new battle of the bandwidths - vodat international · 2019. 6. 26. · battle of the bandwidths:...
TRANSCRIPT
Why customers are won and lost on the strength of retail networks
Battle of the
bandwidths
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
The growth of
multi-channel retail may
have created new places
to reach consumers, but
it has made identifying,
attracting, serving
and selling to them via
traditional bricks-and-
mortar harder than ever.
The growth of multi-channel retail
Convenient and often personalised, ecommerce and mobile retail are not
just eroding share of channel from the store; they’re changing shopper
expectations at the shelf edge. Today, the wrong price or a bad experience
can send potential customer online – or to a rival retailer.
Without support from digital technologies throughout the store journey, retailers
cannot integrate online and offl ine retail, and are therefore losing valuable conversion and upselling opportunities. Even those who have technology in place
are letting customers down at crucial moments, because they aren’t investing in
the network underpinning their technology.
In this report, Vodat International will look at where tech-savvy shoppers are
being let down by the current store experience, and create a new roadmap for
engaging bricks-and-mortar customers in an increasingly digitised world.
A world in which customers are won and lost on the strength of retail networks.
3
The impact of the ‘digital high street’
Walk into any store or through any shopping centre and you’ll see
the fundamental impact of technology. Consumers are glued to their
smartphones as they wander the aisles, and practices such as comparing
online prices whilst stood at the shelf edge, or ‘Googling’ discount vouchers
prior to purchase, have become commonplace.
Digital connectivity is now so fundamental to everyday interactions that it has
become a national initiative; in March 2015, the government released Digital
High Street 2020, assessing how the UK must prepare for technology’s increasing
infl uence on retail.
The report made 3 key recommendations:
Raise internet/4G connectivity
standards
While we wholeheartedly support these ambitions, the government has set a fi ve-year time frame for meeting these objectives, and the average High Street still has a
long way to go.
Retailers cannot aff ord to wait for this ‘connectivity for all’ dream to become a reality in the UK. There are a wealth of revenue generating opportunities that can be created
in the store right now, if retail businesses can integrate technology into bricks-and-
mortar experiences.
Let’s explore these opportunities in further detail.
Ensure business
owners have basic digital
skills
Create a digital innovation
hub featuring resources that
companies can utilise
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
Being mobile-savvy is non-negotiable
The chance to engage with shoppers through their mobile device is now almost
ubiquitous; two-thirds of UK adults now own a smartphone, and last year it
overtook the laptop as internet users’ number one device.
To explore the relationship between mobile and retail in greater depth, Vodat
International commissioned original research among 1,000 UK consumers.
Our insights reveal just how intertwined smartphones have become with bricks-and-
mortar shopping. More than a quarter of consumers use their smartphone during all
store visits, while 60% use it in at least half their shopping trips.
Opportunities for interaction are particularly strong among Millennials; three quarters
of 16-29 year-olds use their mobile device during most or all of their store visits.
However, if retailers don’t actively involve themselves in this mobile journey, there
is potential for digital connectivity to detrimentally impact sales – as we will explain
momentarily.
Where are the opportunities to infl uence mobile users in-store?
Payments
Promotions
Upselling
Price matching
Social media
Product reviews
Loyalty points
Repeat ordering
Click-and-collect
Personalised communications
5
Mobile retail: the push eff ect
Consumers’ widespread use of smartphones may present opportunities
for positive engagement, but, if unmanaged, they can also push potential
customers in diff erent directions.
Our research revealed that two of the most common reasons for referring to a
mobile in store are price comparison related. With more than half of shoppers
checking prices for a better deal online, and a further 35% looking for cheaper prices
at another nearby store, smartphone usage can negatively impact sales conversions.
Ch
eck
ing
the
price
of a
n ite
m to
see
if i c
an
ge
t a b
ette
r de
al
Lo
ok
ing
up
furth
er p
rod
uc
t in
form
atio
n
Lo
ok
ing
for a
disco
un
t cod
e b
efo
re
ma
kin
g a
pu
rcha
se
Pe
rson
al u
se e
.g. ch
eck
ing
em
ails
, surfi ng the net
Ch
eck
ing
to se
e if th
e ite
m is
av
aila
ble
che
ap
er in
a n
ea
rby s
tore
sha
ring
ima
ge
s/in
form
atio
n o
n a
m
essa
gin
g a
pp
Sh
ow
ing
a te
xt/e
ma
il to p
ick u
p a
click
& co
llec
t ord
er
Co
mp
arin
g fe
atu
res w
ith sim
ilar
pro
du
cts o
nlin
e
Bu
sine
ss u
se e
.g ch
eck
ing
/re
spo
nd
ing
to w
ork
em
ails
54%
46%44%
35% 35%
29%25%
23%
17%
Reasons for using a mobile device in-store
sha
ring
ima
ge
s/in
form
atio
n o
n
socia
l me
dia
Pa
yin
g fo
r item
s (e.g
Ap
ple
Pa
y)
16%12%
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
Taming the mobile beast
By embracing digital connectivity, retailers can bring an authority to the
online journey that shoppers are experiencing in-store, to neutralise these
detrimental behaviours.
