It is an exciting time to be a retailer and a consumer, especially if you embrace technology and take advantage of the advancements available in today’s marketplace.
Consumers are getting savvier and savvy retailers are keeping pace. Here are 4 trends that continue to emerge and are gaining adoption:
1. Data, Data, Data – Online metrics enabled offline
Retailers are making significant investments to increasingly capture more and more data. This allows them to better understand their customers, their store performance and to personalize their customer experiences. It is expected that in the online world you capture every data point possible, but recent technology advancements makes it possible for retailers to analyze in-store traffic just as well as they can in the online world. They apply facial recognition to count unique and repeat visits in their stores, analyze traffic heat maps, understand paths through the store, time spent in store, time to purchase, and even abandonment rates. It sounds a lot like online data because it is. This walks a fine line between cool and creepy, but mostly it is way cool. Companies like NEC are developing VIP Identification applications that leverage facial recognition to alert retailers and hospitality businesses to the presence of important visitors. Companies like FaceFirst are developing retail applications not only to compliment loyalty systems, but to combat the high cost of shoplifting and fraud.
It is one thing to be able to capture all these data points, but another to be able to action them. Retailers are making investments in not only analytic talent, but in big data systems. Companies like SAS are seeing all time high revenues exceed US$3.02B in 2013 and show little sign of slowing down their growth trajectory. IBM Smarter Commerce division is innovating at a remarkable pace with capabilities that retailers could only dream about years prior.
2. The Convergence of “Bricks and Clicks”
Online shopping continues to grow year over year. The typical consumer is now much more trusting with making purchases online and is typically a more informed consumer. After all, online you can see video content, compare prices, read reviews not only from strangers, but from friends across your social networks. More often than not, retailers have a complimentary ecommerce web presence. Omni-channel is becoming the new normal and it is expected by today’s savvy consumer. But what if you could take the benefit of shopping online and bring it to the tactile experience of in-store shopping? Well, it is possible and it is happening.
Any savvy consumer can whip out their smartphone and start the painful process of searching for reviews, looking for videos and find competitive prices, but retailers are beginning to embrace transparency and making this much easier. Basic technologies such as placing a QR code on packaging are making it possible to leverage the smart phone era and make it easier for consumers to interact with digital and social media in a retail establishment as well as engagement programs. Companies like Apple, Paypal and Estimote are deploying beacon technology using Bluetooth Low Energy (BLE) to create not only new methods to pay, but create an interactive and highly personalized in-store experience.
3. Increasing Use of a Mobile Wallet as a Loyalty/Engagement Identifier
Admittedly, I am a coffee addict and I am a huge fan of Starbucks and their mobile app. I have not used any other form of payment than my iPhone for at least the past year in their locations. It is an app of convenience but I recognize that it is also an identifier for their loyalty program. More and more we will see the use of the smartphone as not only a payment device, but as a consumer engagement vehicle. According to Forrester, mobile payments will reach $90 Billion by 2017 and we will see the largest growth in “proximity payments.” Technologies such as near-field communications (NFC), Bluetooth Low Energy (BLE) and 2D/3D/QR code scanning are becoming more and more common place. Today, most retailers have a two factor checkout process for their loyalty program. One for payment and one for loyalty. Soon be just as common to tap your smart phone to accomplish the same task – payment and engagement in harmony.
4. The Consumer “I want it now” Syndrome
More demanding than ever is the consumer and their expectations of retailer’s ability to satisfy their needs, wants, and desires immediately. We are nearing the end of the shift to digital content. The market of physical books, physical media for audio and video are eroding rapidly beyond those seeking it to be nostalgic. Digital content allows for immediate fulfillment. Companies like Domino’s and Amazon are providing visions of drones enabling rapid fulfillment when we purchase online. The FAA suggests that the drone economy will be a $90B industry within 10 years, delivering packages, medicine and emergency aid. The 3D printing market is also becoming more evolved and affordable enabling home-based and neighborhood-based manufacturing of physical goods from purchasing a digital blueprint.
Engagement programs are also making this shift to real-time decisioning that provides instant rewards. Consumers don’t want to wait for their goods, yet alone wait to be rewarded or appreciated. Savvy retailers are learning to provide instant rewards in the form of discounts, merchandise, exclusive access, and status. An engagement program’s reward currency is becoming a compliment to a multi-faceted recognition program that can deliver not only aspirational benefits through currency accrual, but immediate benefits that surprise and delight the consumer.
It is an exciting time to be a consumer who embraces technology and just as exciting being an innovator of engagement programs. At ESI we are having a blast layering our VEO platform on top of these emerging technologies. The only limitation is one’s imagination.
About Exchange Solutions
Exchange Solutions designs, builds and operates intelligent customer engagement programs that help our clients substantially improve their customer acquisition, retention, and profitability. We deliver our programs via our Managed Services Platform which allows for rapid time to market, customized to our clients’ needs. Our proprietary approach and in-market learning helps our clients realize quicker results, better ROI and deeper and more enduring levels of customer engagement than traditional loyalty programs.