Retail Is Dead! You see this headline a lot lately. Sears, Macy’s, K-Mart, JCPenny, Lane Bryant, Ann Taylor… These are just a few of the brands that are teetering on the edge of the abyss. It doesn’t seem like a day goes by when the list doesn’t grow. But at the same time—Amazon is buying Whole Foods. Target is dropping billions of dollars to shore up it’s Brick and Mortar business, new shopping malls are being built at a blistering pace.
So is “Retail Dead”? As anyone who has gone to the Mall Of America in Minneapolis on a typical weekend and seen the throngs of people charging through the doors as soon as they open… I say No. It is however experiencing an unprecedented period of consolidation and change.
With nearly the same frequency that stories about the death of retail are emerging, experts are putting forward the idea that the businesses that will survive are those that embrace the idea of “Retail As Experience”… They tout things like throwing college back to school parties, staying open on Thanksgiving Day, bigger Black Friday sales… News Flash—these are events, not Experiences.
You could throw an event—everyday. It might bring in a few more customers… You might even see an uptick in sales. But people become desensitized to events. If you hold an event every day… People will eventually stop attending those events. Or worse—they will come to expect an event and when you don’t have one, you have created a situation where you actually drive customers away. It’s a paradox that will drive up your costs while delivering diminishing returns over the long run.
No—the key to saving Retail is not events! It is a sustained focus on improving the Experience of your customer on a day to day basis that will eventually turn the tide of American retail.
To focus on Experience… You’ve got to get to know your customers. Sounds basic –right? You’ve probably heard this one ringing from a constant barrage of posts hitting your inbox on a daily basis. You probably do some variation of the following… You collect customer survey cards. You solicit information about your customer’s likes from your store management and sales teams. You conduct focus groups to check how people are reacting to merchandise. You monitor likes on Facebook and Twitter to ensure people are reacting well to your brand.
The problem with all of these methods though, is that they raise bias in your customers. Simply by asking the questions you are influencing the results that you will receive. The only people that provide feedback are those who are on the fringe of your customer base—they are either already enthralled with your brand or they hate you so much they can’t pass up an opportunity to berate you. The first rule is fixing Customer Experience is…
1. You Have To Collect Experience Information Without Influencing The Outcome.
How do you do that? If you can’t talk to your customers or rely on their feedback without influencing the outcome… How do you measure their Experience? The answer is technology. In recent years a number of platforms have come on the market that allow you to analyze facial expressions and capture emotional feedback. This is the technology that will change Retail! Passive collection of Experience Related data. Using these systems will provide an unfettered look at your customer’s behavior. Once you have stripped away the bias inherent in collecting feedback—you can focus in on what they really like and don’t like about your brand and your in-store Experience. But equally important to the first rule is the second…
2. Experience Is More Than One Point In Time.
Many retailers have adopted counting technologies… Little boxes that sit in the front of your store and collection traffic information as people enter and leave your establishment (some of these little boxes even monitor mood using the facial recognition technologies mentioned above). But having these boxes at just one point in your store provides you with very little information. You have to distribute these technologies throughout your establishment. Having many monitoring points will allow you to determine not only how people are feeling entering or leaving your store, but how they feel as they travel from point to point, experiencing all that you have to offer.
3. People Are More Than Demographics.
Don’t fall into the trap of thinking of people are nothing more than their Race, Age and Gender. While many of the more advanced facial recognition systems focus on providing you data broken down by these broad categories, they are a starting point. Using the multi point approach you will begin to see patterns emerge that are based on how a person reacts to multiple stimuli. For example—if a person reacts positively to a product… Likeminded people will probably react similarly to the product, regardless of Race, Age or Gender. By using a clustering approach to data analysis versus—putting customers into Silos, you will begin to unlock the potential of your Experience Data.
As you can see—there is enormous opportunity in gathering Experience data. With it you can craft better long term strategies for product placement and design. This is the type of information that Web Designers and Engineers used to create enormously successful enterprise like Amazon and E-Bay. But it is merely the tip of the proverbial iceberg. To create Experience you have to focus on how you use this data to influence your customers right now!
4. Do Something With Your Data!
While long term design and strategy are great side effects monitoring your customer Experience… The true potential in this type of data is the ability to react in real time. Whether you are using like\dislike information to drive targeted marketing messages within your stores or tracking “Angry” customers to minimize risks, Facial Recognition technologies are the catalyst to improving Brick and Mortar Experiences. With it, you will be able to offer an infinitely more compelling Experience to your customers by tailoring your business to the individual.
Retail Is Not Dead!
In fact—I would argue that retail is about to undergo a massive renaissance. We have the right idea… Experience is key. Retail has always been about Experience. There is something visceral about holding a product in your hands before you buy it. There’s the giddy feeling you get when taking a new car for a test drive. There’s the togetherness that comes from going to a store and spending the day window shopping with your friends. These are Experiences. These are the things that you don’t get when staring a picture of a product on a screen. Experience is about the individual. Experience is about Emotional Intelligence.
Jeremy Gilbert is the Founder of Pandora Cybernetics, a small company that is dedicated to bringing the Emotionally Intelligent computer systems to the Retail and Advertising markets. Their revolutionary new TeleMetriX Impact Optimization Engine is designed to use Emotional feedback to influence your customer’s purchasing decisions by personalizing the buying Experience. Check them out at www.pandoracybernetics.com