Retail is all about the value and its perceptions

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Customers are the king and queen in retail and they are valuable to the business. On the flip-side, customers are also seeking value in what is being offered to them. Retail brands across the globe are fiercely pegged against each other in this value game, and the one who offers the best value as perceived the customer will be the clear winner.

Let’s try to understand this better. In this day and age of technology driving the industry towards innovation and disruption, there is no ambiguity anymore in the current and future roadmap for retail businesses to survive and thrive. One thing is clear, the retail brands who standout on their customer experience expectations will taste success. However it is important to understand the customer experience paradigm.

Traditionally, retail was transactional and product focused, but that is no more the case. As the focus of the business pivots on the customer, the customer experience paradigm has undergone a significant shift since the early retail days. This shift has largely been the result of technology enabling customers equipping themselves with more information and decision making power, thus putting them in the driver’s seat who are now calling the shots. Fundamentally, the customer experience is all about the value the customer perceives in two ways – i) their interactions with the retail brands, and ii) the offerings they receive from those brands in terms of products/services. Thus, it all boils down to the value the customer receives from their relationship with the retail business.

For retail brands, the best part is that now they have multiple opportunities to provide perceivable value to their customers. As retail has moved from transaction focused to being more customer centric and other factors have influenced the sector big-time, the shopping journey has evolved. Here is where retail brands can seize their opportunities to establish their value offerings. For example, while the customer is researching, a retail company can provide the necessary information that the customer seeks, even though the customer is not seeking information with the intention of purchase. Another example is where a customer can be offered an additional discount while their product is replaced due to issues in the products they had initially purchased. These are some of the many instances of how retailers can offer value – either qualitative or quantitative. These valued offerings will cement the brand-customer relationships in the long-run and thus prove to be a mutual benefit for both the retail company and the customer.

How retailers can leverage O2O effectively!

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The O2O concept is not new, rather it has been a buzzword for a few years now but in the last couple of years this concept has started gaining importance. In simple words O2O means online-to-offline where online channels are used to drive customers to the offline stores. The main aspect here however is to make this experience flow between the virtual and the physical channels seamless and impressive.

Below are three ways how retailers can use their existing resources to leverage O2O effectively.

Brick and mortar stores: By treating stores not just as sales channels but also as distribution centers, retailers can leverage their store network to satisfy customer needs by using store level inventory to deliver orders to customers’ homes as well as for click-and collect orders. With these new fulfillment options enabled by the store, consumers can click, collect and return goods as per their convenience. Modern day customers are demanding a better combination of value, convenience and experience and brands who strike the right balance between delivering great product value and offering superior customer experience and convenience will emerge as customer favorites.

Combination of channels: About a few of years ago retailers went about developing websites and mobile applications to expand their presence and some retailers also shifted to an online-only presence without having any offline stores since the trend seemed like the customer was increasingly going ‘digital’. Moreover running and managing brick-and-mortar stores were seen as an expensive and time consuming affair. But the modern day retailers have realized the need to go ‘omni-channel’ i.e. seamlessly integrating both their online and offline channels to enable customers to research, purchase, earn and burn loyalty points, and return, across channels. Brands focusing on getting their omni-channel right will definitely win the customer experience race.

Data Management: In order to get it right in omni-channel retailing, retailers need to manage their customers and inventory across channels. As customers randomly switch between channels while shopping it is imperative for retailers to ensure that the customer demands are satisfied, irrespective of the channel they choose. Here is where data management will help. Having insightful customer data such as past buying patterns and purchasing history, as well as accurate information of the product inventory and stock, and having all this available in near real-time will allow retailers to be proactive towards managing demands across channels effectively and thus mitigating chances of lost sales. Moreover profiling customers will also enable retailers to create and execute targeted promotions and campaigns to spike customer’s interest in the brand and thus boost sales.

The opportunities to create an engaging retail experience

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Gone are the days where retail used to be treated as a transactional business where in retailers sold the products to consumers who came to their stores to buy those and the mutual give and take of the product and the cost was the be all and end all. It has all changed now. While the transaction is still integral, it is just one of the many processes that make the retail business the way it is today.

A shopper not only buys a product from a retail brand, he/she wants to interact and engage with brand across certain stages of the shopping journey which has evolved into a complex, multi-dimensional journey that shoppers embark upon when they want to buy a product. This complexity has come in due to the influence of technology into the retail sector leading to substantial shifts in the shopping behaviour. The point to focus is not on the complexity but the opportunities that retailers have to connect with their end customers.

