Keeping Up with the Pace of Change

Are you keeping up with how consumers see you and want you to see them?

Forbes predicts that 2019 will be the “year of the final shakeout” for retailers, saying that the losers have sealed their fate because they failed to invest in the future. How do retailers know which future they should have invested in?

How can retailers successfully position themselves to evolve and take on change? They need to clearly understand the challenges and obstacles before deciding on taking action, and it’s becoming clear that technology may create new challenges and obstacles, but it’s the customer who is driving change.

The customer sees just one version of you

Almost everyone shops online now – at least 96 percent of Americans do. However, it’s hardly the end for physical retail establishments. Americans still channel nearly 65% of their total shopping budget to brick-and-mortar locations.

The challenge of change represented here is that consumers now want an omnichannel experience, and they’re seeking out retailers that offer the same experience, whether it’s online or offline. Meanwhile, many retailers have misinterpreted this customer change of preference and still push out a multichannel experience, resulting in a very disjointed customer experience.

With the multichannel approach, physical stores are one silo anything online is in another. The customer experience – which is shaped by the interaction – can be decidedly different even if they purchase the same product. That’s frustrating and disruptive for a consumer, who sees a retailer as a single entity and wants a unified experience, regardless of the channel.

Retailers that retain a multichannel mentality place themselves first, rather than the customer. If there’s any overlap, it’s because it offers efficiency for the retailer. Isn’t it supposed to be about the customer?

Living up to a change in expectations

Consumers no longer patiently manage expectations about the experience they will have with a retailer because it’s happening via a mobile device instead of in a brick-and-mortar location. The challenge for retailers is to move away from customer experiences driven by the operational capabilities of online or offline silos.

And it is quite a challenge because of the likelihood that a retailer’s physical presence will have highly customized point of sales (POS) and enterprise resource planning systems that are tightly integrated into internal business systems which determine operational procedures. How can you integrate this legacy approach with what’s being accomplished online?

Consumers don’t look at retailers and see an online version and a physical version. They see one brand and expect their experience to be representative of what the brand stands for. They don’t care that “Click and Collect” is something you can’t offer because your online ecommerce engine has a clunky interface with your physical POS system.

Leading with experience

Retailers have realized that pure online stores will capture and lead in certain categories, but they won’t wipe physical retailers off the map. It’s why Amazon purchased Whole Foods and is reported to be planning to open up to 5,000 Amazon Go stores. If the reason why isn’t yet clear, return to the challenge retailers are facing with keeping up with changes in the industry.

Online shoppers appreciate the customer-centric experience they get when they’re on the Amazon website or mobile app. It’s in sync with the operating philosophy of Whole Foods, where you simply have to ask a store member to help you sample nearly any product sold in the store.

Managing expectations

Every move a digital shopper makes is measured and used to contribute to a customized experience. Now, retailers have to migrate that effort to their physical operations. Does this mean that brick-and-mortar stores have to be open 24/7?  Customers don’t expect this, but they want continuity their experience. What delights a customer online isn’t the same thing that they seek when they drive to a brick-and-mortar location.

Price and product are no longer the most important points for consumers. According to Salesforce, service-led retail leads the way. “Retailers,” the organization explains, “must have a full picture of their customers, and act on that picture, to compete effectively. Why? Because merely competing on price (and even product) is a losing proposition.”

Capturing that information may provide one of the biggest challenges for retailers. Thanks to GDPR and the actions of social networks, consumers are becoming more protective of their rights to privacy. So, if we are in the consumer-centric age, how do retailers personalize experiences and marketing?

It’s surprisingly nontechnical. It can and should be done with direct relationships. A recent survey shows that 64% of consumers have no problem with retailers who save purchase history and personal preferences if the objective is to offer a more personalized experience.

It’s up to retailers to keep up with changes occurring within the industry to stay relevant to consumers. Oftentimes, there are budget constraints to consider. Retailers must be creative when creating a strategy that works with their budget, and that’s where we come in.

At Sophelle, we help retailers with strategy development to overcome the challenge of change. Our consultants work closely with retailers to create cost-effective, high-performing retail strategies tailored to their business’s needs. Contact us and let our team help you create an omnichannel strategy.