Shoppers today take a digital/mobile first approach to retail, moving seamlessly between on- and off-line venues and selecting from an increasingly diverse range of shops from established and challenger brands.
Most retailers recognize this shift, but the majority struggle with strategies to transform their organizations to deliver on consumers’ increasingly demanding expectations. Emerging online brands naturally seek to disrupt traditional ways of doing business and have developed digital-first models that have created better experiences.
On the other hand, established retail brands are burdened with legacy systems that are not optimized for today’s environment. Their core – people, service, and experience – are strengths to maintain but to satisfy today’s consumers they must integrate the flow of information and resources across their networks of employees, stores and partners.
In its “Future of Retail 2017” report, trend forecasting firm PSFK outlines 10 strategies to transform retail businesses by empowering employees, leveraging technology, and streamlining operations. While the report contains more insights than we can cover here, let’s begin by mapping the customer experience landscape:
- 83% of global customers use on average 2.23 devices simultaneously.
- 1 in 5 customers use a mobile device to assist their in-store experience.
- 75% of customers are more likely to purchase from a retailer who knows their name.
- 75% of online customers expect personalized assistance within five minutes.
- 85% of customers will abandon a purchase if they do not get prompt service.
- 83% of customers prefer dealing with human beings to solve service issues.
To accommodate these ever more demanding customers, retailers need to implement major shifts throughout their organizations. Key areas of change include:
- Transforming customer service into VIP customers
- Making sales associates product experts
- Changing ‘out of stock’ to always available
- Transforming silos into knowledge networks
- Moving beyond intuition led to data-driven marketing
- Evolving retail transactions into brand relationships
- Focusing on the consumer first, rather than the bottom line
The first recommendation to retail brands is to empower frontline employees to become knowledgeable problem solvers, not merely order-takers. This can be accomplished in three ways: immersive training programs, creating network-knowledge exchanges, and transforming sales associates into consumer advocates.
Immersive training focuses on experiential educational programs to prepare sales associates to become problem solvers. Wal-Mart has initiated hundreds of in-store training academies that offer lessons on the sales floor, while grocery chain Wegman’s on-boards employees by requiring them to travel around the store network. Key next steps include: on-going educational programs, cross-training to solve cross-departmental issues, translating jargon packed edu-materials into customer oriented content, and working with retail partners to expand product orientation demonstrations.
Networked Knowledge Exchanges
As noted in the PSFK report, the key is “investing in fluid communication platforms that allow employees to share knowledge and streamline interactions as they serve customers.” One example, the Container Store, provides wearable communicators to facilitate sales floor conversations; Marriott empowers employees to communicate with HQ via WeChat. However, in addition to leveraging existing platforms, new technologies, especially AI and intelligent feedback networks, will be required to create truly 21st century knowledge exchange platforms.
From Sales to Consumer Advocate
Sales staffers need the necessary resources to act on behalf of shoppers, as an independent frontline for customer service. Wayfair is innovating here with customer service needs determined by sales reps. And, Whole Foods Market has employees taste test products to ensure quality and consistency. But much more needs to be done, including: developing feedback channels, rewarding employees for creative problem solving, leveraging employees as test groups, and identifying standout employees to lead educational efforts.
Performance Enhancing Technology
Retailers are increasingly outfitting employees with digital tools that access customer information in efforts to personalize service. Such assisted selling technologies give employees on-demand information to reduce friction in the purchase cycle. Boots, for one, has implemented voice-activated product inventory checks; Uniqlo provides handheld terminals to manage inventory, deliveries, and employee time-keeping. These are but baby steps, with the real info-revolution to come with the advent of AI chatbots and the evolution of data-driven technologies.
The Data-Refined Experience
Collections of shopper data provide the foundation for refining retail, production, and merchandising processes. Ralph Lauren has taken an innovative step in this direction by out-fitting changing rooms with smart mirrors that advise customers on a variety of issues, best fit to accessorizing outfits. Patagonia measures consumer demand to predict inventory needs. Again, more can be done, including: systems to compare customer data across channels, establishing channels to share customer insights, integrating on-product sensor technology, and better sharing of data with retail partners.
The foregoing provides but a glimpse of the challenges facing retail today and a promising future. We find ourselves today at a cross-roads, with paths leading toward a “creepy” data-determined retail environment and one in which sales personnel are customer advocates who champion their needs, help solve their problems in real-time, and channel insights back to management. If retail, online and bricks, is to fulfill its promise, we must harken back to that expression of yore, “The customer is always right.”