Today, Salesforce and Deloitte Digital launched the Consumer Experience in the Retail Renaissance report, a global survey of more than 550 traditional retail, pure play, consumer goods, and branded manufacturing leaders. The research sheds light on what elite performers do to win shoppers and how their strategies suggest a model for success.
The report found that we’re in the midst of a retail renaissance, but what does that truly mean? Rob Garf, Vice President of Industry Strategy and Insights at Salesforce, explains this transformative period’s implications for brand engagement with shoppers. He also advises brand leaders on the most innovative strategies available today to overcome the pain points that arise in the absence of unified consumer engagement.
At a high level, can you describe what this report evaluated and what retailers need to know about the retail renaissance?
In the midst of one of the leading conferences for retail and ecommerce, Shoptalk, Salesforce and Deloitte released a brand new report: Consumer Experience in the Retail Renaissance. Our report analyzes responses from more than 500 brand leaders on their business models and how they optimize for successful consumer experiences. Respondents discussed everything from their use of emerging technologies, such as artificial intelligence, to their core value propositions. One thing that stood out to me was the fact that 39 percent of survey respondents were members of the C-suite, so this is truly a survey with leadership clout, illustrating where shopping is headed.
This research helped us uncover how and why certain strategies are keeping elite performing retailers (brands whose revenue increased more than 10 percent in the past fiscal year) on top during a time when brick-and-mortar stores and online experiences are converging alongside never-before-seen technologies. The combination of these variables has acted as a catalyst for an era we’re now calling the “Retail Renaissance,” where brands are implementing new ways to provide customized and seamless shopping experiences to customers.
Why is it so important for brands to rethink their approach to the unified customer experience, and what trends can we expect to see in the future around unified engagement?
Retailers now have a treasure trove of consumer data that offers unprecedented insights around shoppers’ habits and preferences However, these insights are a double-edged sword. Now that retailers have access to this data, they are under critical pressure — brought on by consumer expectations — to make the most of these insights and hyper-tailor their offerings to their consumers’ preferred experience.
Our report takes retail data analysis one step further and examines the strategies that elite retailers are putting in place to best serve their shoppers. In today’s retail climate, growing revenues by 10% or more in a fiscal year is phenomenal, so we wanted to look at what those true market leaders were doing to change the game. Two key ways these top brands are staying ahead of the competition include:
- Unifying the customer engagement experience: Elite performers are 3.2x more likely than underperformers to be executing a strategy for a single consumer engagement platform, reflecting the importance of taking a unified approach to marketing, commerce, and sales initiatives.
- Focus on speed and agility: 70 percent of elite performers are agile enough to quickly respond to consumer demands and insights vs. 37 percent of underperformers. As pressure builds for brands to personalize their customer engagement in real-time, it’s increasingly important that retailers prioritize speed and agility in their customer engagement.
So, for example, when we look at what Design Within Reach is doing in the furniture space, we see that data and agility are helping the brand set itself apart. According to Bethany Kemp, Senior Vice President of Operations, “There’s a lot more competition online than there was in the early days of our business, so it’s more important than ever that we build close connections with all of our customers. We need to customize every communication and interaction.” Design Within Reach has become a trailblazer by developing increasingly personalized services to provide true differentiation and drive loyalty in their market.
How should brands be reimagining their value propositions?
Traditionally, brands have had a one-track mind when it comes to value proposition, with nearly 60 percent of companies surveyed reporting that their product is their differentiator. But in this new era of consumer experience, product is simply not the be-all, end-all differentiator. Elite performers are realizing faster than others that their value proposition actually lies in providing an unforgettable customer experience. That experience is what drives loyalty and inspires shoppers to return to a brand, time after time.
What is the biggest challenge for brands in moving to a unified platform?
Surveyed brand leaders say they’re battling an average of 39 front-end systems to manage customer engagement. This means that their point-of-sale, mobile, call center, ecommerce, email marketing, social, and content management are all run by different platforms. Thirty-nine systems? Most of us can barely keep track of a few personal and professional communication channels a day. That disjointed network is not only inconvenient, it’s also costly in terms of poor consumer relationships. It can take months or even years to unify. But the end result is worth it.
With so many disjointed systems, the consumer experience — particularly at the top of the marketing and sales funnel — is extremely disconnected, according to what our survey found. Brand leaders rate their biggest consumer experience challenge as engagement and discovery (32 percent), followed by awareness and acquisition (24 percent). In this retail climate, I don’t have to tell you that the top of the funnel is a painful place to struggle.
Let’s talk about data in the retail space. What should retailers who want to be elite performers know to stay innovative and data-driven?
Data is king, and elite performers recognize this. Surveyed brands across the board plan to employ nearly 50 percent more data scientists over the next three years. I love the enthusiasm for data, but brands shouldn’t rush to hire an excess of data scientists without the infrastructure and processes to support their talents. Underperformers lag in a few key areas that beg resolution before data scientists can help, including governance (68 percent are deficient here), agility (63 percent can’t respond to consumer demands in an agile way) and security (unfortunately, 54 percent of underperformers don’t have rigorous compliance and security to monitor and protect consumer data, which is concerning, to say the least). Hiring data scientists before you figure out these core competencies is putting the cart before the horse.
While data scientists are certainly valuable to retailers, brands also should know how to prioritize data access and actionability — that’s the first, and most important, order of business.
The prioritization of data-driven insights will allow brands to offer hyper-personalized engagement, like tailored pricing, optimized search, and personalized content, making the most of their customer engagement and ultimately increasing conversions. Today we’re talking about Apple Pay and Alexa. Tomorrow, who knows what innovations we’ll be talking about? But I can assure you that data and cross-functional teamwork — aligning the journey across marketing, sales, and commerce — will continue to be fundamental to success.
Conclusion
As consumer behaviors change and new technologies continue to emerge, it will be vital for retailers to stay abreast of these trends to and pioneer new technology solutions. Blazing the trails ahead with innovative new strategies is possible with data as the bedrock. We’re seeing a massive shift in the industry toward unifying around the customer. This transformation is just getting started.
For more insights about the Retail Renaissance, download the full report and get highlights here.
