The winds of change are all around, and not least in the retail sector – which by the way, includes banking. For years consultants like me have been trying our best to predict what will happen to the retail sector, will bricks and mortar stores be replaced by digital-only services, what will happen to established brands, what role will cross-border shopping have in the future, will there be space for niche retailers in the future. Retailers need to sharpen up and here is how:
Personalisation is the big trend, I mentioned in my last article that it is not enough to speak to a customer of one, brand owners need to understand and personalise their services and products to suit the customer of one. Knowing your customer is more than just saying ‘hello’ when they log onto your website or walk into your store, it’s about knowing you are meaningful and relevant and in doing so, building relationships that stretch beyond the mundane.
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Robots and digital advisors
Customers are prepared to interact with robots with caveats. Robots serve a purpose, however, there is nothing like a personal service. I am seeing that more and more brands are offering chat features on their websites (in fact I do the same on this website and it has proved an effective tool to engage with my visitors). I am also seeing more and more brands using videoconference technology to speak directly with customers and offer friendly, personal, face to face advice. On a recent trip to Kuwait, I saw that banks like Boubyan Bank (a bank I admire enormously) are successfully empowering their customers to connect with advisors using video technology – and it’s working.
Social media and advocacy
Customers are looking to their friends and network to make recommendations for services that go the extra mile. Whereas in the past, big brands were the only ones with pockets that were deep enough to reach customers now, through social media, everyone can. This results in at least two changes in the buying dynamic. Firstly, customers are now in control, making informed buying choices based on recommendations from a huge selection of possibilities. Secondly, size is not the advantage it was. Customers have a huge database of possibilities at their fingertips.
Bricks and mortar will flourish
In recently published Accenture Financial Services Trends research, 87% of customers who were interviewed said that they want to visit physical stores. However, what happens in those stores will change. In retail, the store will focus on advising customers, a place where they can try products and explore possibilities.
In-home services will prevail
What was once a service for the few, will become a service for many, with more and more brands responding the call of convenience by sending the store to the customer. We will see established retailers providing online shopping with door-to-door delivery times cut to less than two hours, easier returns policies, extended hours delivery services. This trend will not be limited to mass market brands, we will see this trend being adopted by high-end brands and retailers in the banking sector.
Gone are the days of one size fitting all. The future is all about creating ecosystems that put customers at the heart of the retail experience. Relationships will matter, personal and meaningful relationships – that are powered by data but are deeply personal in nature. Convenience will mean that customers can connect with brands from the palm of their hand, and rest assured that they are within easy reach of a physical store whenever and wherever they need it. Physical stores can mean large flagships, kiosks, pop-ups, mall experiences or in the high-street.
What is certain is that, whereas in the past, customers buying behaviour was defined by retailers – the location of the physical store is a perfect example – it now is not. Customers are looking for more from their retailers. Convenience, variety, individualism have led to the growth in smaller, independent stores, the likes of which may not have been viable in the past, but by using technology and social media, they are able to offer their products and services to global catchment, not just a local one.
The retail landscape has changed, service matters, convenience matters, relationships matter, personalisation matters, being in a large overhead physical location does not. More and more power of choice is with us, the customer and I see no reason why this will not continue.