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<\/p>\nThe retail industry, continuously adapting to new technologies and evolving consumer habits, is, once again, at the crossroads of transformation. New technologies, especially the integration of artificial intelligence, are central to this moment, compelling retailers to adjust to changing shopping behaviors and to enhance their customer experiences to create value for customers, which drives loyalty.<\/span>\u00a0<\/span><\/p>\n Many retailers are already adapting: A recent study shows that<\/span> 90 percent of retailers<\/span> are investing in AI solutions to improve the shopping experience by advancing their personalization efforts and executing against their omnichannel strategies.\u00a0<\/span>\u00a0<\/span><\/p>\n As we begin 2024, which three key trends will further shape the retail landscape?<\/span>\u00a0<\/span><\/p>\n As retailers move full steam toward true one-to-one personalization, mass-produced offers and a one-size-fits-approach will become a thing of the past. Market leaders are already driving this change, and the impact of it is evident, with<\/span> 86 percent of retailers<\/span> that have embraced this approach reporting a measurable increase in business results \u2014 including a revenue lift of 25 percent or more, per <\/span>Boston Consulting Group<\/span> \u2014 after implementing advanced personalization strategies.<\/span>\u00a0<\/span><\/p>\n Central to this shift is the advanced capability of AI, which will continue to develop at pace. It already excels in utilizing real-time and interactive digital content to engage customers. This also extends to tailoring offers to shoppers on the fly, leveraging a mix of historical data, contextual understanding and real-time actions to determine what customers want \u201cnow\u201d with a high degree of accuracy. In this way, AI is advancing \u201cMarketing in the Moment,\u201d the practice of targeting customers with specific, bespoke messages triggered by various contextual factors (e.g., time, location) that can supercharge offer redemption and drive incremental spending.<\/span>\u00a0<\/span><\/p>\n An informed \u201cMarketing in the Moment” strategy that leverages authentic personalization will bring the omnichannel experience to the fore.<\/span>\u00a0<\/span><\/p>\n In the journey towards a true omnichannel experience, shopping is transitioning from a “phone-in-pocket” activity to a more engaged “phone-out” interaction. We envision that smartphones will become customer companions that augment the in-store experience. Retailers will develop intuitive apps \u2014 increasingly powered by AI \u2014 that will act as personal shopping assistants, supporting customers throughout their journeys pre-, during and post-transaction. <\/span>\u00a0<\/span><\/p>\n With<\/span> 81 percent of shoppers<\/span> starting their buying journeys online, the distinction between online and in-store experiences is fading. Retailers can no longer afford to separate the two. A new <\/span>study by Grocery Doppio<\/span> found that customers use digital tools extensively before even entering a store. They are making shopping lists (77 percent), confirming item availability (76 percent), and researching an item’s location within the store (69 percent). Retailers will and should focus their efforts on embracing unified digital content, conducting \u201cmobile makeovers\u201d in favor of more capital-intensive store refits as they increasingly acknowledge the mobile phone\u2019s role in delivering engaging, helpful and personalized customer experiences at every stage of the shopping journey.<\/span>\u00a0<\/span><\/p>\n Nike is one brand that has made its mobile app an integral part of in-store shopping and, in doing so, has created a truly \u201cphone-out\u201d experience. App users inside Nike stores can scan a QR code to summon shoes \u2014 in their size \u2014 to try on. They can \u201cshop the look\u201d using their smartphone\u2019s camera or check out instantly using integrated payment options within the app. This is all in addition to the exclusive digital content, recommendations and community connection offered through Nike’s app, all of which augments the brand relationship and the in-store experience.<\/span>\u00a0<\/span><\/p>\n Achieving personalization at scale and delivering individualized customer experiences at every phase of the buying journey can only happen by breaking down data silos to create a holistic understanding of each shopper, their interactions, and the stream of information being shared with them. We predict that barriers between sales and marketing channels will continue to blur and dissolve, allowing for a more consistent flow of data to deliver more detailed and accurate customer insights. Once you have a deep and consistent understanding of customers, retailers should look to better integrate all customer marketing activity (e.g., trade marketing, shopper marketing, loyalty marketing), optimizing personalized communications to each customer rather than optimizing for specific departmental objectives.<\/span>\u00a0<\/span><\/p>\n Retailers can look to the UK coffee chain Pret a Manger’s success with its Pret Perks loyalty program and Club Pret subscription service; it\u2019s an excellent example of how to integrate data across disparate programs and channels to create a holistic view of the customer and drive business results. Sarah Venning, Pret\u2019s chief information and transformation officer, was recently quoted on this topic, saying, \u201cOur broader strategy is to make sure that our customers can have a really joined-up experience across all of Pret\u2019s propositions, in-store and digital, so we become a truly omnichannel organization and people can buy and engage with Pret however they want.\u201d<\/span>\u00a0<\/span><\/p>\n In the last three years since launching its market-leading subscription program, Pret has worked to effectively leverage the data generated by on- and offline customer touchpoints (including the point-of-sale system, a critical capability for retailers and foodservice providers alike), demonstrating the benefits of removing silos and strategically connecting information. The company’s H1 2023 results revealed that <\/span>42 percent of transactions<\/span> in that period were digital, something that would have been unimaginable for a purely brick-and-mortar business just a couple of years earlier.<\/span>\u00a0<\/span><\/p>\n Each customer\u2019s interactions with Pret-branded digital assets \u2014 the loyalty program and the subscription service \u2014 can be tracked, enabling the business to use that insight to continually enhance its omnichannel personalization efforts. And because subscription rewards and loyalty perks are redeemed inside Pret locations, the brand can also collect data on in-store behavior through this channel. Seamlessly combining this digital data with POS system data reveals a complete picture of each Pret member and customer and enables a variety of personalization techniques that would be impossible in a more siloed environment.<\/span>\u00a0<\/span><\/p>\n This approach to channel-merging and silo-ending translates to improved consumer experiences, with insights being leveraged to provide precise predictive recommendations and dynamic content customization that boost engagement. In the year ahead, businesses will be focused on delivering marketing content that adapts to each individual, providing a personalized and “Instragram-eqsue” experience where every interaction is unique.<\/span>\u00a0<\/span><\/p>\n 2024 will be the year when retail experiences move from generic or segmented to highly individualized. The idea of separate retail channels will become a thing of the past \u2014 and the change will come much faster than many retailers anticipate. Customers will enjoy dynamic shopping experiences powered by the technology they carry in their pockets every day. Brands that successfully implement these dynamic, personalized experiences using the technology that\u2019s available right now will see significant growth. <\/span>\u00a0<\/span><\/p>\n Tim Mason is CEO of\u00a0Eagle Eye Solutions, a SaaS technology company transforming marketing by creating digital connections that enable personalized performance marketing in real time through coupons, loyalty, apps, subscriptions and gift services.<\/em><\/p>\n<\/div>\n1. AI Will Power Personalization at a Scale Not Seen Before<\/span><\/b>\u00a0<\/span><\/h2>\n
2. Shopping Will Become a ‘Phone Out’ Activity<\/span><\/b>\u00a0<\/span><\/h2>\n
3. The End of Silos and Channels<\/span><\/b>\u00a0<\/span><\/h2>\n
Key Takeaways for 2024<\/span><\/b>\u00a0<\/span><\/h2>\n