Technology – or to be more precise, the way consumers use technology – is a big factor behind the five major trends shaping (and reshaping) retail today.
These trends, identified in a recent report from Bazaarvoice, include social networks' growing roles; agenda-setting Millennials; mobility's meteoric rise; and customer expectations of a seamless omnichannel experience.
- Shopping is social: Shoppers aren't just stumbling into user-generated content; they're actively seeking it out and making it an indispensable part of the shopping journey. Seven out of 10 consumers research online before making an in-store purchase, and the average shopper uses approximately 10.4 sources of information to make a purchase decision. After Dillard's increased review volume on its website, it found that shoppers who looked at reviews with visual media were 23% more likely to convert. Consumers want e-mails, alerts, product suggestions and user-generated content they can filter and sort according to the attributes they care about.
- Millennials are setting the tone: Consumers born roughly between 1978 and 1995 are profoundly shaping the consumer experience; by 2017, it's estimated they will have more spending power than any other generation. Just over half of Millennials say consumer opinions found on a company's website have a bigger impact on purchase decisions than recommendations from family and friends, and 63% say that knowing a company is mindful of its social responsibilities makes them more likely to buy from that brand.
- Mobile is the medium: By the end of this year, more than half the people in the U.S. will own a smartphone, and mobile traffic is expected to account for 40% of all data traffic. Forrester Research projects that smartphone-based commerce will increase from $3 billion in 2010 to $31 billion in 2016. Consumer users of smartphones (and tablets) become an always-on opportunity for retailers to tap.
- Omnichannel equals a seamless experience: Retailers have long recognized that the more channels a customer uses, the greater their value. But shopper expectations of what constitutes a seamless omnichannel experience keep climbing. Today's omnichannel strategy means understanding that online shopping happens in stores as much as it happens at home. It means adding items to a shopping cart online and seeing them when customers resume shopping via their smartphones; consistent pricing and promotions across all channels; and automatically pushing targeted offers to shoppers' phones when they enter a store, providing ratings and reviews when shoppers scan a QR code at the shelf and offering one-click purchase in the aisle.
- Big data can uncover unprecedented insight: For the first time, technology exists that can collect and analyze the massive amounts of data consumers generate with every click, tap and even their physical movements within stores. Retailers can gain a clearer understanding of the path shoppers take to purchase; what most influences them; and which customized deals work best and at what times, all down to the level of the individual shopper. The catch? There's a shortage of human capital with the ability to deeply analyze Big Data and make effective decisions with it. But retailers that can fuse technology and talent will have a strong leg up with Big Data.
