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Convenience as a differentiator

Convenience, as a retail concept, once meant providing a product or experience within a reasonable walk or drive. Convenience stores and petrol stations built their competitive advantage on being on every corner, as did the local milk-bar. But convenience as a concept is being re-defined in a digital world and it is becoming more than just a driver of choice for where and how consumers shop – it is becoming a strategic differentiator.

Whilst COVID took away so much of consumers freedom, it enabled consumers to understand the value of their free time and for many, re-consider what is important to them in life. It also challenged brands to fight for survival – enabling many to re-think how to get products and services into the hands of customers.

Although convenience and ease were always important before the pandemic – it is heightened in a post covid world. A study by Linnworks found that a whopping 78% of consumers value convenience more now, than pre-covid – demonstrating the importance consumers are placing on convenient solutions to better manage their busy lifestyles.

So what matters when it comes to convenience?

Customers now play by a different set of rules and expectations, especially in eCommerce. They want retail services to fit their hectic schedules and lifestyles

  • They want to choose how and where they transact

  • Near instantaneous delivery of products bought online and

  • Want experiences to be truly frictionless, whether in the store or online

So important has convenience become that research from the NRF's Consumer View report in 2020 found that in the US, more than 9 in 10 consumers are more likely to choose a retailer based on convenience and are willing to pay more for it.

The degree to which consumers will pay more however differs by category with research showing that 66% of grocery shoppers are willing to pay more for convenience vs 61% of those shopping for fashion and 59% shopping for electronics.

The rise and demand for convenience is fuelling the popularity and growth of delivery services like Amazon Prime, Catch and others. The same NFR study in the US found that sixty-six percent of shoppers pay for at least one type of delivery service and one-quarter pay for multiple delivery services. Whilst in Australia, a Pattern research study found that 31% of Australians already had access to an Amazon prime membership. Whilst a study in 2021 commissioned by Deliveroo shows that Australians are seeking value in their purchasing decisions, with almost two-thirds (62%) of Australians currently using up to six or more subscription services. When asked about the reason behind their subscription choices, the top reasons are convenience (46%), variety (42%) and cost savings (34%).

But convenience isn’t simply about delivery. What delivers convenience for consumers differs across various categories. For example, research from Accenture has found that when it comes to grocery shopping factors, that the importance to deliver instore convenience includes product availability (95%), proximity to home (94%) and being able to shop as quickly and easily as possible instore (92%). Whilst online, it means minimizing product substitutions (93%) and having a good availability of home delivery slots (88%). In fashion however convenience is all about the ability of ease in returning the product, flexible payment options and ensuring consumers can select products online that are the right fit, to avoid the need for returns and refunds.

Winning in a world convenience war

In a market where consumers are spoilt for choice, can get products delivered within 30 minutes and are increasingly wedded to the platforms that know and understand them the best, brands need to re-think their strategy to deliver a new breed of convenience to remain relevant and win in market. To do so brands need to:

  1. Understand what convenience means within their respective category: Delivering on convenience can result in brands trying to do everything they perceive to be important to the customer, in a convenience economy. To ensure investment is made into areas that will deliver the most value and drive preference, brands need to step out of their world and understand what matters most to consumers when it comes to convenience for their category.

  2. Understand the biggest friction points across the customer journey and innovate accordingly: Research from the NRF has shown that when it comes to delivering on convenience across the lifecycle – not all stages are created equal. When consumers were asked “at which part of the shopping experience is convenience most important to you?” 40% of consumers stated checkout was the most important stage, when making instore purchases. Whereas online, 38% stated that the most important stage was researching, as discovery can often be challenging online.

  3. Maintaining profitability: As brands increasingly adapt and embrace new ways to deliver on convenience, they need to keep profitability front of mind over the short and long term. Whilst consumers increasingly expect brands to be present within their preferred platforms, to be able get items delivered within an instant, or to use the payment options they prefer many come at an additional operating cost for brands. It is important that as brands test and trial new concepts and mechanisms to deliver on customers convenience expectations, that they have effective mechanisms in place to monitor profitability and have clear benchmarks to achieve, in order to assess outcomes and value derived from its convenience play.

Is your brand looking to build a strategy to address the changing landscape? Get in touch with us to chat about how we can help.


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