The Retail “Perfect Storm”: Hyper-Personalized Engagement with Customers at Scale
This is the first in a series of blogs focused on the expanding retail trend of establishing personal relationships with customers in the pursuit of unique hyper-personalized customer experiences.
The retail industry has undergone significant change during the last 10 years, driven by consumer’s rapid adoption of emerging technologies, the expansion of social network platforms, and the Amazon Effect which introduced consumers to a magnetic ecosystem of compelling near friction-less shopping experiences which provide endless aisles, rich product visibility, easy returns, invaluable customer reviews and trusted processes with near-immediate results. While these forces were driving an upward shift in online shopping, the COVID-19 pandemic catapulted digital shopping to penetration levels not expected for another five years. This was a boon for many retailers but exposed every nook and cranny of their digital channel and forced many to rethink their digital destiny while pondering how all of these forces impacted the relationships with their best customers.
Perhaps the biggest change of all is the consumer shift from buying products to buying experiences, led by the Millennial and Gen-Z generations. Shoppers today want retailers to know them personally and will gravitate toward retailers that provide personalized experiences and targeted promotions which cater to their individual desires and preferences. They’re willing to share priceless information and create intimate relationships with retailers based on a foundation of trust, but demand to be in control and want value in return.
For decades, personalized customer experience has been retail’s elusive Holy Grail. But for the first time in history, the convergence of powerful, ubiquitous technologies, digitally mature customers, and an ever-expanding source of customer data is creating retail’s “Perfect Storm” making hyper-personalized engagement with customers at scale a reality for retailers.
Powerful, Ubiquitous Technology
An explosion of enabling disruptive technologies has sprung from R&D to you and me and are laying the foundation for hyper-personalized customer experiences:
- Beacons, Proximity Sensors, Edge Computing and IoT to name a few will provide the real-time infrastructure that grease the skids of Immersive Adaptive Experiences & Contextual Personal Promotions
- 5G is the conduit. But it’s more than just a better connection. It’s a better, smarter connector. 5G technology will enable the intelligent contextual connection between a customer & retailer and give rise to entirely new customer experience interactions and business models
- Cognitive Computing and the ability to harness AI and ML will play an excellent role in intelligent assistants and virtual advisers. Siri, Google assistant, and Alexa are great early examples. Intelligent Agents will be utilized across the entire customer shopping journey and will be able to sense and adapt to real-time needs.
- Machine Vision along with Face & Voice Recognition blessed with customer sanctioned profiles and Opt-in Data Tracking will be used to provide not only automatic inspection, process control, and robot guidance, but the ability to identify individual customers and sense their mood, predicting their needs contextually
- Blended Reality enhances experiences not just with new viewing methods, but new input methods as well
- Sensor Fusion and Customer Data Platforms will aid retailers in aggregating customer data from disparate sources such that its whole is greater than the sum of the parts, enhancing a retailer’s ability to generate and harness a 360-customer view to create personalized customer experiences
- Real-time Edge Analytics, Camera & Video Analytics, and AI Algorithms will be commonplace throughout every retail business process, and when combined with user-contexts such as the current shopping journey, previous purchase history, and user-generated preferences will generate the Predictive Analysis retailers need to create hyper-personalized experiences & offers which are aware of the consumer buying context.
Digitally Mature Customers
The Millennial generation has surpassed the Baby Boomers as the economic force driving our economy, with the digitally native Gen-Zers hot on their trail. They buy experiences over products and are influencing the retail landscape by pushing brands to reflect their values. They view their ever-more-powerful smart devices as critical to their lives as the air they breathe, chewing up and spitting out mobile apps and web-services at break-neck speed. But they’re not the only generations jumping on the digital shopping bullet train. Shoppers that might never have considered digital shopping in the 55+ age demographic became digital converts during the pandemic, expanding both their shopping paradigm and expectations. The customer journey for shoppers of all ages has irreparably changed, and retailers that intend to survive must abandon their legacy view of “shopping channels” and get on the only channel that matters now – The Customer Channel.
Ever-Expanding Source of Customer Data
The explosion of digitally active customers leaving breadcrumbs throughout the web and their shopping journeys has created an unprecedented tsunami of customer data access. While it contains a treasure trove of valuable information for retailers, accessing and mining it has become an almost impossible challenge. Where is it? How can I use it? When can I use it? And how do I aggregate it to make the whole greater than the sum of the parts? The sources of this information continue to expand at unimaginable rates:
- Point of Sale
- Pages Views
- Web Searches
- Browsing History
- Orders and Purchases
- Service Tickets
- Email Opens
- Text Messages
- Social Networking Likes, Views, and Comments
- Store Associate Engagement
- Loyalty Status
- App Interactions
- Chat Bot Engagements
- Blogging and Vlogging
- Wish Lists
- 2nd and 3rd Party Data
An effective Customer Data Platform, the crucial blend of CDP and CRM, is the panacea that orchestrates this powerful pool of priceless people data into a structured sea of sense. It provides a retailer with that non-negotiable 360-degree view of the customer without which there is no “PERSONAL. Seeing the customer as they really are will require insight into all the facets they choose to make available in the public domain. The ability to enhance 1st party data with 2nd and 3rd party customer data immersed in powerful retail AI algorithms empowers retailers to round out the bigger customer picture – and will be absolutely critical in nurturing trusted relationships, providing hyper-personalized experiences and promotions, and staying relevant whenever and wherever the customer chooses to engage.
There is now only ONE retail channel – the Customer Channel – and retailers that thrive going forward will be those that can race the fastest down that super-channel buy-way of hyper-personalized customer experiences.
Next in the series on Hyper-Personalized Customer Experiences: The Critical Next Step – Establishing Customer Trust