of the processes below, how closely your marketing, sales and customer service units work together? Please rate on a scale of to (% respondents) No coordination; units are completely separate Ad hoc coordination; not systematic or consistent Some procedures established, but not consistently followed Procedures established, regular interaction Broad, systematic and consistent integration of information and strategies Don’t know Planning promotions/campaigns 3 40 27 27 37 27 20 Executing promotions/campaigns 13 20 Measuring effectiveness of promotions/campaigns 13 13 47 Developing and launching new products 13 20 43 17 13 Analysing and segmenting shoppers 17 27 33 Gauging shopper satisfaction 20 23 37 17 Responding to shopper demands or complaints 23 57 20 Incorporating shopper feedback into products/services 10 27 43 13 Other 10 18 10 20 60 Economist Intelligence Unit 2009 Appendix Asia-Pacific survey results Beyond transactions Building a compelling retail experience Do you agree or disagree with the following statements? (% respondents) Agree Disagree Don’t know In chosing to business with my organisation, price is the single most important factor most shoppers consider 23 73 Compared to our competitors, my organisation’s shoppers are more loyal 67 17 17 My organisation has an accurate way to estimate the lifetime value of customers 30 47 23 My organisation prioritises sales and marketing resources based on each customer’s lifetime value 37 43 20 We are currently developing a social media strategy 40 43 17 My organisation has more flexibility than its competitors in pricing its products 63 33 Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months 77 17 We are more engaged in developing products or services collaboratively with customers than we were 12 months ago 60 30 10 Shoppers view my organisation’s products and services more as commodities now than five years ago 47 30 23 Our margins are higher than the margins of most of our competitors 40 43 17 If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles 73 In your view, which of your organisation’s activities are most in need of improvement? Select up to four (% respondents) 20 Which of the following would provide the biggest benefits in integrating your organisation’s marketing, sales and service activities? Select up to three (% respondents) Targeting the right shoppers to achieve sales volume and revenue objectives 37 Cross-selling or upselling shoppers Developing and sharing a detailed picture of shopper behavior and preferences 50 37 Measuring the satisfaction of shoppers 37 30 Generating promotions/campaigns 27 Segmenting and profiling shoppers 27 Maximising repeat purchases and building loyalty among shoppers 27 Gathering shopper intelligence in the course of providing service 27 Measuring/optimising effectiveness of marketing and promotional campaigns 20 Building long-term relationships with store management 20 Reducing the cost of sales 20 Involving shoppers in product/service development (eg, co-creation) 20 Ensuring that shopper complaints are resolved quickly 13 Creating effective collateral Other Don’t know Making each unit aware of how the others have interacted with a given shopper Measuring the probability that shoppers will turn into buyers, and using these scores to guide sales 30 Prioritising resources directed towards shoppers by total value over the life of the relationship 30 Establishing common definitions, assumptions and data 20 Integrating tracking of shoppers from initial contact through to post-sales service 20 Helping each function find and act on ways to support the others 17 Presenting shoppers with a consistent picture of the organisation 13 Our company sees no need to integrate our marketing, sales and service activities Other Don’t know/Not applicable 19 Economist Intelligence Unit 2009 Appendix Asia-Pacific survey results Beyond transactions Building a compelling retail experience Which of the following trends have had the greatest impact on your business over the past 12 months? Select up to three In which of the following ways does your organisation empower shoppers? Select all that apply (% respondents) (% respondents) Global economic downturn 60 Offering additional value along with products (eg, in-store service, merchandising improvements, sustainable packaging) 60 Changing needs of shoppers Improving usability, search and navigation of shopper-facing websites 53 37 Emergence of new markets for our products and services Building or supporting online communities of shoppers 23 33 Significant demand shifts for our products/services Creating educational forums for shoppers (eg, online content, in-store content, communities of interest, direct-to-consumer outreach) 23 Emergence of new competitors 33 20 