In-store customer experience – a top retail focus for 2021

Retailers have never before had to be so agile and flexible, shifting their priorities as the industry changed shape before their eyes. Trends that were ‘bubbling under’ accelerated rapidly courtesy of COVID and retail looks very different to two years ago. I’ve been talking to retailers about their revised priorities. What I am hearing, and is supported by expert 3^rd party research, is a consistent pattern of four key priorities: in-store customer experience, knowledgeable staff, personalised loyalty programs and social media marketing.

In the new retail world, with so many shoppers having moved to online purchases, brick and mortar stores have offer something different if they’re to get customers back through the doors. The in-store customer experience is that differentiation.

Upside-down retail – In a report based on its recent research, Unibail-Rodamco-Westfield refers to ‘upside-down’ retail, where brick and mortar stores dedicate more floor space customer experiences than products.  Westfield was predicting the ‘tipping point’ as 2025, but have now revised that view, seeing it coming as early as 2022.

The power of tech – Technology and automation enhance customer experience – existing initiatives such as contactless payments, self-checkout, BOPIS and curbside pickup will all continue to gain momentum, and will rely ever more heavily on barcode and OCR-enabled apps for maximum efficiency.

Amazon’s cashier-less ‘Just Walk Out’ technology, which uses a combination of cameras, shelf sensors, computer vision techniques and deep learning to eliminate the checkout, will be applied by retailers whose customers want speed and convenience.

Analysts Forbes see the continued use of Artificial Intelligence (AI) and Augmented Reality (AR) to enhance the customer retail experience. Already, 20% of shoppers want interactive AR mirrors for trying on clothes, for example. AI will help retailers to flawlessly manage stock across multiple locations, increasing inventory visibility and contributing to customer experience by ensuring that the right stock is in the right stores at the right time.

Focus on local – Consumers have shown a marked preference for local stores over the last 18 months, a trend that looks set to continue, so retailers are looking to emphasise local ‘flavour’ within each brick and mortar store. Shopping venues are becoming community hubs, and according to Westfield, 9 out of 10 retailers are planning some form of community initiative by the start of 2023.

Loyal customer advocates, customers who purchase regularly and encourage others to do the same, generate profit and revenue. Strong loyalty programs continue to be a key focus area for retailers, with more emphasis than ever on personalisation at scale. According to McKinsey, when retailers use the detailed data from a loyalty program to increase share of wallet in already loyal customers, they can increase sales by 1-2% in grocery or more in other forms of retail. Not only that, but with increased customer satisfaction rates, and a reduction in marketing spend of 10-20%, it’s not hard to see why personalised loyalty programs remain a top priority.

As shoppers’ on-screen time increased over the last 18 months, so did the power of social media and influencers. Shoppers are more easily persuaded by the recommendations of family, friends and celebrities than they are by retailers’ own advertising, so retailers will use an increasing portion of their marketing resources on generating interest, awareness and sales via social media.

After a time of massive change, retailers are adapting their strategies for a new retail landscape. They see the key to success in that new world as dependent on customer experience, knowledgeable staff, strong loyalty programs and social media marketing.