Although there is concern, consumers are already using cloud services.
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As retailers plow forward to connect all devices, stores and platforms in effort to appease consumers, it might behoove them to remember that shoppers are easily scared.Brands and retailers have been tasked to satisfy customers with omnichannel experiences; yet seem to have lost sight of the fact that consumers are still wary of pulling the trigger in mobile checkouts. With grimly low mobile commerce conversion rates, consumers still don’t quite trust — or understand — the benefits of cloud-based services resulting in lost potential revenue.Millennials have driven up mobile traffic share. According to the Demandware Second Quarter Shopping Index, mobile traffic share rose to 47 percent globally surpassing desktop traffic at 44 percent. This marks new opportunities for retailers and brands to exhibit strategies in the spaces in which their customers are most active — social, in particular. But strategies alone won’t keep the lights on. According to Smart Insight, a strategic digital marketing agency, add-to-basket conversion rates for mobile averaged 1.27 percent for the third quarter in 2016.Highly publicized data breaches such as Target’s 2014 hack and LinkedIn’s compromise in 2012 have instilled consumer apprehension regarding new technology that can be perceived as hackable. This has a direct effect on brand loyalty. In a study on Generation Z by Interactions, titled "Consumer Experience Marketing Retail Perceptions," 59 percent of those polled said they avoid shopping at retailers that have been hit by security breaches. However, 78 percent of respondents trust retailers to keep their personal information safe.It’s not an unfounded concern. The more devices used by a given individual or company increases the chances for a hack. “Over the last three years, AT&T has recorded a 3,198 percent increase in IoT vulnerability scans. The research firm IDC predicts that by 2018, approximately two-thirds of enterprises will experience some sort of IoT security breach,” noted authors of AT&T’s CEO Guide to Navigating the Threat Landscape report.As if a shaky reputation wasn’t bad enough, most consumers are completely confused about all things cloud. In a recent Ask Your Target Market survey, 11 percent of respondents said they use cloud technology — 31 percent said they never use it. What’s more, the same survey said “60 percent of participants worry about security when it comes to cloud technology.”The survey also revealed that 45 percent of respondents said they have a mobile device and acknowledged syncing it to a computer or an online account. "Seventy-two percent said that they shop online," the report stated. "Seventy-one percent use social networking sites. Sixty-two percent use online banking."Consumers fear the cloud but don’t realize they’re already using it.And though shoppers are highly self-informed, their investigative nature tends to focus on product or brand research, leaving room for retailers to educate customers on their cloud-based offerings and security.“Part of the solution to this problem is communication of the program to the consumer. This includes making certain representations as regards to security and how their information will be used or won’t be used and the ability to opt out of the relationship at any time, either by phone, web or in-store,” explained Michael Mauerer, chief executive officer of Teamwork Retail, a cloud-based, point-of-sale service. Customers of Teamwork Retail range from Gilt Groupe to Rebecca Minkoff to Asics.When approaching shoppers, diffusing concerns before they surface can maintain loyalty. “Consumers, in general, do business with brands that they trust. Whether it’s an iconic brand that has been around for a long time, or a newcomer, the key is to communicate with customers early and often. Keep communications simple and easy to understand, in addition to communicating what to expect during the entire transaction from point of sale to delivery. This will help give customers the reassurance that business processes are well in hand,” said Michele Dupré, group vice president for retail, hospitality and distribution with Verizon Enterprise Solutions.Consumer insistence for integrated, personalized experiences across platforms is only increasing. Here, cloud-based solution-providers such as SAP, Adobe and Infor aid retailers in delivering customized content in order to move the needle of conversion. In order to capture more purchases, retailers will benefit from multiple touch-points during the checkout process. “Whether it’s a commitment made on a retailer’s web site, part of the opt-in language for using an app or in an e-mail message confirming a purchase, retailers can take steps to reassure consumers that securing their information is a business priority,” Dupré said.Consumers present a paradigm of demands, requiring cloud-based services that can support a multigenerational shopper base. “The main pain point that retailers are feeling today is the change in the way the consumer interacts or engages with the retailer. Consumers today come in two basic categories: The consumer who wishes to have incredible service ad the other consumer wants to be left alone, does not want to be hassled and wants a friction-free experience,” Mauerer said. “These are characteristics of today's Millennials. A retailer has to be positioned to serving both classes of consumers. Cloud-based services can support these two types of consumers through things like personalized attention and frequent communication or self-service through web or in-store, so as to not have to interact too much or more than desired.”Retailers can win big both from a financial and marketing standpoint if the proper security measures are proactively implemented. According to a 2012 HP Enterprise Security survey, “The average annualized cost for 56 benchmarked organizations is $8.9 million per year, with a range from $1.4 million to $46 million each year per company. Last year’s average cost per benchmarked organization was $8.4 million.”The study went on to note that companies that deployed appropriate security software benefited from $1.6 million cost savings.Streamlined cloud-based services that enhance consumers’ journey — despite their preferred path to purchase — will only be meaningful if its underlying platform not only ensures customer information is secure, but the retailers employing said services communicates the benefits to its customers relieving security concerns.
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