Will Australian Retail Rise to the Occasion?

With nowhere to go and more people shopping online than ever before, will customers now expect more of Australian retailers? And will retailers show up?

Prior to 2020 we would come home from an overseas adventure, often excited by what we’d experienced in bricks and mortar retail, whether that be an incredible store design or a positive customer service experience. It was then customary to just put up with what Australian retail had to offer until your next opportunity to leave again. But now that international travel isn’t an option and consumer spending habits and behaviours have rapidly changed, what will motivate us to physically go in store, other than returning online purchases?

In past years, travelling was less mainstream and was seen as “an occasion”. To the pre-Boomer & Boomer populations travel was rare and was something you did in either retirement or for your honeymoon - as our grandmother would say “get it out of your system before you settle down”. But that’s certainly not the case anymore, in fact, 2018-19 was the highest year on record for Australian residents returning from a short-term trip overseas, with 11.2 million trips made, with each trip averaging 15 days. For comparison, that’s 5.4 million more trips than 10 years ago. And back then, retailers giving us the bare minimum was ok because we didn’t know any better, but now that we’ve experienced better, we expect better.

So, if we’re not travelling abroad and spending our cash overseas, then our retailers have a significant opportunity to secure substantially more from the consumer’s unspent cash. In our recent podcast with Steve Cox, CEO at Destination NSW, he said “NSW residents last year took almost 2 million international leisure trips and spent $16.7B on those trips”. An astounding figure when you consider that $16.7B doesn’t include incidental spend, for example shopping, meals, entertainment etc. That figure is purely what we spent on flights, accommodation and transfers. Steve also recognises the opportunity for retailers and reminded us “The opportunity domestically is to capture the international spend and bring it into this market”.

Consumer behaviour has shifted and not just because of COVID. Our path to purchase is and will become more thoughtful because consumers are now choosing brands who stand for something more than just making money. Based on Roy Morgan data, Millennials now make up around 28% of the population and it’s no secret that we are fiercely determined to make our purchases count, whether that be supporting local, shopping more sustainable brands, purchasing from indigenous businesses, researching and buying from B Corporations or supporting businesses who’s culture is diverse and inclusive.

Here’s what we think needs to be considered by Australian retailers to “show up”, which we believe will in turn help drive the retail recovery, post COVID:

Show me great store design

Your customer has a billion retail options at their fingertips, give them a reason to shop bricks and mortar again. We want to be wowed, we want to understand the brand, we want to live and breathe what you stand for and we want to be proud of our retailers.

Please give me a frictionless experience

Whether its online or in store, please make it easier for us to purchase from you! We cannot emphasise this enough! We want the freedom to pay however we like – phone, tablet, card, cash, Afterpay etc. – POS should be mobile, all transaction should be seamless, and we expect that when using your loyalty program that it will be effortless.

Focus on ROX (Return on Experience)

ROX measures the value you get from investing in your customer AND employee experience. The employee experience is vital in creating a great customer experience and vice versa. The two are directly correlated to each other and they also correlate to what your customer thinks of you as a company. Your customer service representatives are the face of your brand, invest in them and you win the customer and their wallet.

Give Back

Retail has a bad name when it comes to sustainability, and as the customer becomes more educated, it’s important that you do too. Do some research into how big retailers like Ulta Beauty and Selfridges are radically changing the way we shop for the better. If giant companies like that can change directions whilst in full motion, then so can you.

Lastly, and most importantly, get to know me

Salesforce recently reported that “64% of consumers don’t think retailers truly know them”, and we’d have to agree because if you did, you’d know what we want. Retailers have plenty of data on their customers and no idea how to use it.

Rant over… :)