Other Focusing on sustainability efforts 17 Don’t know Accessing key components or resources through our supply chain 13 10 Finding access to credit/capital Disruptive technology developments What avenues of customer feedback is your organisation best and worst at collecting and using to improve the experience of shoppers? Select up to three from each column Changing needs of store management Other (% respondents) We are best at collecting and using We are worst at collecting and using Don’t know Point of sale feedback 50 10 In which of the following ways does your organisation empower store management? Select all that apply In-store sales staff 60 (% respondents) Our own e-commerce site(s) 20 Improving usability, search and navigation of store-facing websites 33 33 Third-party e-commerce sites Making prices and sales terms more transparent for easy comparability by store management 23 Phone order interaction 27 Improving online or self-service support tools for store managers 30 23 Direct response feedback Building or supporting online communities 40 20 Investing in self-service tools for store employees across multiple channels (web, mobile devices, e-mail) Call center customer service interactions 17 17 20 Other Targeted focus groups 27 20 Don’t know/Not applicable 37 Online social media efforts 33 Other Don’t know 17 20 Economist Intelligence Unit 2009 Appendix Asia-Pacific survey results Beyond transactions Building a compelling retail experience How well is information from all sources used to accomplish the following goals? (% respondents) Consistently and systematically Not at all Don’t know Empower salespeople 13 40 37 10 Empower customer service 27 37 33 3 Create effective marketing campaigns 17 30 37 10 Refine product development process 14 45 24 7 Forecast demand 17 37 23 20 Improve service to shoppers 27 43 17 13 Improve retail offerings and selections 23 40 13 23 Adjust pricing 20 37 My organisation’s greatest challenges in using information from store management employees and shoppers to improve the customer experience are: Select up to three 17 17 10 In which region are you personally based? (% respondents) Asia-Pacific (% respondents) 100 Latin America Putting recommendations into action 47 Persuading shoppers to share experiences, both positive and negative 40 Monitoring the results of actions in terms of shopper behaviour and marketing metrics 30 Synthesising information from retail outlets into coherent recommendations 23 North America Eastern Europe Western Europe Middle East and Africa Dealing systematically with extremely high volumes of information from stores 20 Demonstrating to shoppers that their comments are being addressed 20 Persuading store employees to share feedback from shoppers, both positive and negative Who are your organisation’s primary customers? (% respondents) 17 Distinguishing relevant from irrelevant shopper information 17 Synthesising information from customer service into coherent recommendations 17 Synthesising information from online channels into coherent recommendations Individuals (eg, retail) 64 Businesses or other organisations (eg, business-to-business) 14 An equal mix of both 21 Other Don’t know 21 Economist Intelligence Unit 2009 Appendix Asia-Pacific survey results Beyond transactions Building a compelling retail experience What are your main functional roles? Please choose no more than three functions Which of the following best describes your title? (% respondents) (% respondents) Board member General management CEO/President/Managing director 52 Customer service 17 CFO/Treasurer/Comptroller 28 Marketing CIO/Technology director 24 Sales 10 Other C-level executive 24 Finance SVP/VP/Director 17 IT Head of Business Unit 17 Strategy and business development Head of Department 14 Operations and production 10 Manager 14 31 Human resources Other 14 Information and research 10 Supply-chain management What are your organisation’s global annual revenues in US dollars? Risk (% respondents) R&D 0 Procurement $500m or less 50 $500m to $1bn 14 22 $1bn to $5bn 25 $5bn to $10bn $10bn or more Legal Other Economist Intelligence Unit 2009 Appendix EMEA survey results Beyond transactions Building a compelling retail experience Appendix: Europe Middle East and Africa survey results In your view, which of the following best represents the core strength of your overall business? Select only one (% respondents) Customer service: Providing superior service to customers 61 Product innovation: First to market with groundbreaking new products or services 16 Operational excellence: Creating highly efficient processes 13 Other 10 Each of the organisation’s customer-facing departments influences the shopper via different channels For each of the processes below, how closely