5 tenets of new retail
The story so far
I’ve been thinking, talking and writing about ‘connected experiences for brands’ for over 20 years. But over the last five years in particular, our work with companies such as adidas, P&G, Intel, M&S and Etisalat has focused on how retail can evolve to drive profitability for the retailer, and usefulness for the customer.
The key question is: what will retail look like in the future? And more specifically, what will it look like 2020? And here I mean retail in the broadest sense, not just shops but banks, gyms, airlines – any organisation selling you a service or product of any kind.
It’s all been driven by a massive amount of research, insight, testing and refining, and some key principles are beginning to solidify. So now, in the spirit of openness, I’m going to share what we’ve found.
But before I do, lets look at the big changes happening today, that will shape retail – and life – in the future.
The world has changed
Digital, social and communications technologies have transformed our world as everyone knows and will continue to do so. Just look at what’s happened in the last few years:
- Glasses have become computers
- Watches have become phones
- Phones have become wallets
- Printers have become 3D
- Clouds have become binary
- Raspberries have become computers
We’re living through the ‘age of convergence’. Soon, everything will be able to do everything else: multi-functional, multi-platform, multi-channel. For some, that’s made the world a more complex, confusing and challenging place. But there are also tremendous opportunities to be had.
Consumers have changed
We’re all increasingly channel agnostic. We no longer make a distinction between different channels. Instead, we expect a single seamless and consistent experience.
We’ve also been empowered by social and communications technologies, which have given us a voice and connected us to friends, communities and expert influencers.
As consumers, we now expect personalised experiences, and the opportunity to participate in co-creation. We’re equipped to short-cut old retail models, and we’re always informed, with access to real time information on price, availability, and location – giving us greater control over the path to purchase.
Shopping has changed
The lines have blurred between channels, with stores trying to be more like websites, and websites becoming more like stores. The ‘start’ line and the ‘finish’ line – used to try to push people from online to transact in store – is gone.
Even the line between shopper and consumer – if we think that the store is now omnipresent, does that mean they are always potentially a shopper? These changes are reflected in the changing channel behaviors we’re seeing:
- Smartphone penetration will reach 60% by 2019
- 73% of smartphone owners have used their device while out shopping
So what does it mean?
These are the key principles – or tenants – as we’ve we’ve found them.
1. Think multi-channel
The first thing we need to do is adopt a multi-channel mind-set. As discussed in my previous posts, a lot has been written about this particular buzzword, but at its essence it’s very straightforward. It’s about letting customers have anything (product or service) at any time (day or night) from anywhere (at home, on the go or in store) any how (from any device or platform).
In this connected multi-channel world customers are now the central organizing principle, and everything revolves around them, The shopping experience exists where ever they areand It travels with them wherever they go.
2. Adopt an ecosystem perspective
If customers are now the central organizing principle, then we need to adopt their perspective and see it from where they’re standing. Rather than thinking of the shopping experience as a single linear journey.
Think of it as an interconnected ecosystem made up of all the touch points and interactions from online to mobile to in store. This is the world that your customers see and experience when they’re shopping your products
3. Populate this world with ‘functionality’
In this experience ecosystem it’s ‘WHAT’ you can do (i.e. the function) not ‘WHERE’ you can do it (i.e. the channel) that counts. So adopt a ‘channel agnostic’ perspective – one that focuses primarily on the wants and needs of the end user, not the channel. Identify the functionalities and utilities that will improve their experience and make these ‘universal’ so they can be deployed across multiple touch-points.
Help customers to do what they want, where, when and how they want to do it. When you achieve this, and create value for the end user they will take you with them on their journey down the path to purchase.
4. Facilitate free-form journeys
The shopping experience is no longer a single, linear, ‘one size fits all’ journey through the store and back again, so there is no longer a right or a wrong way to experience it – it’s whatever suits that customer.
It’s about open-ended experiences that are determined by the user. That let them engage with you where when and how they want – with multiple points of entry, multiple pathways through and multiple points of exit, flexible enough to reconstruct themselves each time around the specifics of the individual.
5. Join up the dots
Connect up the experience. Focus on the back-end integration of systems, platforms and data so that you can start creating connected consumer experience.
Hook up all the nodes in the experience so they start operating as a connected whole. Use digital as the thread that ties the experience together. Exploit mobile as the most ubiquitous and readily accessible device to link the experience. And place a Single User View at the centre to coordinate it all.
So there you have it. Whilst they may be obvious to some I hope they prove interesting and useful to others. Please let me know.