There has been so much disruption in the retail space in the last five years, that it’s hard to see it as the same industry. The pandemic sped up the pace of change as practically everything we needed day-to-day shifted to online purchasing. For many retail locations, the drop in foot traffic during the pandemic still lingers. Fewer walk-ins, compounded by a massive increase in online shopping, led to a large number of permanent store closings. If ever the term “transform” should be used to describe an industry, it certainly applies to retail.
However, the turmoil of the retail industry has created a huge opportunity for what I call Experience Automation. This opportunity applies to both online and brick-and-mortar businesses. In the last shift for retail, online and offline retailers focused on cost, speed, and making a purchase transaction more frictionless. The industry now has to shift its modus operandi to make that transaction more of a memorable customer experience. This means retailers have to jump on their customers’ journey, not force the customer to follow the retailer. They have to get their customers to want to spend more time with them. If you can lengthen the amount of time a customer spends with you, it is likely they will spend more per transaction.
How can you do that? Going back to pre-pandemic “normal” is not the answer. Now is the time to transform your business model and center it on Experience Automation. Selling goods and services to people has always fundamentally been about matching a need in the right place and time. Now, more than ever, consumers are using various technologies to research and understand their needs. In this, they are signaling a vast amount of information that most retailers cannot access. To survive and remain relevant in this industry, retailers have to take an integration-focused approach to consumer technologies and then listen and adapt in order to serve customers and capture more sales.
What are consumers telling the industry? Listen to the data: customer experience is the ruling factor in creating a competitive differentiator. Salesforce research in 2021 found that 80% of customers now consider the consumer experience as important as a company’s products and services1.
Let that sink in for a moment. Your products and services are perceived as parity, and it is the consumer experience that tips the scales on the purchase decision for the vast majority of customers. How you sell is just as important as what you’re selling.
To thrive in this new era, retailers need to be in the consumer experience business, delivering a high level of personalization by reimagining the customer relationship. You need to start before the relationship is established and carry through with exceptional personalization through every step of the customer journey. Expect brick-and-mortar stores and experiences to rise above the mundane using digital intelligence across all aspects of online and offline shopping. The widespread expectation of digital convenience and flexibility are here to stay and are now just the entry points. Commerce is everywhere and if you want to win sales, you must deliver an exceptional experience to your customers wherever and whenever.
A focus on customer experience is rapidly driving the deployment of new shopping models and experiences. Converting data into business insights leads to the development of operational innovation that transforms shopper experience, which in turn differentiates you from your competitors and drives revenue. The transformation is well underway.
In the last week, you are likely to have experienced one or all of the following examples of convenient and personal customer experiences online, offline, or both:
- You were able to quickly find what you were looking for
- You skipped a long cashier line, checked and bagged your own groceries
- You received help either in person or by chatbot when you needed it
- You experienced a fast online checkout
- Without even realizing it, you received dynamic pricing
- You used a visual search to find a product
- You used voice to search or order a product
- You participated in customer satisfaction tracking
- Your behavioral data were collected to help improve your next shopping experience
- Your purchase generated personalized product recommendations
- Bonus points if you were able to check out by simply walking out of the store like at the new Amazon-go enabled retail stores
These transformational customer experiences are all examples of retailers harnessing the power of automation and machine learning in order to efficiently connect more meaningfully to each customer. And the use of automation to transform the industry goes beyond the customer interaction layer. To deliver an elevated experience AI is being used to convert data into actionable insights around forecasting demand and merchandising, automating inventory management, and streamlining operations and promotions.
Your differentiation as a consumer experience company is predicated on understanding and convenience. We will be hearing less about sales ladders and more about nurture loops to achieve longer-lasting customer relationships. Caring for customers on a mass individual basis yields direct benefits to bottom-line profitability. Ninety-one percent of customers say they are more likely to make an additional purchase after receiving a great service experience2. With that level of retention, shouldn’t every executive responsible be plotting a course to transform their retail business into a Customer Experience?
Since 2007, Originate has been a premier digital innovation company composed of seasoned entrepreneurs, business strategists, and top product engineers. From startups to the world’s largest enterprises, Originate accelerates businesses with a value-driven approach to Experience Automation.
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- Salesforce Research, “State of the connected customer”, 2021.
Salesforce, “What Are Customer Expectations, and How Have They Changed?”