e-commerce for many years was an interesting trend, but it was just e-commerce. Today we don’t even know what e-commerce means. They’ve just come together, the on and the offline. Now, every merchant, every retailer must have an omnichannel strategy or they won’t survive.
omnichannel is often used as the catch-all phrase as a key to succeed in selling to the consumer, but using it effectively truly separates the winners and losers. Successful retailers will be those that offer the best customer shopping experience, including price and value relationship, which will vary by consumer, either in store or online, with the best delivery time and ease of return. Retailers need to be focused on their target consumers, understand what they want, when they want it, how they want to buy it and what they are willing to pay for it.
That’s very different than just 24 months ago. There in my opinion will be no death of the retail store but there will be a transformation of retail real estate but definitely no end to it. People like to shop and they like the entertainment factor that retail engagement provides. As omnichannel takes hold stores will become fulfilment centers as much as full-fledged shopping experiences. Stores are going to be highly technology enabled. In the not too distant future, you will see a fundamental restructuring of retail real estate—you will see distribution centers, local economies, technology-enabled shopping, and a very different approach toward how you engage with the consumer. And that engagement is going to be omnichannel, not mobile not internet because no one will even consider the difference. That is when we will know the retailer has a successful omnichannel experience.
Many retailers have spent their entire lives thinking about how to build an engaging experience in one channel, which is the store. But now, understanding how to connect with your core customers across every way they want to connect—not the way you want them to connect, but the way they want to connect with you—is a different skill. It requires design and product management. It requires understanding how to market in a digital world.
There are still many instances that I see where it is old-school marketing. It’s still about major TV campaigns, get people into the stores. That’s still important, and that’s not going to go away. But understanding how to engage in a world of exploding social networks, how to use search, how to use catalog, how to optimize, and how to engage—very different skills. I think that is going to become a core part of the playbook for retailers and merchants of all sizes around the world. To compete and to build a competitive advantage the use of data will drive this marketplace.
Great data is both art and science. There’s a lot of press about the science; there’s not as much about the art. But the truth is that judgment matters a lot. You could create an infinite number of segments and an infinite number of possibilities from data, but creating an infinite number of possibilities isn’t an actionable strategy. It’s not about big data, big data is important for an overview and overall trends but it’s now much more about small data. Big data is almost meaningless. Big data is about big data sets that represent large groups of people and large behaviors. But in the world that I mentioned before, it’s about the retailer connecting with the customer. The customer does not want to be part of a big data set; they’re just looking to buy a shirt. And that’s about small data. That’s about understanding insights that the retailer can glean about the customer that does not feel intrusive, does not feel creepy, and does not feel artificial—but feels natural.
That, to me, in my opinion is the future of retail.