your marketing, sales and customer service units work together? Please rate on a scale of to (% respondents) No coordination; units are completely separate Ad hoc coordination; not systematic or consistent Some procedures established, but not consistently followed Procedures established, regular interaction Broad, systematic and consistent integration of information and strategies Don’t know Planning promotions/campaigns 16 13 35 26 Executing promotions/campaigns 6 23 45 19 Measuring effectiveness of promotions/campaigns 16 29 35 13 Developing and launching new products 23 23 35 19 29 10 35 10 19 10 Analysing and segmenting shoppers 23 32 Gauging shopper satisfaction 23 29 Responding to shopper demands or complaints 16 29 32 Incorporating shopper feedback into products/services 10 13 35 32 Other 14 23 14 71 Economist Intelligence Unit 2009 Appendix EMEA survey results Beyond transactions Building a compelling retail experience Do you agree or disagree with the following statements? (% respondents) Agree Disagree Don’t know In chosing to business with my organisation, price is the single most important factor most shoppers consider 23 74 Compared to our competitors, my organisation’s shoppers are more loyal 61 29 10 My organisation has an accurate way to estimate the lifetime value of customers 32 61 My organisation prioritises sales and marketing resources based on each customer’s lifetime value 39 58 We are currently developing a social media strategy 26 48 26 My organisation has more flexibility than its competitors in pricing its products 55 39 Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months 58 29 13 We are more engaged in developing products or services collaboratively with customers than we were 12 months ago 45 48 Shoppers view my organisation’s products and services more as commodities now than five years ago 61 29 10 Our margins are higher than the margins of most of our competitors 39 48 13 If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles 81 In your view, which of your organisation’s activities are most in need of improvement? Select up to four (% respondents) 13 Which of the following would provide the biggest benefits in integrating your organisation’s marketing, sales and service activities? Select up to three (% respondents) Segmenting and profiling shoppers 48 Targeting the right shoppers to achieve sales volume and revenue objectives Making each unit aware of how the others have interacted with a given shopper 35 45 Establishing common definitions, assumptions and data Cross-selling or upselling shoppers 32 42 Reducing the cost of sales 39 Maximising repeat purchases and building loyalty among shoppers 32 Measuring/optimising effectiveness of marketing and promotional campaigns 26 Gathering shopper intelligence in the course of providing service 26 Measuring the satisfaction of shoppers 23 Involving shoppers in product/service development (eg, co-creation) 19 Generating promotions/campaigns 16 Building long-term relationships with store management 13 Creating effective collateral Ensuring that shopper complaints are resolved quickly Other Don’t know Developing and sharing a detailed picture of shopper behavior and preferences 32 Prioritising resources directed towards shoppers by total value over the life of the relationship 29 Presenting shoppers with a consistent picture of the organisation 26 Helping each function find and act on ways to support the others 26 Measuring the probability that shoppers will turn into buyers, and using these scores to guide sales 26 Integrating tracking of shoppers from initial contact through to post-sales service 23 Our company sees no need to integrate our marketing, sales and service activities Other Don’t know/Not applicable 24 Economist Intelligence Unit 2009 Appendix EMEA survey results Beyond transactions Building a compelling retail experience Which of the following trends have had the greatest impact on your business over the past 12 months? Select up to three In which of the following ways does your organisation empower shoppers? Select all that apply (% respondents) (% respondents) Global economic downturn Improving usability, search and navigation of shopper-facing websites 81 Changing needs of shoppers 52 Offering additional value along with products (eg, in-store service, merchandising improvements, sustainable packaging) 39 Finding access to credit/capital 45 Creating educational forums for shoppers (eg, online content, in-store content, communities of interest, direct-to-consumer outreach) 29 Emergence of new competitors 32 29 Building or supporting online communities of shoppers Significant demand shifts for our products/services 23 26 Other Accessing key components or resources through our supply chain 13 Don’t