No shopper enjoys a long checkout line — and as it turns out, no retailer should either.
According to a new report conducted by payment platform Adyen, retailers are losing a collective $37.7 billion in potential sales due to long checkout lines.
With analysis from information technology advisory company 451 Research, the study broke down the figure for the last 12 months, adding that retailers gave up $15.8 billion in potential sales to their competitors and the industry itself forfeited $21.9 billion after customers opted against a lengthy wait and then never made their purchases elsewhere.
“The lines between the physical and digital shopping worlds are dissolving,” said Roelant Prins, chief commercial officer at Adyen. “Retailers need to cater to shoppers by offering fast, easy and frictionless ways to pay so there are minimal lines and offer personalized recommendations and in-store deals. In other words, experience is key.”
However, it’s not just long lines that are driving away customers. Retailers that don’t have preferred payment options risk handing over customers to their competitors, with the study amounting that loss to nearly $1.1 billion in potential sales over the past year.
Among the respondents surveyed, three groups emerged: Spendsetters, or customers who embrace a next-generation shopping experience (34 percent of respondents); Fence-sitters, including those who wait and see before adopting a trend (the largest group at 46 percent); and Resisters, who are less eager to engage with new technology (20 percent). The former category — 52 percent being millennials — is composed of shoppers who are four times more likely to say they enjoy shopping compared to the latter category.
According to the study, these Spendsetters are more willing to make purchases through non-traditional channels (think mobile apps and digital wallets like Apple Pay) and demand more personalized experiences, which is already transforming the way retailers do business.
“Digital experiences represent a revolutionary shift in the retailer-customer relationship. Shoppers now have a stronger voice and more power than ever, and they expect the companies they do business with to rise to the occasion,” the report read. “Digitally transforming to attract, win, retain and support customers is no longer a luxury, but a necessity for retailers’ survival.”
Adyen and 451 Research analyzed data gathered from 1,003 consumers across the country aged 18 and up, along with 250 business-to-consumer retailers that operate in the U.S. — 42 percent of which were fashion, 14 percent luxury brands, 14 percent beauty and 30 percent hospitality.
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