The National Retail Federation’s annual Big Show is a massive cacophony of everything retail: the challenges, the angst, potential solutions and reasons to look forward to the future.
But if you listen carefully at the show, which opened in New York today, you’ll hear themes emerging — challenges nearly everyone faces, improvements almost everyone wants to make, goals almost everyone has.
Knowing what’s in the hearts and on the minds of the 33,000 or so retail professionals who are careening through the Javits Convention Center this week is, of course, impossible. But if you’re looking for a good hunch, consider the notion of improving the customer experience.
It’s something you’ll hear a lot about at the Big Show, whether it’s by using beacons, speeding up checkout in stores and online, accepting payments, building an “omnichannel” experience, focusing on mobile first or capturing the attention of millennials.
Personalization is a key
And while there is no silver bullet for those challenges, as much as those in attendance wish there were, one initiative seems to offer the potential to move the better-experience effort forward more than any other: personalization.
“They’re very sophisticated and consumers expect a much more personal experience,” Cal Bouchard,The North Face’s senior director of e-commerce, told me after presenting a session on the subject based on the company’s recent deployment of IBM’s Watson. “And I think it goes hand-in-hand with the data that people are starting to be willing to give up. They’re expecting a more and more personalized experience from brands and retailers.”
(More on Watson’s role at NRF.)
Just over an hour earlier, Office Depot’s European-based vice president for e-commerce stood on stage and made the same point.
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“We don’t get to design the interactions that our customers have with our brands today,” said Office Depot’s Jonathan Newman. “They choose the channels, the touchpoints, the time and places of their interactions.”
Treat customers like a well-known patron
And, he argued, retailers need to treat those customers like a well-known and appreciated patron, by understanding their likes and dislikes no matter how many different devices they use to make a particular purchase.
The fact that consumers are demanding personalization is certainly a good reason to strive for it. After all, if customers enjoy the experience of shopping at your store or on your digital sites, they become long-term customers, meaning more revenue for you. But there are other reasons, too, including one very big one: Amazon.
Face it, if you’re a retailer, you’re not going to beat Amazon on price and convenience. You need to stand apart.
“You can only get a price and a convenience level down so much before there is a segment of people that says, ‘I would actually like to pay for a better experience; I would like to actually get a better experience rather than just the cheaper and faster option,” Bouchard says.
And so she is hoping to use Watson’s machine learning abilities to not only present individual shoppers with relevant recommendations based on their typed conversations with Watson, but to also provide relevant content about travel, for instance, — if the customer is traveling, or weather, if the customer is planning an outdoor adventure.
Standing out from Amazon is crucial
“We’re always looking for ways to engage the consumer that may not be the quickest hit to purchase or conversion, but maybe a long-term play,” Bouchard said. For now, Watson helps The North Face shoppers with buying coats by asking questions about how the shopper will use the coat, what features he or she likes etc.
Providing helpful content is one way for smaller online retailers to take on Amazon, said Neil Patil of Fluid, who presented with Bouchard. Fluid is The North Face’s digital agency.
“There is a wider and wider selection on Amazon,” Patil said. “But when you look at that, you’re like, ‘There is not a lot of advice.’ So, it’s really the brands that we see at Fluid that need to put that experience out as part of the brand.”
And, of course, to be valuable, that advice has to be tailored to the individual.
So, the good news: Personalization is a powerful way to create a better experience for your customers. The bad news: It can be hard to do. Or at least to do well.
“Personalization” is one of those buzz words that can take on different meanings depending on who is doing the talking. Plenty of retailers segment their customers, meaning they divide them into groups with similar characteristics and treat all those in each group like each other, but different from other segments. And many provide product recommendations often based on the idea that if a customer bought product A and product B, anyone who buys product A, might like product B.
But as Keith Mercier of IBM’s Watson team told me, people are tired of being treated like cookie-cutter copies of each other. He says he doesn’t want to hear that he might be interested in a specific product because someone who bought something he bought then purchased that item.
“How about what I would like?” He said. “Not people like me. What I would like.”
Personalization takes work
In his talk, Office Depot’s Newman was candid about just how hard it is to achieve one-to-one personalization. His operation started working on it 2014 along with a replatforming of the company’s website with an eye toward personalization.
Now, his European organization is tackling the challenge of keeping track of the same user across channels and devices.
“Our strategy, like most, is to support our customers on whatever vehicle they feel appropriate,” Newman said during a morning session on the path to personalization. “So we need to personalize across many touch points. That’s become a strategic imperative.”
Fluid’s Patil has no doubt about the personalization imperative. And he is fairly optimistic that retailers will be doing amazing things in the future. And while Watson is great, he says, there are a number of companies working on ways to improve a customer’s experience through artificial intelligence, or AI.
“We used part of Watson and we use other AI technology as well,” he said. “I don’t believe any one suite of AI technology is going to deliver everything that retail needs here and now and in the future.”
And yet, looking around at the hundreds of exhibitors at NRF, offering all kinds of answers for all kinds of challenges, you have to figure that the pieces of the solution are going to just keep coming.
Photo of Javits Convention Center and Patil and Bouchard presenting by Mike Cassidy.
Mike Cassidy is BloomReach’s storyteller. Contact him at email@example.com; follow him on Twitter at @mikecassidy.