By Mario Toneguzzi
The report – Consumer Experience in the Retail Renaissance: How Leading Brands Build a Bedrock with Data – says that the formula for success includes embedding data into organizational principles, turning data into intelligence, and adopting a unified consumer engagement platform. [Download the full report here]
“Over the last few years, how many times have you heard a retail executive say: ‘We must put the customer in the center of everything we do’? It’s a common goal, and while many brands have invested in what they believed would deliver an amazing consumer experience, their efforts haven’t always hit the mark,” says the report.
“In an era of increasing consumer expectations, technological innovation, and industry mega-disruption all converging simultaneously, it’s time to dig deeper to find out what’s really working and reflect on where brands still fall short on delivering relevant, contextual, and intimate consumer interactions.”
The report was based on a survey of more than 500 traditional retail, pure play, consumer goods, and branded manufacturing leaders from around the world.
It says rumours of the retail apocalypse are everywhere these days but the reality is that winners and losers in this landscape have emerged.
“On one hand, disruptions in consumer behavior, technology, competition, and economics have transformed the retail market considerably, and many brands haven’t risen to the challenge. On the other hand, these disruptions have opened floodgates of opportunity for brands to grow their relationships with shoppers. The continued evolution of technology, particularly in the areas of artificial intelligence (AI), machine learning, and augmented and virtual reality, generates new opportunities for brands to personalize experiences and transform internal operations,” says the report.
“Today, we find ourselves not in the midst of a retail apocalypse, but a retail renaissance. This renaissance means that brands must rethink consumer experience — and how to invest in it — to thrive.”
The report offers the following evidence that the retail apocalypse is exaggerated:
- Retail spend has outperformed GDP and risen every year since 2009;
- In 2017, 44 per cent of consumers reported spending more on retail than 2016. Only 14 per cent said they spent less; and
- Brick and mortar is predicted to grow by $36 billion by 2022, and ecommerce is predicted to grow by $50 billion in the same period.
“There’s a solution to consumer experience woes: unlocking data to know consumers and provide what they want — time and time again, journey after journey,” says the report. “It’s time to put consumer data back into consumer experience. This data shouldn’t be macrolevel segments and driven by one-size-fits-all messaging, but should instead be informed by individual shopper preferences to tailor the most relevant journeys.”
“But data is both the solution and the problem. Survey results show that brands today aren’t able to translate data into actionable insights, hinting that they won’t be prepared to apply innovative capabilities such as AI in the years to come.”
The report says there’s reason for optimism but retail brands have to understand the key disruptions taking place in the market.
- First, consumer expectations for speed and convenience are critical due to the proliferation of technology in society.
- Second, the technological revolution has had a big impact – 34 per cent of shoppers say they’ve researched a product online using a mobile device while in a physical store. Also, innovations such as AI allow brands to personalize across every consumer touchpoint.
- Third, competition is fierce today from a variety of different brands.
- Fourth, “income and expense pressures have driven a bifurcation in consumer behavior, where growth has occurred primarily with price-based and premier brands. Those in the middle have fallen behind,” says the report.
“Consumers are enjoying limitless options in this renaissance. So brands must be laser-focused on the value proposition that matters most to their customers. Nearly 60 per cent of brand leaders surveyed said their company’s unique value proposition is based on product quality or uniqueness — compared to 11 per cent for price and six per cent for convenience,” says the report.
“As they work toward success in the retail renaissance, brands must think beyond product as a differentiator and become more granular in how they identify and satisfy customer wants and needs. To stand out from the pack that offers mediocre experiences, brands must offer frictionless engagement across marketing, commerce, and service touchpoints, from the showroom (either online or physical) to the call center to how they operate their supply chain and fulfill orders. Consumer experience involves the entire value chain — including the battleground of the last mile.”
Mario Toneguzzi, based in Calgary has 37 years of experience as a daily newspaper writer, columnist and editor. He worked for 35 years at the Calgary Herald covering sports, crime, politics, health, city and breaking news, and business. For 12 years as a business writer, his main beats were commercial and residential real estate, retail, small business and general economic news. He nows works on his own as a freelance writer and consultant in communications and media relations/training. Email: firstname.lastname@example.org