New Forrester Consulting research commissioned by Radar finds that location is essential for building world-class customer experiences
We are excited to announce our newest commissioned study, “Deliver world-class customer experiences with location infrastructure.” This study, conducted by Forrester Consulting, presents new data on the impact of location on customer experience and found that investing in location is essential for businesses that want to improve customer experiences and remain successful in competitive industries. Yet, despite the impact of location on business outcomes, many teams either don’t know where to get started, or they struggle to fully capitalize on their existing location solution.
It's clear that location is the solution to many of the challenges that brick-and-mortar businesses face today. This post will explore three of these challenges and the ways in which digital leaders are addressing them with location.
Takeaway #1: Retailers with brick-and-mortar stores must make their physical locations an asset instead of a liability
Even before pandemic shutdowns, retailers with large brick-and-mortar footprints were at a disadvantage against digital-only businesses. Despite a return to in-store shopping, consumer habits continue to heavily favor digital interactions. To compete against digital-only brands, retailers with brick-and-mortar stores must make their physical locations an asset instead of a liability. The best way to do this? By doubling down on the consumer experience, both digitally and in-store.
According to our study with Forrester, over the next 12 months, improving the customer experience is the most important priority for brands, with nine out of ten respondents reporting it as a critical or high priority for their company.
Location is essential for improving customer experiences and it powers the initiatives that are top of mind for digital leaders. We see this reflected in the data, with CX leaders reporting that their top priority over the next 12 months include both creating or improving personalized customer experiences (83%) and creating or improving in-store experiences that span both digital and physical channels (75%).
To make stores revenue drivers, retailers must invest in creating the retail experiences of the future, which span both physical and digital channels. For retail brands who are looking for concrete ideas on how to do this, one instructive example comes from Home Depot, which has an in-store app mode that augments the customer’s shopping experience with information, recommendations, and wayfinding. JOANN provides another example of how hybrid in-store experiences can also be used to drive digital orders. By displaying a free shipping coupon for shoppers who are in-store, JOANN was able to generate 25K incremental orders.
Takeaway #2: Restaurants must operate more efficiently to meet their bottom line
Rising labor and raw good costs have put a crunch on restaurant brands and QSRs who typically already have thin margins. As a result, restaurants must focus on improving efficiency while also driving customer loyalty. One of the biggest vectors for efficiency gains is in order management since it has direct implications for both in-store operations as well as the customer’s experience. Yet, 51% of study respondents reported that they face challenges managing orders going out across multiple channels. Additionally, 46% of respondents said that one of their most significant customer experience challenges is standardizing customer experiences across locations.
Inconsistent experiences are costly and erode customer loyalty, and location infrastructure is a key ingredient in creating more seamless operations. Today, leading restaurant brands are using location to deliver flawless order ahead and pickup experiences. Yet, the power of location doesn't stop at the pickup lane. As restaurant brands – such as Panera – are re-imagining the restaurant of the future, forward-thinking teams are using location technology to make data-driven decisions, increase automation, and develop personalized on-premise experiences.
Takeaway #3: Consumers expect personalized experiences, but are more privacy-conscious than ever before
Consumer expectations have shifted dramatically over the past few years. While the bar for experience and personalization has been set by digital leaders, brick-and-mortar brands must catch up if they want to stay competitive. Customers expect that messaging and experiences across their journey will be personalized and contextual. At the same time, one of the most significant CX challenges for respondents in our study is personalizing customer experiences (54%).
Personalization no longer means just including a customer’s first name in marketing emails. Rather, it’s tailoring every step of the customer's journey based on their preferences and past interactions. Personalizing experiences based on a customer’s location ranges from displaying messaging relevant to a customer’s physical location to surfacing in-app content that reflects their history with your brand.
While customers expect personalization, they are more privacy-conscious than ever. As a result, businesses need to ensure that customers receive value from sharing personal data, such as their location. According to the research conducted by Forrester Consulting, customers failing to opt in to location sharing represents a challenge for 68% of respondents. To circumvent this challenge, restaurant and retail brands must show customers the value of opting in to location services and foster trust by being a good steward of their customer’s data. Building location-based experiences using just foreground signals, rather than background signals, is one way that businesses can minimize the data they collect, while also delivering seamless, world-class experiences that customers expect.
These findings also highlight the importance of partnering with a trusted location provider, such as Radar, as survey respondents at companies who develop all or most of their location technology in-house are more likely to report permissions prompting is challenging or very challenging than those who purchase or license it (57% versus 37%).
It is possible for all businesses to build the future of location now. It’s also imperative. Failing to invest in location infrastructure — or failing to maximize their current investment in location — costs businesses both in terms of lost revenue and wasted spend. This is why brands such as Levi’s, Whataburger, and Smoothie King partner with Radar to maximize the opportunities presented by location.
To learn more about how brick-and-mortar leaders are investing in customer experience and location, download the new study “Deliver world-class customer experiences with location infrastructure.”