Consider this scenario – a shopper intends to purchase a mobile phone. So he decides to research about the options and varieties online on the website of his preferred retail brand. He is not happy with the options so he decides to further research on a market place online. Having shortlisted the devices that he could consider to buy, he visits multiple stores to check out the devices, to have an experience of their look-and-feel. Still not convinced of which one to go with, he goes onto social media and seeks opinions. Moreover, he also checks out information portals that review products.

Now, the above shopping journey is an incomplete one since the purchase has not happened yet, however it is interesting to note the number of times the shopper has interacted with the brand through multiple touch-points. From a retailer’s point-of-view, these are indeed the opportunities for the brand to interact and engage with the customer. The above scenario is one of the complex shopping journeys and the complexity can further increase along with the number of touch-points that can be used throughout the entire shopping journey. Again, these are multiple opportunities that retail brands have to interact and engage with the customer and create the impact.

To sum up, as shopping behaviour has evolved, it has provided ample opportunities for retail companies to go beyond the traditional concepts of retailing. Rather, this evolution has enabled brands to meet and greet their customers across multiple stages and touch points of their shopping journey. Ultimately, customers prefer an engaging experience and those brands who will be able to offer that kind of an experience will thrive.

Why is luxury retailing a challenging business?

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Luxury products have always been one of the most admired and sought after products. So much so, that consumers of such products take pride in their possessions and are often considered to be of a higher class. They and their products are the ‘talk of the town’ most of the times in social gatherings and people like to be associated with such class conscious, brand loving and luxury seeking consumers. Luxury products therefore had few options and demanded a high cost of purchase deliberately tailored to a select set of consumers.

But now times have changed thanks to rapidly changing consumer mindsets and the very idea of “luxury” is evolving. The old-fashioned ideas that defined luxury as aspirational, high status, exclusive, wealthy, don’t really paint the exact picture of what customers perceive about luxury products. One of the drastic changes over the recent years is that the new age luxury isn’t for showoff.  Similarly other values that luxury brands exclusively attributed to, such as better quality and style, precise workmanship and great designs, are not exclusive any more to luxury.

Consumers’ tastes are evolving. There is an indisputable appeal for new products and services along with more choice of options yet having the flavor of uniqueness and exclusivity. This has given rise a various breeds of brands such as specialized ones and those that are highly customized to customer demands, thus increasing competition.

Further, along with changing tastes, customer shopping patterns and buying behavior have undergone a tremendous transformation. Traditionally, luxury shoppers heavily relied on physical retail to fulfill their desire for luxury goods. But now, multiple channels have come into the game and customers willingly switch between channels to get what they want. Seamless demand fulfillment across channels necessitates the reduction of various issues such as decrease in quality or other losses that are caused during the course of the supply chain. While older shoppers are still playing a significant role in the luxury market spends, millennials and Gen Zs are predicted to account for the larger growth in the coming years. Moreover, their new spending habits which are faster, more frequent, brand-conscious and trend-driven while being highly influenced by digital platforms.

All these are the modern day challenges that luxury retail businesses, especially the ones still depending heavily on the heritage and traditional processes are facing and there is one way out. They need to transform their retail businesses to omni-channel and employ the right omni-channel retail software to exceed their customer expectations and fulfill their business goals.

Retail is all about…

1. The customer

It is the underlying truth and the ultimate reality for the modern day retail business. The customer has to be at the central focus of the business. Retail brands need to go beyond merely understanding their customers. They must yearn to learn more about their customer so much so that they know every customer well enough to be able to service them appropriately and effectively.

2. The detail

The entire retail business is made up of blocks of processes and operations which need to work together and in tandem for the business to run successfully. As such, attention to details is a must in order to ensure the smooth functioning of the entire business. Moreover, the importance of having details at the granular level can go a long way in enhancing the business, for example having customer details such as which products were searched, which locations were preferred, and so on can help retailers create tailored offerings to their customers.

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3. The 4+1 Ps

This basic principle still holds good. The four Ps i.e. product, price, place, and promotion – are some of the basic foundations of building a successful retail business, add to that another P which stands for the ‘people’ involved in the business – made up of the employees and even the customers. The success mantra for any retail business can be summed up as – ‘having the right products, at the right place and the right channels, at the right price, at the right time, with the right promotions, and driven by the right people and the right processes’. The right retail technology can definitely ensure that the various processes and operations run smoothly for the business to succeed well.

