Holiday digital priorities
E-commerce holiday sales are expected to increase 18% to 21% this holiday season, reaching $111 to $114 billion, according to the annual holiday sales forecast from Deloitte. With online growth eclipsing total holiday sales growth (expected to rise 4% to 4.5%), savvy retailers will be pulling out all the stops to step up their digital game.
Industry experts say retailers need to create an engagement strategy based on individual customer needs — along with the optimal solutions to support their efforts.
“Retailers that fail to &lsquodigitally disrupt’ themselves run the risk of getting left behind,” said Gordon White, general manager of The Social Client, a digital marketing provider. “At the same time, investing in digital tools for the sake of disruption will show minimal return. Technology should enable and enhance the user experience.”
Among the top digital strategies this holiday season are:
&bull Personalization. To attract shoppers, retailers need to tailor the shopping experience to individual needs. Personalizing marketing messages is the easiest way to jump into the game.
“There are different types of customers, and all have different needs,” said Brett Bair, principal strategist at Monetate.
Despite having access to a wealth of customer behavior and purchasing data, companies still don’t effectively use this information to meet consumer expectations. However, there is still time. The first step is to centralize all customer data, making information actionable. Experts also advise retailers to keep messaging simple.
“Don’t overdo initiatives just to be top of mind,” said Jason VandeBoom, founder of ActiveCampaign, a provider of integrated email marketing, marketing automation and CRM. “Begin analyzing customer actions from previous messages and how these turned into purchases. Also, identify how they interact with various channels.
For those retailers that are behind in their initiatives, it is not too late to start.
“Keep programs simple, and maintain processes going after the holiday season to learn how to master tailored messaging,” VandeBoom added.
&bull Mobility. Smart devices are the key for retailers to stay engaged with their customers before, during and after the shopping experience. Whether using the internet or an app, retailers need to leverage mobility as a means of keeping consumers and associates abreast of available inventory, the status of in-transit orders and even connect customers with service agents — via live chat or chatbots.
In its 2017 holiday outlook, research firm Forrester emphasized that retailers need to perfect the mobile checkout process ahead of the holiday rush, or they risk losing sales. To smooth mobile checkout, Forrester recommends streamlining the mobile checkout task flow.
“Easy fixes include reducing form fields, asking for only one address for both shipping and billing by default, and adding capabilities to proactively suggest addresses as the user starts to type,” the report stated. “Beware any instances where you ask the customer to enter information that they’ve already added earlier in the process.”
The study also recommends eliminating anything that impedes progress, such as content and text that are too small.
&bull Artificial intelligence. To best meet customer needs, retailers need to know what matters most to shoppers this holiday season. This is where AI, or software that imitates intelligent human behavior, comes into play. Retailers are tapping AI as a support for chatbots. GameStop, for example, used chatbots last holiday season to track its online orders — a service that had a 20% opt-in rate.
“AI will play an increasingly important role to identify which customer questions are better suited to digital tools, and which require live assistance,” White said. “This is especially critical during the holidays as your stores and contact centers begin receiving an influx of customer calls, orders and questions.”
&bull Cloud computing. Besides being more scalable than a licensed solution managed in-house, cloud-based solutions secure customer interactions, sustain load time and manage customer sessions.
Walmart, for example, is investing in high-level graphical processing units, or Nvidia chips. Accessible through a cloud network, this will be the foundation for Walmart to build out AI systems, from natural language processing and image recognition to machine learning.
“Whether ensuring pages load quickly, or push out new iterations of mobile apps or websites, retailers relying on the cloud will be able to scale and keep up momentum throughout the holiday season and beyond,” said Michael Levine, VP of marketing at digital solutions provider Photon.
Nordstrom tries on new look
As retailers consider how to best use physical spaces in a digital world, Nordstrom is going “local,” debuting a small-format concept that has no dedicated inventory. Instead, it combines personal services with personal styling.
Set to open at press time, Nordstrom Local is located in West Hollywood, Calif., and has a 3,000-sq.-ft. footprint. The services include on-site tailoring (for garments purchased at Nordstrom, as well as at other retailers), easy returns (for goods purchased at Nordstrom and its Trunk Club subsidiary), a manicure bar, and a buy online, pick up in store service — with items ordered before 2 p.m. available for pick-up on the same day. Same-day delivery to the customer’s home is available for completed alterations or purchases (if ordered by 2 p.m.).
