Experience a new world of interaction

Are you ready to find success in the era of the empowered consumer?

© 2010 NCR Corporation

NCR 2010 Global Consumer ResearchAn NCR White Paper

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Consumers today have unprecedented access to information—including price comparisons, advice, expert opinions and peer reviews—about products and services they are considering for purchase. Once limited to media such as newspapers, magazines, radio, TV and phone directories, growing numbers of shoppers and diners now seek input through websites, email, blog posts, text messages, tweets and more.

In response, many retailers and restaurants offer their customers the opportunity to interact and transact through the additional channels that have emerged in the digital age.

What shoppers want.

With greater access to information and with multiple new channels at their disposal, it would seem that consumers should be more satisfied than ever with their shopping experience. But is that truly the case? And if not, how can the situation be improved to benefit consumers and businesses alike?

NCR Corporation commissioned a global research project to examine questions that can help companies gain a better understanding of consumers’ attitudes and preferences. Armed with this knowledge, businesses will be better positioned to improve processes and make decisions about the best technology enablers.

Introduction 1

Success in the era of the empowered consumer.

NCR’s 2010 consumer research explores how today’s technology-empowered consumers want to interact with businesses. The findings are presented in four sections that examine:

consumers’ day-to-day use of technology, •including how they believe social media and mobile phones could improve the way they interact with organizations;

the confusion and chaos consumers must •navigate as they make decisions and complete transactions;

the ways consumers want to control how •their interactions are personalized—i.e., how businesses recognize their presence and preferences; and

the value consumers place on the convergence •of their preferred channel combinations for an improved shopping or dining experience.

The research shows that consumers across all the countries surveyed are comfortable with and frequently use technology in their everyday lives, and they are interested in expanding the ways mobile phones and social media can benefit them as they interact with retail and hospitality businesses.

92% of consumers frequently or very frequently •connect to the Internet at home and use email, while 86% use a mobile phone and 66% use Facebook or similar social networking sites.

44% want to use their mobile phone to locate •stores or restaurants, or to download coupons for redemption when they shop. And 43% would like to use their mobile phone for price comparisons while shopping.

45% would like organizations to put experts •online quickly to respond to questions on websites and social media sites, and 44% would like organizations that use social media to recognize them as individuals with unique preferences.

Even though they are empowered with greater access to information and multiple channels for dealing with businesses, consumers often are confounded by communications and interactions that lack consistency and coherence.

65% of respondents use the Internet more •frequently to research products and prices, and 58% report they often switch between retailers to get better prices or deals.

41% report that information they need is •available on some channels, but not on others, while 39% complain they receive irrelevant information from retailers and 31% feel bombarded with information.

The research also shows that consumers are interested in a more personalized shopping experience, but they want control over that personalization.

45% of consumers want the business to understand •their preferred language and payment methods during checkout, and 42% want the business to remember their preferred brands.

54% want to manage their loyalty program accounts •online and decide through which channels they will receive offers and coupons, while 47% would like the ability to create shopping lists by using retailers’ records of their favorite purchases.

Critically, the research reveals that consumers want a seamless, consistent experience across channels when they interact with businesses.

87% want a similar way to access products and •services across industries (banking, retailing, travel, etc.)—whether online, in the store, on their mobile phone or using a self-service device.

85% agree that organizations should do more to •integrate their social networking sites with other channels.

And 83% say they are more likely to do business with •retailers that allow them to personalize and control where, when and how they interact through their preferred channel combinations.

Organizations that evolve their business model to converge channels and touchpoints, while providing a consistent experience and control over personalization, are more likely to earn greater consumer confidence and loyalty.

Findings at a glance 2

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Few would question that consumers today use technology in their daily lives more than ever before. Or that this trend will continue moving upward as today’s generation of “digital natives” becomes a larger percentage of the world’s population. Most of this year’s survey respondents connect to the Internet at home, use email and use mobile phones frequently or very frequently. The popularity of social networking is also reflected in the survey, with two-thirds reporting frequent or very frequent use of Facebook or similar websites.

As they have embraced technology, consumers are increasingly aware of its potential to empower them as shoppers, with more choices and access to a wider expanse of research and opinions on products or services. They understand, for example, that their mobile devices can deliver an expanded suite of applications that help them locate stores or restaurants and provide access to promotions, price comparisons and peer reviews. And they want businesses to interact with them through social networking sites to answer questions or provide personalized service.

“Technology is part of my being”

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3

How often, if ever, do you use (or do) the following?

