Total Retail 2017

In 2017, UK retailers face one of the most competitive environments in decades. With the continuing shift in customer preferences towards online and increasingly mobile shopping, an unstable global marketplace that demands unprecedented technological sophistication, some retailers are being confronted with challenges to their very existence.

A perfect storm

The UK’s imminent exit from the European Union adds further complexity to the mix. The retail sector faces a perfect storm: how can retailers balance change and increasing costs whilst still embracing opportunities? Our Total Retail research shows that remaining customer-centric, more than ever before, is essential to stay ahead.

Investing for the future

Our 2017 Total Retail Global survey is our most comprehensive to date, with feedback on consumer behaviours and expectations from over 24,000 shoppers across 29 territories and 5 continents - including 1,003 consumers in the UK for the sixth consecutive year. The findings can help UK retailers solve the puzzle of where investments should be made in 2017 to ensure that they thrive in the years ahead.

Mannequin in shopwindow

To get ahead of competition, embracing a Total Retail mindset throughout your whole business is key.

What’s new for 2017?

  • In our comprehensive 2017 Total Retail report we’ve compared the UK results with to two of the largest consumer markets – the USA and China, to highlight key differences between British shoppers and their international counterparts.
  • We’ve also looked at the luxury product sector to analyse consumer trends and issues.
  • We’ve assessed how Brexit is likely to impact UK consumer spend over the next 12 months
  • We’ve examined the impact of CSR and product sourcing on decision making – do ethics and environmental accreditations matter, and do consumers prefer to buy British?
  • Looking to the future, we’ve explored the potential use of wearable devices and the possibilities for moving elements of healthcare provision into the retail sector.

If you’re short on time and would like a quick overview of our 2017 findings – download our 10 things you need to know about Total Retail report. If you have little longer to browse, download our full report.

New areas for 2017 list

How to win – The six battlegrounds

Disruptors are reshaping consumer behaviour. In response, retailers are stepping up their game. In our analysis, we examine six closely intertwined focus areas, or battlegrounds, that retailers must focus on to better attract and retain today’s mercurial shoppers. The underlying theme of these battlegrounds: to create an immersive, seamless, brand-defining experience for consumers across all channels, one that will keep them coming back.

1. Pricing

Dynamic pricing allows for real-time adjustments

Disruptors are now competing on speed, variety and convenience. In fact, shoppers told us their motivation for shopping online isn’t always dictated by price; 48% selected convenience as the main reason for shopping online. Across all channels, however, low price continues to dominate shopping decisions for 59% of shoppers. 35% of shoppers use price comparison sites for their inspiration and 38% start their product search at Amazon.

91% of shoppers now use Amazon, 49% check prices there

2. Loyalty

Keep 'em coming back

Brand loyalty, while hard-won, is not easy to shake and 65% of UK shoppers consider themselves to be loyal shoppers, versus 61% globally. That's good news for retailers who have cultivated close ties with shoppers over many years. It also reinforces the power of one-to-one connections with customers via personalisation, which new entrants online cultivate rigorously.

The loyal shopper: I am a loyal shopper who knows the brands and products thet I like and that is what I buy most ofther: 65% UK versus 61% Global

3. Delivery

Hurry, hurry, hurry!

Cost-prohibitive last-mile delivery issues continue to challenge retailers who are experimenting with a combination of options in response to customer preferences for speedy delivery. 29% of UK shoppers say that fast and reliable delivery (same day, collect from store or designated place) and a 28% good returns policy (free or return to store) are reasons for shopping with their favourite retailer.

Reasons for shopping with my favourite retailer...

4. In-store

Product knowledge is power

Ultimately, UK retailers need to entice customers to interact with them in-store — to keep them coming back.  To do this, they need to provide a convenient, frictionless in-store experience, with the added advantage of knowledgeable sales staff who can explain product offerings, the number-one preference of in-store shoppers, ahead of ambience. It is important, perhaps more than ever before, for retailers to invest in talent and the training and development of their in-store associates.

This is a key opportunity for UK brands looking to attract new customers from overseas, as 44% of global shoppers say they need to see and touch the product before purchasing.

Most important in-store attrivute: 59% of shoppers say sales associates with deep knowledge of product range

5. Mobile

Make it simple and beautiful

For a technology platform to succeed, it has to be part of an overarching digital strategy that encompasses the entire organization — rather than an ad hoc point-in-time initiative. Respondents to our survey were more open to using mobile payment via smartphone this year than they were last year and since 2014 there has been a 39% increase in the number of consumers using their phone for purchases at least once a year. However, almost one in three Digital Natives find that mobile websites are not easy to use.

32% of Digital Natives find that mobile websites are not easy to use

6. Innovation

Focus on what will make a difference

Continual experimentation and ongoing course correction is at the core of disruptors’ success — even when they are ahead of the game. From self-checkout devices to circumvent long check-out lines to touchscreen fitting-room mirrors that offer immediate help from sales associates, retailers are experimenting with a number of options to make the shopping experience simple, convenient, personal, and engaging.

In particular, Virtual Reality (VR), Augmented Reality, Wearable technology, voice and connected home devices offer exciting opportunities for the retail sector.

The concept store's shopwindow

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Disruptive Innovation – 5 key trends

Watch our video to hear Rob McWilliam, former VP of Amazon UK, explore 5 key trends disrupting the UK retail sector.

UK themes

Explore the survey through our four key themes

We’ve identified four emerging themes in the UK which should remain key focus areas for retailers in 2017. These are:

  • Trust
  • Simplicity
  • Innovation and
  • Connections

Together, these four areas form the firm foundations of an excellent customer experience.

Trust: Uncertain times have led customers to rely on retailers they know and trust. More than ever before.

In the UK, trust is now the second most important reason for choosing a retailer, after price. As the world gets more unsettled, trust and familiarity become more important. It takes years to build, and yet one bad day on social media can obliterate it altogether.

Find out more

Simplicity: It’s underestimated

91% of UK consumers now shop on Amazon, could this be because the experience and the operation is smart, seamless, efficient, and quick? It’s no coincidence. Because these days, price and quality are a given: the real competitive advantage is ease.

Find out more

Connections: Customers now demand more personalised connections...

Three out of four UK consumers have had some kind of interaction with a retailer via social media and 40% spend more as a result. Are you creating the connections that matter the most to your customers and which will also add value to your brand and bottom line?

Find out more

Innovation: With retailers around the world racing to innovate, a lack of investment in innovation to satisfy customer demands is an enormous and unnecessary risk.

In challenging times, it is imperative for innovations to focus on addressing your customers’ pain points and reducing post-purchase dissonance. Innovations that create cut-through will use personalisation to deepen and enrich the connection.

Find out more

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Lisa Hooker

Lisa Hooker

Leader of Industry for Consumer Markets, PwC United Kingdom

Tel: +44 (0)7802 882562

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