How the future of retail marketing will bridge the online and in-store experiences
The future of retail marketing is brick-and-mortar stores, but not as they exist today. Instead, think about stores that bring the e-commerce experience into the physical realm and obliterate the barriers between online and in-store shopping. Think about, "2025: A Retail Space Odyssey."
The future of retail marketing will be about one thing: relevance. E-commerce will continue to thrive, but the labels "online" and "in-store" will be meaningless. The future model will be about using data Web, mobile and in-store sources to create relevant experiences for every individual consumer in every interaction.
Retailers are far from a 360-degree view of customers
Retailers have quite a way to go before they understand every aspect of their customers. "What big data has really done is made you realize that you can capture information anywhere," Carl Boutet, a retail strategist with Canada's Mega Group, said in a recent interview. "What we haven't been so good at is figuring out how to work with it."
Some retailers have taken a few steps. According to Advertising Age, stores with loyalty programs, such as Guess, Lowe's, GameStop and Sephora, have built profiles of their best customers, allowing them to send the right email at the right time and recommend products they are likely to buy. Others are deploying third-party tools that use machine learning to understand a consumer's intent and match it to a retailer's products, MIT Technology Review reports.
The future requires analyzing data for all touch points
In the future of retail marketing, industry leaders will pull together multiple data points from all of a consumer's interactions and analyze them in a way that shows what customers want now and in the future.
Netta Kivilis of predictive analytics company Custora says demand analysis hasn't been widely adopted yet. "The majority is not doing it, but they want to do it."
Though it's still a vision for most, predictive analytics will likely be commonplace in the future. The revolution started by widespread smartphone adoption will rage on, continuing to empower consumers. Retailers will need to be increasingly transparent with customers about what information they are gathering, how sharing that information benefits consumers and how they can opt out of the arrangement. Physical stores, which account for more than 90 percent of retail sales according to the U.S. Census Bureau, will still be relevant; they'll just be very different places. In-store beacons will send relevant promotions and product recommendations to customers who have opted in.
Virtual reality experiences will transform stores, too. Shoppers will be able to try on clothes, view inventory and make purchases. Smart mirrors, which allow customers to digitally try on outfits, will be common fixtures. As consumers highlight their preferences, the technology will record data about their likes and dislikes and offer targeted suggestions.
Further, heat maps will show retailers where customers linger. Cameras will provide data on which products consumers are looking at and will recognize and record emotion and reaction to various products to inform future merchandising.
Data delivers relevant recommendations to each customer
Sales associates armed with tablets will be able to see a wide range of information, including company-wide inventory, weather conditions and individual customers' buying habits. This data allows up-selling or cross-selling based on inventory and the buyer's intent. Point-of-sale devices will continue to gather information, too. All of it will be aggregated, analyzed and presented in a digestible form that will allow retailers to take meaningful action.
It's a huge transformation. Not every retailer will make it through to the other side. Those who have the best chance will look for the pieces they can implement right now. They will also look for capable partners who have the technological know-how wrangle the torrent of data that is key to success. The future of retail marketing will be here soon.
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