The Future of Retail Promises More Disruption, eTail Europe Panel Concludes
While the panel peering into the future of retail at eTail Europe was sometimes divided, a few points of consensus emerged about where retail and ecommerce are headed in the tumultuous years to come.
First, the so-called “retail apocalypse” is not an apocalypse at all, but a transformation that has retailers scrambling to find the best ways to marry what is good about stores and what is good about online shopping and buying.
Second, customer experience is still as important as everyone has always said it is, but retailers need to clearly understand what they mean by the term and then execute flawlessly on that definition.
Third, omnichannel is both hard and vital to retail’s future and it’s important to understand that with each new sales channel or method comes new threats from those looking to take advantage of retailers.
As is often the case with trade show panels, there was no crystalizing moment in the discussion, though retail veteran Jeremy Seigal might have come closest to delivering the sort of tidy takeaway that conference-goers look for.
“First of all, it’s about thinking customer,” said Seigal, chairman of Revital and former CEO of White Stuff. “Thinking customer in everything you do is really important. In this conference you might think AI. But for a retailer, such as White Stuff, it might be about giving a customer a cup of tea or some water for their dog — something simple about helping and looking after the customer.”
Bringing the best of online and in-store together
Seigal said retailers with a brick-and-mortar presence also need to bring the best of online into stores, making practical use of tablets in the hands of associates, for instance. He warned against having misaligned incentives for in-store employees, incentives that might steer them away from promoting online shopping. He also said retailers need to be thoughtful about the kind of whiz-bang technology they adopt.
- Think “customer” all the time: Even little things matter, like offering a cup of coffee.
- Aovid the shiny object: When adopting improvments for customers’ experiences, be sure the change actually works for your consumers.
- Leverage brick-and-mortar as an asset: Think of creative services, such as BOPIS and from-store delivery.
- Eliminate fear to eliminate friction: Fear leads to barriers that diminish customer experience
- Work on creating “fans” not customers: Fans are advocates. They’ll come back and they’ll tell their friends.
“Make sure you embrace things that work for your customers,” he said.
The panel, which also included representatives of Vivienne Westwood, Made.com, Riskified and Signifyd, didn’t provide a step-by-step guide to success, but it did offer plenty of key issues to think about and some help with how to think about them.
For instance, literally everyone agrees that customer experience is a key to doing retail right. But the panel poked and prodded at the definition. What is customer experience? What part of the customer experience is important? How do you deliver customer experience?
One strategy, according to Signifyd Vice President of Marketing Stefan Nandzik, is to make sure a retailer is using physical stores to its advantage. Take buy-online-pickup-in-store, a mainstay of real omnichannel retail. Fully 40 percent of retailers said offering BOPIS, also known as click-and-collect, gave them a competitive advantage, according to a Signifyd survey of 250 enterprise retail decision makers.
“Obviously, leveraging the store as an asset rather than a liability was the way to go,” he said.
Nandzik said one of the biggest obstacles to a great customer experience is fear — fear on the part of retailers.
“A lot of friction points are really driven by fear,” he said. “You fear your customer, so you put in barriers.”
Think of online fraud — an area that Signifyd, as the largest provider of guaranteed fraud protection, is intimately familiar with. To avoid fraud, some retailers will tighten up their requirements for shipping an order — seeking assurances that the order is going to a legitimate customer and not a fraudster. Inevitably that approach means legitimate orders are declined when legitimate customers are mistakenly identified as fraudsters.
Guaranteed fraud protection improves the customer experience
“That’s probably the worst thing you can do from a customer experience perspective,” Nandzik said.
So retailers should get a modern fraud management tool in place, he said. In particular, a new breed of fraud tool that comes with a financial guarantee to make merchants financially whole if an approved order later turns out to be fraudulent.
It’s part of what it takes to win a customer over. In fact, Nandzik said, retailers shouldn’t think in terms of winning a “customer.” What retailers want to do is create “fans.” A customer is loyal until he or she isn’t. A fan is a true believer, a shopper who will return again and again and evangelize your store, your products or both.
And while few would disagree that declining a legitimate customer’s order because of a misplaced fear of fraud is a terrible customer experience, defining a good customer experience is not always so black and white. In fact, there is no one best customer experience for all occassions
“Not all customers want a deep and meaningful relationship at every touch point,” Seigal, formerly of White Stuff said. “One of the interesting things that we found in White Stuff is, in the physical space, some stores would be in a market town where people would have a lot of time and they would want a different customer experience to the one, say, in a shopping mall, where people were on a mission, had much less time and therefore a long conversation and a long engagement weren’t appropriate.”
In some ways it all gets back to providing individual consumers with the ability to shop how they want, when they want and on what device or in what channel they want to. No, it’s not easy. And each new channel a retailer opens or builds leads to new efforts by enterprising criminals to take advantage of retailers.
Removing friction increases retailers’ vulnerability
Self checkout in stores, for instance, has reduced waiting times for customers, but it’s also introduced “self-assigned discounts that people give themselves,” Nandzik said. Liberal return policies have eliminated stress for shoppers buying clothes and other products online, but they also opened retailers up to abuse. The trend seems particularly strong among millennials, who have a different attitude toward what they are entitled to.
“It’s interesting. If you talk to them, if you do look at some of the studies, there seems to be no guilt for any of that any longer,” Nandzik said. “These new channels all have their new risk profiles and that just needs to be managed.”
If nothing else, then, the future of retail looks challenging, exciting, disruptive and in need of leaders who can think several steps ahead and adapt quickly to what they never saw coming.
Photo by iStock
Contact Mike Cassidy at firstname.lastname@example.org; follow him on Twitter at @mikecassidy.