The march toward digital transformation has been underway for some time. Slowly in some industries, more rapidly in others. What we once considered smaller components of our collective behavior — remote work, distance learning, telemedicine, curbside pickup — are now considered the new normal. The acceleration of digital transformation has been swift and abrupt, and the ripple effects are likely here for the long haul.
As businesses react to unexpected changes in customer behavior, they must also balance the downstream impact on their future plans and roadmaps. In this high-stress environment, it’s easy to lose focus. This is especially true for those verticals selling directly to a customer base thrust into a new world of digital adoption and, subsequently, new expectations.
At WWT Digital, some of the current retail trends and themes we’re actively tracking and working on with clients include:
- Grocery chains owning their own ecommerce experience rather than depending on outsourced platforms.
- Restaurant chains establishing their own digital technologies to escape the limitations of current third-party options.
- Retail stores quickly expanding their contactless experience with current technology, but with an eye on long-term implications and scalability.
- How to set the foundation for real customer understanding by reevaluating enterprise data gathering, integration and analysis.
These complex strategic questions can materially impact people, processes, long-term operating models and technology investments. These are challenging decisions in the best of times, and the current climate is exacerbating things by adding additional pressure and confusion to the decision-making process.
When things seem most uncertain, it’s often best to get “back to basics” to evaluate the best path for evolving digital maturity and growth. Key areas of evaluation include:
- Consumer experience and expectations: Simple, efficient and right the first time.
- Fulfillment: Contactless experiences are here to stay.
- Marketing: Anticipate customer needs and focus on your purpose.
- Consumer data and analytics: Changing behaviors require new evaluation and new data.
By evaluating these areas in more detail, companies can likely discover opportunities in the near-term while establishing some reference points to better evaluate plans for future growth.
Consumer experience and expectations
Now is the time to evaluate your consumer experience in a new light, particularly given that new users groups have emerged through forced adoption and existing users may have new expectations and ways of interacting. It’s time to reevaluate and update personas and user segments to better reflect where your experience is meeting your customer’s needs and where it’s coming up short.
- Experience mapping will be more important than ever given shifting consumer behaviors and retail upheaval.
- Old personas and customer journeys may be rendered obsolete and will need to be retooled to account for very different shopping behaviors.
- User experience (UX) and information architecture (IA) will be profoundly changed as new delivery and fulfillment models are incorporated into traditional ecommerce structures.
Contactless is now the new norm for everything from cars, mortgages, groceries and games. Curbside pickup and expanded delivery options are not only expected but may be required for some time. How brands deliver their experience via last-mile delivery will be critical to ongoing success and differentiation.
Here are some of the trends we’re seeing in fulfillment:
- Third-party platforms like Postmates, DoorDash, Deliv, TaskRabbit, etc., are typically only available in major markets and only work with larger retailers and restaurant chains, but they’re expanding rapidly as demand increases.
- The expansion of these services beyond takeout will have a major impact on delivery timelines and availability, and we can expect their ubiquity to impact the overall customer experience.
- In-house delivery will be a differentiator for those that have invested in that capability.
- Curbside delivery will be challenging for mall-based retailers without an outside presence, but solutions are emerging market-by-market.
- Retailers with established “buy online/pick up in store” (BOPIS) programs are extending their capability by updating notification capabilities to enable contactless transactions.
Understanding how to translate new consumer shifts to marketing performance will be challenging and more important than ever. There is a need to talk specifically about how your brand is approaching change and communicating value through your products and services. Some of our suggestions include:
- Talk specifically about how your brand is dealing with the safety of your employees, your customers and your vendors.
- Find a cause and communicate it. Cause-related messaging can demonstrate empathy and develop deeper customer connections.
- Understand how to adjust your existing investment models to accurately reflect the situation.
- Overstocked companies will need to adjust their acceptable acquisition costs given the margin pressures they will face.
- Those companies with scarcity issues will need to avoid paying for traffic that can’t convert due to lack of availability, or for needlessly paying for traffic that would arrive organically.
- Siloed teams cannot move with clarity or efficiency to respond to turbulent times.
- Small, self-contained cross-functional teams will need to evolve and work with the most complete customer data to enable campaigns and executions that maximize business goals.
Customer data and analytics
Customer data will be a defining feature of businesses that thrive compared to those that struggle. While those with a solid analytics practice will be better positioned, it’s reasonable to assume that any existing models will quickly become outdated and may not present an accurate view of customer understanding. Accordingly, our recommendations include:
- This massive acceleration will render most models inaccurate, meaning it will be necessary to constantly evaluate what is being measured/tracked and to use artificial intelligence and machine learning techniques to help predict future behaviors.
- New segmentation of existing data will be incredibly important to better understand the dynamics of digital-first interactions with customers.
- Now is the time to focus on business outcomes instead of “vanity” metrics such as traffic, impressions, ROAS and the like.
- This is also the time to be laser-focused on things like revenue and profit, marketing ROI, new-to-file customers, order recency and frequency across segments.
- Those behind the curve on customer data will need to quickly invest in tracking technology that provides an automated foundation for better decision making.
- Data science will be necessary at all levels of the organization to make holistic customer decisions rather than relying on the siloed functional choices most operational models use today.
While these are challenging and somewhat daunting times for our industry, we’re confident that with focus and discipline companies can emerge with an even greater ability to create experiences that lead to long-term customer loyalty and growth.
WWT is learning and leading on these topics with a diverse group of customers and partners every day, and we’d be happy to talk through the specific challenges you’re facing. Our ability to help identify the key strategic experience components that matter most to your business, and to provide the right technology solutions to support your growth, can lead to great things — even in these turbulent times.