Which 5 trends are building the future of retail?
NRF 2018 was always set to be a special one, as it marked the first event in which Vantiv and Worldpay came together as one.
After speaking with our new colleagues, existing customers and partners while scouring the show for the hottest topics in retailing and eCommerce, here's my roundup of the most intriguing and impactful topics.
1. Create communities to add value.
There were many discussion around adding value to the product purchase journey across channels by creating community and improving communication with your shopper. Some examples:
A subscription model where shoppers get a monthly box of toys and treats for their dog. Barkbox have created a great community that identified types of dog toys based on animal behaviour - selecting the right type of toy for the right type of pet. They also curate games and videos for their community on how best to spend some quality time with their dog and how to get the most out of playing with them.
Lego are now using stores as theatres. It's about personalisation and allowing people to play and have fun. The key question to answer when defining the concept of the store is “what will be the memorable brand experience in this store?" And this needs to be a two-step process:
1. Meet the fundamental needs of consistency and location
2. Create an emotional experience
Building a community: "Barkbox has built up and monetised a loyal group of dog owners with its personalised content - the right food and toys for the right dogs has equalled the right customer experience...for the humans too."
2. Social media is key.
Retailers are starting to really consider social media as an additional sales avenue, and some are even designing products just for Instagram or Facebook messenger. This could be a key differentiator for those brands that "get it right'"in the months to come.
3. Data, data...data!
Retailers can explore different business models by sharing their data with providers. Currently, only around 0.5% of the world's data is analysed - even though 90% of this data is so new that it was only created in the last two years!
An example of great data usage:
Rent the Runway
The shopper gets four to six designer items per month on subscription with Rent the Runway. Key is the amount of data they give back to the designers. If the shopper wore the item, for what occasion? How long do the garments last after dry cleaning - just two dry cleaning sessions or for 30? Where do the items start to deteriorate or break?
Also, designers are starting to use the website to test potential products, to see if their shopper fanbase will buy them or not.
Rent the Runway also turn their stores into logistics hubs (see trend number one above!) - a great use of brick and mortar retail space to attract brand engagement while mixing offline with online sales channels.
Rent the Runway turned stores into logistic hubs for subscribers to drop products and check new ones - but it's their data that really impresses: shoppers trial clothing and report back directly to the designers on durability, style and a number of insights that benefit both parties.
4. It takes localisation to be truly global
According to Amazon, the most important "local" elements are: payments, the supply chain and compliance.
- You need to offer the preferred payment method by country and by geographic area.
- Much of the time, large global logistic companies are more expensive and less reliable and precise than local companies.
- Compliance issues change by market, especially invoicing, tax calculations and reporting.
5. AI is powering retail growth
AI has a massive potential impact, and there are many user case across the whole commerce process, from start to finish. Some examples:
Consider + browse
Cosabella uses AI to identify the best performing ads with highest conversion,allowing the firm to increase investment on these; eBay has image recognition that can show products that look like the image users have uploaded.
Decide + transact
On eBay, search is improved by AI to show shoppers relevant products. Cosabella uses product personalisation to show you recommendations for additional products based on items frequently bought with the items in your basket.
1-800-Flowers were the first to implement Facebook chat payments and enable purchases through Google assistant and through Alexa!
Rent the runway is using AI to identify which products to have in stock in stores based on sales performance in that area.
Chatbots can be used to improve responsiveness of customer service throughout the process, and could be used to manage returns or exhanges.
And finally, back to the beginning...during the manufacturing process, Tommy Hilfiger uses QR codes right from the design stage of new products to sales.