know Changing needs of store management 13 Focusing on sustainability efforts 13 Emergence of new markets for our products and services What avenues of customer feedback is your organisation best and worst at collecting and using to improve the experience of shoppers? Select up to three from each column 10 Disruptive technology developments 10 Other (% respondents) We are best at collecting and using We are worst at collecting and using Don’t know Point of sale feedback 48 29 In-store sales staff In which of the following ways does your organisation empower store management? Select all that apply 42 23 (% respondents) Our own e-commerce site(s) 26 26 Investing in self-service tools for store employees across multiple channels (web, mobile devices, e-mail) 39 Third-party e-commerce sites 10 Improving online or self-service support tools for store managers 29 35 Phone order interaction Building or supporting online communities 23 26 Making prices and sales terms more transparent for easy comparability by store management 26 Improving usability, search and navigation of store-facing websites 16 Direct response feedback 45 Call center customer service interactions 13 19 16 Other Targeted focus groups 19 19 Don’t know/Not applicable 26 Online social media efforts 26 Other 0 Don’t know 6 25 Economist Intelligence Unit 2009 Appendix EMEA survey results Beyond transactions Building a compelling retail experience How well is information from all sources used to accomplish the following goals? (% respondents) Consistently and systematically Not at all Don’t know Empower salespeople 10 42 16 26 3 19 13 3 16 3 Empower customer service 13 42 23 Create effective marketing campaigns 16 39 26 Refine product development process 13 32 32 Forecast demand 19 16 39 16 Improve service to shoppers 16 48 23 10 Improve retail offerings and selections 19 42 13 13 19 6 Adjust pricing 29 39 My organisation’s greatest challenges in using information from store management employees and shoppers to improve the customer experience are: Select up to three (% respondents) 3 In which region are you personally based? (% respondents) Asia-Pacific Latin America Putting recommendations into action 52 Distinguishing relevant from irrelevant shopper information 35 Persuading shoppers to share experiences, both positive and negative 29 North America Eastern Europe 10 Western Europe Synthesising information from retail outlets into coherent recommendations 23 Synthesising information from customer service into coherent recommendations 77 Middle East and Africa 13 23 Persuading store employees to share feedback from shoppers, both positive and negative 19 Who are your organisation’s primary customers? (% respondents) Monitoring the results of actions in terms of shopper behaviour and marketing metrics 19 Demonstrating to shoppers that their comments are being addressed 16 Dealing systematically with extremely high volumes of information from stores 13 Synthesising information from online channels into coherent recommendations Individuals (eg, retail) 65 Businesses or other organisations (eg, business-to-business) 13 An equal mix of both 23 Other Don’t know 10 26 Economist Intelligence Unit 2009 Appendix EMEA survey results Beyond transactions Building a compelling retail experience What are your main functional roles? Please choose no more than three functions Which of the following best describes your title? (% respondents) (% respondents) Board member General management CEO/President/Managing director 52 Strategy and business development 23 CFO/Treasurer/Comptroller 29 Sales CIO/Technology director 26 Finance Other C-level executive 19 Information and research SVP/VP/Director 16 Customer service Head of Business Unit 16 Marketing 13 Head of Department 13 IT 19 Manager 10 29 Procurement Other Supply-chain management Human resources What are your organisation’s global annual revenues in US dollars? Operations and production (% respondents) R&D 3 Risk $500m or less 48 $500m to $1bn 10 27 $1bn to $5bn $5bn to $10bn $10bn or more 32 Legal Other Economist Intelligence Unit 2009 28 Cover image: Shutterstock Whilst every effort has been taken to verify the accuracy of this information, neither The Economist Intelligence Unit Ltd nor the sponsors of this report can accept any responsibility or liability for reliance by any person on this white paper or any of the information, opinions or conclusions set out in the white paper LONDON 26 Red Lion Square London WC1R 4HQ United Kingdom Tel: (44.20) 7576 8000 Fax: (44.20) 7576 8476 E-mail: london@eiu.com NEW YORK 111 West 57th Street New York NY 10019 United States Tel: (1.212) 554 0600 Fax: (1.212) 586 1181/2 E-mail: newyork@eiu.com HONG KONG 6001, Central Plaza 18 Harbour Road Wanchai Hong Kong Tel: (852) 2585 3888 Fax: (852) 2802 7638 E-mail: hongkong@eiu.com [...]