What I Learned about Customer Experience from The Retail Prophet
Navigating the Future was the theme of the 2018 ICFA Educational Conference. In line with the theme, the event kicked off with a keynote that helped retailers visualize what the future of shopping may look like and how they can navigate what’s ahead. Doug Stephens, the founder of Retail Prophet and author of Reengineering Retail, gave a thorough overview of influencers in retail. He also presented 5 key attributes of exceptional retail experiences, that he defines as S.U.P.E.R.
First he reviewed current retail influencers…
The statistics Stephens shared to set the tone for his keynote were truly mind-altering. Over 8,000 stores closed in the US in 2017 and gave way to a +24% increase in eCommerce spending. Talk about a monumental shift in shopping behavior.
He shared a vivid story of where eCommerce can go through the performance of China’s Black Friday equivalent, Singles Day. On 11/11/2017, e-Tailer Alibaba generated $8.6 Billion in the first HOUR of business. Yes, you read that right. Stephens went on to further demonstrate just how significant this is by pointing out that H&M only conducts $42 Million a YEAR. This means Alibaba exceeded H&M, a global retailers’ fiscal year sales by 3x every minute on Singles Day. Further, Alibaba’s sales were 2.5x the performance of every single retailer in the US on Black Friday. While we are constantly presented with facts about eCommerce growth, these comparisons really demonstrated the potential of online shopping.
The picture continued with an update on Amazon’s market share, which is an astonishing 60 cents per every new dollar spent online. Stephens noted that “Membership eats loyalty for breakfast,” something to think about in building repeat business. 82% of households with an income over $100k have a Prime membership. In fact, customers spend $99 annually to conveniently shop with Amazon Prime, so why would they go anywhere else to purchase? Don’t worry he has a great answer!
He also shed new light on Amazon’s purchase of whole foods, noting how their access to customer’s grocery bags provides an endless wealth of data on demographics and lifestyle alike. His last noteworthy point on Amazon was that they are transforming into a shipping operation. Amazon is extending their logistical capabilities with Amazon Flex; think of being an on-demand Uber Driver, but delivering Amazon packages for $25 an hour. It’s a genius way to meet consumer’s high demands for shipping, while not having to overstaff in the offseason. What’s the point of sharing all this? It’s about reinventing the wheel and breaking the mold.
Before you start thinking that there is no silver lining, there is. Because as Stephens notes Amazon is not a platform for fun, discovery, and experience. This is where the keynote delivered an action plan.
The Harmonist
The good news for in-store experiences is that shopping is a human endeavor, a fundamental social and psychologically pleasurable experience. Stephens dug beyond the simple fact that customer experience is important. He went around the world to analyze the best of the best in retail customer experience. He was able to pinpoint 5 distinct qualities that were shared by the top experience providers in the world. He calls this the S.U.P.E.R. Store.
Here are the 5 S.U.P.E.R attributes of the top retail experiences based on real-world examples around the globe:
SURPRISE Customers There are too few genuine surprises, yet the retailers Stephens found that were leading global retail experiences managed to delight their customers unexpectedly. This reminded me of a social media campaign Lord & Taylor ran recently. To boost social media engagement, they asked their customers to post items that they were #obsessed with on Twitter. The customers were shocked to find the items delivered to them, free of charge, a few weeks after the campaign. What an exciting way to spread the word about your business through user-generated content AND inspire new customers to shop with you!
UNIQUE Experiences
His next attribute was to be unique. In a world full of over-stimulated customers and too many options, this one is a no-brainer. Nordstrom has always been lauded for their customer service, but their new store concept is a hot topic. Customers can pick up their online orders in-store. However, instead of just taking the bag and hitting the road, the clothes are waiting for them with a personal stylist to finalize their choices. That’s one way to eliminate buyer’s remorse. In addition, alterations can be made while the customer sips champagne or gets a mani/pedi. Talk about luxury delivered in an out of the box way.
PERSONALIZE Interactions
This challenges a retailer to create a one on one interaction. The goal Stephens stated was for the customer to leave a brand experience saying, “that felt like it was just for me.” His example here was perfumer The Harmonist. An interactive, sensory process allowed each customer to determine their own personal scent. The Harmonist then blends the custom perfume letting each customer leave with something that is truly one of a kind.
ENGAGE on a Deeper Level
Stephens highlighted several exceptional examples of engaging customers and how they all redefined what an in-store experience was. It had less to do with the physical product and more to do with what that product would become in the customer’s life. Globetrotter, an athletic gear retailer in Germany, delivers ground-breaking experiences around their product. From scuba diving tanks to all-weather chambers, customers can field test new apparel in store. People seek the socialization of these experiences and share it virally, a win for the company in many ways.
REPEATABILITY
Of course, perhaps the most important element of any customer service experience is consistency and repeatability. How bothered are you when you revisit a restaurant to find the same meal you once loved tastes completely different? Repeat customers drive revenue in this country, so retailers need to be on the cutting edge of delivering the above elements of experience and reinventing how they achieve each of these goals.
Globetrotter
To sum up the takeaways…
My biggest takeaway from this keynote that tied this all together was simple yet spot on. Store owners are so worried about digital channels taking away their stores’ importance yet stores that are successful must become a media channel. Consumers are constantly engaging with media and technology. Your store must be a place they want to seek out with their peers to engage. This is a key shift in thinking about what a store’s purpose truly is. A store is not a place for product, it’s a place to highlight your brand and inspire evangelists.
I laughed a little bit at the notion he shared that a store had to be worth a selfie, but I stopped to think about my most memorable shopping experiences lately. My amusement came from how often I photograph my favorite store environments. I constantly Instagram retail locations that inspire, like interactive works of art. I seek out retail locations in new cities I visit, regardless of what they sell, that provide a cultural experience. A great example I shared socially was my time at Savannah Bee Co. in Charleston. Their store was stunningly beautiful and offered unique food and mead tastings through collaborations with other local products and vineyards. It was engaging to my senses, my tastings were personalized to what I was responding to, I was surprised at the variety of collaborations, and found the overall environment very unique. Great job on the S.U.P.E.R. scale in my opinion!
I always love an actionable presentation and Doug Stephens hit this one out of the park. So how will you combine your unique attributes to create a S.U.P.E.R. retail experience?
Savannah Bee Co.
Written by Caitlin Jascewsky. Caitlin writes STORIS’ educational content and manages STORIS.com, focusing on how retailers can use technology to enhance their customer experience. A graduate of the Fashion Institute of Technology, Caitlin worked in retail for 7 years before joining STORIS.