Retail's BIG Show 2014

Piers Fawkes

PSFK Founder and President Piers Fawkes

It doesn’t matter if you’re a small e-commerce startup or an established omnichannel giant: Success in 2014 requires an obsession with creating unique shopping experiences.

At Retail’s BIG Show, Piers Fawkes and Scott Lachut from PSFK outlined the key takeaways from their Future of Retail 2014 report. They used technical terms like “data-driven commerce platforms” and “networked purchase path” to describe the trends they’re seeing. But all of those buzzwords point to one big idea: Developing remarkable but frictionless opportunities for customer interaction is vital to engaging and retaining busy, distracted shoppers.

When data, technology and human-powered service come together, retailers can connect with consumers at every stage of the shopping process. Here’s a look at how innovative retail brands are already putting these top trends into action:

Scott Lachut

PSFK Labs Director of Research and Strategy Scott Lachut

  • Omni-point of purchase – Ideally, shoppers should be able to buy anytime they experience a product, whether it’s on television, social media or on the street. The path from discovery to checkout is just the first part of the journey; fulfillment completes the experience. Google’s “Shoppable Hangouts” let viewers shop while watching videos that mention products.
  • Contextual support – Lachut reminded retailers that “there is a fine line between welcome information and spam.” And that line is defined by relevancy. Devices like Estimote Beacons help retailers beam information to a shopper’s smartphone at precisely the right moment and location.
  • Connected relationship management –Collecting information about customers’ purchases and preferences can help retailers provide better experiences. For example, Tory Burch’s Client Book makes it easier for sales staff to provide personalized service.
  • Instant verification – Making transactions more efficient and secure can go a long way to removing purchasing obstacles. Apps like Square Wallet attach payment options to a verified customer identity.
  • On-demand delivery – Even the most patient shoppers hate waiting for a product to arrive, which is why instant gratification is the final frontier in online shopping. Digital storefronts that offer immediate delivery – like Kate Spade Saturday’s shoppable windows – are dissolving the boundaries between digital and in-store shopping.

Attendees at Retail’s BIG Show saw many innovative ideas in the exhibit hall, but this conversation helped to identify overarching trends while pinpointing successful implementation in the field. Check out summaries and selected insights from PSFK’s report for more examples and ideas.

