2016 demonstrated a real shift in retailers executing more targeted and relevant content at scale. We also saw digital being used in stores to improve experiences through things like contactless payments and the use of tablets for ordering and engagement. Retailers demonstrated their versatility in finding interesting ways to adopt disruptive technologies such as Augmented Reality and the Internet of Things into their ecosytem.
No doubt 2017 will be a very exciting year in retail with brands competing for that share of wallet which is more diluted than ever before through the choice the customer has. Retailers are looking for ways to be more meaningful and relevant to their customers, to offer that extra bit more which is not just product and price but great service and experience.
As part of our series exploring predictions for 2017, I spoke to Bhavesh Unadkat, Management Consultant in Retail Customer Engagement Design, to find out what retailers should get ready for. He told me about four interesting trends we will see in 2017, which are not necessarily new but will get traction and focus from retailers:
1)The ‘rebirth of loyalty’
There are many loyalty schemes in the market and customers are enrolled in multiple schemes – but how many of them do they actually use and how many influence purchase decisions? Even the extent to which they drive any kind of advocacy to the brand is to be questioned. The reason for this is loyalty schemes as a whole are very similar and are based largely on financial rewards – spend £1 and I’ll give you 1p back. Retailers more than ever are now thinking about how their schemes can be more sustainable and be built on a reciprocal value exchange with their customers that provides a differentiation and more reasons to be loyal.
The ‘rebirth of loyalty’ will be about the ability for retailers to craft propositions which create and use a deeper understanding of customers, to engage and reward them at a more meaningful level. Loyalty isn’t built in a moment, but instead over time, and it needs to be considered as a more holistic outcome, achieved through supporting, inspiring and engaging the segment of one customer.
2)The Internet of Things (IOT) will expand its reach in the retail sector
By the end of the decade we can expect to see the number of internet-connected objects increase significantly, and its impact on retail will be dramatic. The number of wearable devices purchased doubled in 2016 and with technology like Amazon Echo facilitating a connected experience for the customer the opportunities for retailers playing in this space become substantial. As well as customer facing opportunities there are a number of supply chain benefits that IOT can help unlock. For example, the ability to more accurately measure supply and demand in a near-real-time way will allow businesses to better ensure things do not run out based on a surge of demand, or that stores are not overstocked. Retailers will spend 2017 experimenting further to strike the right balance between making the experience a better one for customers and at the same time unlocking business value through a more connected shopping experience.
3)Augmented and Virtual Reality will continue to influence retailers’ interactions with consumers
Augmented and Virtual Reality are two technologies that have been well embraced already by retailers and these will continue to become mainstream in the customers shopping experience. Mothercare is a great example. It introduced an innovative twist to its catalogue this year by allowing those customers with its app to scan the page and watch models showcase the products on their screens.
Virtual Reality eliminates the limitations of space and time, so that retailers can dream of whatever experience or design they choose. As the technology evolves and costs lower (look at Google Cardboard as a headset for example), we can expect this to be more of a common site, with virtual showrooms and virtual fitting rooms becoming the norm.
4)Biometric recognition is on the rise, and shows no signs of letting up, providing opportunities for retailers to really understand their customers
The biometric recognition revolution is in full swing, and the opportunities that it offers retailers to learn more about their customers, and in turn enrich their shopping experience, is an exciting prospect. Whereas AR and VR employs technology to enhance interaction, biometric recognition allows retailers to instantly collect much more detail on their customers than a simple online registration form, such as their approximate age, height, gender and preferences. That detail is then used to instantly offer bespoke shopping choices and experiences, whether they are in-store browsing or sat at home on a tablet device.
On the other end of the spectrum, we’re seeing technology trialled that can monitor customers’ reactions to a product they’re trying-on, and can adjust the clothes offered online accordingly.
Expect 2017 to offer even more innovation and trialling in this space, as retailers look to stay ahead of the competition through the adoption of technologies that are becoming more and more accessible to brands regardless of their size and budget.
Visit our blog tomorrow for our 2017 predictions for manufacturing.