forbes (source) :
Technology has led to an evolution in the retail industry over the last two decades. It all started with the move to e-commerce in the early 2000’s. Now, most retail companies find they are having to learn and adapt to a wide variety of technological tools and marketplaces.
The retail environment has been further disrupted by daily deal sites, targeted advertising and, most recently, automated customer service bots. Not only do retailers have to change, but the service providers that call them customers. Everything from marketing to distribution is being reinvented. Consumer product companies that embrace technology and even use it to rethink their business model stand to position themselves for great growth in 2018.
1. Create a strong focus on the customer experience.
Casper was one of the early movers into the fast-growing D2C mattress market, with $200 million in sales in 2016, just three years after it launched. Casper has been at the forefront of the revolution in what channels big-box items can be sold in. It changed a traditional model that was traditionally only brick-and-mortar since it was believed customers would not buy certain expensive and experiential items online. This model has now been carried over to other product categories, from furniture to appliances.
Casper’s fast growth can be tied to the experience it brought to buying a mattress — focusing on the customer first through a risk-free trial, free shipping and returns and sleep specialists available to talk to customers. These were all first in the industry. While not technological solutions directly, these solutions were enabled because of the platform that Casper decided to sell their products on.
D2C allows brands to control their customer experience better, focus on value instead of price, reduce waiting periods and increase customer retention. Many companies believe a customer has to experience their product first, but by modeling the experience Casper has created, they can cut out the middleman and provide outstanding customer experience at lower prices with higher margins for themselves.
2. Tap into advanced analytics by using larger platforms.
Jet.com was acquired by Walmart for $3 billion. Among the chief reasons was “smart cart,” an innovative and algorithmic pricing feature. The first of its kind, smart cart determines discounts on add-on goods based on the incremental cost. This innovation was a first-of-its-kind relating to supply-chain-based pricing. Around the time it was founded, Marc Lore, founder of Jet.com, said, “We’re dynamically repricing products as you shop to reflect the true marginal cost of getting that product to you.”
Providing a similar technological advancement to the retailer side, jet.com created their Jet Rules Engine. The Jet Rules Engine was the first option for retailers to use dynamic pricing to improve competitiveness, profitability and new customer acquisition. By allowing retailers to modify prices based on four distinct factors (shipping distance, item returnability, order size and email opt-in), jet.com created new opportunities in e-commerce.
Smaller e-commerce sites usually do not have the ability to develop their own features like Jet.com did, but there are two ways that they can provide smart tech for customers. One method is to sell on sites such as Amazon. Even large retailers, such as Nike, have made that switch recently. The second method for smaller e-commerce retailers is to utilize a third-party backend software for their e-commerce sites, such as Shopify.
3. Prioritize reviews of your product.
A former client of mine, iuzeit.com, is a data-centric startup that helps consumers see all reviews and pricing in one place. The new platform aggregates reviews from experts, users and their own social circles to show reviews and find the best prices on products in one place.
Nowadays, most consumers won’t purchase a product without first checking online reviews. If reviews don’t provide the credibility and confidence a customer needs, they won’t finalize his or her buying decision.
Providing all reviews in one place is not an easy implementation for some e-commerce sites, which is why an independent solution can improve the customer experience. At this time, most e-commerce retailers can generate reviews using a third-party service provider, such as Yotpo, to help them with their lack of data.
The continual transformation of the retail world is inevitable, and retailers need to embrace and continue to innovate the consumer buying experience. Our hyper-connected world coupled with technology has led to high consumer expectations, and only those companies that embrace technology to improve the customer experience will thrive.
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