Convergence of the retail kind: The human touch
Photo by iStock.com
By Sarah Tarraf, director, customer experience, Gongos, Inc.
It's an all too common occurrence in the news: well-established companies downsizing or shuttering stores that can't compete with the expedience and pricing of the rising class of etailers. Though media and entertainment companies were first on the scene with a click-and-collect model, the digital movement has caused a fever pitch across the apparel, consignment, household goods, grocery, and pet care industries — leaving a trail of traditional brick-and-mortar retailers in its wake.
However, opportunity exists to reshape this reality. While closures are a consequence of digital giants and start-ups alike, they're also exacerbating the problem. When brick-and-mortar stores close their doors, they relinquish their very advantage of the retail experience and the environments they cultivate.
The human element
Harkening back to dime stores in small-town America and village squares in Italy, merchants thrive on face-to-face interactions with their customers. It instills a sense of community and reciprocity that builds lifelong loyalty. Beyond the importance of human connection, the tangible aspects of shopping often lead to an almost visceral sense of gratification and reward for customers.
In the same vein, consumer insights professionals are enlisted inside organizations to foster this same spirit inside the modern-day retail environment. They know that strategies can't rely on hard data alone. An empathic connection with customers in today's retail space is still the linchpin to a personal and enduring relationship between a brand and its customer.
The digital experience
Giving into the demands of the competitive landscape, traditional retailers are infusing technology to foster the ease and convenience of the digital experience inside their physical stores. In fact, some say the next frontier is leveraging data-driven customization to infuse a more individualized on-site experience. Beyond convenience, GPS and beacon technology enable personalization that was once only afforded in a digital environment. Such advancements benefit consumers while they shop, providing a like experience through tactics such as mobile targeting of promotions and offers based on shopper interests, search patterns, and physical location.
Converging the human and digital experience
While effective, digital strategies tend to be largely centered on e-commerce objectives, ignoring the human experiences that shoppers have with brands. On the other hand, programs such as space design and visual merchandising have long sought to optimize the in-store retail experience. Unfortunately, these strategies do not intersect.
And it's not just the strategies that stand alone. The teams that develop them often work independently. Digital and e-commerce planning oftentimes sits outside the organization, both with agency partners and off-site consultants. This siloed process fosters two separate experiences — clearly leaving white space opportunities for companies to integrate them. In other words, customer experience and user experience teams often don't join forces to refine the shopper experience.
The hidden opportunity
The white space that this creates is the opportunity for retailers to reinvent themselves. Integrating digital strategies with all the humanistic qualities of the in-store experience showcases the value of an in-person interaction in an omnichannel world.
Had Best Buy succumbed to closing its doors and competing solely on digital footing, it wouldn't have been able to sustain a competitive edge against Amazon. Instead, it capitalized on its human differentiator as an instructional and educational alternative to e-commerce.
Competing with Amazon meant being better at things that technology simply can't master, namely customer service and care. While Amazon has spent billions building a speedy delivery system and plans to use drones to become even more efficient, Best Buy has returned to its heritage in customer experience and has retained a $42 billion position in the electronics business.
While research suggests data is at the heart of exceptional shopper experiences throughout the omnichannel universe, as demonstrated by the example above, retailers will win or lose based on the value of their human experiences. In fact, companies globally lose $300 billion a year due to bad experiences. And worse yet, over the next five years, $800 billion will shift in the retail, financial services, and healthcare industries from those that can't deliver good experience to the 15 percent that are getting personalization right.
So, while the Amazon Go model brings the best of the digital experience to life with stores entirely staffed by robots, in the foreseeable future these automated machines will never be able to form the indelible experience afforded by human connection, and the human touch.