What is the future of consumption? Four things to know:
1. The internet and digital technologies are hired to do everything that shoppers don’t want to do themselves.
2. The retailer’s role is to create great moments for consumers.
3. Every company is an internet company and must be equipped by data, which must become integral to the retail process.
4. We must embrace and accept the changing nature of consumers and consumption. It is a road to discovery that offers many opportunities.
Technology has changed the consumption landscape. Most fundamentally is the shift of the customer to the centre of the retail process, and the need for businesses to be truly customer-centric.
To thrive, businesses must adapt and learn to listen to customers. This can be a challenge for some multinational consumer companies which have the habit of viewing their customers, their needs and aspirations through a western lens. A company that truly listens acknowledges local difference and cultural biases.
The consumption experience
Today’s consumers are looking for an experience when they buy – as much as product or price in many cases. Markets across the world are seeing a rise in experiential retailing.
How “experience” is delivered varies. It may be “the experience of purpose”, of knowing that buying decisions are good for the families, the community, the environment. It may be the experience of shopping in a mall that provides entertainment, comfort and connection. Or it may be the experience of seamless efficiency, from the integration of e-commerce and the physical retail environment, or “the experience” of seeing the product made in-store.
Creating the experience of purpose
People are increasingly looking for purpose in their shopping experience. A sense of purpose, of connection and value is created when shoppers see that their purchases reflect their values or has tangible impact in an area that matters to them.
There is a perception, for example, that recycling is an inconvenience. Managed well, however, recycling is an opportunity to connect customers more deeply to a brand. Brands may be rewarded when they connect their consumer to purpose by, for example, creating a transparent narrative around sustainable operations, how recycled products are used, or even narratives on the challenges the company may be tackling to reduce its carbon footprint. By making the consumer a partner in the process, brands may be rewarded with loyalty, market share and brand recognition.
Trust and transparency
Transparency and trust increasingly go hand-in-hand for consumers. This is something the food and beverage industry has long understood. Supply chain traceability provides an understanding of quality and safety for consumers. Creating a consumer story that is ever more transparent is a model that all consumer sectors are learning from.
The role of data
Both the online and offline consumer experiences are no longer separate. The e-tailer, and the retailer are becoming less differentiated.
E-commerce platforms are redefining their purpose to become data platforms. Their focus is shifting to the data they gather, and how it can add value to the customer and to the business.
E-payment is ever more integrated into offline shopping. Apps like the E-wallet make all purchases – even in-store – effectively online purchases. As people walk around shopping centres, they are, with phone or tablet in-hand, constantly connected.
Retailers must learn to use data intelligence to deliver online aspects to enhance the bricks-and-mortar shopping experience: in-mall navigation, in-store navigation. find-your-car-in-the-carpark tools are examples of applications that integrate the online and offline experience for the customer.
Ultimately, while people will continue to visit physical stores for the shopping experience, the function of the bricks-and-mortar store will evolve. Shops will increasingly become a space for an experience, service centres or fulfilment centres. A systems shift to support more diverse functioning of individual store will accompany this change.