Jeff Bezos said, “If we can keep our competitors focused on us while we stay focused on the customer, ultimately we´ll turn out all right.”
Many retailers today seem to do exactly this and try to compete with Amazon.com. It's not rare that I have conversations with retailers about implementing strategies to compete with, or even leapfrog, Amazon. I usually provocatively ask the question, “which part of Amazon would you aim to overtake?”
Focusing on competing with Amazon isn't a winning strategy. Retailers, instead, need to laser-focus on their customers and not primarily on the competition.
People Are People
Consumers say, “Treat me like a person, not as a sales opportunity. Don´t just sell products. Sell to me!”
This is where technology comes in. Technology can help retailers bring back the intimacy of the corner store in today's omnichannel environment. Technology is a means to create a deep and trusting customer connection, which turns consumers into advocates.
While it’s important to have a 360-degree view of your customer, the reality is most retailers have an incomplete view of them. Historic point-of-sale and other sales data alone aren't good enough to make shoppers believe that retailers really care about them.
Consumers are willing to pay more for positive experiences. Making individual consumers happy will be the ultimate driver for loyalty and differentiation. However, companies must first be able to see their own business through the eyes of the customer, and then apply artificial intelligence (AI) to big data to provide adaptive and intelligent industry processes to better serve individuals.
This can only happen when retailers intelligently correlate sentiment, emotional, behavioral and sensor data to specific operational business process data. Acting on those insights with confidence and speed is priceless.
To create really memorable customer experiences, retailers also have to consistently deliver on their promises. For this to happen, the demand chain needs to meet the supply chain. Without an intelligent end-to-end solution that's fully integrated, there's no great or memorable customer experience. It's as simple as that: delivery execution trumps loyalty.
Sea of Sameness
Retailers need to become much more courageous in challenging the status quo and moving to new frontiers to become truly customer obsessed. It's time to abandon the sea of sameness in retail. We all talk to the same consultants, go to the same conferences and have the same key performance indicators (KPIs). A “sales per square foot” KPI sounds like complete madness in today´s omnichannel experience economy. This KPI alone kills countless great innovation attempts to put the customer in the center of the universe.
Wouldn't it make more sense to measure how well stores perform as brand experience centers? Why not measure the level of friction stores take out of the customer journey? Or implement a KPI regarding the performance of stores as tiny urban warehouses for faster and cheaper delivery?
Your customers want you to open different types of stores to fight the sea of sameness and individually engage with them in new ways.
Look at mattress startup Casper, which opened its Dreamery store in New York City. At that location, customers pay $25 to take a 45-minute nap on a Casper mattress in a beautifully designed private area. This is an example of a true brand experience center. Ikea recently announced its plans to open a “studio” store in Manhattan. This store will solely act as a “planning studio” where customers can select items they would like delivered to their homes. Amazon opened its new Amazon 4-Star store in Manhattan, solely selling items which are “trending around NYC” and those that are highly rated on its website. This is omnichannel customer experience at its best.
How you sell what you sell is important! Customers expect your attention to be on them, not your competitors. It's all about more empathy, more fun and less friction, which results in happy customers for life.
Ralf Kern is the global vice president, retail at SAP SE, responsible for the future direction of SAP’s solution and global go-to-market strategy for retail customer experience.
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Ralf Kern is the Global Vice President Retail at SAP SE, responsible for the future direction of SAP’s solution and global Go-to-Market strategy for Retail Customer Experience. He is a retail technology executive with more than 25 years of experience in the technology sector. Ralf has consulted and collaborated with many retailers around the globe.