Very Frequently or Frequently

Connect to the Internet in my home

Use email

Use Use a mobile phone

Use Facebook (or similar)

Use a smart mobile phoneUse social media sites to express

satisfaction about a product or service

Use Twitter (or similar)Use social media sites to express

dissatisfaction about a product or service

Use self-checkout at a store

Use kiosk at a store

92%

92%

86%

66%

43%

39%

34%

34%

33%

19%

Given that mobile phones can take photos and video, access the web and email, and show your location, in which ways would you want to use applications on a mobile phone to give you more control in how you shop?

Use my phone while on the moveto locate stores or restaurants

Download coupons to my phone so that I can redeemthese via a bar code scanner when checking out

Use my phone for online price comparisons in a store,by using the camera to scan bar codes and get best

prices through price comparison websites

Have loyalty cards on my phonescreen that I can use in a store

Have stores and restaurants in my locations sendme personalized offers to my phone

so I can take advantage while out shopping

If I’m in a store and a product I want isn’t there,use my phone to access the retailer's

web site to order for home delivery

Use my phone in a store to access review sites orsocial networking sites for a product

recommendation or peer opinion

None of the above

44%

44%

43%

37%

35%

34%

31%

20%

How, if at all, would you like organizations to use social media sites such as Facebook and Twitter in the way they interact with you?

66%

45%

44%

39%

39%

7%

Put experts online quickly so they can respondto questions through the organization’s

websites and social media sites

Recognize me as an individual customer,including my unique preferences,

so I get personalized information and service

Ensure that reviews of products and services on social media sites are available through the

organization’s website, or at a physical location via a kiosk

Enable me to respond to offers across social media sites and company channels (for

example, let me identify an offer on Twitter, review recommendations on Facebook, then

complete the purchase for that offer at the company’s website or store)

None of the above

4

Regional highlights.

The survey found high penetration of Internet, email and mobile phone usage in most countries. Consumers in the UK (96%), Australia (95%), Canada (95%) and the U.S. (94%) report frequent use of the Internet at home, with similar usage of email. Mobile phone usage is highest among Chinese, Indian and Italian respondents (93% each), followed by consumers in Brazil (92%), the UK (89%) and Australia (86%).

When it comes to mobile phone use, consumers in many countries (China 67%, Brazil 48%, UK 45%, Canada 44%, Australia and Italy 42% each, India 41%, U.S. 40%) are interested in downloading coupons to redeem at checkout. Respondents also like the idea of having loyalty cards available on their mobile phones for use in a store (Brazil 48%, China 47%, UK 42%, Canada 38%, Australia 37%, India and Italy 36% each, U.S. 34%).

The use of social media to interact with organizations holds appeal across most of the countries surveyed. For example, consumers in China (65%), Brazil and India (46% each), want reviews of products and services on social websites to be available through organizations’ websites or kiosks, as do shoppers in Canada (37%), Australia (36%), the UK (34%), Italy and the U.S. (33% each).

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Even though consumers are more technologically savvy and knowledgeable, many still find themselves time-starved and—even as the economy improves—under financial pressure. Moreover, they are concerned that communications from businesses seem disconnected and disorganized. Does the digital-age version of “information overload” make shopping even more frustrating for consumers?

The research findings show that nearly two-thirds of consumers use the Internet more frequently to research products and prices. Given this fact, it’s not surprising that a majority report they frequently switch between retailers to get lower prices, better deals or more loyalty rewards.

But these same consumers also express dissatisfactions. They note, for example, that information they need from retailers is available on some channels, such as websites, but not in others, such as stores. Or that they receive information that isn’t relevant. They often feel bombarded with information and find it difficult to get consistent information.

Regional highlights.

Consumers across most of the countries surveyed use the Internet more frequently than in the past to research products and prices—led by Brazilians (82%). Switching among retailers occurs most often in Australia (69%), Canada (68%), Brazil and the U.S. (65% each), and the UK (64%). The desire to receive coupons, promotions and offers before they buy products is strongest in China (68%), India (51%), Canada (46%), and the U.S. (44%).

Consumers in most of the surveyed countries voiced concern that some information they need is available in some channels but not in others (China 58%, India 49%, Brazil 48%, Canada 45%, Italy 40% and the U.S. 39%). Significant numbers of consumers in Brazil (49%), the UK (46%), Canada and the U.S. (43% each) note that they receive information from retailers that’s not relevant, as do respondents from China (41%) and India (32%). In addition, getting bombarded with information is an issue for many consumers, including Chinese (39%), Brazilians (38%), Italians (36%), Indians (30%), Americans and Canadians (29% each).

