What Younger Shoppers Demand from Digital Experiences

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All marketers know that younger shoppers prefer frictionless experiences and digital options. But what exactly does crafting a customer experience fit for Gen Z approval entail?

The customer experience company Verint conducted research to determine just what younger shoppers value in digital experiences. Street Fight connected with Jenni Palocsik, VP, marketing insights, experience, and enablement at Verint, to discuss the company’s findings.

What does the Verint Experience Index for Retail Report tell us about how younger consumers’ preferences differ from those of older cohorts?

The role and relevance of physical brick-and-mortar locations has been debated ever since the advent of ecommerce. While physical retail will probably never go away entirely because for many shoppers it is highly experiential, we do see younger consumers demonstrate a preference for digital channels for a significant portion of the buyer journey. Younger consumers do still see the value in the retail store in their path to purchase, seeing its utility as a streamlined click-and-collect depot for merchandise. While only 28% of these respondents make purchases via the retailer’s website or app, 51% make purchases either via buy-online-pickup-in-store (BOPIS) or curbside.

Forty-four percent of Gen Z respondents and 43% of millennial respondents said they had expended more effort than expected to complete an interaction. It’s possible that these results may indicate that younger generations have higher expectations for digital experiences than older shoppers. 

Since Gen Z is the age group most likely to use digital solutions for some or all of their purchases, retailers need to ensure their digital experience provides a wide range of suitable products, with seamless purchase processes, to stand the best chance of retaining their business.

Technical problems, login issues, or poor digital experience could mean losing out on a sale altogether and damaging a potentially long-lasting customer relationship; the consumers most likely to use digital services are also the least patient when it comes to bad experiences.

Gen Z are by no means the only demographic that brands should focus on to adapt and enhance the customer journey, but since they are most likely to engage digitally, seamless experiences are the biggest drivers of better customer satisfaction, NPS, and repeat business.

Retailers must focus on uniting digital and in-store experiences and removing silos across the customer journey. Experience management programs can collect customer input across all channels to pinpoint gaps in processes and flag fixes that need to be made, as well as help companies understand what is working well. Engagement orchestration blends actions of humans and bots performing individual tasks at the right time, and leverages a single source of knowledge of a shopper’s history and preferences for best-in-class real-time support. 

What does it mean that younger consumers have more complex journeys?

Online retail has grown, with e-commerce spending in the U.S. predicted to jump by 13% to $1 trillion in 2022, but consumers have increasingly complex purchase journeys that often involve both in-store and digital steps. 

Our survey results show that Gen Z and millennial shoppers have more complex purchase journeys, with over 75% of these respondents using at least one other digital resource — such as ratings websites, influencers, and social media — to help inform their purchasing decision.

Respondents under 40 are also more concerned with retailers’ environmental practices than respondents in other age groups, rating eco-friendly packaging at least 15 percentage points higher than Gen X and Boomer respondents.

Our research has found that digital interactions, whether on public social or private messaging channels, are the most effective way for retailers to turn customer communications into sales and do so in an agile manner. While marketing emails can easily get lost in an inbox, sending the right mobile message at the right time to the right customer can turn automated interactions into purchases. 

Retailers can send timely reminders based on past activity or appointments which encourage customers to rebook or refill their regular purchases. They can also be useful in cart abandonment situations, where retailers can reach out to existing customers who haven’t completed a sale on their website or app with a reminder, or discount code, to encourage them to finish their purchase. Click-to-Messenger adverts, targeted advertising on Facebook or Instagram alongside purpose-built bot flow can create a seamless browsing and payment sequence for a personalized shopping experience without leaving a private messaging conversation.

You ranked the omnichannel capabilities of top retailers. What defines the best retailers? What do laggards have in common?

With the world’s supply chains facing unprecedented strain, we see an almost universal shift in the biggest driver of customer satisfaction being “merchandise” — specifically, merchandise appeal, quality, and variety. “Merchandise” ranked as the highest driver across the top 25 U.S. retailers. At a time when many items are more difficult to find, access to high quality and a large variety of items to buy clearly matters most to shoppers.

Digital experience — specifically responsiveness, ease of finding products, and the ability to provide needed information — was the second biggest driver of customer satisfaction. 

Price — specifically, value, competitiveness, and clarity — was the third biggest driver of customer satisfaction, not unsurprising in an era of inflation. 

Service representatives – specifically their availability, responsiveness, and ability to answer questions — was the fourth biggest driver of customer satisfaction. This aligns with other research that we, at Verint, have done, that indicates that while many consumers value self-serve service channels, they also value human assistance, especially when they have an urgent question or problem or when the purchase is of high value. 

While there are myriad factors that make or break a retail experience, prioritizing and increasing customer satisfaction will positively impact desirable customer behavior. And understanding those factors that wield the greatest influence enables retailers to lean in and prioritize their focus. 

Joe Zappa is the Managing Editor of Street Fight. He has spearheaded the newsroom's editorial operations since 2018. Joe is an ad/martech veteran who has covered the space since 2015. You can contact him at [email protected]