Over the last few years, how many times have you heard a retail executive say “We must put the customer in the center of everything we do”? It’s a common goal, and while many brands have invested in what they believed would deliver an amazing consumer experience, their efforts haven’t always hit the mark. In an era of increasing consumer expectations, technological innovation, and industry mega-disruption all converging simultaneously, it’s time to dig deeper to find out what’s really working and reflect on where brands still fall short on delivering relevant, contextual and intimate consumer interactions.
It’s a time of retail renaissance
Today, we find ourselves not in the midst of a retail apocalypse, but a retail renaissance. This renaissance means that brands must rethink consumer experience — and how to invest in it — to thrive.
To help brands grow their relationships with shoppers, Salesforce and Deloitte surveyed over 500 traditional retail, pure play, consumer goods, and branded manufacturing leaders globally to help educate the market and paint our shared vision for the future.
Our 15-page joint research report, Consumer Experience in the Retail Renaissance, looks at the current business-to-consumer landscape to discover how organizations harness consumer data, experience and technology strategies to deliver relevant and personal engagement across touchpoints, from marketing to commerce to service.
Addressing the four disruptions behind the renaissance
Need more proof that the retail apocalypse is exaggerated? Consider (1):
- Retail spend has outperformed GDP and risen every year since 2009.
- In 2017, 44% of consumers reported spending more on retail than 2016. Only 14% said they spent less.
- Brick and mortar is predicted to grow by $36 billion by 2022, and ecommerce is predicted to grow by $50 billion in the same period.
There’s reason to be optimistic. However, brands must understand the four key disruptions behind the renaissance before they can address them.
1: Consumer Disruption
Thanks to the proliferation of smartphones and connectivity, consumer expectations for speed and convenience have reached new heights. Ten years ago, a five-minute wait at a department store checkout line would’ve been easily overlooked. In the current climate of one-click ordering, that same wait could feel like forever.
2: Technological disruption
No facet of retail has gone untouched by technological revolution, from awareness to purchase and from brick-and-mortar to ecommerce. Thirty-four percent of shoppers say they’ve researched a product online using a mobile device while in a physical store, and innovations such as AI allow brands to personalize across every consumer touchpoint.
3: Competitive disruption
The days of competing with a few other stores in your neighborhood are over. Today, brands race against literally thousands of competitors, including behemoth marketplaces, nimble pure plays, and new business models like subscription services.
4: Economic disruption
Income and expense pressures have driven a bifurcation in consumer behavior, where growth has occurred primarily with price-based and premier brands. Those in the middle have fallen behind. U.S. retailers, in particular, at either end of the spectrum have tended to perform better (Figure 1), forming the great retail bifurcation.
Thanks to these four disruptions, brands must understand what matters most for consumers they target and more deeply examine the changes in their shoppers’ preferences — because no two brand’s shoppers are alike — to determine what’s driving their behavior and tailor experiences accordingly.
Of course, focusing on consumer experience isn’t new. But it’s now more important than ever for brands to rethink their approach and revolutionize their organizations from within.
Join Kevin Hogan, managing director, Deloitte Consulting LLP; Rob Garf, VP, and Heike Young, manager, Salesforce, at Salesforce Connections at 12 p.m CST, Thursday, June 14, to learn more. Register here today.
Kevin Hogan is a senior leader in Deloitte’s Retail and Commerce Practice, specializing in helping companies transform their business to take advantage of emerging digital opportunities designed to drive revenue growth, increase cost efficiency, and optimize the customer experience.