In order to achieve this, retailers need to invest in technology that supports
a positive customer experience, to infl uence sales in a profi table manner. For example, Vodat International discovered that:
58% of consumers would
shop in a store more
often if it off ered free customer WiFi
39% would increase their
store visits if there
were more self-
service checkouts
31% would like
contactless and
mobile payments to
be readily available
23% would increase their
loyalty if there was
a digital information
kiosk in-store
19% would like store
associates to be
equipped with tablet
technology
The store layout can be even further optimised if retailers can map technology
requirements to the needs of their target audience. For instance, our insights show that men are more likely to check prices and look up product information, whereas
women are more concerned with sourcing discount codes and redeeming click-and-
collect purchases.
7
Falling at the fi rst digital hurdle
Some retailers will be reading this report thinking that’s great, I’ve already
invested in some of these store technologies, but the ‘bells and whistles’ being
used to create digital connections in-store are only part of the story.
Ultimately, the customer experience is only as good as the technology itself - the
ease with which it connects, the speed at which it works – and a vast part of this
success is the store network.
Many retailers are falling into the trap of investing in software and hardware to
bridge the online/offl ine divide, but failing to support this new technology with a robust network, capable of managing the increasing number of customer and staff devices logging on.
The strain of more technology being added to the bricks-and-mortar environment
is already beginning to show. Our research has found that slow running networks
are impacting the service shoppers are receiving within the store.
4 in 10 shoppers have been frustrated by slow public WiFi in-store, while a third have experienced issues with slow card machines and self-service checkouts. In
fact, less than a quarter (22% of men and 24%) have not encountered problems
with slow running store technology in the past 12 months.
78% of men
76% of women
have encountered
slow running store
technology in the
past 12 months due
to an overloaded
network
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
9
The true cost of digital disappointment
Slow running networks don’t just keep customers waiting; they can have a
signifi cant impact on overall satisfaction levels.
95% of the shoppers we surveyed that have experienced network issues were forced
to wait up to 30 minutes for the problem to be resolved, with a third of these waiting
more than 10 minutes.
This not only leaves them in a bad mood following that encounter, it can have a lasting
impact on customer/retailer relationships. 25% of our consumer panel lost loyalty with
that retailer in some way following a network incident.
For many, the impact was immediate: 1 in 5 were put off shopping at that store for some time, or stopped shopping at that particular store, but still visit a diff erent outlet within the same retail chain. Meanwhile, a staunch 5% felt so let down that they
stopped shopping with that retailer altogether.
Even those that persevered put the retailer on ‘last chance’ terms – 3 in 10 of the
shoppers we polled gave the store the benefi t of the doubt, but would stop shopping with that retailer altogether if they experienced slow running technology problems for
a second time.
Two strikes and you’re out
30%
of shoppers will give a
retailer the benefi t of the doubt after experiencing
slow running technology
issues in-store, but won’t
return if it happens a
second time
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
How to choose a future-proof
network
As our insights show, the cost of a sub-par store network is signifi cant. It can cost on the spot sales and damage valuable long-term relationships – and that’s
not taking into account the secondary impact of shoppers ‘bad mouthing’
retailers to family and friends.
In order to prevent customer disappointment and potential disloyalty, the foundation
of a retailer’s digital strategy in the bricks-and-mortar environment must be a
business strength network.
For many organisations, the most resource-eff ective solution is to partner with a managed data network provider, which can shoulder the responsibility for the
network’s performance without the need to invest in an in-house IT department.
However, it’s important to work with a partner that understands the bespoke needs of
your business, rather than a deploying a ‘one size fi ts all’ approach.
