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House of Fraser concept shop

The Multi-Channel Conundrum

BY Faye Higgins

Amazon is soon to be twenty years old. Just digest that for a moment. Twenty! (A quick fact here for all you quiz buffs - the first transaction online is heralded to be the sale of Sting’s ‘Ten Summoner’s Tales’ for $12.48 in 1994.)

In those past two decades, growth in e-commerce has been enormous. Retailers have had to accept that this is the way that people do business now, and are having to add to and adapt their multi-channel strategies accordingly.

But with the retail landscape changing at an ever increasing pace, it’s becoming harder and harder for companies to ensure that they remain at the forefront of the multi-channel innovation.

With this in mind, Transform held a Multi-Channel Retail Dinner last week at which managing director Emma Robertson and retail expert Neil Ashworth established a list of ten trends that they believed would characterise 2013…

1. Accepting the New Norm
OK, so we’ve already covered this one a little bit above. But not only is e-commerce vital for success (over double-digit growth across the world in the past twenty years), m-commerce is also now just as pivotal. So forget the labels, it’s all just commerce now. Retailers are having to integrate operations on a single platform basis. This is it – it’s the way we do business today, and the way we will do business in the future. Customers expect a consistent brand experience whatever the channel, and it’s up to retailers to provide exactly that.

2. Knowing Me, Knowing You
Previously, retailers used to be able to differentiate on two clear axis: range and price. Book shops sold books, clothes shops sold clothes and food shops sold food. Now we operate in a retail environment where range extension as a growth strategy has led to a blurring of the lines between retailers – for instance you can now buy a barbecue from Argos, Amazon and the AA. So how do retailers steal a competitive advantage? Increasingly this comes down to how well a retailer knows its customers – both collectively to drive macro level design decisions and individually to drive personalised communications.

3. The emergence of the Customer Experience Officer
In a world where job titles are getting ever more ridiculous, we may have stumbled upon one that actually has some meaning. The Customer Experience Officer is a role that’s been implemented by a number of high-profile organisations, including Vodafone and B&Q. And with customers now willing to share personal information with commercial organisations – providing a benefit is received at the end - a CXO can be useful to ensure that a seamless customer experience is maintained at all times and across all channels.

4. The Last Mile Home
Within retail one of the biggest peak post-mortems has been around delivery capability and experience – with both mainstream media and industry publications full of horror stories about parcels being dumped or deliveries cancelled to meet KPIs. This has to change. Gone are the days of beating parcel carriers up for low rates and high service levels – retailers will now need a model that can be profitable, competitive and support the service levels expected by their customers.

5. What’s in store?
Your local stores are looking very different to how they used to. And in 2013, we’ll be seeing more and more of them doubling up as distribution centres, where online kiosks sit snugly alongside the more traditional methods of shopping. US giant Macy’s for instance is transforming stores into online fulfillment centres, whilst Boots is working along similar lines in the UK. Other companies will surely follow suit, and the winners will be the ones who most effectively shape their stores around the customer.

6. Location, Location, Location

In-store technology is the next frontier for multi-channel retailers wanting to focus on meeting customers needs. Despite their anecdotal negativity, self-service tills have cut queues and improved customer service, and House of Fraser has been adapting its stores very effectively to provide a better retail experience – its stock-free concept store in Aberdeen (pictured above) being an excellent example of this. In the main, we’re seeing retailers using in-store technology in very varied ways – some are looking to enhance the shopping experience, some to build brand credibility, others for range extensions or cost-saving measures. In fact, this is one area where technology is lagging behind ambition. In 2013 expect to see a number of new trials and experiments being rolled out as tech companies try to catch up.



7. Technology needs people

Don’t see the ever-growing presence of technology as a way of shedding staff numbers. A recent survey found that 21% of people would choose retailers on the high street over web stores, providing the high-street staff could provide an additional layer of knowledge that consumers simply couldn’t get online. That figure is even greater amongst those with a higher disposable income – they want to engage with a real person rather than simply shop online. So store colleagues are a key piece of the multi-channel jigsaw – but you must ensure that they are well trained and prepared to offer consumers the optimum lifestyle experience.

8. Customers are on the move

4G is going to change the retail landscape forever. Companies will be able to provide more data, at faster speeds, and many of the experiences currently reserved for TV and web will be available on mobile handsets and tablets on the move. The smart retailers will use this to offer richer content and visualise more of their offering, whilst things like showrooming and shopping-on-the-go are going to be even more influential.

9. No more pillar to post

The standard of what makes for good customer service is currently being redefined. Nowadays retailers need to know who every customer is, what they’ve bought and what their complaints are, irrespective of when they bought their item and through what channel. Great customer experience can’t work without all channels being interconnected; retailers need to embrace technological developments in order to determine how best they can do that.

10. Stand out from the crowd

The power of the consumer in the digitally enabled landscape has more sway than ever on how retail strategy – and government policy – is influenced. Retail experiences – both good and bad – are shared by everyone, and retailers must therefore do what they can to control the conversation. This can particularly play a part when it comes to Corporate Social Responsibility initiatives; consumers are making more moral judgments than before and retailers must learn that they can no longer get away with insincerity or CSR campaigns that masquerade as something else.

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