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If you’re celebrating the birthday of the World Wide Web today – the anniversary of the day in 1989 that Sir Tim Berners-Lee wrote a paper proposing the system that transformed the Internet – then you’re paying homage to 25 years of online inspiration. Thanks to the Internet Archive Wayback Machine, is reminiscing about the way retail websites looked in years past, compared with their more modern designs today. (1999) – Like many, this titan started with simple homepage navigation. They had a focus on personalized features like wish lists, email recommendations and purchase circles. The company also touted its ever-expanding product selection by introducing “zShops” merchant partnerships. (today) – The breadth of product assortment is still on display. Wish lists and personalization continue to be key, and of course there’s Amazon Prime that’s changed the way we think about online shopping and Kindle that’s changed the way we think about reading and publishing. The recent release of the Amazon Seller app could change the way individuals and businesses sell items online and communicate with customers. Other notable additions include six countries to the international site list and more than 30 other sites and stores acquired or developed by Amazon like Zappos, and, just to name a few. screenshots in 1999 (left) and 2014 (right) (2000) – Walmart took a little more time to launch its online experience and unveiled in 2000, but has done quite a bit to catch up since then. In 2000, the retailer was already the No. 1 store in the United States, with more than 1 million associates and nearly 4,000 stores and clubs worldwide. Since then, the site design has shifted from text-based links to imagery and the store locator feature has moved up in prominence from its original bottom-right placement. But site search – of enduring importance to user experience – remains front and center. (today) – In-store and online deals take center stage – complete with engaging videos and buttons. The company’s mobile efforts are also turning heads – a Walmart executive said consumers who download the retailer’s app not only spend more, but also shop in-store twice as much as the average shopper. screenshots in 2000 (left) and 2014 (right) (1998 and today) – Product evolution has driven site design on Site navigation has changed over time to put the Apple Store and a range of devices at the top of the page, supported by much larger, emotive images. Need we say more about this digital revolutionary? screenshots in 1998 (left) and 2014 (right) (1996) – One of the first known Web purchases took place in 1994: a pepperoni pizza with mushrooms and extra cheese from Pizza Hut, a somewhat appropriate purchase for the early days of the Internet. As much a trailblazer in 1996 as they are today, the company sets the path for digitizing the delicious experience with the brand one experience at a time. (today) – It makes you hungry, doesn’t it? The 2014 online and mobile experiences for Pizza Hut are some of the best out there in the food/restaurant vertical. The company recently reported that they have sold more than $1 million worth of pizzas through Xbox 360 game consoles in the first four months that their delivery app was live. Pizza Hut is even exploring the interactive table concept, making it easier, more digital, and more personalized than ever for those who frequent one of the company’s 4,000 dine-in restaurants in the United States. What’s next for the brand? I can only imagine the possibilities of calorie-free options delivered by drone or beamed in for the ultimate Jetsons experience. screenshots in 1996 (left) and 2014 (right) (2000) – Long-time member was the country’s first online shoe retailer, bringing their family business online in 1996. The original homepage isn’t archived, but this 2000 version shows the breadth of shopping options by brand and category, and offers a glimpse of promotions like free shipping and online giveaways. (today) – Nearly 20 years after launching online, continues to optimize their digital experience. With a massive assortment of shoes and some of my favorite product detail pages in the industry, the brand has incorporated customer reviews, product videos, alternate payments, a blog and an online catalog into their shopping experience. I think long-time CEO Dan Gerler has made his father proud. screenshots in 2000 (left) and 2014 (right)

Our own site was archived by the Wayback Machine in 1996. (Fancy!) Whether you’ve been selling online for decades or you’re a digital retail newbie: Thanks for connecting with us online. We can’t wait to see what the next 25 years will bring.

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Spring holidays such as Easter, Mother’s Day and Father’s Day are important shopping periods for many retailers. In 2013, NRF surveys conducted by Prosper Insights & Analytics found that U.S. consumers spent an estimated $17.2 billion for Easter, $20.7 billion for Mother’s Day, and $13.3 billion on Father’s Day. While smaller than back-to-school or the winter holidays, all three represent strong reasons to engage with customers as well as great opportunities to test drive new website features and functions retailers are investing in this year.

2014 Shop-org Spring Planning Guide 300px

Download the Spring Planning Guide.

To help retailers plan for these events, has released the 2014 edition of the “Spring Holidays Planning Guide: Easter, Mother’s Day and Father’s Day.” The report examines 2013 trends for these holidays, as well as lessons learned and best practices from the eHoliday 2013 Post-Holiday Consumer and Retailer Study. Several areas stand out:

Top priorities for online shoppers: shopping cart total, clear product descriptions, in-stock availability, value, and on-time delivery. The fundamentals are paramount for online shoppers, so doubling down on these basics pays off. For example, showing the shopping cart total – that means shipping and sales tax included – is a must to avoid customer sticker shock when it’s time to start checkout. Clear product descriptions are just as important, and smart retailers will scour customer reviews to find points of confusion or additional questions that should be addressed to help increase confidence and reduce the likelihood of returns.

Free shipping is key for online shoppers at all times. Among consumers who spent more online for holiday in 2013 than in 2012, nearly 40 percent said free shipping offers were a motivator. Retailers should try a variety of tactics to manage cost and customer expectations. For example, SeeWhy’s research has found that average abandonment rates vary widely across cart values, a good area for retailers to test the right threshold for offers that stipulate a minimum order value. After analyzing the 2013 holiday season, Adlucent recommends testing customer response to a price lowered by the value of the shipping in lieu of free shipping. Retailers should also market other free shipping options such as in-store pickup and pickup at third-party locations.