... management 7 Human resources What are your organisation’s global annual revenues in US dollars? 7 Information and research (% respondents) 4 R&D 4 $500m or less $500m to $1bn 17 39 Legal 4 Other $1bn to $5bn 25 $5bn to $10bn 14 $10bn or more 18 0 0 Economist Intelligence Unit 2009 Appendix 3 Asia-Pacific survey results Beyond transactions Building a compelling retail experience Appendix: Asia-Pacific survey... 17 My organisation has an accurate way to estimate the lifetime value of customers 30 47 23 My organisation prioritises sales and marketing resources based on each customer’s lifetime value 37 43 20 We are currently developing a social media strategy 40 43 17 My organisation has more flexibility than its competitors in pricing its products 63 33 3 Despite the recession, my organisation has greatly strengthened... to achieve sales volume and revenue objectives Making each unit aware of how the others have interacted with a given shopper 35 45 Establishing common definitions, assumptions and data Cross-selling or upselling shoppers 32 42 Reducing the cost of sales 39 Maximising repeat purchases and building loyalty among shoppers 32 Measuring/optimising effectiveness of marketing and promotional campaigns 26 Gathering... ways to support the others 17 Presenting shoppers with a consistent picture of the organisation 13 Our company sees no need to integrate our marketing, sales and service activities 3 Other 0 Don’t know/Not applicable 7 0 19 Economist Intelligence Unit 2009 Appendix 3 Asia-Pacific survey results Beyond transactions Building a compelling retail experience Which of the following trends have had the greatest... Unit 2009 0 Appendix 3 Asia-Pacific survey results Beyond transactions Building a compelling retail experience Do you agree or disagree with the following statements? (% respondents) Agree Disagree Don’t know In chosing to do business with my organisation, price is the single most important factor most shoppers consider 23 73 3 Compared to our competitors, my organisation’s shoppers are more loyal 67 17... 2009 Appendix 1 Overall survey results Beyond transactions Building a compelling retail experience What are your main functional roles? Please choose no more than three functions Which of the following best describes your title? (% respondents) (% respondents) Board member General management 2 50 CEO/President/Managing director Strategy and business development 15 22 CFO/Treasurer/Comptroller Sales... to integrate our marketing, sales and service activities 4 Other 0 Don’t know/Not applicable 4 0 14 Economist Intelligence Unit 2009 Appendix 2 Americas survey results Beyond transactions Building a compelling retail experience Which of the following trends have had the greatest impact on your business over the past 12 months? Select up to three In which of the following ways does your organisation empower... Other Targeted focus groups 3 27 20 Don’t know/Not applicable 37 Online social media efforts 3 33 Other 0 3 Don’t know 3 17 20 Economist Intelligence Unit 2009 Appendix 3 Asia-Pacific survey results Beyond transactions Building a compelling retail experience How well is information from all sources used to accomplish the following goals? (% respondents) 1 Consistently and systematically 2 3 4 5 Not at all... transactions Building a compelling retail experience Do you agree or disagree with the following statements? (% respondents) Agree Disagree Don’t know In chosing to do business with my organisation, price is the single most important factor most shoppers consider 23 74 3 Compared to our competitors, my organisation’s shoppers are more loyal 61 29 10 My organisation has an accurate way to estimate the lifetime...Appendix 1 Overall survey results Beyond transactions Building a compelling retail experience Which of the following trends have had the greatest impact on your business over the past 12 months? Select up to three In which of the following ways does your organisation empower shoppers? Select all that apply (% respondents) (% respondents) Global economic downturn 71 Offering additional value along .. .Beyond transactions Building a compelling retail experience Preface Beyond transactions: Building a compelling retail experience is an Economist Intelligence Unit report sponsored by SAP The... Intelligence Unit 2009 Appendix Asia-Pacific survey results Beyond transactions Building a compelling retail experience What are your main functional roles? Please choose no more than three functions... Limited 2009 Beyond transactions Building a compelling retail experience Conclusion Few survey respondents say they can accurately measure the value of customers Faced with challenges they cannot control—global