With UK consumer confidence at its lowest level since May1, British shoppers say discounts are the most important factor influencing where to shop and expect retailers to offer more discounts in recognition of the current uncertain financial conditions.
Original research of 2,000 UK consumers in the Promotions at the Speed of Demand report from the leading omni-channel promotion solutions provider, XCCommerce, reveals more than half of shoppers (56%) say discounts are the most important factor when considering where to shop, increasing to 70% amongst 18-24-year olds.
Despite 62% of respondents saying their personal financial situation hasn’t been affected by Covid-19, 60% say there are spending less as a result. Accordingly, 52% of shoppers who haven’t previously prioritised finding promotional offers say this is now a consideration with a further 43% identifying this as a key influence when deciding to make a purchase.
Nearly a third (32%) of shoppers are spending more time researching offers and promotions than a year ago with this figure increasing to 48% of 35-44-year old shoppers. Nearly three-quarters of all respondents (72%) felt retailers should step up and offer more discounts to support consumers during these challenging times.
Despite this clear consumer demand for greater value, shoppers still indicate there is a fine line between promotion and provocation with 46% of respondents saying they are put off buying from retailers who ‘over communicate’ offers.
Consumer anxiety around the long-term implications of the pandemic has made consumers increasingly sensitive to pricing and promotions, meaning retailers and brands must find the right balance to drive revenue and preserve customer loyalty, explains Robin Coles, EMEA MD of XCCommerce: “It’s clear consumers expect to see retailers rewarding their loyal customers with discounts and offers, as an act of good faith, in recognition of the difficult financial times. But beware, promotion fatigue remains high and can impact brand loyalty. Retailers need to ensure they are carefully targeting audiences with the right offers, via the most relevant channel and crucially that these offers are consistent across channels.
“To be blunt, this requires a more intelligent and creative approach to promotions. Without upping their game retailers will be unable to convert diverse and dispersed inventories to cash and more importantly profit, nor maintain customer loyalty.”
Download the Promotions at the Speed of Demand report to learn more about how technology can enable retailers to deliver consistent, timely and targeted omni-channel promotions, that promote customer loyalty whilst protecting margins.
- GFK Consumer Confidence Index, October 2020