Digital Shopping: Elevating Brand Interaction
Brands are using data and digital technologies to tailor experiences, services, products, and promotions to the individual for “digital differentiation”
In recent years we have seen how customers’ needs and expectations have evolved around how they want to shop, engage with and experience brands. Digital has played an enormous role in accessibility and how customers get what they need regardless of their physical location. The pandemic only accelerated this digital transformation. Overnight brands were shifting their focus to digital and virtual experiences to connect with and provide for their customers. By 2030, consumers will interact with an average of 15 connected devices and 95% of global retail will be facilitated by eCommerce by 2040. How will brands keep up with customers’ expectations and demands as well as ever-growing competition? Brands must explore new formats and leverage data, customer insights and digital technologies to cater to consumers in hyper-personalized ways through curated experiences, services, products, and promotions.
Data Driven Hyper Personalization
The idea of “me-commerce” is the growing expectation of a highly personalized shopping experience. By leveraging customer data and information from purchase and search history, companies can target customers with unique offers and a customized mix of products they actually want, simplifying their decision making and helping them connect to the brand. Most shoppers are willing to share their personal information if they receive personalized offers and content that they believe bring value and purpose. This also results in building trust and loyalty between customers and the brand. To bring value and more purposeful exchanges to their customers, brands are leveraging AI to be real time predictive and obtain insights that will help them deliver meaningful, hyper personalized content.
Social Commerce
Media consumption and screen time skyrocketed during the pandemic, highlighting the need for businesses to find new ways of engaging with their customers through entertaining content and media. Brands are exploring experiential retail by delivering physical, digital, emotional and cognitive content, creating unique customer experiences on social media platforms. Videos, social media apps like Tik Tok, and partnering with popular influencers have all helped brands entertain, inform, communicate, and sell to their customers, leaving them with memorable moments, not just products. Many brands are also giving their customers the option to shop directly from a social media platform, making purchases right from the Instagram post or news feed.
Aerie has posted double-digit growth, often over 20%, every quarter for the last 6 years. A key component of its marketing strategy: targeting customers on social media platforms like TikTok using popular influencers. An April 2020 campaign starring teen star Charli D’Amelio generated over 2 billion views on TikTok, and an 855% increase in traffic to the site.
New Immersive Experiences
Brands are leveraging physical and digital touchpoints by experimenting with AR, VR, mixed use spaces, digital shopping platforms, contactless interactions, and delivery experiences to meet the connected needs of their consumers. Virtual stores like the Ralph Lauren Virtual Experience and Cost Plus World Market give customers an immersive and 3D experience. Using live streaming and virtual fitting rooms customers can peruse aisles, click on products and engage with sales associates. Taco Bell, Starbucks and Chipotle Mexican Grill are among D2C Brands who have opened digital-only physical experiences in the US. Amazon’s Go locations feature new cashier-less technology where customers can just grab what they need and go.
Subscriptions
Consumers are shifting from buying products to subscribing to services. Instead of paying to own assets, people are paying to use them, a model that gained in popularity during the pandemic. Subscriptions can give customers back the luxury of time by saving them trips to the store and not requiring them to think about ordering, replenishing or scheduling purchases and services. Brands are introducing new distribution models and ways to subscribe to products and services, following the likes of Uber and AirBnB to provide convenient and unique experiences. Using AI to analyze customer data, subscriptions can be personalized and curated to meet the needs and interests of consumers across multiple touchpoints.
Optimizing Value Chains
As we look forward to a more resilient future, retailers have been looking to reimagine experiences and modernize operations to reestablish competitive advantage, keep pace with digital growth and meet the evolving needs and expectations of their customers and direct consumer. All while driving profitable outcomes. Modernized value chains driven by new digital capabilities drive profitability and customer experience. Automation has become the new outsourcing, significantly reducing processing times to meet customer expectations. Robots and AI are being used to automate warehouses to provide reliable stock data in real time, helping to improve inventory control, stock flow, smart predictions, and forecasting.
Brands are investing heavily in technology that will help digitally transform and enhance their global networks. The goal is to create more agile inventory systems, product information, order management systems and orchestration methods to offer greater assortment, accessibility, and availability to customers. These investments in technology help customers get the products they need, when and where they need them. Some common examples include same day delivery services, BOPIS, and curb side pickup. Target’s digital sales grew approx. $10 billion in 2020, driven by 235% growth in same-day services.
Conclusion
As we look forward to a more resilient future, retailers must reimagine experiences and modernize operations to reestablish competitive advantage, keep pace with digital growth and meet the evolving needs and expectations of their customers, all while driving profitable outcomes. By using data and digital technologies to streamline all aspects of the business to focus on the consumer, brands can identify where, when, and how to create memorable experiences that meet the unique needs of their customers, driving loyalty and profitability.
“Want to learn more about this topic? Connect with a digital expert at Hellodallas@slalom.com
Natasha Brown has 12+ years of experience in corporate retail, eCommerce, and customer experience that she leverages to drive digital solutions for clients. She is passionate about how both internal and external customers experience and engage with brands, helping clients explore their digital landscape to create unique strategies designed to anticipate their customers’ needs while exceeding their expectations.
Slalom Customer Insight is created by industry leaders and practitioners from Slalom, a modern consulting firm focused on strategy, technology, and business transformation.
