02|OC&CPartnering to win in retail’s digital age Over 50% of all retail search queriesare now completedon a smartphone OC&CPartnering to win in retail’s digital age|03 For the last three years we have been living in the eraof M-commerce: smartphones now represent over 50%of all retail transactions and retail search queries acrossthe UK, France and Germany, while over 60% of all retailcustomer journeys now involve digital channels at somepoint and these journeys continue to fragment intosmaller and more granular steps. HOWEVER, AS QUICKLY AS M-COMMERCE HASARRIVED, CONSUMERS ARE ALREADY MOVING ON: Social retail has been established in China forsome time, but it is now fnally being embraced byyounger European consumers and we forecast that10% of total E-commerce spend will be throughdigital social channels by 2025.Digital assistants and voice search are opening upnew growth opportunities for retailers operating atthe frontier of these new developments. Over 50%of search queries will be voice-driven by 2020. The retail channel landscapecontinues to evolve apace and,as always, it is led by major shiftsin consumer behaviour. FIGURE 1: SHARE OF JOURNEYS BY CATEGORY THAT AREMULTI-CHANNEL VS MONO-CHANNEL1 % share of journeys FIGURE 2: CONSUMERS WHO HAVE USEDSOCIAL MEDIA TO PURCHASE AN ITEM1% respondents Groceries 2,437 Health & Beauty 2,405 Fashion 2,124 DIY /Garden 1,740 Homewares 1,701 Electricals 1,707 10% 4% 76%55% 11% 34% 42% 21% 37% 35% 12% 54% 21% 22% 57% 16% 37% 48% 1. Share of customer’s most recent purchase journey across UK, FR and DE that are mono-channel or multi-channel (where channel = desktop, mobile/tablet website, retailer app, or store) Source: OC&C Consumer Survey November 2017, ComScore, OC&C analysis Multi-Channel (Both Store & Online) Mono-Channel: Store Only Mono-Channel:Online Only % Who use today % Who expectto use infuture 25% 42% +17% 1. % of consumers who have either purchased directly or indirectly through social media platforms Source: OC&C analysis 04|OC&CPartnering to win in retail’s digital age “Forget the word omnichannel –we are re-orientating around ourcustomers and the touchpointsthat matter – We need to engageappropriately with our customersthrough a channel based on whatthey’re trying to do.” CEO, FTSE 250 Retailer “Omnichannel thinking is fawed-it creates an over focus onchannel-led thinking rather thancustomer-led thinking. Winnersobsess about customers andfocus on anticipating their needs.We put all our energies into ourcustomer and what we need todo to stay relevant for her.” CEO, UK Retailer The response of many retailers tothis rapid change has been to adoptomnichannel strategies, aiming to createseamless (and improved) customerexperiences across all channels.However, our research and interviewssuggest that this has not been thepanacea retailers thought it might be. Customers tell us that retailers havefailed to deliver on the promise of ‘joined up journeys’, while retailers tellus they have often added signifcant costand complexity, but only received limitedincremental returns – growth has beenlargely substitutional. 50% 50% 57% 50% Source: OC&C Consumer Survey November 2017, ComScore, OC&C analysis Quality of in-storeproduct information Quality of in-store service FIGURE 3: TOP OFFLINE CUSTOMERPAIN-POINTS % of customers who cite as a pain point Remembering meacross devices Number of steps tocomplete purchase FIGURE 4: TOP ONLINE CUSTOMERPAIN-POINTS % of customers who cite as a pain point 。。。。。。