Journey of the Future Shopper

Associate Consultant of Strategic Business Research

A few years ago, several economists and news outlets predicted the gradual demise of brick and mortar stores as eCommerce entered the scene. But today that doesn’t entirely seem to be the case. While eCommerce is soaring, new-age shoppers today seem to still like a hybrid approach to retail. A hybrid model involves the customer being involved in both eCommerce as well as retail stores during some part of their shopping journey.

This demands the retailers today to invest in omni-channel marketing strategies. Retailers have to make use of multiple platforms to close a sale including but not limited to – email, in-store, online, social media, online display ads, and more.

 

Who is your typical new-age customer and what do they want?

The new-age customers are more interested in the experience and convenience you provide than the product itself. According to a study conducted by Gartner about 100 million customers will prefer shopping in AR both in-store and online by the end of 2020. Consumer expectations and behavior is not only changing but also evolving with advancements in technology and automation. This change is motivating many retailers and brands to transform digitally.

Customers expect brands to understand their shopping needs

They expect retailers and brands to offer a seamless shopping journey. According to a report published in ‘State of the Connected Customer’, 70% of the customers prefer connected processes like contextualized engagement inspired by previous interactions with the retailer/brand. And at least 76% of customers simply expect the brands/retailers to know what they want. This is why detailed analytics and analyzing consumer shopping patterns is crucial for business now more than ever.

Customers expect new & personalized experience

The new-age customer loves being pampered, and who doesn’t? They want to be spoilt for choice and be offered something that is tailored for them. Customers are twice more likely to view a personalized offer than an offer targeted to a general audience. Customers are more likely to shop at your store (both online or physical store) if you make use of modern technology derived from AI technology such as AR experiences. Almost any customer would immediately sign up for an AR-based trial room than actually trying on all the pieces of clothing they shortlisted at the retail store. This AR app can measure them checking if the size fits plus they can see how this particular yellow t-shirt pairs with those green pants (probably not that great!).

 

How does the shopping journey of a new age customer look like?

 

What are companies doing to meet the new-age customer expectations and improve customer experience?

 

Development in technology has disrupted the traditional form of shopping. New-age customers have a lot to do and have very little time. Which is why getting things done with a few taps on their mobile screens seems to be the most convenient and time-saving. This is also why new-age customers look at convenience as a premium and don’t mind spending a bit extra for it – for example, paying extra for shipping costs or groceries home delivery from their local supermarket.

Brands are turning the customer’s surroundings into a digital playground by using Augmented Reality technology and projecting it into their physical environment to try and infuse the real and the digital world. Brands like TopShop and Timberland installed virtual fitting rooms using AR technology. This allowed customers to see how a particular piece of clothing looked on them without actually trying it on.

To understand customer patterns, companies are always looking for more accurate and detailed insights about customers. For example, Amazon’s machine learning recommendation that works on ML algorithms alone is responsible for at least 55 per cent of the sales. This kind of data requires companies to include more and more touch points where the customers can be engaged. Brands can identify touch points in various stages of the customer’s journey:

  • Pre-shopping: Depending on customer patterns and data analytics, brands and retailers can predict what the customers are interested in and prompt them in the right direction (to your store or website). While it is easy to recognize a customer on your website, it is not the same when a customer enters your physical store. Here, using facial recognition cameras to identify your customers and then send them relevant promotions and offers depending on their purchase history will not only improve customer experience but also increase your chance of making a sale. For example, CaliBurger used facial recognition to identify its loyal customers and pulled up their accounts as they approached the kiosks and displayed order suggestions based on their previous meals.
  • Shopping: As retailers, you have to make it as easy, fun, and convenient as possible for your customers to shop at your store. For example, to make navigating through the store easier, Lowe launched an in-store navigation app powered by AR tech to help customers find their way to the exact products they need. This makes shopping quicker and easier.

Furthermore, you can use immersive technologies like AR and VR to enhance customer experiences, allowing them to realize how it feels to actually own the product and share it with friends via social media. For example, the cosmetics brand, Charlotte Tilbury’s store in the UK uses a ‘magic mirror’ powered by AR tech to let customers see how their face looked with different makeup styles – without actually applying any makeup!

Also, including automated checkout systems would be the perfect way to end the shopping experience in-store. No waiting in long queues, no wasting time for a transaction to complete, etc. Your customer entered your store in a good mood and left with a good mood. Creating a virtual cart for the customer to pay online directly from their credit cards and getting their products delivered home, if they like, is another area not much explored.

  • Post Shopping: After the customer leaves your store, make sure to prompt them to come back soon. Attach promotions or offers with their last purchase so they can use it for their next purchase. Reward them with loyalty points. Prompt a feedback from them for the products they purchase. Ensure that the returns and refunds process, should the need arise, is quick and hassle-free.

 

Final Thoughts:

Retailers have left behind the traditional five P’s of marketing approach and are beginning to revamp their marketing models to satisfy the new-age customer. Through machine learning and analytics integrated with actionable insights and ‘design thinking’ retailers are able to create integrated experiences for the customers.

Target used ML algorithms based on customer’s purchases to identify soon-to-be parents and send relevant coupons and offers to them. Unfortunately, this experiment led to a 16-year old’s father finding out that his daughter was pregnant. While this strategy would prove to be successful, retailers need to be careful when it comes to this level of personalization. A fine line between privacy and convenience must be drawn, letting the customers choose the degree of invasion.

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