Our CFO / Co-founder Greg Gormley takes a moment to reflect on some of Retail Week Live's biggest takeaways:
Retail is in a constant state of reassessment about its future, which is why Retail Week Live is always such a stimulating event. Any industry that aims to keep re-inventing itself needs to be good at spotting its own strengths and weaknesses. It needs to be both self-obsessed and outward looking. Above all, it needs to understand that the path to the future is never, like a Roman road, built in a straight line.
I bet, like me, you came away from Retail Week Live with your head reeling; so much to do, so little time. Or, more to the point, so much to do and so little budget. This year’s Retail Week’s Retail 2017 report highlights what a tough year 2016 was for many retailers. Fashion and Grocery had more than their fair share of woes, rocked both by cheaper competitors and online merchants. Things, however, can only get better. There appears to be renewed optimism that some of the revenue-sapping challenges can be addressed this year.
The report’s co-author, Henri Seroux, highlighted several themes for 2017. The two that stand out are instore experience and the need to better personalise customer communications. These are the critical differentiators that build better relationships with customers and ultimately compel them to shop in one store over another. The key word here is ‘compel’, in preference to other ways of capturing the essence of competitive advantage and customer loyalty; such as encourage, stimulate, entice or even persuade.
Instore experience can’t be faked
Bricks and mortar stores are back in vogue. They’re now more front line than ever as shoppers use them to complete purchase journeys perhaps started on the internet, and use them for further research. There’s no internet substitute for seeing and touching, or even smelling. Shoppers have been off into enchanting worlds of discovery for a while but appear once again to be coming back to earth. This is where they’re finding that they have enormous choice; they are omni-channel savvy, digitally connected, and like to make the easy assumption that the stores they shop in have kept up with all this digital wizardry.
Soft sell encouragement or stimulation doesn’t cut it anymore; the reasons to visit a store must be compelling. They must invest in the attraction of product with promise of added enjoyment, the thrill of being in the store. Creating this thrill is a complex task.
The report states:
“… customer expectations have changed radically over the past decade – even the essentially isolated, impersonal online experience has become a powerful, engaging and increasingly personal event…
The anonymous in-store shopping experience in particular may have been the norm for the past five decades, but the tide is turning and retailers urgently need to reconsider the quality, relevance and personalisation of that in-store experience if they are going to stay ahead in uncertain times.”
The process of making the ‘personal experience’ a reality, rather than a shallow and transparent machine response that shoppers can see right through, still seems to elude many retailers however. It takes a lot of technology to get truly personal yet a third of retailers say they are “several years away from having a single view of customer and stock.” No view of the customer, to me, seems to imply no view of the future, or even a grasp of the present challenges.
Customer communication can’t be fudged
The report observes that 28% of retailers intend to up the ante on personalisation in customer communications during 2017. However, when you consider the challenges in tailoring those communications within the instore experience there are still many traditional technology barriers in the way.
Currently the key means of driving communications are email and SMS, but smart money is on social media as hugely important channels for 2017, with 28% of retailers also confirming social media as a strategic priority. Identifying the building blocks of deeper customer relationship nurturing is one thing, but knowing how to construct a robust, workable, and sustainable interaction platform from them is a far bigger challenge.
Of course, it should also be considered that technology is the enabler in addressing vast audiences as if each person were the sole recipient of the communication.
A question of balance
In turning transactional relationships into sustainable connections (tipping the scales in your favour) there are a thousand questions to be asked, so to get the ball rolling here are what I’d suggest are four great starter questions:
- How do you know when a customer is in your store, for example?
- When a customer is at the till making a purchase, how can this critical transactional moment be tracked back to the customer’s online persona to improve insight and personalisation in the future?
- What can you do at this significant tipping point to deliver compelling reasons for the customer to return?
- In short, how do you build loyalty without the perception of desperation
A lot of questions to be answered, but there is an easier start point to customer engagement than setting out to create the monumental omni-channel edifice. Put one brick down first, then another.
Maybe trying to tackle the omni-channel experience is the wrong solution for initial relationship building foundations? Could it be that the solution lies in the hands of the consumer and the mobile device that is becoming central to their lives? We believe there is already a powerful way to connect with your customer at the most critical stage of the buying journey. Just Pay as normal with your payment card, contactless/chip & PIN and earn the rewards you deserve from the brands you love.
CFO / Founder