4. The customer experience

The importance of understanding and knowing the retail consumers cannot be stressed more. These are necessary factors to be able to create and offer shopping experiences that can have a positive and memorable impact on customers thus resulting into loyalty, repeat sales and even attracting newer customers to the business. The customer experience in this modern-are retail spans across the entire customer journey and therefore it is essential that retailers leverage each stage of this journey to cement their relationship with the customers.

Understanding Millennial Shopping Behavior is Important for Retail Brands.

Millennials enjoy a seamless experience while expecting a high level of convenience across multiple devices and touch-points when it comes to shopping. There has been a profound influence of smartphones and social media in everyday life. Millennials use these mediums substantially and on-the-fly to get assistance while they are shopping in a brick-and-mortar store as well as to search for coupons and other offers.

Though Millennials generally love to shop in a store, they demand cross-channel capabilities so that they can acquire whatever information and help they seek from any channel that is most convenient to them during the shopping journey. To summarize, Millennials and the newer generations expect a lot more, a lot faster, at their own convenience and at desirable prices. All this has forced retail businesses to evolve and this is an ongoing process.

The below infographic depicts certain important trends about Millennial shopping:

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Millennials have been one of the game changers for the retail industry, demanding versatility, flexibility, convenience, and speed from retail brands. Going forward, this generation along with the Gen Y and Gen Z are set to disrupt the retail industry further. It is high time, retail brands take the right steps to understand these consumers and be able to satisfy their demands.

Omni-channel Retailing is not about the channel, it is about the Customer

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In the modern day scenario, while there are numerous elements that play a role in the success of a retail business, the most essential element is to be responsive to customer demand and meet customer expectations. However this seems to be a challenging ask in today’s digital era as the consumer behavior and expectations are highly dynamic and constantly evolving. For the consumers of today, shopping is no longer just wanting to purchase products — they also demand entertaining, convenient and personalized shopping experiences. Add to this the complexity of handling multiple channels where customers can connect with the brand or shop from.

Omni-channel retailing has gained popularity over the years and now it has become the new norm and necessity for retail business to thrive and flourish. Be it brick and mortar retail companies or e-commerce companies – most have realized the dire need to go omni-channel and are thus adding new channels to their operations so as to facilitate their business with the opportunity to be where the customer is. However, one of the biggest roadblock for retailers achieving success in omni-channel is focusing on the channels and not on the customer. Retailers must understand that very essence of omni-channel lies in delivering a seamless customer experience across channels and hence it is imperative to focus on customer centricity. Here’s how:

Understanding and meeting customer expectations

Considering the shopping habits of today’s shopper it is clear that consumers themselves have dramatically changed. Technology such as the internet and social media have significantly expanded their horizons enabling them to consume more information, find a wide range of products and share about their experiences. Emphasis is on curated offerings that customers seek along with personalized product recommendations. Retail companies can find success by realizing, considering and understanding consumers’ shopping preferences and then using retail technology solutions to provide more personalized experiences. In order to continue meeting the demands of evolving consumer expectations, it is very important for retail owners to follow the shopper journey and then orchestrate information, pricing, inventory and promotions as the consumer moves through to the path to purchase.

Encouraging and enhancing consumer engagement

It is not just about delivering a personalized and seamless omni-channel experience, rather it is about being able to do it consistently. This is what retailers should seek to achieve in order to be able to stay in the game. It is important for the retailer to understand that each and every part of the shopping journey is important. Therefore they must not only focus on the purchase but also aspects like information gathering, opinion seeking, post-sales services, promotions and so on as the customer moves along their shopping journey. Importantly, the retail brand must be able to stay connected with the customer across the entire journey span, transcending multiple channels. Moreover the brand should seek to enhance their relationship with customer through constant engagement that is personalized and relevant to them. Retail business’ success lies in not only realizing that whether the customer purchases or not, every touch-point across the customer journey there is an opportunity for the retail company to meet its customer but also must be seized by the retailer and efforts should be taken to keep the customer positively engaged. With the right retail software, this is definitely possible to achieve.

