Now that the curtain has closed on NRF 2020 and the dust has settled, we want to share our key takeaways from the three-day conference, along with the implications for your customers. While some of the news was bleak, there is plenty to be optimistic about in 2020.
Create Shared Experiences
Social acceleration is real; consumers are stressed. We don’t have enough downtime, so we continue to work 24/7. Addiction to our mobile devices is creating isolation, and shoppers are suffering from decision fatigue amid general economic uncertainty and have lost trust in brands.
As an antidote, consumers are craving shared experiences. That is why community matters, perhaps now more than ever. Brands can play a role by creating destinations where shoppers can gather, in either the digital or the physical world. Deploying online forums and chat groups, for example, can help cultivate connections among shoppers as well as between your shoppers and your brand. In-store events drive traffic to the store and bring shoppers together. But the approach must be authentic, because consumers will see right through you if it isn’t. Authentic brands convey their brand story and value proposition clearly and persistently across all touchpoints.
Brands often make the mistake of growing old with their customer base. Younger generations, however, are growing up to challenge traditional norms, so you have to be flexible and embrace change. Generation Z consumers live in the moment. They want immediate gratification, even when it comes to paying for purchases. PayPal, Venmo, and other alternative forms of payment are gaining in adoption rates. This generation of digital natives demands a new generation of retail.
Loyalty and Personalization: Focus on the Human Element
Loyalty involves a strong interplay between the physical and digital worlds. Do what’s best for your customers—listen to them, but make sure acting on their needs works with your business model. Loyalty programs rooted solely in a points-based tier structure are obsolete. Go beyond points—your shoppers are more than the sum of their purchases. Use these programs to build on those emotional connections with your customers.
True personalization means retailers have to toe the line between being “creepy” and being “relevant.” Customers are conveying what they need and want, and you need to listen. You must be customer-centric. In-store, there is a new mandate for associates to be more personable and engaging with customers and to spend less time on tasks that take them away from customer interactions. To become customer-centric first means to focus on the human relationship at the core.
Personalization and loyalty are like the chicken and the egg; one begets the other. And both personalization and loyalty begin with data—more importantly, smart data. Harnessing the right data can help to provide your shoppers with solutions that will make their lives easier. Retailers must not only be ready to meet shoppers’ current needs but must anticipate their future needs as well.
Contextualize Your Commerce
Contextual commerce is gaining traction, especially in terms of social and voice shopping. Indeed, we’ve heard it before, but it can take an iterative process to perfect new technologies and marketing strategies. Voice is a natural extension of how we communicate as humans. Voice is contextual, convenient, and immediate. For the past decade, keyword relevancy has been the focus, but the future will center on situational relevancy. Social platforms are digital communities where your shoppers already gather. The next dot to connect is to effectively (and authentically) leverage your social efforts in order to decrease the gap between discovery and conversion. In the end, those brands that can successfully connect with consumers at the moment of inspiration and discovery will win.
“Channel-less” is the new omnichannel. Consumers don’t “see” channels: they don’t differentiate between in-store, mobile, mobile app, and so forth. It’s all one unified brand experience to them, or should be. Customers expect a seamless, frictionless experience, so keep the journey uncomplicated and inspiring. Discovery can begin in one channel and end with a sale in a different channel. Every engagement is an opportunity for an immersive experience.
Invest in Sustainability
Sustainability is more than a trend: it is a fundamental shift in consumer behavior. Consumers are educated and are becoming increasingly socially conscious in regards to their carbon footprint. They are consuming less and focusing more on the value they receive from the products they buy. Meanwhile, returns are projected to cost brands $400 billion in 2020. The environmental impact from the fashion industry, in particular, is of grave concern. Consequentially, the exploding resale market is being embraced by shoppers of every economic level. Consumers want to know how their products were made, and they want to shop with brands whose social values align with their own. Retailers who invest in sustainability measures will attract shoppers.
Don’t Neglect Your Brick-and-Mortar
The physical store is evolving— today it is about creating experiences within brick-and-mortar environments. Developing new partnerships, creating exclusive products via collaborations, and utilizing pop-up locations are some of the ways in which the physical store is being reimagined. But stores must still work smarter on the back end—they should be a hub for order pickup, fulfillment, and returns, connecting the digital to the physical. Consumer demand for sophisticated technology is continually growing, both in-store and online. But you can’t provide technology just for technology’s sake. It must be relevant to solving shoppers’ pain points.
Now is the time for change management and thinking differently but staying true to your north star—your brand. Retailers can often be hindered by legacy systems and status quo thinking. You must have curiosity, agility, and flexibility to endure. It will take-next generation thinking to reach a next generation of consumers.