How Retailers Can Reinvent Shopping With Data And Mobile

Pactera EDGE Chief AI Officer. Leads organizational transformation using data, technology, information systems, analytics and data products.

This holiday season, retailers have an opportunity to completely reinvent the online/offline experience forever by taking shopping closer to the consumer. They already have the technology in place to do it.

A Different Holiday Shopping Season

It’s clear that the 2020 holiday shopping season will be different as shoppers and retailers plan for a time of uncertainty and social distancing. A Google-commissioned Ipsos survey found that 74% of U.S. shoppers said they plan to shop online more than they have done in previous seasons. Shoppers will still visit stores, but retailers should not expect a stampede of eager shoppers on big shopping days such as Black Friday. Many shoppers will look to services such as curbside pickup to minimize exposure to other people. (In fact, Salesforce predicts that stores retailers offering some sort of pickup service will see a 90% increase in digital sales over the previous holiday season.) And those who do venture inside the store will want to navigate the retail floor as quickly as they can.

Retailers are already adjusting to these expectations in a number of ways. Walmart announced digital Black Friday sales across November, and Home Depot has basically declared the entire shopping season a digital Black Friday. Many big retailers are beefing up their services such as curbside, with Target announcing additional contactless payment services in stores and outside.

At the same time, retailers still expect shoppers to come to them — whether it’s to the store or to their websites. What if retailers took the shopping experience to the consumer?

Data-Fueled Pop-Up Stores

For instance, what if retailers, armed with hyperlocal data about shopping preferences in different cities and neighborhoods, were to offer pop-up stores with holiday-themed merchandise and special deals available in neighborhoods carefully selected for safe social distancing?

Pop-up stores are not new. Businesses have relied on them for years to test new products, capitalize on events by selling associated merchandise and bypass the strictures that come with either owning physical property or paying rent and other associated costs. Pop-up stores are often associated with small, nimble brands. However, Walmart has experimented with the pop-up store format for years. In 2019, Target operated a holiday-themed pop-up store near New York’s Chelsea Market featuring merchandise and experiences such as an Instagram-ready photo booth.

But the pop-up store can be so much more if retailers harness the value of customer data and put mobile to work in a more targeted way. Picture this scenario:

• A retailer such as Target or Walmart mines its customer purchasing data to design a pop-up experience customized for local tastes. A pop-up store in the Chicago suburb of Naperville might feature family-friendly holiday merchandise tailored to local tastes (with special deals for snow shovels to keep the suburban driveways clear), but only 35 miles away, another pop-up store might cater to the tastes of the largely Hispanic Pilsen neighborhood of Chicago.

• The retailer alerts customers in each neighborhood of the pop-up store coming to their area. The alerts specify the date and time of the pop-up store and entice customers with promises of special deals available only during the duration of the pop-up store.

• Customers visit the pop-up stores and either purchase items at the physical location or use their mobile devices to purchase merchandise and have it delivered to their homes (or set aside for pickup later at the pop-up store if the customer plans to return later that day).

Retailers could also collaborate with malls (which could certainly stand for increased foot traffic right now) to design more immersive experiences. Of course, this scenario favors large retailers such as Target and Walmart that already enjoy the use of native apps. However, that’s the point of the hyperlocal pop-up store — brands putting their customer data to work and capitalizing on the power of mobile. The large brands are best positioned to do this.

What Retailers Should Do

So what do large retailers need to pull off this kind of experience?

• Enable a hyperlocal, digitally enabled, physical experience.

• Integration into a mobile app that notifies consumers of the experience — and perhaps even gamifies the experience.

• Use consumer demand that’s driven by forecasting to drive relevancy and the likelihood of success at hyperlocal levels.

• Ability to fast-track last-mile delivery. For instance, Best Buy is using its physical retail stores to fast-track the delivery of products to homes.

Finally, retailers need to adopt a sense of urgency. The pandemic continues to make the in-store experience less attractive. As author James Surowiecki wrote recently, brick-and-mortar businesses are suffering from “demand shock” rooted in consumers’ justifiable fear of getting Covid-19. That fear is not going away so long as the pandemic remains. It’s best that retailers adapt now.

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