Yes to digitalisation – but preferably without data release

25.06.2019 | K?ln/Hamburg

Digital technologies in the retail environment are a hot topic. The added value is evident to the retail companies – Artificial Intelligence, algorithms and their binary cousins all contribute to a better understanding of the customer and to making them precisely tailored offers. But what’s the plus for the customer? For them, these technologies above all need to add convenience and match the specific circumstances of their lives. All this is revealed in the new study entitled ‘Future Retail’ carried out by ECC Cologne and the Otto Group.

Push or pull – when do technologies make the breakthrough?

Amongst all the shopping-relevant technological offers, the most loved are those that make the shopping process as easy as possible for consumers, from the order right through to delivery – ‘convenience’ is the magic word here. The smartphone as the consumer’s constant companion is their prime means of access to digital services throughout the customer journey. Specifically, this means that for customers to adopt a technology, it needs to save them time and / or money, be flexible and usable independent of their location, be entertaining, enable communication – and raise the aforementioned level of convenience.

“The results show that as retailers we cannot afford to sit back. We need to rise to new challenges constantly, which bring with them repeated changes in purchasing behaviour as well as new expectations from our customers. If we intend to remain successful for the long term we need to listen harder than ever before, and become a problem-solver”, affirms Dr Marcus Ackermann, Otto Group.

A particular focus is on two main consumer target groups that display partly very different user behaviour. While the ‘innovators’ are eager for new technologies and drive the broad-based adoption of new e-commerce solutions, the ‘laggard’ consumer group is far more reserved towards new technologies. The major challenge for online retailers in the immediate future will almost certainly be delivering the right offers in the complex area between these two poles. In this effort, handling customer data transparently and fairly can serve as a common framework. After all, 59 percent of all survey respondees trusted German companies to handle their personal data correctly – a clear trust advantage versus US and Chinese providers, for instance.

Digital competence? Room for improvement!

‘Artificial Intelligence (AI)’, ‘algorithms’ and ‘bots’ are just a few of the numerous terms that crop up in the context of digital services. However, nowhere near all consumers know what each of these really imply. While around 88 per cent of respondees stated they knew what ‘AI’ is, just 33 and 16 percent respectively had a rough grasp of ‘Augmented Reality’ or ‘Voice Commerce’. That’s not all: many consumers’ own beliefs differed widely from reality regarding these topics.

“Besides the technological added value itself, it is essential to communicate comprehensibly on the new digital services – because transparent communication, also concerning data release, helps to break down barriers to consumer use”, believes Dr Eva Stüber, Member of the Executive Board, IFH Cologne.

Data release is often unconscious

The study also reveals that consumers are frequently unaware of precisely which data they are releasing when they use certain digital services. In fact, with the actual use of many digital services, consumers’ prevalent belief that they do not release data is not justified. 63 percent of respondees believed they had never released data on any personal contacts – however, 95 percent of them regularly use WhatsApp. As a further example, around half of those surveyed believed they had never yet released data on their own purchasing behaviour, although 74 percent of them regularly used credit cards and 90 percent regularly shopped online. These results indicate that the majority of consumers are unaware of which data they actually release when they use digital services


About the study

The study ‘Future Retail’ carried out by ECC Cologne and the Otto Group examines the digitalisation of society, digital technologies, and in particular the handling of data and data release. Further, it analyses under which conditions digital offers gain long-term acceptance with consumers. For these purposes, in January 2019 two focus groups were formed and five in-depth interviews with respondees aged from 18 to 49 were held at two locations in Germany; in March 2019 2,000 Internet users aged from 18 to 69 were surveyed.

A copy of the study can be ordered from the IFH Cologne online shop: www.ifhshop.de/handel-mit-der-zukunft (in german language).


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Media Contact

IFH K?ln
Christina Bunnenberg
Corporate Communications
+49 (0) 221 943607-92?
presse@ifhkoeln.de

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About the Otto Group

Founded in Germany in 1949, today the Otto Group is a globally active retail and services group with around 52,560 employees in 30 major company groups and does business in over 30 countries in Europe, North and South America, and Asia. Its business activities are grouped into three segments: Multichannel Retail, Financial Services, and Service. In Multichannel Retail the Group’s investment focus is on the Platform (OTTO), Brands (Bonprix, Crate and Barrel, Witt Group) and Retailers (About you, Mytoys Group) business areas. In Service the focus company is Hermes Europe, and in Financial Services the EOS Group. In the Start-up area the Group focuses on OGDS, Project A and Eventures. In the 2018/19 financial year (to 28 February), the Otto Group generated revenues of 13.4 billion euros. With online revenues of approximately 7.7 billion euros, the Otto Group is one of the world’s largest online retailers. The Group’s particular strength is its broad market presence with differentiated product and service offers to diverse customer target groups in almost all of the world’s relevant economic regions. Numerous strategic partnerships and joint ventures provide the Otto Group with excellent opportunities to transfer know-how and leverage areas of synergy potential. Group companies demonstrate a high degree of corporate responsibility and willingness to collaborate with one another; at the same time this guarantees flexibility, customer proximity and optimum target-group appeal in their respective national markets.


About ECC Cologne

Integrated in IFH Cologne, ECC Cologne is the first point of contact for trends and developments in the world of digital retail. Retailers, producers and service providers benefit from ECC Cologne’s unique market and customer insights as well as bespoke market research and strategic consultancy. Through the ECC Club (www.ecc-club.de) ECC Cologne offers a unique content and networking platform for e-commerce decision-makers. ECC Cologne stands for Content. Commerce. ONE Community.
Find out more at: www.ifhkoelnde.de | www.ecckoeln.de

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