Last week Outside In dug deep last week to cover new developments in the Retail Tech Landscape here at:
As part of the same dive on the Retail Industry, I even stumbled upon another lovely read – A PSFK report on the Retail Landscape for the 2020s. So, I have gone ahead and made a short piece out of my key takeaways from the PSFK Perspective on the Retail Future. Hope it will be an exciting bonus read on the dynamic retail industry… Here we go…
Consumer Expectations
Experiences that once would have seemed magical are now table stakes, as today’s consumers have grown accustomed to a shopping experience built around their individual needs and desires:
1. Digitally Fluid, Mobile-First
2. High Value Convenience and Flexibility
3. Intertwined Browsing and Shopping
4. ‘Made for Me’ Moments
5. Meaningful Relationships (beyond Transactional)
What It Means for Retailers – Shifts for the 2020s
Move from Historical Profiles to Real-time Conversations
Investment from Targeted Ads to Personal Portals
Transition from Data Personalization to Data Partnership
Pivot from Responsive Storefronts to Anywhere Stores
Emphasis from Retail Experiences to Shopper/Personal Utility
A mix of advanced computing, delivery logistics and connected technology is powering a hyper-personalized retail experience that has the objective of anticipating and providing exceptional service. The best retailers will guide, meet, anticipate, serve and reward each of their customers in the age of Personal Utility
The 5-Pillars of Personal Utility
1. Know Me: Empower me with digital tools that allow me to control my shopping experience while continually working to make it even better
2. Inspire Me: Provide me with personalized recommendations and curated content to help me discover and choose the right products for my needs
3. Meet Me: Integrate shopping into my daily life, providing me with access to the goods and services I need in the manner that’s most convenient for me
4. Serve Me: Don’t just sell me a product but provide me with a solution, making my life easier and ensuring I get the most out of my purchase
5. Value Me: Look past my purchases to provide meaningful value that rewards my loyalty and shows me you’re there for the long term
What Do Retailers Have To Do?
1) KNOW ME
Compare the public and member experiences of your store, and make sure they differ. Invest in moments of delight or convenience for customers to unlock as they become more brand-loyal
Consider how mobile devices can help customers circumvent the biggest pain points in-store, such as long checkout lines, locating associate help, or remembering where they parked
Ask customers directly for their input on product decisions. Start small: Invite superfans (say) to influence small production changes such as color, material, or fit—building trust toward bigger decisions
Solutions Approach
a) Shopper APIs power every Interaction – from Inventory to Transaction – Sam’s Club Now App
Personal Gateways: Mobile apps are becoming integrated platforms that function as gateways through which shoppers can access a range of key functions at every stage of their journey, both online and in-store
Logged-In Recognition: Allowing shoppers to ‘check in’ upon entering a store via mobile app in order to unlock a more responsive in-store experience while contributing to CRM
Payment Plus: Creating a mobile app payment ecosystem that encourages loyalty and provides personalized discounts
b) Real-time Research will direct Customer Service and Offering – Choosy’s On-Demand Production
Predictive Merchandising: Harnessing data and employing predictive analytics to uncover shifts in consumer preferences and accurately forecast demand, enabling them to improve supply chain efficiency, merchandising strategy and inventory management. Studying online & in-store purchasing data for a local market in order to improve supply chain efficiency & uncover shifts in consumer preferences, ensuring that stores are always stocked with shoppers’ preferred items
Computational R&D: Applying data from in-store behaviors, product interactions, loyalty engagement and shopper feedback to inform decisions around merchandising, rewards programs and technology investments that inform future decisions
Behavioral Heat Mapping: Tracking shoppers’ real-time in-store movements and behaviors throughout store in order to optimize store layout, pricing, merchandising and inventory
Sales Data Optimization: Carefully studying online and in-store purchasing data for a given area to uncover shifts in consumer preferences and forecast trends in order to ensure that a given store is stocked with consumers’ preferred merchandise
2) INSPIRE ME
Test how you’re guiding customers to their best-matched products in-store: Are you using mobile cues? Dynamic signage? Empowered associates? Make sure that experience is pleasant rather than interruptive
In digital channels, explore how difficult it is for customers to get from ad/branded channels to the product on your website. Tackle any interruptions or technical challenges that pop up
Consider what else, besides products, your stores can introduce to consumers. What films, books, activities, and destinations reflect your brand? How can you leverage store design to expand the worldview of your shoppers?
