What happens when some of retail’s most progressive marketers get together in New York City? Those that are exceptional thinkers and ambitious futurists. Those who are relentlessly cracking the code on retail’s fate in an eternally evolving world. Zimmerman is on a quest to uncover the trends of the future, ones that will help make our world of retail a smarter experience. Because of it, they decided to bring together those people for 48 hours at Google New York for an exclusive event called Retail 20/20. There, they predicted what our vast world of retail will look like…
HERE ARE THE 8 BIGGEST PREDICTIONS FOR RETAIL’S FUTURE IN 2020:
1. “Stores” will be in consumer’s hands. Literally.
Mobile is the new front door as three-quarters of consumers use mobile as the first step in the shopping process. An overwhelming majority – 90% of consumers – use mobile in-store. Three in ten currently use mobile to buy. Mobile purchases are expected to reach 50% by 2020. (Sources: NinthDecimal, SessionM, Internet Retailer/Forrester.) How can you reimagine mobile so it is your most important store? And, given your category, what is the reinvented role of the physical brick-and-mortar store? How can your brick-and-mortar be a must check out destination through the unique experience you can provide?
2. There are only needles. No haystacks.
No matter how we look at it, these days, relying on ‘mass marketing’ is ineffective. This does not mean to say that broad reach channels like TV should be ignored, but rather, are simply one component with a very specific purpose (typically building awareness). Agencies who paint with a broad brush will not be effective. Today we can be razor sharp and we need to be. On average, people are only willing to drive about 17 minutes for local shopping, suggesting that we need to be hyper-targeted (Source: BrightLocal 2014). If we think of everyone as a needle in that haystack, we now have the ability to find the needles, with less effort wasted on the haystacks of people who may never be open to your product or service. What do your needles look like? Do you know how to find them on a hyper-local level?
3. Worship thy creator.
If content is king, then creators are Gods and Goddesses. They are unencumbered by media convention, and instead are the great pull of their communities, drawing “subscribers” by the tens of thousands – even millions. And they are highly persuasive – 62% of people would try a product/brand suggested by a YouTuber (Source: Defy Media, “Acumen Report, Constant Content 3/3/15). But, beware that not all creators are created equal. We need to strategically identify and use the ‘one-hit wonders,’ the ‘flavor of the month’ folks, and the ones with sustainable social traction because of a strong inherent connection with the content creators. In addition, incorporating the brand and messaging must be done in an authentic way that feels natural and organic to both the creators and the communities. Nailing credibility – for both the creator and the brand – is like a tightrope walk. Instead of just marketing our products and services, how can we build brand ambassadors at the same time? Should content studios be a new division of marketing departments?
4. Clairvoyance is good for business, not just good to know.
90% of people would buy from the company that best predicts their intent – and suggests products intuitively – over all others. Data is power. It’s no longer a rear-view mirror of what took place, but a strategic weapon that looks forward and enables us to reach our target consumer, and our target KPIs. Have you invested in a strong analytics team? Do they have a prominent seat at the table when key strategies are being developed?
5. The store needs to move more people.
We need to create in-store experiences that can connect with consumers emotionally. We can help them feel something that they can’t feel when shopping online. In addition, we need to move past browsing to drive people to complete the sale, because within the last 18 months, we’ve seen that while people are shifting their shopping behaviors away from in-store to online, retail sales are actually flat. Traffic has also decreased; down by about 3% since 2015. (Source: Zimmerman). Because of it, we have fewer touch points with consumers, so each touch point needs to be more effective and work harder to complete the sale. We believe that the correlation between online shopping and online purchasing will be closer in the years ahead, so we need to plan for this behavioral shift. Can you reimagine your in-store experience to connect more emotionally with consumers?
6. “Add-Ons” have added value.
We’re likely all familiar with arguably the most famous add-on opportunity to increase transaction spend, “Would you like fries with that?” Tomorrow’s equivalent will be the ultimate incremental revenue driver, “Would you like an experience with that?” We are heading to a place where experiences are the new things and we need to identify how we can best leverage – and create – them for our products and services in order to make them worth more, differentiated, and enticing to consumers. In fact, 86% of consumers are willing to pay more for an upgraded experience (Source: ThinkJar, The Huffington Post 10/15/15). While we are focused on compelling retail experiences, these experiences can also be in-store product experiences that drive true sales. How can your product create an interactive or immersive experience to create demand? Additionally, what experiences will captive your target, so the decision is no longer based solely on what you are buying? Conversely, what are experiences that are engaging your target consumer that you can turn into a selling opportunity for your retailer?
7. Uncover friction and innovate.
With a plethora of product SKUs and brands, the majority of consumer needs are essentially met. “The real magic happens when you tap into a need that people didn’t even know they have,” says Michael Angelovich, EVP, Head of Strategy at Zimmerman. “The ‘wow-factor’ is a powerful demand trigger.” As such, innovation should focus on finding the friction that people don’t even realize is friction yet. Many retailers fall short because they have it backwards. They look for the ‘wow’ first instead of the consumer friction. Where is the friction in your consumer’s path to purchase? How can you overcome – and enhance – that experience? How else can you engage your UX team? What’s the ideal balance of commerce and cool?
8. Find your “Frenemy.”
As we strive to engage and draw consumers to our retailers, unexpected partnerships may be the key to unlocking greater traction and deeper engagement. Put your ego aside, and seek unconventional partnerships that have the potential to breathe new life into your retailer. Traditionally, partnership strategies were driven by a more linear fit, or natural extension due to a brand’s equity and elasticity. As we look to the future, there is an opportunity to align with new retail partnerships based on consumer behaviors and needs vs strict brand equity alignment. Think CVS within Target. What retailers, brands and passions over index with your target? Can we better transform our retail space so it is more of a media channel?
SO BRACE YOURSELF FOR THE GREAT RETAIL TIPPING POINT…
…where stores will be in the palm of our hands.
…everyone will be treated as every one.
…content creators will be held in the highest esteem.
…we will be one step ahead of our consumer.
…emotions will run high in-store.
…people will order a side of ‘experiences.’
…invisible friction will spark innovation.
…and, the most seemingly unlikely retailers and brands will be sitting side by side, driving people to unlike-no-other retail destinations.