Strategic investments in fulfillment options help retailers compete. Four out of five online consumers said a flexible return policy is important while two-thirds said pickup or return at the store is also important. The good news: retailers this past holiday season told us that investments in shipping and fulfillment such as ship-from-store and ship-to-store are a key focus this year. Recently, StellaService found that once Best Buy started shipping from 50 of its stores last summer, average delivery timeframes decreased significantly, making them much more competitive with Amazon.

Customers expect all touch points to work together seamlessly. Multichannel retailers are working rapidly to meet customer expectations for online and offline to tie together seamlessly. Brands should focus on clearly identifying and placing the store locator at the top of the mobile home page. Since emails now are one of the primary points of interaction between retailers and customers, retailers need to invest in honing smartphone-optimized emails with smart subject lines, strong calls to action, clever use of geo-location to point the customer to a nearby store, and links to the site that make sense. Research from Moveable Ink found consumers opened two-thirds of their email via mobile devices, primarily on their smartphone, in the fourth quarter last year.

Customer service keeps evolving. Access to customer service is important to almost two-thirds of online consumers surveyed. While many online holiday shoppers said they gravitated to self-service options such as site search and even FAQs, other customer service options are in demand. For example, The Luxury Institute found 47 percent of affluent consumers want live chat or video assistance from a sales professional to help them better understand products. Service via social media is set to grow also, following in the footsteps of pioneering use of Twitter by Gilt and Best Buy. As Conversocial has found, customer expectations are high for brands to both respond to and resolve their questions.

Visit the site to download the Spring Holidays Guide and get a jump on planning for spring holidays.

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Posted in: Holidays | Marketing | Merchandising | Mobile | Research | Retail Companies | Social Media Tagged , , , , , , , , , , , , , , , |
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From same-day fulfillment to sites that are optimized for mobile shopping, the influence of e-commerce and m-commerce is undeniable. But what many consumers don’t see is how different point-of-sale systems in the store, on desktops and on mobile devices act on the back-end. This innovation of retail technology has changed the industry for the better – but often at the cost of displaying an inconsistent customer experience across these channels.

Retail IT teams around the world are addressing this challenge head-on. I asked NRF Vice President of Retail Technology Tom Litchford to explain how this challenge relates to the recent Digitizing the Store study, which sought to quantify the convergence of point of sale and e-commerce technology and the impact this is having in stores.


Learn more about Digitizing the Store.

Digitizing the Store explored where POS is heading in the coming years. But POS tends to be thought about more in a store setting. How has e-commerce sparked an evolution of the modern POS system?

Great question. Historically the term POS has been applied to the physical point-of-sale solution in stores. But this research was looking at how systems were evolving that actually transacted with customers – in other words, accepted payment for goods or services. Before the Internet and subsequent e-commerce systems, store-based POS was the primary, if not only, transacting system. With the rise of e-commerce, and now m-commerce, retailers and their customers have multiple “channels” now where they can conduct business. Unfortunately, from a technology perspective, these channels have evolved in isolation from each other. This is making it difficult for the business to present a seamless experience to the customer.

The study polled 200 retail IT executives in the United States and Europe. What did it reveal as far as their expectations from store technology solutions, and how do those relate to all things digital?

Many retailers and industry solution providers have recognized that this “isolated evolution” is a problem. According to our survey, nearly 40 percent of retailers are considering a single consumer platform to manage interactions and transactions. This means retail IT teams are thinking about how to update existing infrastructure, architecture and applications – most notably within brick-and-mortar locations – to keep pace with the constantly changing face of the industry.

One of the most interesting findings is that retail IT executives are looking at e-commerce platforms specifically as a solution for their in-store POS needs. What’s driving that and what does mean for e-commerce IT teams?

When you look at all the system architectures, extensibility, features and functional requirements for a common platform and solution, today’s e-commerce solutions appear to have a leg up on the other choices.  A single platform presents several advantages in the areas of customer intelligence, product content, inventory, order management and promotions. From a business perspective, it helps retailers enhance the customer’s experience across all channels, standardize business processes across all channels, and increase associate productivity.