Solutions Approach
a) Discovery & Recommendation served at Right Time, Right Place – McDonalds Drive Thru’ Menu
Personal Recommendation: Recommending related products to buyers based on previous purchases or their particular lifestyle
Contextual Targeting: Using RFID and other technologies to detect items that in-store shoppers are interacting with in order to target them in the moment and drive incremental sales
Interactive Merchandising: Leveraging responsive in-store technologies, such as interactive shelf displays and AR-powered virtual demos that supply shoppers with additional information to bring products to life
Expert Consults: Providing one-to-one consults and expert advice to boost the confidence of customers and help them make the optimal choice
b) Stores will become Media Channels, Delivering Inspiration, Education and Entertainment – Morphe In-Store Studios
Immersive Storytelling: Using store design and immersive storytelling to highlight unique attributes and invite shoppers into the world of the brand, establishing a deeper connection
Store as Studio: Leveraging the physical space to encourage the creation and sharing of content both by brands and their fans
Participatory Playground: Offering customers in-store experiences that encourage them to participate or engage in entertaining brand offerings, cultivating a more immersive experience while tapping into an emotional mindset
3) MEET ME
Review your store footprint in retail-dense areas and assess which locations are competing with one another for the same customers; plan how each store can serve a unique, complementary purpose along the customer journey
Identify which areas are underserved by your physical locations and consider how mobile activations can extend to engage customers and drive sales without a physical footprint
Review how you’re logging customers in and out of physical experiences and acknowledging their permissions without interrupting the interaction
Solutions Approach
a) Always Logged-on, customers will be in a Hyper-State of Shopping – Cargo Essentials on Uber
Point & Click World: Sophisticated AI is powering a new era of image recognition technology that is bringing online search engines into the real world. These capabilities now enable consumers to take a photo of nearly any object in the physical world to receive related information or even purchase that item with a single click
Shoppable Broadcasts: Blurring the line between media and commerce by turning product pitches into broadcast events, allowing consumers to shop directly in real time and facilitating a two-way conversation with a community of brand fans
Near Me Shopping: Voice assistants and digital payment tools are integrating shopping into the driving experience itself, turning the car into a powerful mobile commerce hub that allows consumers to easily purchase items, such as food and gas, while on the go
Digital Drops: Designing interactive content & experiences that bring worlds of physical & digital shopping together in exciting ways, allowing consumers to unlock exclusive product launches and buy them through their mobile phones
b) Store Networks will offer multiple Modes, Models and Services to meet an ever-changing set of Needs – IKEA Planning Centre
Service Marketplaces: Dedicating a portion of the retail footprint to offering related goods and services beyond their core offerings in order to create more meaningful value for consumers by providing solutions that not only save time but elevate time
Micro Fulfillment Centers: Meeting customer demand for speed and immediacy by using the physical store to fulfill online orders or building warehouses and fulfillment centers that are closer to population centers
4) SERVE ME
Review how customers are sharing their preferred locations with you: Through saved addresses? Or, location data? Consider whether more granular location information could help you meet customers in their moments of need
Whether via survey or reviewing customer support tickets, identify customers’ biggest product troubleshooting issues. Design assistive experiences that turn these troubleshooting moments into positive touch-points
Investigate which services or products consumers use to compliment their purchases from you. Research whether strategic partnerships or in-house development could help you bundle these items together
Solutions Approach
a) Fulfillment will go beyond Speed to Delivering an Elevated level of Service and Convenience – Myntra Last Mile Delivery via Tailors
In-Step Logistics: Meeting demand not just for speed but for convenience by giving consumers greater control over when and where they can receive and return online orders, allowing them to choose the option that best meets their in-moment needs
White Glove Delivery: Offering a more premium delivery experience via specially trained employees can provide a high level of service, including in-home setup for complicated items
b) Products will be embedded with a seamless layer of Service & Experience – Equal Parts Cooking Coach
Circular Commerce: Developing new appliances that directly deliver products to the consumer, eliminating need for single-use packaging while building an ongoing, circular relationship
Elevated Onboarding: Fostering a supportive relationship with customers post-purchase by incorporating informational content into the product experience
Passive Purchasing: Offloading responsibilities of frequent purchases by IoT solutions to automatically connect to a marketplace to reorder supplies when specific conditions are met
5) VALUE ME
Make your terms and conditions easy to read and interactive. Let shoppers know what their data is being used for, how it will be protected, and what they get in return. Customers are more willing to share information if they understand how it will be valued
Study your largest customer service concerns and investigate how they could be addressed proactively, further upstream in the customer journey
Tighten your feedback loop. Customers want their loyalty to be recognized fairly quickly; implement micro-rewards to help customers realize the value of investing in your brand
Solutions Approach
a) Customer/Brand Relationships become a 2-way Value Exchange – Outer Neighborhood Showroom
Tailored Rewards: Leveraging the data collected through the loyalty programs in order to analyze and understand consumers’ individual preferences and desires, engaging them with rewards and offers that are relevant and interesting while building a one-to-one relationship
Members-Only: Looking beyond loyalty points and rewarding members with early access to new products and one-of-a-kind experiences that invite them into the world of the brand, creating an emotional connection
Reciprocal Exchange: Rewarding consumers for sharing information about their behavior and other personal data, in the form of money, loyalty rewards and/or the delivery of a more personalized experience, fostering a mutually beneficial exchange
Democratized Design: Involving customers as co-creators in the product development process, allowing the brand to connect with fans for input and creating products that resonate with customers on a deeper level
b) Customer Service will anticipate Needs--and Shoppers will expect it – Stitch Fix Personal Stylists
Empowered Associates: Equipping staff with data-driven and tech-enabled resources to empower them to act as independent frontlines of customer support
On-Demand Support: Using human support to connect with consumers and deliver relevant information as needed, moving away from AI and automation to create a 1:1 experience
Anticipatory Support: Applying machine learning and data aggregation tools to anticipate consumers’ needs based on situational or emotional contexts and provide service or product recommendations
In Conclusion
Everywhere the rules of retail seem to be being rewritten but we shouldn’t see this as a concern or a challenge. Instead, we should realize that there never has been a better time to work in retail. As innovation frees the industry from the legacy rules, an exciting new decade beckons – one where the best retailers and brands serve their customers with personal service and true helpfulness. Just as they always have –but now with a few new tools to use – Piers Fawkes, President & Founder, PSFK
References and Sources:
1. PSFK Report – The Retail Future: https://www.psfk.com/report/future-of-retail-2020