Retail Transformation – Act now, and save (yourself)
If you’re an avid marketing reader, no doubt you will have been inundated with daily blog posts of the goings on at SXSW – the annual tech, music and film festival in Austin, Texas.
Rather than chronicle the daily events, over the coming weeks I’m going to synthesise what I believe are the big trends I witnessed over multiple days of brain-exploding stuff.
Now there have been the cynics that write off Cannes as a festival of ads that will never run, and SXSW as a celebration of things that will never happen, but those people would have most likely hoped that someone would re-tweet those bon mots, which is a verb that didn’t exist 10 years ago.
There’s so much to choose from, so I’ve decided to focus on retail. And the single biggest observation I have for retailers is this: unless some form of digital transformation is on your roadmap now, you will not exist at scale in 10 years time, and here’s why.
If you picture digital and physical retail as two ends of a pendulum swing, the swing to digital has been unmissable. But physical retail has endured because of factors such as immediacy, immersiveness, personal service, and the tactile experience of the product itself.
But I have bad news for retailers with physical or even blended retail assets – your digital-only competitors are solving for the traditional constraints of online, and they are doing it fast.
In terms of immediacy, take eBay’s purchase of Shutl – an online delivery service that can have goods delivered “in minutes, or at a convenient time” with a single click at check-out, or from your favourite store. While the logistics of Australian cities may make this challenging, with youth unemployment at a 12 year high, this kind of service could take off like a, well, rocket.
And in terms of immersiveness, I had the joy of walking on Mars courtesy of Oculus Rift virtual reality glasses at the NASA stand. A colleague of mine got to try out the next generation of this technology and apparently it’s even better. If you want to dismiss VR as fringe, consider there are already companies like Marxentlabs that are aiming to make this technology a plug and play solution.
In terms of personal service, the field of artificial intelligence service avatars has come a long way too. I went to a demo of IPSoft’s “Amelia” that they estimate will not only cut cost, but call times too. In Australia, the degree to which we can offer personal service is heavily constrained by our cost of labour, so the opportunities are obvious.
And as for the tactile experience, consider ThirdLove, a specialist bra manufacturer whose app can size a woman perfectly.
Yes, the technology is fractured and the cases are isolated. But that is changing fast.
The real reason to amp up your digital transformation isn’t to try and swing the pendulum back to the physical. It’s to start capturing the learnings of what works for your brand and your customer. That’s how you’ll prepare for a future where the experiential distinction is non-existent.
This future will be very real within 10 years and it takes times to roll-out a revamped retail experience.
So there really is no time like the present.
Originally Published on www.switzer.com.au: Wednesday, March 25, 2015