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The Year of Living Disruptively

BY Dan Berthiaume

Back in October, I commemorated my six-month anniversary as technology editor of Chain Store Age with a column looking at how retail IT has been disrupted in recent years. Now that I have a full year under my belt, I thought it would be interesting to look at how customer expectations of retail IT have been disrupted in recent years (and don’t worry, there will be no 18-month anniversary piece). Three paradigm-shifting changes in how retailers must now engage with customers using technology stand out.

Every Man is an Island
Simon and Garfunkel once sang, “no man is an island.” With all due to respect to those mighty troubadours, the individualized nature of modern consumer technology has made every man (and woman) an island, and they like it that way. Social media sites, search sites, news sites and even many retail sites both allow consumers to set preferences for what type of information they want to receive, and also automatically tailor the content they view further using behavioral algorithms.

As a result, the typical consumer expects to receive a uniquely filtered experience that presents exactly what items they want at that precise time and location, for an agreeable price, across all of a retailer’s digital channels. And there are enough other opportunities for an individual digital experience that a consumer who doesn’t get one from you can easily obtain one from your competitors. Oh, consumers also now expect this highly personalized experience in your physical stores (see “Shattered” below for more on this “seamless” phenomenon).

Here We Are Now, Entertain Us
Nirvana sang these words ironically back in 1991, but in 2014 they represent the very real expectations of mainstream consumers. Constant connectivity means consumers now have access to constant entertainment, as any parent who has calmed a small child with a smartphone video knows.

But adults want to have fun, too. And they want it all the time from every omni-channel interaction, not just when they download a game app or visit a theme park. Retailers like HSN have responded with “gamification,” the usage of video game strategies to turn digital shopping into a fun competition with prizes, awards, and public status symbols. Brick-and-mortar retailers like Starbucks have also joined the gamification craze through activities like contests for customers who post tweets of themselves enjoying their favorite Starbucks beverages. If it isn’t technology-enhanced fun, it doesn’t sell.

Shattered
The Rolling Stones released a song called “Shattered” about the manic pace of life in late 1970s New York. The pace of life consumers lead today, with distinctions between “virtual” and “physical” blurred beyond recognition, makes Studio 54 look like a retirement home. Mobile devices with continually expanding computing power allow consumers to engage with the physical world using social media, the Internet, and apps as experience enhancers and sources of additional information.

This “shattering” (hold your groans, please) of traditional silos between channels means retailers have to offer an identical, sequential and personalized experience across every touchpoint, whether physical, online, social or mobile. The back-end implications are staggering, but the front end implications are simple. If you don’t want your profits to disappear like the distinctions separating once distinct consumer channels, you will find a way to deliver a seamless customer experience. The Stones have bucked the odds by lasting more than 50 years in rock n’ roll, the odds against retailers who do not adapt to the seamless expectations of today’s constantly connected consumer lasting even a year or two are much longer.


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Amazon Fire TV’s voice search gets new partners

BY CSA STAFF

Amazon this week announced that Hulu Plus, Crackle, and Showtime Anytime are joining VEVO in integrating their full catalogs into Fire TV’s unified voice search.

“We’re excited and energized by the momentum we’re seeing with Fire TV,” said Dave Limp, VP, Amazon Devices. “Customers are telling us they love it, developers are building for it, and we’re working hard to expand existing features and build new ones. We’re thrilled to have Hulu Plus, Crackle, and SHOWTIME integrating their full selection of movies and TV shows into Fire TV’s unified voice search.”

The team is already working hard to make Fire TV even better, according to the company. Voice search, for example, is expanding. Hulu Plus, Crackle, and Showtime Anytime will be integrating voice search for their full catalogs starting this summer. There’s also what the company describes as “a big pipeline of great developers” working to make their services and games available for Fire TV. New selection is coming from developers like Telltale Games, Halfbrick, Pixowl, Disney Interactive, Minority Media, Paradox Interactive, Gaiam, AllRecipes and Twitch.

New features are also already in the works for Fire TV, including:

  • New Prime browse will make it even easier to discover movies and TV shows that are included in Prime Instant Video.
  • Amazon FreeTime and Amazon MP3 integration coming as part of a free, over-the-air software update.
  • More Games coming soon. In addition to the over one hundred games available on Fire TV, you will be able to play touch-enabled games with the upcoming Fire TV app for your phone or tablet.

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Express begins assault on outlets

BY CSA STAFF

Mall-based specialty retailer Express opened its first outlet store at a Tanger outlet mall near Washington, D.C., and has plans for 30 more locations this year.

The operator of 630 predominantly mall-based stores had previously shunned outlet locations, but now views the popular venues as a growth opportunity.

"We are particularly excited about our outlet initiative which represents a new format for Express," said Michael Weiss, the retailer’s chairman and CEO. "I’m very optimistic about this new part of our business and the associated growth potential."

The factory outlet concept supports the retailer’s growth strategy of becoming more accessible to the twenty-something, fashion-conscious, yet price-sensitive customer, according to the company. Recognizing the opportunity to capitalize on the ever-growing outlet business and capture a new customer base, Express plans to open outlet stores this year in markets such as Chicago, Dallas, Detroit, Las Vegas and New York.

"Factory outlets are an important growth initiative for Express, offering us a unique opportunity to acquire new customers by offering great fashion and quality at an amazing value," said Andrew Buck, vp and general manager of outlets for Express. "We are thrilled to present the Express Factory Outlet as an accessible shopping experience for young fashion-forward women and men."

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