Creating and enriching customer experience

As mentioned above, retail is no longer about just the transaction between the retailer and customer. It is way deeper than that and retailers must go beyond their usual practices to reach that depth. As the modern day consumers are evolving dynamically, they are not just seeking to satisfy their material wants by purchasing products; they are craving experiences – experiences that will leave an impact on them and want them to come back and stay loyal to the brand. From the customers’ perspective, it is easier for them to stick with a retail brand that stands true to their expectations. Retailers must constantly look to create and deliver enriched omni-channel shopping experiences as well as ensure that these experiences are seamlessly unified and are specially curated for the customer. By creating these personalized shopping experiences across the customer journey, retailers will able to address the needs of their consumers on their own turf – eventually moving from shopping carts to the consumers’ hearts thus leading to sales, positive experiences and brand advocacy. The right mix of retail technology and innovation will make it possible for retailers to achieve success.

Tips to transform your in-store customer experience

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Customer experience is the ‘be all and end all’ for retail businesses today. Every retailer is vying to gain the biggest share of the customers’ attention and wallet in order to succeed; and delivering a superior customer experience is the best way retailers can achieve their goals. Therefore, they need to compete in this intense ‘customer experience’ battle ground. Moreover, for brick and mortar retail companies, the competition gets even stiffer as they have to tackle additional contention from e-commerce retail players. With all this competition and other internal & external constraints, offering a fantastic shopping experience for in-store customers is a challenge for your retail business. However, below are a few simple tips that can help you transform your in-store customer experience.

  1. Offering unique and personalized experience

Knowing and understanding customers not only by the demographic characteristics and buying history, but also following their individual shopping journey. This will enable you to go beyond the usual conventions of customer experience and drive you to innovate ways by which you can make the customer experience unique and personalized. Something as basic as knowing that a customer has visited the store on her birthday and presenting her tailored offers can leave a positive impact. Similar kind of unique and personalized experiences need to be created and delivered. This will set you apart in the perception of the customer.

  1. Channelizing store employees

An important element that stores have over e-commerce is the personal touch factor. Store employees can be the brand ambassadors for your business and can thus influence the customers purchase decisions as well as enhance their experience. Therefore you need to mobilize and channelize your store employees and harness their potential to deliver a superior shopping experience. Investing in training your store employees is essential to the success of your brand.

  1. Providing value added services

More is less in the new retail mantra. The modern day customers are demanding and how. They seek more channels for shopping, more choices of products and expect more value for the money they spend. Though this seems to be a challenging situation, you can convert it into an opportunity by incentivizing your customers with value added services for purchasing from the store. This is like an extra layer of customer service that will go a long way in compelling customers to come back to the store. Simple service options like offering to home deliver apparel after alteration or offering to take old stuff and providing cash coupons for purchasing at the store, are some techniques than can be implemented.

  1. Tendering convenience and reducing time

There seem to be a few specific attributes for in-store layouts that have been tried, tested, and proven successful. Some of these attributes include speed, convenience, cleanliness, and product selection. In today’s fast-paced world, where customers expect immediate assistance and instant gratification, making it easy and quick for customers to find their products or information, or providing them with different payment options for convenience and reducing their wait time at check-out queues, can significantly  enhance your in-store customer experience. Using innovative retail technologies can allow you to add these capabilities to your retail stores.

  1. Rewarding regular customers

You must appreciate the loyalty your customers have towards your offline retail business and reward them. Customer relationship management and loyalty programs with attractive reward schemes are proven methods to enhance the brand-customer relationships. The more you reward, the more your customers will come back to buy from you, resulting into a profit churning cycle for your business while offering a superior experience to your customers. Further, these loyal customers would be your brand advocates who in-turn would use their word of mouth to bring new customers.

3 essential ways to make the checkout experience better

Retail is generally an emotion-driven industry. In order to keep customers happy and loyal, retailers need to consistently promote positive emotion and reduce negative emotion at each and every touch-point in the customer’s shopping journey. Over the last few years, there has been a rise in investment and innovation, with efforts to improve nearly every aspect of the retail shopping journey. One of the most important and critical aspects of the overall shopping experience has been the checkout and even today many retailers are losing out on sales due to a poor checkout experience.