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5

“Shopping can be confusing and chaotic”

Which of the following apply to you when you shop?

65%

58%

41%

25%

19%

28%

4%

I use the Internet more frequently than I have in the past to research products

and prices before buying

I often switch between retailers to get better prices, deals or more loyalty rewards

I expect to receive coupons, promotions and offers before buying products

I need to get in and out of stores faster because I’m pressed for time

I have been making more frequent shopping trips to manage cash flow

I use kiosks and digital signs to find more information or make purchases in the store

None of the above

Given the growing number of ways to research products, receive promotions and buy things through multiple channels, which of the following apply to your experience?

41%

39%

30%

31%

22%

19%

22%

26%

12%

Some information I need is available on some channels, such as the website, but not

in others, such as a store

Retailers send information that’snot relevant to me

I get bombarded with information

I find it difficult to get consistent information through all channels

It’s more time consuming to getthe information I need

It’s difficult to communicate with retailers in the way I prefer

It’s like the retailer doesn’t know me

I don’t receive promotions through the channel I prefer

None of the above

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The research also explored the value that consumers place on personalization during the retail or hospitality experience. Survey respondents rate understanding their preferred language and payment method at checkout as most important. Brand preferences, receipt type, and food/drink choices at restaurants are also top of mind, along with personal shopping lists and being recognized by name.

Notably, 60% of the consumers surveyed believe retail shopping or restaurant ordering would be faster if they had a personalized experience.

When asked about controlling the personalization of their retail interactions, a majority of survey respondents agree they want the ability to manage their loyalty program online so they can decide whether to receive offers and coupons via email, mobile device or in the store. In addition, nearly half would value being able to use their favorite store purchases to easily create a shopping list.

Of course, to receive a personalized shopping or dining experience, consumers must be willing to share information with businesses they patronize. The research found that across a spectrum of different types of retail and hospitality organizations, consumers are most inclined to share their name, gender, email address, age and purchasing history. Fewer are willing to share credit card information, mobile phone number and home address.

Regional highlights.

Personal service is seen as a priority by consumers in most of the countries covered by the research. For example, Chinese (60%), Indian (59%) and Brazilian (51%) consumers cite understanding their language preferences during checkout as important, as do consumers in the U.S. (46%) and Canada (45%). Understanding their preferred payment method during checkout is ranked high in Brazil and China (64% each), India (60%), the U.S. (44%) and the UK (41%). And understanding their brand preferences is of most interest to shoppers in China (67%), India (62%), Brazil (56%), the UK and the U.S. (38% each).

Roughly 8 out of 10 Chinese, Indians and Brazilians believe shopping and restaurant ordering would be faster if the experience were personalized. Around 60% of Italians and between 40% and 50% of consumers in the U.S., the UK, Canada, Australia and Germany agree.

Being able to manage their loyalty program preferences online resonates with consumers in China (65%), Canada (63%), and Brazil, the UK and the U.S. (58% each), as it does with Italians (53%) and Australians (52%). Consumers also express interest in multichannel access to a portal that allows them to provide personal information in order to get better targeted and personalized information and offers (China 65%, Brazil 39%, India 38%, Italy 35%, U.S. 30%).

“Recognize my presence and my preferences” 6

How important is a personalized retail or hospitality experience to you?

Very Important or Important

45%

45%

39%

42%

39%

36%35%33%32%31%28%

26%26%

27%

For the business to understand my payment method preferences during checkout

For the business to understand my language preference during checkout

For the business to understand my brand preferences

For the business to understand my preferred receipt type (paper or electronic) during checkout

For the business to understand my food and drink choices at restaurants

For the business to understand my personal shopping lists

To be recognized by name when online

To be recognized by name on my mobile phone

To be recognized by name by the business's associates

To be recognized by name at the store checkout

To be recognized by name at the self-checkout in the store

For the business to understand my color preferences

To be recognized by name at the kiosks in the store

To be recognized by name at digital signage in the store

Which of the following ways would give you more control in how you personalize the way you shop with retailers?

47%

54%

34%

38%

33%

12%

Be able to manage my loyalty program online so I can decide how I want to receive offers and coupons, for

example email, send to my mobile, or print in store

Be able to use my favorite store purchases to quickly and easily create an in-store shopping list or a home delivery

shopping list

Be able to review a history of my receipts and transactions online, through a mobile phone or on an

in-store kiosk

Be able to provide my personal information through a retailer portal accessed via a website, mobile phone or

kiosk, so I get better targeted and personalized information and offers

Be able to personalize the way I interact online orin store by selecting my preferred language

None of the above

Consumers seek a more consistent experience across channels and they want retailers to reduce the confusion caused by fragmented communications.

