By Ed
Kowalski, Sutherland
Every retailer knows customer
experience is paramount in today’s competitive landscape. As brands vie for our
business, today’s customer is increasingly informed and demanding. These connected
customers, with unfiltered, always-on access to the Internet in the palm of
their hands, add in another layer of complexity to the buying journey as brands
struggle to keep up with their ever-changing expectations and find more
effective ways to communicate with them.
According to Forrester, we are five years into the “Age of the Customer,” which requires brands to completely overhaul the
way they are conducting business. In this new frontier, it’s imperative for
retailers to continuously identify the right methods of communication to connect
with existing customers and engage with prospects to drive meaningful
interactions and foster customer loyalty. By leveraging these critical factors
at play in the disruption of the traditional buyer’s experience, brands are
better equipped to operate proactively in an increasingly competitive,
customer-centric retail atmosphere.
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Shopping Behavior Is Evolving
Despite any hype you may
hear about the “death of brick-and-mortar” or declining retail sales, the
retail outlook remains incredibly bright when viewed through the lens of how
consumer behavior is changing. Recent research
by PwC found that consumers
are highly optimistic about their local economies, with over 25% spending more
on products and services this year — mostly in stores or on mobile.
Consumers’ shopping
habits are clearly not waning; they’re simply evolving. Today’s shoppers not
only expect but demand a well-curated, highly customized shopping experience. The same PwC survey,
for instance, showed consumers are willing to pay extra for personalized
services. From automated checkouts, to
hyper-personalization, to the rise of conversational commerce with the
introduction of messaging apps, customers are disrupting the way store
associates and brands interact with them — with hopes that the process will
become much more effortless.
What’s
a brand to do in the face of this new landscape? Listen — after all, the
customer is always right. To adapt, retailers must lean into the innovation
playing out in today’s shopping experience. But at the same time, it’s not just
about technology. What customers want is not just the latest shiny tools, but
rather a seamless, convenient shopping experience catered to their needs.
Technology certainly plays a critical role, but the focus should be on
designing an experience that blends the benefits of technology with the empathy
and authenticity of human interaction.
The Connected
Customer Is King
This
balance is perhaps best exemplified when it comes to meeting the needs of Gen
Z. A study
by CrowdTwist found that 57% of Gen Z prefers shopping in-store rather than online, despite
being digital natives. Born with a smartphone in their hand, the digital
experience is innate to Gen Z, but they also crave the unique experience and
engagement that a physical store can provide. Gen Z shoppers rely on smart
devices, mobile apps and other technologies to drive their in-store shopping
experiences and leverage the best of both worlds.
Many brands are similarly looking to create
engaging, interactive experiences in stores, online and across social channels
to capture younger generations. For example, one new way Gen Z’ers and Millennials
are getting their direct fashion fix is through LIKEtoKNOW.it, a social-based shopping service. The LIKEtoKNOW.it app allows
Instagram users to instantly access and purchase an item their favorite
influencer is wearing in a photo, providing an entirely new way to shop for customers
who desire both convenience and a brand — or in this case, a makeshift brand
ambassador — they trust.
Storefronts
are likewise looking to new visual, interactive approaches to cater to the
needs and desires of today’s connected customers. For instance, trendy retailer
Reformation
is bringing the “Clueless” closet to
life. With only one of each item hanging on the store floor, shoppers add an
item to their fitting room by browsing on a touchscreen monitor or asking a
store associate to scan the barcode. The customer then waits as their fitting
room is prepared, where the clothes magically appear in a wardrobe. Last year,
Nordstrom also launched Nordstrom
Local, a crop of inventory-free “neighborhood hubs” where shoppers
can enjoy everything from personal stylists to alterations, online and mobile
curbside pickup, Trunk Club services and even manicure appointments.
Virtual
and augmented reality (VR and AR) also are making their mark in today’s
experience-driven environment, letting shoppers visualize items they’re looking
to purchase without ever visiting a showroom or dressing room. In fact, 10%
of customers have used an AR application to try on clothing or see how a piece
of furniture would fit in their home. As for shoppers who prefer to visit a
storefront, companies like Memomi, a smart mirror enterprise,
are letting customers virtually try on everything from an array of eye shadow
and blush colors to clothing outside of their normal style, completely revolutionizing
how shoppers interact with products.
The Bottom Line For Retailers
While
all of these changes are creating exciting new experiences for shoppers, retailers
stand to gain immeasurably in this new climate as well. Interactive new
approaches are bringing shoppers and products closer together, facilitating
relationships and creating greater trust and brand loyalty that many retailers
have historically struggled
to maintain. With a more complete view of shoppers’ preferences and habits
— down to every Instagram like and dislike — retailers can better curate the
customer experience to help them along in the buying journey.
Technology
changing both sides of the shopping spectrum is a given at this point, but
never before have shoppers’ preferences been evolving so rapidly in tandem. The
advent of the connected customer is forcing brands to adapt to the increasing
types of shoppers and their ever-changing behaviors. Ultimately, retailers that
strike the right balance between man and machine and find new, customized ways
to interact with shoppers will gain a competitive edge — and those that don’t
will see their customers’ loyalty shift elsewhere.
Ed Kowalski is
Assistant VP for Retail Marketing at Sutherland. He brings over 20 years of experience in leading
global strategy, brand and product marketing for the Retail business vertical
at Sutherland. Kowalski also leads new business process solutions integrating
data, analytics and technology to drive better outcomes for retailers and their
customers. Prior to joining Sutherland, Kowalski served as the Marketing
Consulting practice lead at Experian where he helped retailers and hospitality
businesses map out integrated omnichannel customer experience journeys. Over
his career, he has worked closely with clients such as L
Brands, Neiman Marcus, Sears, Dick’s Sporting Goods, Coca-Cola, CVS Caremark,
Samsung, BRP, ConAgra Foods, and Orbitz.
