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Australian retail study shows gaps in unified commerce practices
Manhattan Associates, in collaboration with Google Cloud and Zebra Technologies, has unveiled a pioneering analysis of unified commerce in the Australian retail market. The 2024 Unified Commerce Benchmark, conducted by Incisiv, highlights the maturity and adoption levels of unified commerce practices among 29 Australian retailers across four specialty segments.
The study identifies Bunnings, Cotton On, Harvey Norman, and JB Hi-Fi as leaders in unified commerce. It assesses over 290 attributes across digital and physical channels, based on real-world data from purchases, returns, and customer journeys.
Amarjot Mokha, Chief Operating Officer at Incisiv, commented on the importance of innovation in the Australian retail landscape. "In an evolving Australian retail market, retailers must continually innovate and adapt if they are to keep pace with shifting consumer trends. Success in Australian retail relies on understanding these differences and customising offerings, a cornerstone of effective Unified Commerce," Mokha said.
The benchmark report indicates that only 42% of Australian retailers have adopted a unified commerce approach, which is essential for providing a consistent customer experience across online and offline channels. Raghav Sibal, Managing Director of Manhattan Associates Australia, remarked on the findings: "It is surprising that the adoption of unified commerce remains so low in Australia, especially when it enables better inventory management, personalised marketing, and streamlining of operations and costs. The research shows that retailers who invest in becoming leaders in Unified Commerce have the potential to generate an additional USD $19 million per billion in annual revenue."
The report further reveals that 85% of shoppers are likely to make repeat purchases from brands that offer a smooth returns experience. However, only 27% of Australian retailers provide the ability to initiate and track returns online. Sibal highlighted the ramifications: "Retailers that fail to meet customer communication expectations and have poor returns processes due to outdated reverse logistics systems are creating unnecessary business costs and risk losing repeat business and customer loyalty. Integrating returns management systems and ensuring seamless logistics and better shopper communication is imperative today."
Delivery and fulfilment also emerged as critical factors for consumers when selecting where to shop online. Nearly half of the consumers surveyed stated that these aspects influence their purchase decisions. Yet, capabilities such as expedited delivery, split delivery, and order modifications post-confirmation are minimally adopted by Australian retailers. Sibal remarked, "With low adoption of capabilities like expedited delivery, split delivery, and post-confirmation modifications, many Australian retailers may lose business, as consumers might choose retailers who offer more flexible and convenient options. Retailers that invest in enhancing these delivery capabilities can differentiate themselves and improve customer experience."
Sustainability is another significant factor influencing shopper behaviour, with consumers willing to pay up to 30% more for products that are sustainable and ethically sourced. Nonetheless, only 25% of non-leading Australian retailers publish their Environmental, Social, and Governance (ESG) metrics, indicating a gap between consumer expectations and retailer transparency. Nearly 70% of consumers expect retailers to provide clear information about their sustainable practices.
Sibal emphasised the importance of integrating digital and physical platforms: "The 2024 Unified Commerce Benchmark highlights the necessity for retailers to improve their integration of digital and physical platforms to meet the increasing consumer expectations for a unified shopping experience. Those who master this integration will not only enhance customer satisfaction but will also see marked improvements in operational efficiency."
Mokha concluded by noting the broader implications for businesses: "Retailers embracing a Unified Commerce approach can go beyond simply selling products, to a place where they can craft experiences that resonate with their customers. This type of customer connection drives strong business growth, up to 3X higher revenue opportunities and creates the type of brand connection and customer loyalty every retailer covets."