In addition, customers can consult with “personal stylists,” making an appointment online, over the phone or in person to take advantage of the free service. Along with giving styling advice, the associates can, at the customer’s request, transfer merchandise from Nordstrom stores (or its website) to Nordstrom Local for try on. Eight dressing rooms surround a central meeting space where customers can relax, chat with stylists or enjoy a glass of wine or other refreshments from an on-site beverage bar.
“We know there are more and more demands on a customer’s time, and we wanted to offer our best services in a convenient location to meet their shopping needs,” said Nordstrom SVP of customer experience Shea Jensen, who led the Nordstrom Local initiative. “Finding new ways to engage with customers on their terms is more important to us now than ever.”
Amazon blends online and offline
Eleven brick-and-mortar stores — and counting. That’s where Amazon Books stands after the opening of its new outpost in New York.
Located on 34th Street across from the Empire State Building in Midtown Manhattan, the 5,200-sq.-ft. store is part bookstore, part high-tech electronics shop, with a cafe for shoppers to linger in.
The space has a modern look, with accent lighting and wood flooring, fixtures and display tables. There is a spacious children’s area, set off with carpeting and cozy seating. Coffee (from hipster fave, Stumptown Coffee Roasters) and other beverages, along with pastries and snack items, are sold in the cafe, which has both table and counter seating.
More than a traditional bookstore, Amazon Books is a direct extension of the online giant’s digital book-buying experience. The integration of digital and physical retail is evident throughout the store, from customer reviews on product nameplates to integration of the Amazon app in the overall shopping experience.
The new location features about 3,700 titles. The selection is based on a combination of factors, including Amazon.com customer ratings, pre-orders, sales, popularity on Goodreads — the company’s review/recommendation site — and its own curators’ assessments.
In a departure from the traditional spine-out presentation, the books are placed on the shelves with their covers facing out. Under each book is a small card with a sampling of a customer review from Amazon.com, along with its star rating (most of the titles in the store are rated four stars or higher) and the number of reviews it has received.
The label also includes a bar code that customers can scan with their smartphone, via the Amazon app, to see the price, more details on the book’s ratings and additional reviews.
Curated: What sets Amazon Books apart from conventional bookstores is how it’s curated. Similar to Amazon’s online offerings, the books are displayed in a variety of categories, with titles appearing in multiple sections. The store features all the standard categories, such as New Nonfiction, Cooking, Travel, Science Fiction, Self Improvement, Young Adult, etc.
But Amazon’s vast storehouse of data also allows for more unusual selections. Customers will also find such categories as Highly Rated (4.8 stars and above), Page Turners (books Kindle readers finished in three days or less), 100 Books to Read in a Lifetime, and Goodreads’ Most-Read Classics. In another adaptation of an online feature, one display is devoted to recommendations based on books the customer has already read — If You Like, You’ll Love This. Data also allows Amazon to add a local element to each location.
Gadgets: However, books are only part of the merchandise mix. The store also serves as a showcase for all of Amazon’s tech products, from Fire television and the Alexa Smart Home system to Echo and the Kindle e-reader, and related accessories.
The items are displayed on tables and stands, making it easy for customers to test drive — and hopefully buy — the products. Several displays are devoted to accessories. And plenty of associates are hovering around to answer questions.
Amazon Prime members have the advantage when it comes to pricing, paying the same price for items while in Amazon Books as they would on Amazon.com. For non-Prime customers, Amazon devices are the same price as on Amazon.com, but books and other items are sold at list price.
Customers can look up prices on the pricing scanners located throughout the store or by using the app. Goods can be paid for with a credit card or charged to the customer’s Prime account. The store doesn’t accept cash.
Amazon Books will open two more locations in 2017, at Westfield Century City in Los Angeles, and at Broadway Plaza in Walnut Creek, Calif., giving it a total of 13 by the end of the year. Amazon would not comment on how many bookstores it plans to open in 2018.