#21interviews: Data is key to the future of shopping
by Nompumelelo Mokou. Trends in online shopping have been advanced by years. This acceleration is an opportunity for all retailers to establish a balance between the online and physical shopping experience.Thursday, 17 Dec 2020
by Nompumelelo Mokou. The restrictions on people, particularly around lockdown, social distancing and large gatherings brought about by the Covid pandemic have encouraged, or rather forced, a massive change in buying behaviour for many people around the world. Trends in online shopping have been advanced by years. Amazon, the massive global online retailer has hired around 500,000 people between January and October this year. To put that number in perspective – it took more than 20 years for the company to reach its first 500,000 employees. It has since doubled its staff in eight months. This kind of hiring surge has never been seen in corporate America.
Although the trend is to shop online across sectors, bricks and mortar stores will still be with us because nothing can quite replicate the in-store experience. I suggest that this acceleration is an opportunity for all retailers to establish a balance between the online and physical shopping experience. In this context, smaller retailers such as specialist shops might in fact move quicker than large corporations who tend to have more bureaucratic decision-making processes, as well as legacy systems that might hinder systems and process transition. It essential for both large and small retailers to maintain a low-cost base, sufficiently easy to use channels, e.g., WhatsApp, a store app, etc; as well as efficient no-hassles shopping experience.
The key to finding this balance is about understanding customers and hyper-personalisation. Data analytics and data management still stands out as key enablers in understanding customers. All interactions with customers lead to a collection of data. There are various technology tools and solutions that enable retailers to understand their customer trends, of course within the allowed ambit of related legislature. In addition to this, technologies such as virtual reality (VR) and augmented reality (AR), will also play a significant role here in hyper-personalisation of the shopping experience. Customers have a plethora of choices, getting and keeping their attention is essential. Sometimes though, it is just about offering a convenient and personal shopping experience.
Data allows retailers to interact with their customers at a number of levels, from simple location information to detailed profiles of online behaviour. Obviously, there is a negotiation, a careful path that is walked by both parties that draws a balance between information gathering and surveillance, that allows the personalisation of the shopping experience without forcing people into certain behaviours. It is about convenience, meeting customers’ needs, and making them feel special.
Pinpointing online behaviour – in store
It is interesting to think that when we log onto a website like Amazon or Netflix, we’re each recommended different things. This is because data insights gathered from our online behaviour has allowed the services providers to anticipate our needs, and constantly adopt our profiles to likes and preferences. Now imagine if this online experience could be somehow tied into our in-store experience, for example, using interactive displays, touchscreens, digital storefronts, magic mirrors, virtual dressing rooms and in-store kiosks to order out-of-stock items. This is what the seamless integration of online and offline (bricks and mortar) shopping is about. Shopping online or in-store should be efficient, easily accessible, safe and secure and leave the customer satisfied.
As far back as 2015 (which is a long time given the rate of change in this area), American retailers were using Pinterest pins to track products that were trending; and using that social data to promote those trending products in their brick and mortar stores, with relevant signage. Companies would also use Wi-Fi to track customers in stores and analyse information gathered by their followers on Twitter and Facebook.
Fashion retailer Bonobos started off as an online company, but has now enhanced their operations by establishing physical stores. The store is a space for trying on and ordering clothing that is then shipped home to the customer separately. Ad Libris, a Swedish online bookseller, has also gone the route of setting up stores as a way to enhance customer experience and engagement. Also, in Sweden, the fashion company Bambuser offers online live shopping via video link with in-store assistants. IKEA, the Swedish furniture retailer, now uses AR as part of its annual catalogue that allows customers to “virtually” scan IKEA furniture into their own homes, and so get a great feel for how it looks, without having to go to a store.
You get a sense of the range of options and possibilities available to retailers wanting to combine the online and physical shopping experiences. I sense an opportunity for online food delivery companies to start offering recipe and menu ideas to people based on what they’re buying. You can then start offering special deals on ingredients based on shopping habits. It’s about keeping the customers’ attention, as well as ideals assuring them that the store knows and understands them.
This merger of the online and in-store shopping experience is in its early days. It will be interesting to see how it evolves as the balance between the two spheres shifts and becomes one. Technology, and more specifically data, will play a key role in this move to a seamless shopping experience. It will also be interesting to see how Africa’s vast informal retail market evolves. It will also be interesting to observe the transformation and inclusiveness of larger retailers given some of the continent’s challenges of poverty, legacy infrastructure, lack of internet access and constantly changing customer needs.
For more insights from retail and brand leaders in the #21interviews series publishing 1-21 December 2020, ahead of 2021:
#21interviews LAUNCH: 2021 comes with a disclaimer, by Louise Burgers, Publisher & Editor, RetailingAfrica.com.
#21interviews: Brands need to get brave, says Bozoma Saint John, Global Chief Marketing Officer, Netflix.
#21interviews: The power of being purpose-led will drive brand value, by Karin Du Chenne, Chief Growth Officer Africa and the Middle East, Kantar.
#21interviews: Plan for growth in 2021, says Herman Botha, Group General Manager, PNA Group.
#21interviews: Next year will be all about authentic visual immersion, by Craig Bellingham, Founder & CEO, Studio[K]irmack.
#21interviews: Covid has created a brand vulnerability, says Elouise Brink, Senior Marketing Manager, Country Road, Woolworths Holdings.
#21interviews: Reimagining a better world without the inequality of ‘normal’, with Economist and Author of the post-pandemic book, FutureNEXT, Dr Iraj Abedian, talking to Retailing Africa Publisher & Editor, Louise Burgers.
#21interviews: Embrace technology at all levels, says Thabani Maluleka, Business Development Director for Rogerwilco.
#21interviews: It will not be business as usual, by Dave Nemeth, Trend Forecaster & Founder of at Trend Forward.
#21interviews: Lessons from an unprecedented year in retail, by Jonathan Hurvitz, CEO, Teljoy.
#21interviews: Beware ‘Covid fatigue’, by Guy Yehiav, General Manager, Zebra Analytics, part of Zebra Technologies.
#21interviews: Be deliberate in listening, says Zizwe Vundla, Marketing Director of Diageo South Africa, talking to Retailing Africa Publisher & Editor, Louise Burgers.
#21interviews: Critical factors for retail growth, by Enver Groenewald, Group CEO, Ogilvy South Africa.
#21interviews: The future of micro-commerce in Africa, with Vahid Monadjem, CEO and Founder of Nomanini, talking to Retailing Africa Publisher and Editor, Louise Burgers.
#21interviews: Plan for a ballet of black swans, by Rachel Irvine, Founder & CEO, Irvine Partners.
#21interviews: Consumers are investing to connect, says Shani Naidoo, Group Director, TFG (The Foschini Group)
Nompumelelo Mokou is the intelligent customer experience executive at Dimension Data. A Chartered Accountant by profession, she has always had a love for business. She has co-founded a project management company; has been chair of the Business Women’s Association of South Africa, Soweto branch; and has headed up marketing and business development and finance in the past at various firms.
– Receive the Retailing Africa newsletter every Monday and Thursday • Subscribe here