Additionally, proactive network management is a must. This report has underlined
the cost of poor performance, and technical downtime is only going to be more
costly. A leading managed data network provider should be able to identify potential
issues before they escalate, and liaise with technical suppliers to address the problem
without it costing retailers vital trading hours.
11
7 questions all retailers should ask themselves when selecting a network provider
1. Can the solution eff ectively connect all our stores and other sites?
2. Is there suitable bandwidth capacity to
ensure speed and performance?
3. Can the network scale and fl ex as our business estate grows?
4. Are there surveillance tools in place?
5. Does it provide secure connectivity?
6. How resilient is the network and what
failover systems are in place?
7. What level of support is on off er in the event of a technical problem?
If a robust business network is step one when
building digitally-driven customer experiences
in-store, a reliable public WiFi off ering is step two.
The opportunity to impress shoppers with a stable, secure WiFi connection is huge. Vodat International’s research found that three quarters (77%) of smartphone
users will log onto free store WiFi if it is available, with a third (32%) using it every
time they visit that store.
However, the current state of store internet services leaves much to be desired: 3 in
10 shoppers don’t fi nd free WiFi services reliable, while a further 1 in 10 prefer to
use their own 3G or 4G capabilities because they get better performance.
Off ering enterprise-class WiFi opens up new opportunities to interact with, infl uence and capture insight on consumers – provided retailers invest in a solution that’s fi t for purpose.
Security is paramount for customer peace of mind. Retail stores
need to off er either a separate guest WiFi, which can be an expensive option unless it’s an open public WiFi service, or a solution that can separate public and business traffi c.
Bandwidth control is also a key concern. Many retailers still struggle
to get good bandwidth from ADSL connections, and customer
WiFi can take up a lot of this bandwidth, resulting in critical store applications running slowly. A business-class managed solution
enables retailers to restrict the amount of bandwidth customers can
access when demand is high, ensuring essential technology operates
at peak performance, regardless of how busy the store becomes.
One fi nal consideration is access restriction. An enterprise WiFi solution can allow retailers to block users from visiting certain
pages, such as a competitor’s site. Outsourcing WiFi to a third party makes this process easier to set up, and can also shoulder further
legislative burden; organisations off ering customer connectivity must keep a record of the sites they have visited, which can become
onerous on an IT team if managed in-house.
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
Winning with reliable
customer WiFi
77%
The problem with
going public
Some retailers opt for a public WiFi solution, which can be seen as a cost-
eff ective alternative to separate guest WiFi services. Although this outsources
performance and security responsibilities
to a third party, it means retailers cannot
collect customer data – therefore losing
valuable marketing insights.
13
Battle of the bandwidths: Why customers are won and lost on the strength of retail networks
Adding digital ‘bells and whistles’
With the right network from which to run technology, and a reliable WiFi service
in place for both customers and staff to use, retailers can then begin to investing in the tools for digitally-enhancing the store experience.
The exact shape of this investment will depend on what a retailer’s customer base
wants from their retail experience, as we outlined earlier in this report. But whatever
technology retailers select, having a robust managed network in place will empower
them to add more devices to the store, and for more customers to connect their
smartphones to WiFi services, without compromising performance.
This way, retailers can ensure they are off ering store shoppers a ‘best of both worlds’ experience, connecting online and offl ine retail long before the 2020 deadline of the Digital High Street initiative, and utilising technology to diff erentiate themselves from the competition.
in place for both customers and staff to use, retailers can then begin to investing in place for both customers and staff to use, retailers can then begin to investing
15
Future-proof network support from
Vodat International
As the fastest growing supplier of telecom solutions and private, managed
networks to the UK retail market, Vodat understands that what goes on
behind the scenes is just as important in enhancing satisfaction levels as your
customer-facing interactions.
Managed data network
Tailored to the needs of retailers with complex, multiple site estates, our business
strength private networks are managed directly and securely through intelligent
remote management software.
Our own MPLS core interconnects with major UK carriers, enabling us to select and
deliver broadband connections by the Britain’s major carriers. As we’re not tied to one
Telco, we can mix and match, to bring you the best bandwidth and reliability within
your budget.
Wireless network
Simplistic, high performance WiFi technology, from world-renowned supplier Cisco. Our Meraki wireless network solution builds enterprise systems through the cloud at
much lower costs than over fi rst generation networks. Our solution is ideally designed for the hospitality and leisure industry.
Call us on 0161 406 1820 or visit www.vodat-int.com for a better network solution.
Call us on 0161 406 1820 or visit www.vodat-int.com