The top six preferred big-box retailers are falling short on personalization, according to a recent ICLP report, commissioned by Survey Sampling International. Looking at performance by Amazon, Walmart, Target, Nike, Macy's and Kohl's, the study found that while Amazon overall provided a more individualized shopping experience than the other aforementioned retailers, each brand is still falling short on proper communications, understanding of preferences and relevant rewards considering their massive amounts of resources.
The research indicated that 53% of U.S. consumers would buy more if brands better communicated with them.
For the top six brands, 50% of consumers believe that Amazon, Nike and Kohl's communicate in a tone that is personally appropriate for them. Similarly, 40% report the same about Target and Macy's and 37% about Walmart. All brands are also below the 50% mark when it comes to asking their customers their preferred method of communication. The top of the pack was Amazon, with 42%, and the low end was Walmart, 29%.
“What we’re seeing is that big-box retailers are still not putting sufficient resources behind personalizing the customer experience, and as a result, are losing out on valuable opportunities to generate more repeat customers—a key aspect of a strong bottom line,” said Phil Seward, regional director, Americas at ICLP. “By failing to excel at the three tenets of customer loyalty—communication, customer understanding and rewards—even the largest and most powerful brands are at risk of losing business to smaller competitors that make their customers feel valued. Whether it’s promptly responding to them on social media, providing relevant recommendations based on individual insights, or even giving them a surprise reward on special occasions, US consumers won’t be as loyal to brands if they feel like they’re just one in a million. For the big guys, it’s about giving customers the feeling of shopping at their local neighborhood store, except with more choice, convenience and better perks.”
In terms of social media, ICLP's findings show that the brands only respond to their posts and messages 27% of the time, with Amazon leading at 33% and Kohl's behind at 16%. Of those surveyed, 63% reported that Amazon makes relevant recommendations for products and services, Nike, 42%, Walmart, 33%, Target, 32%, Macy's, 28%, and Kohl's, 25%. In terms of proving that they know what their customers want, Amazon and Nike lead at 40% and 38%, and Kohl's was last at 13%.
Finally, when it comes to rewards, 74% of U.S. consumers would buy more if they were rewarded with more relevant and timely offers. For the top six, Nike ranked the highest at 47%, followed by Kohl's at 41%, Amazon at 39%, Macy's at 31%, Walmart at 32% and Target at 30%.
Customer understanding is another important piece of the puzzle, and 59% of U.S. consumers said they would buy more if retailers understood their needs better. This includes recommending products based on their browsing patterns.