A new playbook for the retail & fashion industry to deal with undisciplined consumers.
Business leaders are frequently quoting that “the only certainty is change”. They couldn’t be righter but yet so many companies lack the necessary set of attitudinal and behavioral competences that can truly drive change.
The retail and the fashion industries are probably the most impacted by the change in the DNA of consumption and living habits, powered by the widespread digitalization and life appization, which makes each customer absolutely unique and drives the need for a hyper personalization of products, services and value propositions.
Consumers are facing a lack of social references to build their personality and turn to brands for guidance, identification and leisure, really trusting in brands to lead them in times of uncertainty.
But brands are not being able to keep the pace with consumers – according to Havas Media Group Meaningful Brands study for 2019, 77% of brands could disappear without getting noticed by the consumers. Why? Because they lack relevance and don’t add value to their lives on a personal and/or collective way. As a marketer, manager or citizen, ask yourself – why should I miss this brand?
The Meaningful Brands study also proves a connection between meaningfulness and retention, challenging brands to reflect on their own core beliefs and drive away from interruption or outbound marketing to a more personalized customer experience, powered by increasing digitalization and data abundance.
Key challenges
The fashion and retail industries are facing a number of significant challenges, namely:
- Increase meaningfulness
- Drive experience-based differentiation
- Engage and blend online and offline behaviors
- Optimization of operations
- Personalization and customization
Businesses will shift their focus from market share to attention share, because attention will be the most valuable asset for consumers and companies. This means that each interaction should be thought in context to deliver the right message, with the right creativity, in the right setting and in the right moment.
But what are the main areas where successful retail and fashion businesses are already reaping success from their investments, in terms of ROI and ROM (return on meaningfulness)? We’ve identified three:
LIMITLESS RETAIL
Companies should adopt both limitless mindset and operations. Consumers should be allowed to buy anything they want, anytime, anywhere and anyhow. Digital has (almost) no bonds and so consumers expectations. Adidas has shoppable interactive windows, Kim Kardashian has launched a Shazam for clothes, EasyJet allows users to make travel reservations with a simple photo of their desired destination and Zara has dedicated areas in offline stores for online orders pick-up. The purchase experience should have no boundaries.
FRICTIONLESS RETAIL
Each obstacle in the shopping process is a potential moment of loss, or delight, for consumers. Companies should find their “1 click buying button” just like Amazon, thinking how to make the buying process leaner, easier and uncomplicated so as to improve conversion and the average buy, along with the consumer’s delight. It also implies blurring the distinction between online and offline.
Zara is launching self-service checkouts to avoid lines and more and more companies are organizing stores as showrooms, moving away from POS and attendants. Amazon launched GO, a supermarket without POS or assistants, and eobuwie, an online shoe seller, launched a physical store that replicates the more intimate experience of online buying.
AI AND THE DATA DELUGE
“In God we trust, all others must bring data” said W. Edwards Deming and now we are overwhelmed with data, but companies are not being able to deal with it in an intelligent and actionable way. High hopes are laying in the use of Artificial Intelligence, but the real challenge is the human transformation that goes with it – managers and employees need to understand that AI will not replace humans but assist them making enhanced humans focusing in what they do best – interpret and decide.
Stich Fix is a subscription and personal stylist service where an AI assistant makes a set of recommendations to the personal assistant that he/she can review, change or endorse, allowing him to focus on choosing without losing time with non-adding value activities. John Lewis and Farfetch offer virtual fitting rooms with advice. Amazon has launched a physical store only with 4* rated products embedded with online elements.
What about people?
The change is, and it will be, human at his core and for that companies will need to engage and energize communities, turning consumers into micro ambassadors and influencers, while betting also on strong attraction management with a combination of retail, entertainment and leisure.
A last word of warning
Brands should not look at tech and creativity as the last shiny thing and go after it just for fun – they should considerer result-oriented creativity that is measurable and accountable.
Another potential pitfall is the lack of human touch, because in the end it’s all about people’s lives and therefore brands should not forget to make their communications meaningful and consistent (and consistency is not “doing always the same thing”), making a difference in people’s lives with everything they do.
