If anything is true of retail today, it is that retail is in a state of reinvention and disruption.
While the future is uncertain, one thing we know is that the role of technology will only accelerate.
Last week the Technology Association of Georgia hosted an event to highlight this future with thought leaders from the world of Connected Retail. Key topics included customer loyalty, mobile, big data and personalization in the context of retail and customers.
While technology plays a critical role in the future of Connected Retail, Phil Rubin from rDialogue (a customer loyalty and relationship marketing firm) set the tone early that technology for the sake of technology is not the objective.
The real need is to focus on customers.
After all, every retailer seeks greater revenue from customer engagement and loyalty versus ‘owning the best technology stack’.
The top retail imperative must be to become customer centric
Among global affluents, loyalty program membership is down 20%.
Pretty simple. Today, retailers – and other marketers – view loyalty as a program where customers must show loyalty to brands.
In this ‘tried-and-true’ model, customers must spend or relinquish personal data for the promise of an enhanced relationship.
But, rDialogue argues, there is a better model – one they call Loyalty 3.0.
A model where brands are loyal to their customers.
That subtle, yet important shift can make all the difference.
“Allow us to pay attention to you and we’ll make it worth your while”
The example of Amazon is often overused for retail.
However, for the New Loyalty Model for Retail, it is an appropriate case study.
More than any other retailer, Amazon is customer obsessed.
They make it simpler and easier to do business with them than any other retailer.
They treat people well and, as a result, they are a trusted retailer. They are not always the lowest cost, but rather almost always the lowest risk.
This engenders great loyalty from customers.
In fact, recent research indicates that Amazon Prime membership has climbed to somewhere between 49-65 million members. That’s roughly 45% of US consumers.
Relevant Dialogue Required
Loyalty has always been about a value exchange. Consumers will share their personal data if the value you give is greater than the perceived cost. Therefore, Brands must provide overwhelming value. The way to make that happen today is not just about lower prices and rewards, but more so that engagement must be relevant. The focus on relevant messaging comes to life with assistance of data and technology. These are enablers for this higher-order customer centricity (not the drivers). To be successful retail communication must be relevant now (time), relevant here (place) and relevant to me (message).
Connected Retail = IOX or IOT?
This is perhaps the greatest implication for Connected Retail: the Internet of Things is the wrong way to think about it.
IoT focuses on the technology and ‘things’ .
The Internet of Experiences, or IoX, starts with people.
We must understand people as customers and shoppers first.
To understand who they are, what is important to them and how your brand fits into their lives.
Then, and only then, should retail dream up how to create the experience and then how to bring it to life with technology.
The future of Connected Retail will be won by those focused on greater customer centricity, using technology to make the Internet of Experiences a reality.