The High Velocity
Petah Marian, Senior Editor, WGSN Insight
Every day there is a new story, a new technology, a new campaign shaking up the retail world. But what’s driving these changes? We’re in front of screens more than we’re face-to-face, as we question sources we used to trust. WGSN has partnered with World Retail Congress to reveal how our daily experiences are shaping the future of retail in this excerpt from WGSN’s latest white paper, “The High-Velocity Consumer.”
Scroll down for an introduction
to the 6 key drivers changing the pace of retail
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The Feel Factor
As consumers become lonely and disconnected they are seeking moments that evoke connection and allow them to feel more human.
Personal vs Personalised
As retailers invest in AI and their digital experience, the importance of the human connection will become a key brand differentiator.
82% of US and 74% of non-US consumers want more human interaction, but 59% of all consumers feel companies have lost touch with the human element of customer experience, according to 2018’s PwC Future of Customer Experience Survey.
There seems to have been too much focus on creating personalised experiences and not enough on creating personal experiences.
(Personalised = digital recommendations of products based on an algorithm; Personal = a human interaction that evokes emotion)
While retailers and consumers seek frictionless experiences, the sobering reality is that the more time spent in the store, the more interaction a customer has with an associate, the greater their propensity to spend.
Increasing interaction with staff at the NBA store on Fifth Avenue in New York led to significant gains, with the business finding that customers who browsed longer than 10 minutes purchased 370% more than customers who browsed four minutes or less.
Meanwhile, customers who engaged with a store associate increased conversion by 182%, and if engaged multiple times ended up staying longer, trying on and buying two- to three-times more merchandise.
The world is now filtered through mobile phones, and as self-checkout becomes an expectation, retailers need to extend their mobile capacities into new spaces.
Some 26% of American adults admitted they are online “almost constantly”, in a 2018 Pew Research study, up from 21% in 2015. This is significantly more pronounced among younger cohorts, with 39% of those aged 18-29 and 36% of aged 30-49 saying they’re constantly online.
“There’s 3 billion+ people around the world that still aren’t participating in the digital economy…it’s a great opportunity for all the businesses out there that want to serve those consumers.”
Bill Ready, COO Paypal
Consumers have become unsure of what is real, so retailers and brands need to double down on new strategies that engender trust.
The latest Edelman Trust barometer finds that trust in the US has suffered the largest ever recorded drop in the survey’s history among the general population. The global study found that trust among the general population fell nine points to 43, placing it in the lower quarter of the Trust Index.
The collapse in trust is being driven by a lack of faith in government, which fell 14 points to 33% among the general population, and 30 points to 33% among the informed public. Business, media and NGOs also experienced declines of 10-20 points.
"As a retailer, now is the time to invest in building trust and putting your voice behind issues your employees and customers care about. Consumers want to buy from brands they believe in."
Greer Hughes, consultant director, WGSN
“1.9 trillion dollars in e-commerce is going to be sold this year globally, and that’s going to go up to about 4 trillion dollars in the next couple of years”
Harley Finkelstein, COO Shopify
“The end game here, is always remove friction from the experiences that consumers may have”
Patrick Gauthier, VP Amazon Pay
“Whether it’s mobile, online or native app, you’re meeting the consumer on their couch or their bus ride. 67% of the transactions that we see start on a mobile device."
Robert Clarkson, GM Paypal North America
“How do you learn about customers in their contextual moments that truly reflect their behaviors…because identifying customers at the moment of their buying decision, is just too late.”
Kevin Lee, VP Head of Design, Visa
The Old Days of Ownership
With the decline in ownership, retailers need to reconsider what it is that they’re selling.
The shift in spending away from buying stuff and increasing spending on experiences has been well-documented.
The product discovery process has also irrevocably changed: consumers today never ‘go shopping’, but at the same time, they’re never ‘not shopping’ – they’re constantly scrolling on mobile apps and Instagram.
Retailers have approached this problem with strategies that aim to make product ownership itself becomes a by-product of experience – a way to capture a memory of something else. They have responded by creating free activations, but as this shift away from ownership continues, retailers need to reconsider what it is that they are selling to the consumer.
Increasingly, the experience will have to become the product – a revenue-generating channel that stands on its own, rather than a value-added marketing addition.
But as the number of Instagram-friendly wonderlands reaches saturation point, retailers will have to do more to encourage consumers into their spaces.
What types of experiences should you create? Download the full white paper to find out.
What is Worth
Today’s retail environment is moving at an electric pace. To win in today’s supersonic environment, you need to be ruthlessly consumer-centric and passionately embrace change. From building trust in your brand, to seeking new models of ownership, our latest white paper identifies the six consumer drivers that are moving at the highest velocity and key strategies retailers need to implement to stay relevant in 2020.
About WGSN Insight
At WGSN Insight, we report on what’s emotionally-driving the consumer to enable our customers to develop long-term strategies to win in an increasingly competitive world. From our seminal Future Consumer report, to daily coverage of the latest innovations from around the world, we’re there to ensure our customers stay one step ahead.