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For Retailers, 2012 All About Customer Interaction and Experience, NRF/KPMG Report Finds

For Immediate Release
NRF: Kathy Grannis (202)783-7971 or grannisk@nrf.com
KPMG LLP: Manny Goncalves (201) 307-7735 or mdgoncalves@kpmg.com 

Purchase the complete Retail Horizons report

For Retailers, 2012 All About Customer Interaction and Experience, NRF/KPMG Report Finds
-Growing mobile capabilities, web personalization tactics top strategic priorities for retailers-

Washington, February 15, 2012 – In an effort to build customer engagement, capture wallet share and accelerate sales growth, retailers in 2012 will focus on a number of customer-centric functions, including IT and ecommerce investments, enhancing customer service initiatives and, building on their mobile platforms. A new report from the NRF Foundation and KPMG LLP, Retail Horizons: Benchmarks for 2011, Forecasts for 2012, which surveyed 247 retail executives from various sectors, outlines retailers’ top strategic initiatives for 2012 including merchandising, ecommerce, store and field operations, supply chain and human capital, among others.

“Retailers are poised to enter 2012 with a renewed focus on building up and building out many of their most important operations, hoping to establish a new sense of brand loyalty with all of their customers,” said NRF President and CEO Matthew Shay. “Though customers are always a company’s top priority, customer satisfaction will get a huge facelift this year. From increasing their brand visibility through cross-channel initiatives to providing unique, personalized shopping experiences through every channel, retailers have indicated 2012 is all about the customer.”

According to the survey, nearly 67 percent of companies rank customer satisfaction as the top strategic initiative for 2012 and, similarly, 82 percent say customer service strategies will be their top priority in the coming year, up from 75 percent last year.

For the first time in the survey’s ten-year history, retailers’ websites or online channels eclipsed physical stores as the top channel for marketers (81% for brick-and-mortar vs. 86% online). As such, retail executives say they will invest in programs that directly resonate with today’s shopper. According to the survey, 85 will emphasize  increasing online sales, up from 83 percent in 2011, and 38 percent will have a greater focus on increasing mCommerce sales over the next year, up from 29 percent in 2011. Additionally, more than half (53%) of those surveyed say they will specifically focus on web personalization engines in the coming months, which includes such enhancements as location-based services and tracking methods unique to shopping habits.

To better serve mobile-savvy shoppers in their stores, retailers also stated enhancing handheld technologies, such as mobile point-of-sale, will be a core focus over the next 18 months. While 17 percent already use mobile POS technologies in their store, an additional 33 percent indicate they plan further POS investments during that timeframe.

“Compared to the past few years, retailers have turned their attention to growth acceleration, with an emphasis on improved customer engagement strategies and tactics,” said Mark Larson, KPMG’s global head of retail. “Harnessing the vast amounts of customer data they have at their disposal to create unique consumer interactions will be critical, especially as digital sales grow. Clearly the retailers who master the one-to-one customer approach, and who also leverage the full potential of e-and-mobile commerce platforms, will be in a much stronger position to gain wallet share.” 

Aiming to grow that customer interaction, 45 percent of companies are actively developing widgets, gadgets or advanced links that can be incorporated with their social media pages, and another 41 percent are planning to develop these items over the next 18 months.

Other KPMG/NRF survey findings:

•    Thirty-three percent reported increases of greater than 5 percent in same store sales in 2011, up from 21 percent in 2010. Additionally, 63 percent reported gross margins greater than 40 percent in 2011, up from 40 percent in 2010
•    After years of practicing cost containment, this year more than half (52%) of respondents plan to increase their IT budgets
•    Nine in 10 (91%) respondents said they will focus on leadership assessment, development and succession, up from 83 percent in 2011. Additionally, 52 percent will increase associate training, up from 39 percent last year
•    As the number of multichannel shoppers continues to grow, so will retailers’ focus on price optimization - more than one-third (35%) of respondents will focus on solidifying their price optimization technologies over the next 18 months
•    Nearly six in 10 (59%) say new customer acquisition is their top strategic priority for 2012, up from 55 percent in 2011 

For more information about the report and how to obtain a copy, please visit http://www.nrffoundation.com/retail-horizons.  

About the Survey

The tenth annual Retail Horizons: Benchmarks for 2011, Forecasts for 2012 report, released by the NRF Foundation and KPMG LLP, examines benchmarks for the retail industry, reports retailers’ key business priorities and plans, and tracks established and emerging retail trends.  The executives responding represent 135 North American retail companies from a range of business classifications, from general retail segments such as department and specialty to supermarkets, restaurants and online companies.

KPMG LLP, the audit, tax and advisory firm (www.kpmg.com/us), is the U.S. member firm of KPMG International Cooperative (“KPMG International.”) KPMG International’s member firms have 145,000 people, including more than 8,000 partners, in 152 countries.

The NRF Foundation is the research and education arm of the National Retail Federation. A non-profit foundation created in 1981, the Foundation conducts industry research, develops education and workforce development programs, professional certification programs and promotes retailing as a career destination. The NRF Foundation benefits retailers, their associates and business partners and allies, and consumers in many ways. Research provides the basis for education about the industry and its importance to the economy, and provides industry and government leaders with an analysis of public policy decisions on consumers, retailers, and the economy. The Foundation’s education and career development efforts, including NRF University wired, encourage professional development and excellence in performance of retailing for associates and executives at all levels.

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