The next wave of retail is fast approaching, and given all the changes that have disrupted and reshaped the industry over the past several years, we can expect it to look quite different than what we’ve seen previously.
The next wave of retail will be significantly more digital, highly fluid and ultra competitive. Consumers will move seamlessly across channels and mediums and they’ll expect retailers to do the same. They’ll also expect highly personalized, 1:1 experiences at every step of the way.
Heading into this future state, four steps will be critical to success for all brands.
1) Reimagining First Party Data
A strong command over first party data — including the ability to marry customer, behavior and product data and make that information accessible and actionable for marketers — will be critical for success going forward. Specifically, retailers must reimagine:
- What’s defined as first party data by extending the definition to include predictive analytics, which will help retailers understand more about shoppers
- Where first party data lives, since bringing together first party data in a central location will make that information easily accessible and actionable for marketers
- How first party data gets used, as introducing advanced predictive models to power timely personalization at scale across channels drives key goals like retention and loyalty
2) Prioritizing Product Data
As retailers reimagine first party data, one of the most important steps to take is prioritizing the unification of product data into customer data management systems. Retailers must invest in technology that natively integrates with and surfaces actionable insights against product data in real-time. Making this type of product data accessible can help:
- Improve product recommendations and overall personalization efforts
- Introduce merchandising triggered emails to better engage shoppers
- Empower store associates to better help customers with questions and recommendations
- Inform merchandising decisions based on detailed sell-through information
3) Moving to a Learning-Based World
With the retail space getting increasingly competitive, brands must continuously fight to maintain leadership status. This situation means that delivering a best-in-class experience is not a one-time thing; rather, retailers must strive for continuous improvement. Based on this imperative, the next wave of retail will rely on AI to not only deliver personalized experiences at scale, but also to improve those experiences by learning what works best for each shopper. Introducing a learning-based model can help retailers:
- Easily adjust individual campaign elements (e.g. products, offers, content) based on each individual’s engagement over time
- Set goals for specific outcomes, like clicking an email vs. opening it or preserving margins vs. increasing overall purchases
- Better engage consumers based on individual preferences for things like timing and channel, even as those preferences evolve over time
4) Re-Architecting the Retail Martech Stack
Finally, retailers must scrutinize technology investments and re-architect as needed to achieve the necessary agility to respond to ongoing evolutions within the retail space. Introducing a retail-specific martech stack will be equally important in an AI-driven world, as the industry focus allows learning-based models to go deep into data and activities that are unique to retail. In turn, this deep focus allows marketers to create more meaningful engagements. When re-architecting the martech stack, retailers should look for solutions that:
- Collect and combine first party customer, behavior and product data in real-time
- Democratize access to data and make that data immediately actionable
- Use AI as a foundation to power learning-based models and fuel personalization at scale
- Deliver data fluidly across channels from a single system to ensure consistency for customers and improve efficiency for marketers
Get Your Team Ready for the Next Wave of Retail
Beyond taking these four steps, what else do you need to know to prepare your team to compete effectively in the next wave of retail?
Discover what it takes in The Retail Reckoning, which explores what makes retail unique, how retail has evolved over the past 20 years and how retailers can best prepare for success going forward.