The Current, delivered daily.
The expectations that consumers bring to a shopping experience are constantly evolving.
Look at the last three years: People shopped more online during the height of the pandemic. They became accustomed to the selection and access to different brands offered by ecommerce. There was a wider return to stores last year as restrictions lifted, but digital tools remained key to the shopping experience. Shoppers don’t think twice about conducting research online before checking it out in-person, or ordering an item on their phone to pick up later.
Shoppers are comfortable moving across channels. According to the Connected Retail Report from CI&T, consumers are splitting time almost evenly between channels – 48% online, and 52% offline. Even as they toggle between mediums, they want to have similar experiences in both. The report found that 86% of respondents have the same expectations across channels.
As CI&T Chief Strategy Officer Young Pham put it, shoppers want an immersive experience.
“People are starting to realize that their behaviors have changed,” Pham said. “So for retailers, the opportunity is, ‘How do I meet that behavior?’” The lesson for retailers is that they must not return to a time when they didn’t anticipate those changes taking place.
It requires examining what elements work in a specific channel, and how they can be applied across both. That means there is room for ecommerce to apply some of the advantages of the store. Online shopping can be transactional, but it can learn from how the store excels at merchandising, and guiding them through the store.
Where associates may ask questions to understand a person’s needs and show them products, digital tools can make recommendations and personalize the shopping experience. Where there may have been an in-person bike road test or makeup try-on, user-generated content sourced from social can help to show a product in action. A dynamic video could replace a window display.
Increasingly, there is also room to work across channels. Store associates with downtime can help to assist customers online through virtual consultations.
This approach has changed how retailers set up the foundations of ecommerce, such as checkout. Now, Pham said there is also room to bring composable architecture to how retailers build the experience of shopping online with elements such as personalization and user-generated content.
To do so, CI&T partnered with digital experience provider Crownpeak to launch the Retail Experience Platform. Combining CI&T’s experience in the retail industry and digital transformation with Crownpeak’s technology, the organizations are building retail management accelerators to expand access to composable commerce for specialty retailers. While many enterprise retailers are embracing composable, CI&T and Crownpeak see room to grow this approach in the middle market.
A personalized tech stack
This shift has all kinds of implications for the technology and infrastructure that powers commerce. The pandemic brought rapid digital transformation, especially at specialty, mid-size retailers. Bike shops that were destinations for Saturday shopping had to ensure they had online offerings to continue to reach customers, too.
Ecommerce tools were moved into place seemingly overnight, and in-store systems were configured to allow for modes that moved between the channels, such as pickup. But now that patterns have settled back out, there is room to think about how brand extends into the way that people move through an ecommerce store.
“I want to spend more time now thinking about, how I can have a better customer experience…How do I create a relationship?” Pham told The Current on the floor of the NRF Big Show.
Change will be a constant. The digital tools that allow this to happen will continue to evolve, just as expectations do. It requires an architecture where brands and retailers can choose the right technologies that allow them to reach customers, and deploy quickly. It means they may mix the best tools from different tech providers, and change them out as new tools come along.
Known as composable commerce, this represents a shift in ecommerce software. Previously, ecommerce systems for retailers were often custom-built and frequently monolithic. Changing out individual parts often required rebuilding whole systems. But the arrival of the cloud, API-driven technologies and headless content management has brought about the ability to create an interchangable stack of best-in-class technologies that is personalized to the retailer.
'Adjust, adapt and grow'
The shift to composable architecture can bring change on two levels, Pham said. Technology capabilities that will be advanced, and Crownpeak specializes in this area.
“Having the right technology in place that can adjust, adapt and grow with the needs of the customer over time is what we bring to the table,” said Crownpeak Chief Marketing Officer Michael Robinson. “We provide the ready-made building blocks and the right tools to create something that fits to the customer's needs.”
But there are also business considerations. On an organizational level, retailers will be able to use composable architecture adopt new features that can change the shopping experience for customers, and do so in a way that provides flexibility to pivot and improve. This involves not only the internal teams that will prioritize and design experiences, but also suppliers that must move products into place. This will bring a shift internally, and there must be a willingness to embrace it.
“The speed to market is the ideas. It's not the technology,” Pham said. “If you want to look at how you're changing your commerce journey, it's not a whole revamp for a year.” By being able to componentize with composable commerce, “I'm talking weeks and months, versus years,” Pham said.
Once the initial components are in place, the technology allows retailers to grow as these experiences become more common.
