As we've witnessed on this season of American Idol, song choice is everything and the experience that contestants deliver defines success. Just as these contestants vie for a place in the hearts of Americans, so do retail channels. Even as online sales continue to grow, the brick-and-mortar experience still captures the hearts of most North Americans. In fact, 83% of consumers who buy products online prefer shopping offline to any other channel. Why can¿t the Web break up this love affair with the physical world? Retailers should listen closer to the tunes their consumers are singing:

• I want to hold your hand. The Web just can¿t seem to replace that personal touch. Whether researching, buying, or troubleshooting, no other channel satisfies customer needs like the physical retail location. A chart-topping 70% of respondents in Forrester's Consumer Technographics Q3 2005 North American Survey were satisfied with their experiences completing transactions at retail locations, while just one-quarter was satisfied with purchasing online. When looking for customer service, consumers also prefer in-person interaction. To help customers learn to love less expensive self-service support channels, firms should help match customers' goals to the most appropriate self-service methods and focus on improving the usability of kiosks, IVR systems, email, and Web self-service interfaces.

• Do you really want to hurt me? Consumers are beginning to take notice of some of the Web's negative effects on their physical health, while, so far, there have been few complaints about stores having a negative effect on consumers' health. Although many consumers agree that the Net has improved certain aspects of their lives, many point out that being online has had negative effects on their hands and fingers, sleeping habits, eyesight, and back or neck. Consumers feel that their use of the Net puts them at risk for carpal tunnel syndrome, functional scoliosis, or poor eyesight: Between 17% and 30% of consumers say the Internet has caused detriment to their hands, eyesight, or posture.

• Suspicious minds. Security concerns still top the charts as the reason consumers don't shop online. In fact, 62% of consumers don¿t shop online because they don¿t want to give their personal or financial information over the Internet. Retailers can address these security concerns by offering multichannel gift cards and more innovative payment methods like PayPal or Bill Me Later, but consumers continue to trust a transaction they can see over the perceived black hole their credit card travels through online.

• Right here, right now. The top reason that consumers research a product online but then go into the store to buy it is that they want the product immediately. Until retailers start offering free overnight shipping, this will be a hard one to beat, because the second-most common response consumers cited was that they didn't want to pay shipping costs. The issue of immediacy is especially important among two valuable groups that normally have no qualms with sealing the deal online: men and online veterans who have been online for more than five years. To capture these potential customers without sacrificing margin by offering free or expedited shipping, retailers should explore an in-store pickup option. Both Circuit City and Best Buy have embraced this tactic, capitalizing on the opportunity to cross-sell and upsell in the in-store environment and vying for a share of the more than $115 billion of merchandise sales influenced by the online channel (keep an eye out for my upcoming report on multichannel consumers).

So what does this mean for retailers? The Web and stores should think less "Can¿t Get Enough Of Your Love, Babe" and more "Part-Time Lover": Consumers won¿t use the Web or stores exclusively, so the Web and stores will have to work together to meet the demands of today¿s multichannel consumer. To earn more love for the online channel, retailers must improve Web and email customer service channels to better match in-person service by offering simple escalation options like click-to-callback and enhanced merchandising technologies (look out for our upcoming report "Mastering Online Merchandising"), and by experimenting with alternative payment options. To bridge the channel gap and introduce online shopping holdouts to the benefits of the Web, stores can offer in-store kiosks with expanded inventory or product information and reviews. Until retailers change their tune, they'll be stuck listening to the consumer remake of "(I Can¿t Get No) Satisfaction," and trust me, it can't hold a candle to Mick.

As always, I look forward to hearing your thoughts, ideas, and experiences.

Regards,
Tamara Mendelsohn

Research Referenced In This Issue Click-To-Callback Bridges The Cross-Channel Gap (36933) Customers Prefer In-Person Experiences (38396) Customers Want Live, Speedy Support (38521) Online Consumers Want To Control Their Personal Data (39108) The Retail Kiosk Comeback (37498) US eCommerce: 2005 To 2010 (37626) Warning: Using The Net Has Harmful Side Effects (39004)

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