Consumers are changing the retail marketplace through their embrace of mobile technology and their adaptation and mash-up of that technology to support their shopping and purchasing demands. Retailers have been slow in meeting these challenges and this has impacted their sales growth and retention of customers. Many large department store retailers have been focused on strategies allowing consumers to shop any time and pick up or ship any where. These are what I refer to as the purchasing side of the transaction and while this is important, I see consumers focused more on the shopping side of the transaction. In other words, consumers are focused on the social network practices to collaborate with friends and third party service provides to shop for prices, products and services and only engaging with the retailer when they are ready to complete the purchase side of the transaction.
Retailers must embrace a strategy of adaptation both that incorporates both tools and technologies to meet the changing demands of consumers. I see this as the key factor to the future success of retailers and also one of the most difficult challenges to meet. This adaptation starts with a framework that will support the ability to easily add and drop tools. Just as important though is the strategic direction and commitment to collaborate with the consumer to support the changing demands of the consumer shopping practices.
The purchase side of the transaction is probably 10% of the consumer interaction. Retailers must focus on the social shopping side of the equation and change the interaction with the consumer from one of purchase at the lowest price to one of collaboration and social interaction. Consumer retention depends on engaging the consumer in these new social network shopping interactions. Mobile technology allows the consumer to purchase any time and the key to retention is engaging the consumer in the shopping and interaction to increase the likelihood that the consumer will purchase.
Retailers must adapt to the consumer shopping and networking demands in order to maintain sales and success. The large department store retailers have come to realize that a focus on price, or purchase any time any place, will not deliver long term success and is not sustainable for a variety of reasons. Retailers must now expand their focus into the shopping side of the transaction and adapt their tools including their eCommerce site and brick and mortar store experience to focus on shopping and consumer networking. This shift in focus will require a continuous adaptive approach to maintaining and growing the consumer relationship. This will in turn encourage the consumer to return and when they return, whether virtually or physically they will stay longer. This strategy requires an investment in both technology and capabilities for the retailer to maintain and grow the relationship.
And now for the audience participation portion of the show…
ECommerce will have wide ranging impacts on both the retail and manufacturing sectors. How can you focus these abilities to improve the consumer's experience? Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes. In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas. How can you support these continuously changing requirements?