Green Room Design Retail Design Expo 2016 campaign

Customer Experience Series: Part 1

Customer Experience: a key retail focus for 2016…

As 2016 settles in we are still feeling the aftershocks from the effects of ‘disruption’ that have rattled through so many industries. The largest movie network owns no movies; the largest taxi company owns no cars and the largest property rental firm owns no properties (Netflix, Uber, and AirBnB respectively) and we can go on. Apple does not create the majority of its software, Facebook as an entertainment platform creates no content, and Amazon has only just opened its first store.

The world is being shaken up. And as it clearly seems to no longer be about assets. So what is going to be the key differentiator driving business in the future? A recent Gartner survey may have the answer to that. It discovered that:  “89% of company’s surveyed plan to compete primarily on the basis of the customer experience by 2016 versus 36% four years ago.” They are not the only company reporting this, Oracle’s Global Insights paper found that “97% [of business respondents] state CX is critical to success.”

With customer experience or CX a top priority for business execs, how does this translate and what does this mean for retail?

Find out more by reading our whitepaper on ‘Customer Experience at Retail’.

What do we mean by CX?

CX can be interpreted in a number of different ways. It used to be owned by the customer services department, now digital interactions mean that humanised user interfaces become a key part of CX. Marketing could argue that brand perceptions feed into CX, and the editorialisation of stores, providing an experience and emotional engagement with customers means that retail has a big role to play in CX.

Gartner’s ‘customer experience’ definition provides a neat summary; “the practice of designing and reacting to customer interactions to meet or exceed customer expectations and to increase customer satisfaction, loyalty, and advocacy.”

Should you invest in retail CX as a priority? These four reports think so…

The combination of stiff competition and ever increasing buyer empowerment results in customer experience proving to be the only truly durable competitive advantage. You can buy almost anything online, from any place, sent to anywhere. To persuade people to step into your store, you have to be offering them something more than pure product, an interaction or experience that enhances their customer journey.

“Fifty percent of men and 70% of women [globally] now consider shopping a form of entertainment, with 32% of millennials actively expecting brands to host some kind of entertainment experience” states Scott Peterson, Creative Director of US brand strategy agency Fiction.

Steve Cannon, President & CEO of Mercedes-Benz USA and an advocate of CX summed up why investment is a priority. “Customer Experience is the new marketing,”  he explained that, “Now, with social media and the connected environment we live in, a good experience can lead to thousands of connections and a negative experience can lead to potentially more than that.”

Cognizant’s annual UK Shopper Experience Survey reinforces Cannon’s comment stating that ‘57% of UK shoppers reportedly posted an online review of their shopping experience in the past year’.

And Joe Pine, author of ‘The Experience Economy’ put together the below chart to demonstrate how we’re shifting into what he calls an ‘experience economy’ where experiences are becoming the predominant business differentiator.

Experience economy

A forward thinking view of great retail CX

With the rise of etail, the role of bricks and mortar retail becomes less about the product, and more about the experience.  This was summed up very well by Jonny Lennon, Chief of Digital Business at Pro-Direct in our Expo speech with him last year:

“Going back 30 years to when we were a sports shop on the street corner, then we had a USP and a business model of choice and availability.

Right now our business model is about creating high-value content for our consumers.

My brief within Pro-Direct is to head up digital and evolve the Pro-Direct business model, and we have the vision to transform it by 2020. But, we have a big problem to solve – realistically by 2020 it’s going to be user experience that will overtake price and product as a key brand differentiator. The next phase of the business model transformation is to create the ultimate in user experience – by allowing users to self-curate their experiences.”

How do you create great retail CX?

Having identified the prevalence and importance of designing for great CX, we’ve set ourselves the challenge of creating an amazing CX for all of our Retail Design Expo 2016 stand attendees.

Over the next few weeks we will be sharing via this blog some fundamental principles of what makes great retail CX, such as:

  • Community
  • Intrigue
  • Dynamism
  • Sensorial engagement
  • Emotional connection

In our next blog, we’ve reviewed how Coffee Shops deliver great CX and what recent trends in this category can be translated to retail.

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