Learn more about Digitizing the Store.

Even the tech-savviest consumers still rely heavily on the store experience as part of their path to purchase. In what ways are retail CIOs trying to digitize the store by giving biggest brand ambassadors – store associates – mobile devices?

The value of personal interactions between customers and store associates is undisputed in getting a customer to make the purchase decision. Providing store associates with extensive product and customer intelligence in order to make that interaction a positive experience for the customer is top-of-mind for many retailers. This is where the study showed leveraging the e-commerce system’s functionality in conjunction with back-end customer relationship management solutions – for example, guided selling, inventory visibility, and clienteling capabilities – is the most logical approach to deliver this functionality.

What advice do you have for e-commerce and IT teams to work together on POS and e-commerce platforms in the months and years to come?

The easy answer would be to not just automatically upgrade or replace your existing POS or e-commerce solution at the next refresh cycle. Before you do that, make sure from a technology perspective that you have a roadmap that takes into account all potential customer touchpoints and channel preferences. But the discussion isn’t as much a technology discussion as it is a business process discussion. For example, beyond compensation issues, there’s logistics for fulfillment and replenishment. So as business leaders, make sure you’re engaging all stakeholders to gain consensus on the path forward.

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Gilt iPhone app (image via App Store on iTunes)

By now, we’re familiar with research that suggests consumers are frequently using mobile devices to research products and find store information. But many retailers find it difficult to close the sale on mobile. What’s preventing browsers from turning into buyers?

At Retail’s BIG Show, a panel of retailers shared their experiences with making it easier for shoppers to buy on mobile devices. While their tactics varied, they all agreed: It starts with simplifying.


Gilt launched its iPhone app in 2009, and now maintains six mobile apps on four platforms. Jason John said the company’s long experience on mobile is part of why its numbers are so impressive: After 7 million app downloads, more than 40 percent of sales are coming from mobile.

Gilt’s apps take advantage of smartphone and tablet cameras to help customers find products. The apps analyze colors and return images of products that match. The camera also plays a role in smoothing the path toward purchase. Instead of entering payment information on a tiny keyboard, customers can take a photo of their credit card instead. John said these seemingly small features can go a long way toward overcoming hurdles for busy consumers.

Crate & Barrel website is optimized for mobile

Crate & Barrel

In 2013, Crate & Barrel brought its mobile sites back in-house and saw 100 percent year-over-year growth in many key areas. Shehaam Flot explained how an easy-to-remember customer persona – “Fat-fingered Susie,” who’s busy and multi-tasking – helps Crate & Barrel focus on the most important elements and remove anything extraneous.

Smart defaults help Crate & Barrel’s app remove friction. For fields with numbers – like ZIP codes – the app automatically displays the numeric keypad instead of the keyboard. And typing in the ZIP code automatically fills in city and state.

Flot also acknowledged that many shoppers are bouncing from smartphone to computer to tablet throughout the shopping process. When customers are signed in, their carts can be accessed across multiple devices and browsers.


Kiehl's iPhone App

Kiehl’s iPhone app (image via App Store on iTunes)

Sometimes apps aren’t the right solution. Kiehl’s found that customers resisted downloading an app while shopping in stores, so the company adapted its SnapTag program to use text messaging instead. Tory Diamond recognized that tech adoption can be a challenge, and emphasized that new initiatives have to be easy to be successful.

Inside Kiehl’s stores, handouts and product testers help customers find a unique ID to text for a product’s description and ratings. In addition to careful merchandising, Diamond says employee education is also key: It helps when sales associates talk about the program with customers.

While moderating the panel discussion, SeeWhy founder Charles Nicholls reminded retailers that some consumers still don’t feel comfortable shopping on mobile, even if they’ve done it before. They feel more reassured over time, and every easy experience makes customers more likely to purchase.

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