Future Shopper Report: Omnichannel shopping demand expands metaverse retail and AI-based delivery services

05 Jul 2023 --- Wunderman Thompson has released the seventh edition of its “Future Shopper” report, offering a global view into the habits of online shoppers. Omnichannel retail is “ripe for refreshing” consumer engagement with AI solutions. The authors underscore the need for flexibility when remodeling sales channels for new platforms, including gaming consoles, smart assistants and the metaverse.

The report underscores that online and offline channels “must work in unison” to meet consumers’ expectations.

“We have now entered an era which we can call ‘post-COVID-19,’ but much of the collateral damage remains, with the scars in retail still present,” comments Hugh Fletcher, global marketing director and thought leadership lead at Wunderman Thompson.

“And while we might have hoped that being post-pandemic would have coincided with a sense of peace and harmony, it feels like the world is in even greater turmoil than before – be that because of the war in Ukraine, other growing geo-political tensions, inflation or the cost-of-living crisis.”

Even with the metaverse still in its infancy, digital worlds are beginning to present an attractive retail space for some consumers, meriting a mention in the report.The report covers 18 countries and surveyed over 31,000 consumers. Notably, 56% of consumers say they want seamless communication across channels and the ability to move from digital to physical, and vice versa.

Omnichannel-forward
With much talk about the rise of online spending amid ongoing reports of disappointing high street trading figures and closures, the report highlights there is a tendency to say that physical shopping is on its last legs, if not dead.

“We also get a noticeably clear message from consumers that they would prefer to shop from retailers that have both physical and digital stores,” outlines the report.

Last year, 60% of global consumers interviewed by Wunderman Thompson said they prefer to shop with a retailer or brand that has both digital and physical stores, and that percentage has stayed exactly the same this year.

“Once again, this is proof that businesses must develop their omni-channel strategies,” state the report authors. “This link between physical and digital is most important in the UAE (78%), while German consumers seem far less fussed – albeit, 41% would still prefer digital and physical capabilities.”

Even with the metaverse still in its infancy, digital worlds are beginning to present an attractive retail space for some consumers, meriting a mention in the report. Wunderman Thompson shares that 3% of consumers interviewed make their purchases through virtual reality headsets.

Aside from the usual mobile, desktop, laptop, tablet and TV systems, other omnichannel platforms capturing shopper’s interest are gaming consoles (7%), smart watches (4%) and smart assistants (4%).

Top sources for beauty shopping inspiration
Leading marketplaces such as Amazon, TMall and Mercado Libre retain key sources for inspiration, searching and purchasing for beauty products online. However, these are notably witnessing a downward trend.

The report discloses that brands’ home websites hold a marginally larger share of consumer activity, compared to retailer sites, which have “slipped slightly.”

“We have the verdict that no channel is better than the rest. In one respect this is a pleasing result, reflecting the suggestion that in an omni-channel mix, no single channel is superior as part of a balanced channel strategy – a view that Wunderman Thompson has articulated for several years,” the report authors state.

With such a high percentage of shopping now happening online, there is even more pressure to make the experiences good. “Shoppers globally will not stand for an experience that is underwhelming, with 51% saying they will not shop with retailers, brands or marketplaces which do not match up to their expectations,” reads the report.

Consumers are also expecting online experiences to improve. The authors reveal 61% say retailers and brands need to get better at giving them the products, services and experiences they want when shopping online.

The report reveals 61% of consumers say retailers and brands need to get better at giving them the products, services and experiences they want online.But there is an indication of improvement in this criteria, as last year this figure was 72%.

Fun alongside functionality
Consumers are not only focused on functionality in online shopping, it’s also about excitement and engagement. Wunderman Thompson highlights that 60% of global consumers wish retailers and brands would make the online shopping experience more entertaining.

Another 30% of consumers say online shopping is boring. The good news is that this figure was 32% in 2022, so once again there is evidence of progress. 

“However, when it comes to different countries, there are three where the percentage of consumers who find online shopping boring is high: India (54%), Thailand (51%) and the UAE (50%). Clearly, there is work to be done to improve the online experience in these countries,” outlines the report.

Notably, almost half of consumers (49%) think brands and retailers do not understand the steps they take to purchase a product, while 53% say they do not believe brands and retailers grasp all the problems they encounter when purchasing their products online.

Preferences around speed of delivery
Last year, Wunderman Thompson found that global consumers were happy to wait, on average, 2.36 days for the items they had ordered online to arrive. This year, that has dropped to 2.15 days.

“Of course, the amount of time consumers are happy to wait is really dependent on what they are ordering,” say the report authors. “As we can see from the table, when it comes to groceries, the expectation is 1.23 days, while in last position is automotive accessories at 2.62 days.”

Over the last few years, Wunderman Thompson has been tracking the very high percentage of consumers who want their online orders to arrive “super-fast,” meaning in less than two hours. Last year this figure was 24%, up 4% from the year before. 

This year, Wunderman Thompson found out that global consumers were happy to wait, on average, 2.15 days for the items they had ordered online to arrive.

This year, the figure is 23%, slightly down on last year, while 41% of consumers expect delivery within 24 hours.

“Could it be that consumers’ expectations of fast delivery are starting to level off? In some countries this looks like it might be the case, while in others, the demand for faster delivery has increased significantly,” comment the report authors.

Designing new delivery systems with AI
Delivery is noted as a constellation of complex, interconnected optimization problems across the end-to-end supply chain – scheduling, routing, inventory management, resource allocation and pricing. 

Modeling and solving these problems using AI is the first step toward faster and more efficient delivery, suggest the Wunderman Thompson researchers.

“You can still have human domain experts in the loop to validate and tune, but the number of contributing variables and the size of the data have to be crunched by algorithms,” remarks Theodoros Lappas, head of data science at Satalia, a Wunderman Thompson company that specializes in optimizing delivery systems with AI.

“Each and every sub-problem that is not supported by an AI-powered solution is a potential efficiency leak (and an opportunity for improvement).”

Lappas notes it is not easy for an organization to replace their legacy systems or human-centric processes with AI components. 

“It takes time and cost, and there are serious risks if this replacement is not done properly,” he stresses. “A digital twin approach is a way to ameliorate these risks and simulate large changes before actually investing in them.”

“The twin mirrors the organization’s physical operations across the supply chain. This enables the simulation of ‘what if’ scenarios that can test different options (strategies, algorithms, market conditions, customer preferences) and identify the best one to implement.”

By Benjamin Ferrer