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Evolving customer engagement in a changing world

Customer engagement within retail was undergoing great change, with purpose-led businesses coming to the fore and technology like Artificial Intelligence (AI) having greater impact, and then… View Article

GENERAL MERCHANDISE

Evolving customer engagement in a changing world

Customer engagement within retail was undergoing great change, with purpose-led businesses coming to the fore and technology like Artificial Intelligence (AI) having greater impact, and then Covid-19 came along to bring about even more disruption.

Attendees at the recent Retail Bulletin Future of Retail Customer Engagement 2020 webinar, chaired by Darren Williams, MD of Williams Harding Consulting, heard from an array of speakers about how customer engagement strategies are changing during these challenging, but also opportunistic, times.

Changing behaviours

Andy Stockwell, chief commercial officer at RedEye, told attendees: “Everything changed in March. The shock was that product ranges of interest to customers changed overnight. Retailers had to pivot to go after different ranges. The times of purchasing also changed – with browsing earlier and buying later in the day. This behaviour has been kept after lockdown.”

During this period he found retailers attracted different customer segments who must now be targeted in a new way compared with their traditional customer base, which is especially important as the biggest peak in buying [Christmas] approaches. He is very much of the view that there is “no going back to normal”.

Much of this ‘new normal’ revolves around the shift of activity to the online channel that is accelerating the digital transformations of retailers. The situation will undoubtedly prove to be a challenge for many businesses, according to Robert Bridge, former CEO of Childs Farm, who says: “Some are very strong on digital but it surprised me how many had their heads in the sand. They prioritised many other things. They often focused on price and not online. That’s obviously had to shift massively in the last six months and it’s a good thing they’ve had to change.”

Building for the long-term

Luke Phillips, program director at Studio Retail, agrees the growth in online demand has highlighted a need for many companies to change their priorities. “Most organisations had serviced online demand through short-term fixes but this was not sustainable long-term. Businesses now need to look at the bottlenecks caused by this rapid move online. Too many businesses had a ‘if it’s not broken then don’t fix it mentality’,” he says.

He is an advocate of retailers moving away from investing in – undoubtedly very appealing – shiny new things and instead focus on putting money into the boring technologies that ultimately keep businesses running.

Alongside this investment in the ‘plumbing’ part of retailers’ businesses is a need to also retain a focus on ensuring a seamless customer experience. This should also involve a greater level of personalisation across the various touchpoints. This is very much in the strategy of Rebecca Saunders, founder of Seekology, who says: “We’ve replicated the in-store experience online. It’s a safe and impartial way to buy beauty. We’ve developed online skincare consultations and those customers who engage with them have much more value to us.”

Powerful role of content

This has been supplemented by a rich level of content, which includes reviews. Some of these are from the Seekology team highlighting their favourite products for which they have become strong advocates. Reviews are also a powerful feature for Lucky Saint where Emily Laws, senior marketing manager, states: “People look for recommendations and ask people’s opinion. We ask people to tell us what they think and this spikes the number of reviews [received]. People are especially looking for reviews online now while the pubs are shut due to Covid-19 and they can’t try the product.”

Seekology has also found the use of video content a “fantastic” asset, especially for a founder-led business because Saunders says people want to hear their stories. The story is massively valuable to those businesses that are purpose-led. They have undoubtedly become the most engaged retailers with a growing number of people who want a deeper connection with the companies from whom they buy goods and services.

Meaningful relationships

Mark Dunhill, CEO of sustainable fashion business Stelar London, says: “Owning a Stelar bag is more meaningful. It gives us a competitive advantage to have a powerful, differentiated message. Once the story has been told and the product described then you’re onto a winner.”

The growth in the appetite for authenticity, transparency, diversity and sustainability will further drive the success of purpose-led retailers. Shalom Lloyd, founder of Naturally Tribal, says: “Gone are the days of nice and shiny. Instead people want meaning so much more. Consumers want to know where things come from and who makes it.”

Although she acknowledges it is easier to create a purpose-led business from scratch than to introduce this philosophy into an established operation she believes it is possible and even her young business undergoes constant re-evaluation. “We don’t stop. We’re relaunching and rebranding shortly. Our products are all natural but we are constantly evolving them. You have to [constantly] look at the end-to-end supply chain,” says Lloyd.

She adds that engaging with customers in order to solicit their suggestions on how to move your business forward is a sensible approach and can become part of your journey as well as adding to the authenticity of your operation.

Engaging with AI

Engagement with shoppers has certainly been developing at a great pace of late as AI has played an increasing role. This is despite it being seen as a “daunting subject” to many, according to Stuart Dorman, chief innovation officer at Sabio Group, who suggests: “Many retailers have not got their heads around it and just see it as a chatbot. It’s about pattern recognition and making specific recommendations on the basis of these patterns [in data].”

He cites the situation of a customer on a website whose behaviour, based on recognising the patterns from their actions, could lead the retailer to determine whether they are looking for customer services, looking to buy or browsing. They can then be dealt with accordingly. “In-store the assistant will recognise the different behaviours and it’s the same principles online but with the use of AI,” he explains.

Although Dorman does accept that tackling AI can be a daunting prospect he suggests: “Start small and treat it organically when you use it with certain customers. At Marks & Spencer we used it in the call centre for a few scenarios initially before growing it out to hundreds of them. Start small and build from there.”

Geoff Bull, chief marketing officer at sofa retailer Swyft, very much agrees and says experimentation is vital and that there are various free AI downloads that can help in the early stages. Ultimately he believes AI will be widespread throughout the retail industry. “AI will seep into people’s lives,” he predicts, citing the ease with which his children shout commands at the AI-powered Alexa device at home.

Words by Glynn Davis

Join us at Retail Bulletin’s next event, the virtual Omnichannel Futures Conference to be held on 10 February. Reserve your free place here

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