For many consumers, the real occasion at the end of November isn’t Thanksgiving, despite the turkey and trimmings. It’s Black Friday, known for its huge specials and deals.
How do retailers take full advantage of this event? With today’s competition and soaring customer expectations, it requires more than merely slashing prices.
Black Friday came of age in the ‘80s as a one-day post-Thanksgiving shopping extravaganza when retailers were rumored to go from in the red to in the black. Then, in order to gain more shoppers, stores started opening earlier and earlier on Black Friday, followed by some retailers opening on Thanksgiving itself to get a jump in the competition. Black Friday went on to spawn Cyber Monday and today Thanksgiving has become the beginning of a four-day sales event encompassing Black Friday and Cyber Monday.
Cyber Monday, which launched in 2005, has grown exponentially. By 2010 Cyber Monday sales were over $1 billion and double that only three years later. Cyber Monday 2015 was the largest online spending day in history, with digital sales exceeding $3 billion — and now it too is morphing into a full week of deals and discounts.
Over the past few years, the Black Friday/ Cyber Monday shopping experience has radically changed. Once marked by 4 am lineups at brick-and-mortar stores, now it’s just as likely that customers will sitting at home on their sofas shopping on their mobile devices on the day, and time, of their choice. Since 2000, fully three-quarters of retail sales growth has occurred through online channels.
However, simply running an e-commerce site isn’t enough to satisfy today’s demanding consumers.
Customers now carry devices everywhere they go and expect a seamless, omnichannel retail experience – whether they’re shopping online from a tablet or mobile device or in a bricks-and-mortar store. For retail companies, one of the biggest challenges is fusing physical and digital worlds by designing seamless shopping experiences for customers across all channels. But the payoff is worth the effort — companies with the strongest omnichannel customer engagement strategies retain an average of 89% of their customers.
Retailers who thrive will be the ones who learn how to merge physical and digital into a new, ‘omincommerce’ experience for their ‘omnicustomers’. They enable customers to choose where and how to buy across all channels, and understand their preferences and purchase paths. They can provide valuable advice, while letting their clients customize their shopping and delivery experience.
Retailers who thrive will be running live. What does running live look like? It goes beyond ‘online’ or even ‘everywhere’ and becomes ‘everything-at-the-same time’. It integrates the value of a retail store into a customer’s digital interactions for a more personal and personalized overall experience.
Here are just a few quick examples of ways retails are innovating.
Globus, Switzerland’s high-fashion department store, needed to continually improve their supply chain and merchandizing techniques to stay on top of fast-changing fashion trends driven by customers who comparison shop on their mobiles and via social media. To become more responsive they developed an in-memory, technology-based analytics platform to quickly generate insights. They can now generate a “slow-seller” report for their entire line of over 800,000 products in just 17 seconds, resulting in better demand planning, merchandizing and marketing – and a better chance of pleasing choosy Black Friday shoppers.
Then there’s ABYAT, the Middle East’s biggest retail store providing everything a homeowner, contractor, or company could need for designing the perfect house from electrical and plumbing to doors and lighting. Known for their high-quality, personal service they wanted to extend that across the whole ABYAT shopping experience. A prime example of using technology to make things more personal, they’ve armed each of their sales representatives with a mobile device that allows them help customers find and compare items, automatically check stock availability, and help them check out. It both improves customer freedom with stores and reduces the time sales representatives spend with each customer.
Brooks Brothers may be almost 200 years old but they’re hardly stuck in the past. Known for continually reinventing themselves, they recognized that they couldn’t meet customer expectations with old technology. By implementing a universal customer master database they are able to understand a customer’s purchase history and preferences in real time. This adds a valuable digital element to the “personalized white glove service” they’re known for and simplifies the customer experience.
Apart from the fact that they all use SAP technology, the common thread to all these examples is that they are looking for new ways to deliver personal experiences.
Retailers are only limited by their imaginations because the SAP technology exists to make running live a reality. Stores of the future will be able to leverage ‘heat maps’ – which show what customers are doing in a store – in real-time. These stores will be able to instantly track KPIs, such as real-time sales by store area, duration of customer stay, and retention rates. The data can be combined with other data, such as the weather, to create critical customer insights, trigger personalized promotions to enhance customer satisfaction, and increase overall sales. Real-time insights gained from online buyer behaviour and store buying patterns can be used to fine-tune shopping experiences.
As long as retailers leverage the right technology to deliver a great customer experience – from their retail location to their online store, social networks, digital marketplaces, and customer service channel – the future of retail is ‘live’ and well, though never static. And who knows what’s next after Black Friday and Cyber Monday? Whatever it is it’s bound to involve meeting the expectations of ‘omnicustomers’
Follow Joerg on Twitter: @joergkoesters.