Nearly 90% of respondents say it’s important to be able to access products and services in a similar way—whether they are interacting with retailers, banks, healthcare providers or other organizations. And 85% agree that these organizations must do more to ensure proper integration of their social networking sites with the other channels they use to interact with customers.

Significantly, the research shows that 83% of consumers are more likely to choose retailers that enable them to personalize and control where, when and how they interact through their preferred channel combinations.

“I want a converged retailing experience” 7

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44%

43%

8% 3%2%

90%

How important is it that you can access products and services from different industries, such as retail, banking, travel, entertainment and healthcare, in a similar way through your preferred channel combination—online, in-store, mobile or self-service device?

Very important

Somewhat important

Somewhat unimportant

Very unimportant

Don’t know

39%

46%

7%1%

6%

85%Strongly agree

Somewhat agree

Somewhat disagree

Strongly disagree

Don’t know

How much do you agree or disagree that organizations must do more to ensure their social media activities are properly integrated with their other ways of interaction, such as websites, email and physical locations?

49%

34%

7% 2%8%

83%Much more likely

Somewhat more likely

Somewhat less likely

Much less likely

Don’t know

How much more or less likely are you to choose one retailer over another if they make it easier for you to personalize and control when, where and how you interact through your preferred channel combination—online, in-store, mobile or self-service device?

Regional highlights.

A high percentage of Chinese (95%), Brazilians and Indians (94% each) say that a consistent experience across industries is important, as do significant numbers of consumers in Italy (89%), Australia (87%), Canada, the UK and the U.S. (86% each) and Germany (65%).

Significant numbers of consumers in China (96%), India (94%), Brazil (92%) and Italy (90%) agree organizations should do more to integrate their social media activities with other channels, and respondents in other countries agree (UK 84%, Canada 82%, U.S. 80%, Australia 78% and Germany 69%).

Chinese (94%), Brazilians (92%) and Indians (88%) are more likely to choose a retailer that makes it easier for them to personalize and control their interactions. This view is shared by consumers in Italy (84%), the UK and the U.S. (83% each), Australia (82%), Canada (80%) and Germany (60%).

8

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Consumers are more likely to

choose retailers that enable them to

personalize and control where, when

and how they interact through their

preferred channel combinations.

The research shows that consumers—despite being more tech-savvy than ever before and empowered by greater access to knowledge and multiple channels for interacting with businesses—are frustrated by a confusing and chaotic shopping experience. They are tired of a world where “multichannel shopping” often means “silo-channel shopping,” and of being inundated with irrelevant, inconsistent or conflicting information. These consumers seek greater control over where, when and how businesses interact with them and understand their preferences.

Tomorrow’s successful businesses are those that evolve to embrace and build on this consumer mindset. They will move from a business-to-consumer model to a consumer-to-business, or C2B, approach. In this new view of the world, they will focus on providing a seamless retail experience across channels, coupled with relevancy and personalization, to win consumer preference and loyalty.

Enter the world of converged retailing.

With a legacy of innovation and leadership in providing solutions that directly impact consumers, NCR is uniquely positioned to guide retail and hospitality organizations through their evolution to converged retailing.

NCR c-tailing™ solutions create an experience where transactions initiated in one channel are enhanced through convergence with one or more other channels. They recognize the expectations and influence of today’s digitally empowered consumers. And they are enabled through an enterprise process architecture that delivers structure to consumer interactions, encompassing the store, the Internet, self-service touchpoints and mobile devices.

Conclusion 9

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Survey Methodology:

NCR commissioned BuzzBack Market

Research to conduct an online survey

in 2010 among 4,570 respondents in

Australia, Brazil, Canada, China, Germany,

India, Italy, the United Kingdom and

the United States. BuzzBack is a leading

international market research firm

headquartered in New York.

10

Learn more.

Find out more about NCR c-tailing solutions. Visit www.ncr.com/c-tailing, contact your local NCR sales representative, send an email to retail@ncr.com or call 1-800-CALL NCR.

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NCR continually improves products as new technologies and components become available. NCR, therefore, reserves the right to change specifications without prior notice. All features, functions and operations described herein may not be marketed by NCR in all parts of the world. Consult your NCR representative or NCR office for the latest information. All brand and product names appearing in this document are trademarks, registered trademarks or service marks of their respective holders.

© 2010 NCR Corporation Patents Pending EB10275-0410 www.ncr.com

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