“It also allows you to scale,” Robinson said. “If you think about more personalization, more variants of content, different stories, and how you would like to reach out to different audiences, this requires the necessary tools to deliver these experiences.”
In the end, it underscores a mindset shift taking place. New technologies are continuously launching, and consumers are expecting the capabilities they provide to be embedded in the shopping experience. Retailers must be aware of what customers want to use, be able to adapt their technology quickly and integrate it into one dynamic path that moves across in-store and digital channels.
Trending in Shopper Experience
The California-based grocer is expanding its retail media partnership with Swiftly.
Retail media is growing at a breakneck pace and it’s at the top of commerce conversations in 2023. But it’s worth taking a step back to remembering that marketplace-based advertising remains in early stages of development. That means there is room for a variety of retailers to adopt it, and apply a diverse range of approaches to find what success looks like for their particular business.
The latest example comes in the form of news out Tuesday from The Save Mart Companies (TSMC) and Swiftly.
TSMC, a grocer that operates approximately 200 stores under the Save Mart, Lucky and FoodMaxx banners in California and Western Nevada, is launching a retail media network through the retailer’s websites and mobile apps that aims to drive in-store traffic and sales. The new offering expands TSMC’s partnership with Swiftly, a digital customer engagement company that helps brick-and-mortar retailers grow digital relationships with shoppers.
TSMC’s retail media network is taking an approach that is distinct from the advertising offerings of ecommerce platforms such as Amazon, Walmart and Instacart. Rather than search-based advertising in which brands purchase media to improve their ranking in results, TSMC and Swiftly are offering content, coupons and loyalty experiences alongside display advertising and product listings.
One part of the impetus for the focus on in-store shopping comes by way of category imperatives. About 80-90% of grocery transactions still take place in stores, and that’s especially true for regional-level grocers. Additionally, consumers are moving more seamlessly across digital and physical shopping. According to Swiftly data, over 85% of consumers prefer interacting with brands using both channels, so brands will want to show on apps just like they do in the store.
But it’s clear that they’re also thinking about injecting new ideas into the market. Swiftly CTO Sean Turner said the companies believe they can “out-innovate” competitors.
“There is a lot of opportunity to democratize the industry by bringing a lot of the capabilities that the larger players have, and enabling those in the rest of the industry,” said Sean Turner, CTO of Swiftly. “Save Mart is a very forward thinking grocer…and we've partnered together to look to leapfrog what its very formidable competitors are doing in digital.”
Turner offered a few examples of early campaigns being run on TSMC’s sites through the retail medai network:
Chobani has an activation that includes recipes that highlight how yogurt fits into full breakfast meals.
Freebie Friday offers a digital coupon to Save Mart items that offers redemption of a full-sized item available in the store.
Quaker Grits is featuring content on grits for California shoppers who may not be as familiar with a food that’s popular in the South and Midwest. This includes storytelling, pricing and availability.
Foster Farms’ Honey Crunchy Mini Corndogs is featuring a $2-off coupon in the frozen section. When users click into the coupon, they can also see other products available in the store to which the coupon can be applied.
The variety of available media speaks to how shoppers are using digital properties at a grocer such as Save Mart. The company’s websites and mobile apps don’t offer an ecommerce marketplace. Rather, digital is complementary to the in-store shopping experience. So shoppers are interacting with the content in a number of different ways. Rather than pointing to online checkout, everything must orient back to the store.
“They might open up the retailer's weekly ad, they might go to see what coupons are available, they might look at what items are on sale, and we leverage the digital properties to help to tell that story," Turner said. “And that's really where a lot of this brand storytelling can come in. Shoppers are able to leverage some of the great stories, both around savings as well as around new product ideas, to educate shoppers, and offer a better service to shoppers when they come into the store.”
Like most of retail media, part of the advantage lies in targeting capabilities. Advertising through these owned web and app experiences is powered by first-party data. That’s different from the third-party data that for years powered cookies and social media-based advertising. It’s an area where grocers can gain a particular advantage. Their stores are the site of regular purchases, and as a result they have the potential to access lots of data about consumer habits.
“I can't think of a vertical where you've got a richer first party data set, and more choice in terms of just the number of SKUs and brands that you have in your average grocery store, Turner said. “That's ripe for this kind of advancement.”
For regional grocers that have long operated on tight margins, there’s another significant opportunity in retail media: Adding a high-margin digital business that scales quickly. Now, the local supermarket is an internet-based business, too.