Our chief marketing officer Axel has recently interviewed Cate Trotter, who is the head of trends at Insider Trends. Cate has vast experience in retailing and advising big brands such as Lego, Unilever and Chanel.
Axel : What top trends do you see within digital in the retail industry?
Cate: There are two mega trends that I think are happening in retailenvironment at the moment. The first is that the technology is reinventing everything. Online and offline stores are now able to have insights into what’s going on in their stores. Websites like Amazon use disruptive technologies and constantly make retail evolve. We see this from drones to widgets that work with people’s voices.
Axel: Especially the one click buttons they have, if you are running out of detergent you can just click and they deliver to your house the next day.
Cate: Exactly. On a more conventional level, retailers can now see everything that’s going on within their stores, optimize and personalize everything completely and join everything up. Technology is really the key driver in retailindustry at the moment. Also, all of these innovative technologies are actually providing new ways for retailers to bring in new type of human experience to the forefront. For example, with technology that lets customers virtually queue; customers can have a more enjoyable time in the store and browse around. Furthermore, with personalization, customers now can have a way better experience. So there’s this new type of customer focus that retailers can and should have. Human and technology are the two big trends.
Axel: Within these trends, which retailers do you think are really paving the way with these innovations?
Cate: I think Made.com and their Soho showroom is one of the best in-store executions. It’s a furniture showroom and all the items of furniture have NFC tags on them. Customers can go in and pick up a tablet that Made.com providesand if they want to know more about any of the items of furniture they are looking at, they can hold the tablet in front of the NFC chip and it will show any piece of information. It shows reviews, it could show a video if it doesn’t already, so any piece of digital context will be seen in the store. Customers can add anything they like to their online wish list so they can go home and talk to their partner about their purchases, and then buy online later. That really joins up the online and offline experiences. In my opinion, it is a great example of merging technology into in-store practices and creating a valuable experience out of it.
Axel: How do you see the relationship between people who use retail stores to browse and compare? Do you think it is a serious problem or if not, how are the retailers engaging with it?
Cate: I don’t think retailers can fight it. I think they need to have a fully robust strategy of doing things very differently. One example is Apple having their own products in their stores and they don’t care if people go in the store, use the items and then buy from different suppliers. There are other retailers who are launching exclusive lines or white labeling other third party lines so you can only buy it in their stores. For example BestBuy stock a whole line of a brand that you can only buy that in their stores. There’s also a whole new business model that is developing around this. There are a handful of retailers that now charge the product brands to stock items in their stores. So again they don’t care where the final sale comes from, they are using the retail space more as a marketing space than a selling one – one where they can introduce the customer to thesenew brands and designers. Then customers can either buy them from the store or online but it doesn’t matter because that space is already making its own money.
Axel: That’s a completely new revenue stream right there.
Cate: Yeah, so it’s not about trying to prevent customers from buying the exact same thing for less money on a different channel. I don’t think that can be avoided.
Axel: There are certain innovations that are going to change the industry. In retail there are so many technologies as you mentioned that in a way will change the behavior of the people customers. Creating blue ocean revenue streams is indeed a key target for every retailer. You briefly mentioned Made.com. That really connects well with indoor location data. Today, websites such as Amazon capture all the analytics around what product you search or how long you spent looking at a specific product. But until recently, when it comes to physical stores of retail, some retailers used clickers to count the number of people passing by and that’s where their data stopped. So I want to ask, what do you think about the importance of indoor location data?
Cate: To be able to grasp everything that’s going on in their stores is a quintessential benefit for retailers who use indoor data. People have invented tags with accelerometers and they have Wi-Fi and Bluetooth enabled widgets. Someone would pick up a piece of clothing and put it down again and the retailer can see how many people interact with that kind of clothing regardless of how it relates to sales whether they make the purchase or not. The idea of using all the location data to get a heat map of your store is brilliant. Be it an offline store or an online page, heatmaps help retailers to understand, analyse and later make the necessary alterations.
Axel: Do you think this technology and retail intelligence, as of now and into the future, can actually drive sales in retail?
Cate: Totally. They can test almost anything they can think of and find out what works, and then optimize the whole retail ecosystem. So, definitely data insight is adding value to retailers.
Axel: On that note, what advice would you give to retailers who are looking to adopt these technologies? How should they approach from finding them and trialing them, to really embracing that innovation?
Cate: It’s about running small experiments. First of all thinking about what’s the human effect, what’s the customer experience that you want to change, or what’s the benefit to your team that you want to deliver for the insights you want to gather. Then try and work out the smallest experiment you can run within that. Regardless of the actual return on investment, the boosted learning curve is the key valuable aspect.
Axel: Although some retailers may see learning as fantastic, usually they would also demand returns. As these technologies are relevantly new, immediate returns on investment might not be possible. So what advice would you give to retailers and brands who are more interested in seeing the return rather than the learning curve?
Cate: In my opinion, the main returns come from the learning curve. So the real test is, are people really using the introduced technologies in the store and does it really add value to the actual experience? There are some stores where lots of things are written about their RFID magic mirrors, but no one uses them. But in Made.com, we found bunch of old people using the tablets and they have the computers at the back of the space and they were looking things up.
Axel: I believe, retailers want technology to lead their operations because of two main reasons. The first one is obviously marketing. The second one is that they genuinely understand the value of what technology or innovation can bring and they are actively investing in it. These early adopters will be the ones who will be able to grasp the long-term benefits easier than their peers.
Do you use any retailing related apps within and if you don’t, is there any that you would like to see in the future?
Cate: I use Argos Stock Check, their system do work well. Because I’m really busy, being able to find out that something is in stock in their local store before going and picking up is brilliant. And that has really changed my expectations as a customer actually. No more wondering around and not knowing if anyone would have the thing I actually needed.
Axel: I agree to innovations like that provide a really good experience to consumers. Are there any other innovations that you would like to see coming in retail?
Cate: Have you heard of Offer Moments? They have personalized digital billboards. It is currently based on a map so that’s slightly tricky that the users have to have the app in their pocket. I’d like to see a tweak on that where as you walk towards it, it recognizes who you are and has useful advertising or an online profile where you are fully in control of your own data and you could say I trust these brands to access this data but I don’t want others to access it. Also if there’s something in your mind that you wanted to find you can put that to the profile.
Axel: For example, Intel recently created a camera with face recognition, it can recognize whether you are male or female, your age and couple of other input just through facial recognition. At the moment it is at marketing level but I wouldn’t be surprised if in the future technology reaches to that point. That’s kind of what we are doing at Pointr where through the mix between app and app-free solutions, we can recognize where people are with real time accuracy and thus give them intelligence about what’s around but also give the venue intelligence around who was in the venue, how much time they spent by which products and how many times a week they come. We have with the app and the smartphone version and there will the only visuals version that will also merge with our technology and give that seamless, omnichannel experience that everyone is talking about.
Cate: I think that the next stage is to actually link up all these omnichannel selling functions with a little marketing.
Axel: I think that is a fantastic note to wrap it up. Thank you very much for joining us.