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Here are 3 tips on how to make the check-out experience better

Strike the right balance between data collection and checkout time
The point of sale is a great location and resource for data collection. However, while asking customers for details, too many questions can be a let-down, time consuming and will adversely affect the checkout experience. Having said that, retailers’ must not limit their insight potential at this important touch point in order to keep the line moving. Hence the right balance needs to be struck whereby there is no compromise on both fronts. Data collection and seamless checkout need not be mutually exclusive. Allowing customers to initiate the checkout process for a particular product on the retail brand’s mobile app when they get in line, or even when they enter the store, is one surefire technique that will improve the experience. Another good technique is allowing customers to finish their shopping and seeking their details at a later stage through digital mediums at their own convenience.

Use mobile POS to bust the queues
Another highly successful technique to improve the checkout experience at the store is using mobile POS (point-of-sale). A number of retailers have already used and reaped the benefits of mobile POS. The mobile POS is a powerful tool that will allow to drastically reduce the time per customer by scanning the products while the customer shops followed by billing, thus avoiding the need for customers to even enter the queue in cases where the payment mode is not cash. Thus retailers experiencing a higher number of footfalls at the store and more turnover or looking to handle large queues, especially during peak hours and shopping seasons, the mobile POS system is a definite savior. Also, mobile POS can be used as a tool to capture customer data on the go, consequently reducing wait times while billing. This will certainly improve the checkout experience at the store and prevent ‘lost sale’ situations.

Enable omni-channel integration for seamless operations
Focusing only on the store checkout experience in this day and age is just not enough. The checkout experience has to be seamless, convenient and fast, no matter which channel the customer decides to purchase from. And this can be achieved with the right omni-channel integration of previously disparate systems and processes. Having a truly omni-channel driven retail business will facilitate the seamless transfer of data regarding customers, products, inventory and so on, between the various systems including the point of sale system at the store. This enables auto population of customer data during thus negating the need to capture data during repeat purchases, or allows access to uniform product information such as pricing and availability across channels. Thus the customer can shop from wherever they want to, whenever they want to, quickly and seamlessly.

With the help of the right technology – a combination of both hardware and software, retailers can improve their business processes while creating better and seamless experiences at the time of checkout.

Applications of AI in Retail

Application of AI driven process in retail will not only help retailers acquire new customers, but also boost repeat business. Increased accuracy in personalized communication to the customers along with tailored recommendations and offers will compel shoppers to strengthen their loyalty as they will begin to associate the retail brand with personalized, relevant experiences. Having realized this, retailers are looking to invest and use AI heavily in this coming year

According to a research, global spending on Artificial Intelligence (AI) in retail is expected to grow nearly fourfold over the next four years, from $2 billion in 2018 to more than $7 billion in 2022. This is expected to happen as retailers look at new avenues to boost their efforts to offer personalized customer experiences. As such, retailers will heavily invest in AI tools that will allow them to differentiate and improve the services they offer to their customers. These tools, ranging from automated marketing platforms that generate tailored and timely offers, to chat-bots or voice assistants that help to provide instant customer service, will be in the radar of retail brands.

Progress in AI and machine learning in the recent years gone by and those to come will be exponential. The combination of AI, cloud, Big Data have already begun the transformation of the retail industry and this will reach new levels in the near future. As AI leverages big data to personalize experiences, retail companies are looking at these applications to garner robust competitive advantages. As per the report, retailers’ spend will be the strongest in the customer service and sentiment analytics area to understand customers’ reactions to the products purchased and the service received, all being possible with the application of AI in analytics. This will prove to be the breakthrough for retailers looking to improve their customer experience.

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AI will also be able to help in actually predicting the purchasing behaviour as well as the needs of in-store customers. This means that sales staff can have this kind of information handy and will therefore have an idea of what a customer is looking to buy before they even ask for help. This will be a huge step in predicting the customers’ needs in advance and being able to serve them aptly thus revolutionizing customer service at the store.

AI driven insights would also be leveraged to not only design new product ranges but also to plan and create marketing and promotional campaigns and offers. Optimizing product pricing and discounting with the help of AI will prove to be beneficial to retailers. Further AI-backed demand forecasting is also increasingly becoming an essential tool for retailers. Understanding customer demand and accurately planning and managing inventory has become critical, especially during mega shopping events such as Black Friday, Cyber Monday, Singles Day and Chinese New Year. Demand forecasting with the help of AI will definitely empower retailers to be prepared for such big events in advance.

Mentioned above are some of the applications of Artificial Intelligence in the retail business and as time progresses, these applications may get further enhanced and there may be new ones that retailers may want to use and fuse into their businesses to further enhance their customer experience across channels.