Not only will retailers begin collecting more in-depth consumer data, but it’s going to feel more natural.
Over the years we have all been tracking the sun-setting of mass marketing as digitally focused brands move toward more sophisticated targeting to aid in reaching their audiences. Cookies and algorithms stalk our every move as we glide through social networks, mobile apps, and websites, extracting a slice of demographic here, a hint of gender or ethnicity there, all with the ultimate goal of generally delivering targeted banner or keyword ads. There is now of course the potential to use that consumer data to create more personal interactions both online and directly within brick-and-mortar retail locations, which are the focus here. This will be the next wave of ‘service with a smile,’ or what PSFK refers to as ‘connected relationship management.’
Airlines, hotels, and casinos were early examples outside of the retail industry to embrace ‘personalization with a smile’ as they were forced to confront the fact that, to compete, their customers needed to feel clearly more valued for their loyalty. But what about retail brands that also have core interactions within physical locations? These retailers also have real-time customer interactions and feedback as a key part of how they assert their brand experience. Thinking two moves ahead, new revenue will not materialize unless retailers begin to differentiate their customers on an individual level and provide various tiers of service tied to their history of interaction. Retailers now need to start thinking about every interaction as an opportunity to become smarter about a customer, not just a vast demographic or type.
What powers these approaches, as ever, is data — massive amounts of data that need to be collected, compiled, and tied to unique consumer profiles, as well as aggregated for trend analysis. A challenge over the years has been on how to collect what cannot be inferred from tracking people anonymously across digital touch-points alone. To create a better picture of the consumer, service and retail industries are forced to ask directly for additional information to then trigger more personalized responses. Getting that data is not always easy. To succeed retail brands need to provide what has been called over the years “a value exchange”. In others words, to learn more about a customer, we must always provide them something in return. This may manifest itself as discounts and other perks, but what if the reward was simply a better brand experience in itself?
For example, St. Louis-based Build-A-Bear Workshop has recently delivered new interactions within select retail locations that empower their staff to be more effective in contributing directly to a great brand experience. They allow a touch-and swipe generation of kids to define what kind of attributes they want their new bear to have. They can interactively drop magical icons such as ‘sporty,’ ‘smart,’ or ‘polite,’ into an animated and pulsing heart, as well as enter their name and age by playing with a squishy birthday cake interface. For this effort kids will trigger special rewards along the way, but the main goal is a more personalized and human experience as they move from station to station.
As they scan their bear’s ID tag the data is passed along to customer service associates, or ‘bear builders,’ who have access to this information so that they can tailor their narratives and treat each child as an individual. They use the child’s first name in conversation, celebrate their birthday, or actively reference the personality of the bear the kids are making in real-time. By thinking of the store as a data platform and empowering the staff, employees can make every moment seem wrapped around a child’s unique experience. Stores will even be able to ‘re-theme’ themselves for an individual’s life events, as the Build-A-Bear store can do today when a child declares their birthday. It’s a good example on how collecting information from consumers doesn’t have to be an awkward and off-putting event.
The results have been in-store sales increases of 20 to 30 percent–numbers often unheard of in retail. Sixteen locations currently have the technology in place, and the number is growing.
To truly bring to life personalization retailers need to think of a store as an inter-related continuum tied into their other channels as well. By thinking in terms of store-as-platform, we can have applications talk to each other or to other services outside the retail location (website e-commerce, mobile apps, social networks, other store locations) so that the brand story can build over time as the shopper moves through different phases of experience. This means the brand needs the capability to reliably collect customer profile data, capture store engagement for optimization efforts, as well as monitor uptime and experience stability. (How often have you seen a kiosk unplugged and dark, or sporting an error dialog box?)
Additionally, from the operations perspective, data is leveraged to drive fundamental business decisions such as inventory choice and product line design. To enable this retail brands will need solid technical infrastructure and cross-departmental collaboration to stitch all of the variables together. I like to call the platforms that power personalized retail experiences the ‘groundwater’ that flows under the store and connects everything in an unseen way.
As strategists, experience architects, and retailers we need to unlock each individual’s potential for tailored experience and work to deliver personal moments that differentiate brands in a crowded marketplace. A swiped loyalty card can sometimes be enough to enable this, but the next wave of mobile technologies will also allow identification — and subsequent in-person personal service — to be voluntarily activated via RFID, branded ‘beacon’ apps, voice commands or facial recognition. As long as these technologies are used to create truly human connections, they will be ultimately welcomed.
Peter is the Exec. Creative Director and General Manager of Infusion’s Digital Agency. He works directly with clients to help them strategize and conceive next generation brand experiences enabled through technology.