While consumer shopping habits have been tossed upside down by the changes that have taken place during the first half of 2020, the shift has also opened up some opportunities for retailers who have embraced contactless and mobile ordering as a way of doing business moving forward.
But with any degree of change in developing customer loyalty and engagement, there is always a learning curve and some missteps to rolling out ways for brands to stay top-of-mind with consumers, even when those shoppers may not have stepped foot in a bricks-and-mortar store in quite some time.
Some brands have seen huge increases in customer engagement in the contactless and mobile ordering age: restaurants such as McDonald’s, Burger King, Chipotle, Domino’s and Pizza Hut say they have seen a significant uptick — 36% year-over-year increase in some studies — in the number of users who say it was their first time using an app to place an order.
Katie Berndt, Strategy Director for ICF Next, helped to recently produce a retail white paper where they touched on the many ways consumer behavior has changed this year.
“One very clear trend is that the coronavirus pandemic accelerated e-commerce, and more technology advancements and investments are poised to become mainstream sooner than expected,” Berndt says. “As with most industries preparing for recovery, retailers and restaurants are fast-tracking or spotlighting their digital and contactless technologies to not only create cost efficiencies but also minimize health risks.”
Kate Hogenson, a senior loyalty consultant with Kobie, says most consumer decisions are driven by emotional factors, and pandemic-driven changes only amplify these factors, making it crucial for brands to adapt their customer experience accordingly.
“Retailers, grocers, and quick-serve restaurants have done an admirable job addressing critical elements in this changing environment: mobile ordering, contactless payment and reduced contact delivery/pick up options,” Hogenson says. “These contactless experiences give consumers the opportunity to engage with their favorite brands while still fulfilling emotional needs for convenience, speed, and a ‘cleaner way to pay.’”
Several grocery chains are embracing the change: Southeastern Grocers is offering contactless prescription delivery in a partnership with ScriptDrop, allowing Fresco y Más, Harveys Supermarket and Winn-Dixie customers to choose between three delivery options: free curbside pickup, two-day shipping for $4.99 or same-day delivery.
Kroger also launched a contactless payment pilot across its QFC division that will let customers use their mobile devices for a more seamless checkout experience. This pilot includes options for Apple Pay, Google Pay, Samsung Pay, Fitbit Pay, mobile banking apps and contactless chip cards.
“Those elements are table stakes that you have to get right to create trust that interacting with your brand will be safe,” Hogenson says. “Winning brands build on their digital strategies to address the market in real-time and to champion the consumer now and in the future.”
Cell Phone Become a POS
Auntie Anne’s launched contactless mobile ordering on the restaurant chain’s Pretzel Perks app. To use the service, customers need to open the app, place their order, and then wait for it to be delivered. Customers can also earn points toward free pretzels and other rewards exclusive to the app.
7-Eleven is piloting Fuel Loyalty in stores in Florida, Texas and Virginia that is designed to provide contactless payment options, as well as savings at the pump. The chain is also the first retailer to offer Siri functionality to allow for more frictionless and contactless payment options to eliminate touch from the process.
“7-Eleven is in the process of rolling out nationwide their Mobile Scan & Pay experience which allows every cell phone to essentially become a POS, scanning items and checking out without ever going to the cashier,” Emil Sarkissian, CEO of Loyalty Methods. “This is one step better than contactless payments, as it does not even involve approaching another person such as the cashier. You simply walk out of the store once you are checked out.”
Hogenson says that the retail programs that will differentiate themselves are the ones who figure out how to keep a lack of physical connection from becoming lack of emotional connection.
“The element that has been missing is the connection with an individual who helps you and puts a face on the store’s brand,” she says. “Consumers have been slow to interact with virtual stylists or schedule safe appointments with in-store stylists, because the spontaneity and warmth is lacking. Brands need to find a way to make the ‘next recommended product’ experience feel like the virtual version of the person who magically brings you that one thing you needed, or shows you how to use what you’ve selected.”
Implementing Touchless Technology
Many brands see the pandemic as a way to implement new touchless technology, since a recent study showed that almost 60 percent of consumers prefer to use voice interfaces to avoid touch-based practices. The survey also reported than more than 70 percent of brands think that consumers will still want some form of contactless shopping in the post-pandemic era.
That has brought on a big demand amongst companies that specialize in consumer engagement and working with companies who need to go contactless.
Dipti Bramhandkar, Executive Planning Director, at Iris Worldwide, says they are seeing that there is an essential ecosystem between communities and the small businesses that serve them.
“Our role is to help our clients ready themselves to help rebuild this ecosystem by assisting merchants in their day to day needs and customers in returning safely back to their preferred stores,” Bramhandkar says.
“Contactless payment methods and mobile ordering are the tools that support a safer return to doing business
Sarkissian says another pandemic trend is that, in the physical world, one-stop-shopping wins.
“The likes of Walmart and Target are seeing good quarterly results, at the expense of specialty stores, as people reduce the frequency of shopping and seek to satisfy their needs in one trip,” he says.
The change in attitudes among consumers may force some brands to shift the way they launch loyalty programs designed to bring customers into stores. Instead, the promotions and programs may start instead with mobile apps and building around the consumer who prefers ordering online instead of venturing into fixed stores.
“App functionality and enhancements also got pushed to the top of the development priority list,” Berndt says. “Digital customer experience has taken on a whole new level of importance, and this is a trend that will only continue.”