Inflation Continues to Raise the Bar on Consumer Expectations for Omnichannel Retailers
CI&T, a leader in driving AI-powered digital transformation for global brands, released its fourth annual Connected Retail Report, revealing consumers have heightened price-sensitivity in the wake of inflation, raising expectations for omnichannel retailers across the board.
After enduring roughly two years of inflationary pressure, consumers are feeling extra budget-conscious, looking to prices as the primary decision driver when choosing between retailers and shopping channels. According to the report, 80% of consumers have changed their shopping habits due to the economy. Of those, 70% said they are spending less overall because of inflation, focusing primarily on the lowest cost items.
In its fourth year examining consumers’ evolving attitudes and behaviors, the Connected Retail Report shows that consumers have a strong preference for omnichannel retailers and the same set of criteria for both offline and online retail experiences. In 2024, consumers are on a relentless quest for the best prices, and their shopping decisions are calculated and in support of that quest.
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- 71% reported that all retailers, regardless of price, should provide an equally impressive shopping experience
- 81% prefer to shop at retailers who have both online and offline channels, with price being the primary driver on where to shop
- 58% regularly use only 1-3 retailer apps with better prices being the number one motivator for shopping via an app
“There was a consistency in responses this year that we’d never seen in years prior. Decisions around where to shop and which channel to leverage repeatedly came down to price, while simultaneously, there was the overarching viewpoint that lower prices shouldn’t mean lesser experience or more inconvenience,” said Melissa Minkow, Director of Retail Strategy at CI&T and author of the report. “This survey continues to show that omnichannel is ideal for consumers, and there are particular use cases for each channel that can help retailers understand the evolution of the path to purchase.”
Consumers were evenly split as to whether or not retailers should use AI to improve the retail experience, and Generative AI proved even more controversial. Over half of consumers understand what Generative AI means and of those, 67% have concerns with retailers using it. The main concerns expressed include access to personal information and distrust of search results. While these concerns may decline as Generative AI continues to mainstream over time, retailers should bear in mind the importance of transparency with consumers when integrating AI technology.
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CI&T’s 2024 Retailers to Watch
The report’s consumer insights survey helps inform CI&T’s Retailers to Watch List, which highlights the retailers making unique and innovative strides in their experience strategies. This year’s retailers include: Container Store, Crumbl, Dyson, Mango, Nordstrom Rack, and Zenni Optical.
NRF 2024
Minkow will be sharing insights from CI&T’s Connected Retail Report at NRF 2024: Retail’s Big Show in a session with Domino’s Pizza on Tuesday, January 16 from 10:15-11:00 am ET. The “What Retailers Can Learn from Domino’s Digital Experience” session will explore how Domino’s optimized their digital strategy in addition to highlighting key insights from the report.
Methodology
CI&T surveyed over 1,000 US consumers of all ages, races, and genders in October 2023 to capture purchase preferences and shifts in buying behaviors over the last year. By uncovering key motivations along the path to purchase, the survey bolstered our criteria for determining the most exciting digital retail strategies.