By Glenn Taylor, Senior Editor
Although only 2% of household goods are bought online and 8%
of all goods are bought online, shoppers continue to find more reasons to skip
their trip to the store and shop on their favorite e-Commerce site.
In a presentation during the 2017 Retail Innovation
Conference, Josh Wais, Emerging Technology and Strategy Lead at Jet.com, shared
five key takeaways he felt retailers must follow if they want to survive and
thrive in the midst of these constantly shifting consumer preferences.
1. Go Where Others Aren’t
“In the past, location was that,” Wais said. “We could have
region differences in our footprint and we wouldn’t be competing with others.
Today it has to be through your value proposition and the role that you fit in
the lives of your customers. You have to think about how that’s unique, and how
that’s going to serve not everyone, but your particular customers in a way that
they’re going to choose you rather than one-click away choosing someone else.”
Advertisement
Moosejaw, whose
marketing efforts are led by another RIC presenter, CMO Dan Pingree, is a great
example of a brand leveraging its own content to distance itself as a brand and
be the “most fun outdoor retailer on the planet.” Pingree noted that beyond the
silly marketing campaigns, Moosejaw has even hosted its own Valentine’s Day “break-up
service” where customers can ask a rep to call their significant other and end
the relationship for them, showing that the company has a unique and quirky,
yet relatable, sense of humor.
2. Experience
“There’s always been a lot of talk about experience since it’s
a fairly obvious one,” Wais noted. “What’s different now, is that you didn’t have to compete with experience. Your
experience could frankly be pretty poor and you’d still be okay.”
Luxury retailer Forty
Five Ten has several boutique destinations in the Dallas area, most
recently opening a flagship that includes lounges for charging electronics, a
fine-dining restaurant called Mirador, a champagne bar known as Copper Bar and
even a small book store, as well as pitchers of ice tea on every floor. With
luxury retail certainly in flux as consumers prefer to buy less products and
spend more on experience, Forty Five Ten aims to showcase the type of location
that convinces shoppers to spend a day trip.
3. Try To Capture The Entire Lifeline Of The Customer,
Rather Than One Transaction.
“You might lose money
on your first transaction, but it’s worth it if you can get that customer to
keep coming back, because that’s going to be the new normal,” Wais said.
Starbucks arguably does this better than any retailer out there. The
coffee giant’s loyalty program membership has grown 11% year-over-year, with
rewards representing 36% of Q2 U.S. company-operated sales. The brand takes all
the right steps to stay top-of-mind to the consumer beyond the in-store
purchase, enabling loyalty members to collect Starbucks Rewards stars for
buying K-cups and ready-to-drink coffees at the supermarket.
Since last year, Starbucks has
more than tripled the number of products eligible for its loyalty program,
giving its most faithful customers more opportunities to redeem coffee, food
and merchandise within Starbucks cafes.
4. Delivery
“For the type of purchases we talk about that online has
traditionally been for such as electronics, fast is great,” Wais said. “But as
all categories start to move online, fast isn’t always necessarily what you
need, and fast is really expensive. We’re going to hear more about blended
fulfillment; being able to use traditional online methods with in-store methods
to be able to do pickup, or even have a store hand it off to an Uber driver
that can take it to your house.”
Target has made
headlines recently with the announcement of its Target Restock next-day home
delivery service pilot launch in Minneapolis, illustrating that the brand is
raring to take on major competitors Amazon and Walmart. Household items,
personal products and dry goods are all included in the service.
With investments in its Cartwheel mobile couponing app and REDcard
loyalty program, the retailer already has a significant customer database to
build out the Restock program, and it’s 1,800+ stores give it the built-in infrastructure
necessary to scale appropriately. But it will be critical for the brand to convey
a transparent pricing model if it wants to sniff the success of Prime.
5. Act Early
“There’s a lot of chaos, but there’s a lot of upending that’s
going on,” Wais said. “In that, this is the opportunity to start going in and
seizing customers and getting them to start shopping with you, and keep
shopping with you. But if you don’t do it now, you are going to have to pay a
lot more to acquire those customers and to invest in your experiences that will
lead to repeat customers later on. Even though it’s always scary to invest a
lot of money, if there’s a time to do it, now is the time.”
With these five steps in mind, Wais closed out his
presentation with a clear message: today
is not a time for complacency. Brands have to invest in innovation if they
want to avoid the pitfalls many of their contemporaries have already
experience.
