Welcome to Near Future. In this weekly feature, The Current spotlights innovations powering the next wave of commerce.
“By the way, it’s great to be back in-person.”
Whether it was speakers taking the stage or folks meeting up on the tradeshow floor, many conversations at the Retail Innovation Conference & Expo this week started out with that little aside.
It was a reminder that live events are still freshly back. It also underscored the moment before the retail community that gathered in Chicago this week.
In-person experiences are coming back. At the same time, digital habits are ingrained. There is some sense of a “return” to how things were in many facets, and that includes shopping. But, in truth, we won’t be going back to 2019. Too much has changed since then. Much of what started in the last two years will normalize, and be with us going forward.
Still, it's worth remembering that the next era won’t arrive all at once. The pandemic lockdown moment of March 2020 put us on watch for the next event that will change everything virtually overnight. But, in most cases, life tends to change gradually, and it doesn't follow a straight line up or down. Sometimes the shifts taking place under our feet now are only obvious after the fact.
The best way we know how to chart a course to come together, compare notes and share ideas with an eye toward what's working now, and where things might be heading.
That’s a big reason why conferences are valuable, and why they’re likely to remain with us going forward. With the chance to make lots of connections and pick up a voluminous amount of new information over a short period of time, a picture of current trends can start to fill in. Professionals come with an idea of what they want to share with others about their own experiences, and leave with a couple new ideas to apply to their own work.
It’s one way a community comes to an understanding of itself, and tells its story.
With that in mind, the following are a few takeaways on big themes from #RICE22. As a caveat, we didn’t attend every session or talk to all of the attendees. Consider this a snapshot of a few ideas that kept emerging, crosschecked against what we’ve been seeing from companies throughout the consumer goods and retail space.
The physical and digital will blend.
This plays out in a couple of ways.
First, there’s the blend of ecommerce and in-store shopping. Shoppers are now largely comfortable in both realms, and they increasingly aren't considering them as separate experiences. They might start browsing for an item online, then go to a store to see it and complete a purchase. On the other hand, they might see an item in the store, then go home and seek out the right color or a better price.
“These journeys for shoppers are so much more fluid than they’ve ever been,” said Martha Welsh, head of strategy, operations and go-to-market initiatives for Google Commerce.
At the same time, brands are operating across both spaces. Digitally-native brands want shelf space at Target and Ulta to complement their Shopify stores and Amazon operations. Retailers such as Brooklinen and Brilliant Earth are expanding in-person operations. Well-known retailers that started in brick-and-mortar stores are opting for a digitally-based direct-to-consumer approach.
It’s more likely that brands will need to be in each. The goal is to create a seamless experience across them. It’s clear there is opportunity for innovation at the intersection of channels including stores, DTC and marketplaces.
“They all need to work together,” said Fareeha Ali, director of market intelligence at ecommerce software company Mirakl.
The merging of physical and digital is also at the center of the growth of the metaverse. A host of brands launched pilots to explore immersive experiences in virtual words like Roblox and Decentraland. As it evolves, the idea is that the metaverse intertwines both online and offline.
NFT and Web3 consultant Deidre Manna Yoshioka offered an example of a phygital product introduced by Tommy Hilfiger at the recently-held Metaverse Fashion Week. A consumer could buy a piece of clothing for their avatar, and also one that is wearable. It's all one product.
“It helped to bridge the gap between that digital and IRL world,” Yoshioka said.
Supply chain will continue to be front-and-center.
Worldwide supply chain bottlenecks put a snag on commerce in 2021, as brands faced long wait times and out-of-stocks. The recent lockdown in China is a sign that the macro picture still isn’t entirely clear.
It means brands and retailers are continuing to put supply chain considerations at the front of their operations. With stores, websites and marketplaces important, moving items to the right places across those channels at the right time will be even more important.
At Amazon aggregator Perch, Marketing Manager Nathan Sieminksi said the leadership team’s experience building supply chain capabilities and the delivery network at Wayfair are key to its value proposition as it seeks to scale brands it acquires.
At the same time, more fluid modes of shopping across online and offline, such as curbside pickup, will mean the supply chain must be closer to the customer to allow for quick access. As the conference was taking place this week, IKEA announced that it will be outfitting sections of its stores to function as fulfillment centers for ecommerce. The front-end and back-end of shopping will increasingly be in the same place.
Ecommerce is evolving to be more social, and personalized.
Ecommerce grew because of its inherent advantages in convenience, price and selection. As adoption continues and shoppers get a reminder of the in-store buying experience, expectations are rising. Shoppers want fast delivery, and they want items to be accurate to what they ordered. At the same time, they want an experience that feels more interactive, and offers moments of discovery.
This can be achieved by making an ecommerce experience feel more personalized to the shopper. This area is going beyond product recommendations. The growth of livestreaming is demonstrating how bringing a person associated with a brand into the digital shopping experience can help consumers to connect with a brand, better understand a product and get questions answered. The interactive experience of livestreaming also adds a social element that has long helped to inspire purchases. It’s an area that Coresight Research sees as a key trend.
The value of customer data.
The privacy shifts of Apple’s iOS 14.5. The demise of third-party cookies. They’re often discussed as bringing change to how marketing on the internet is done. By setting up a more transparent relationship that is built around a better understanding of a customer, it could make end up making ecommerce stronger.
It makes first party customer data that is owned by a brand, instead of a social media platform, more important. After all, better experiences run on good data.
“Data is the gasoline that drives personalization,” said Brendan Witcher, VP and Principal Analyst at Forrester Research. “...When you have an engine you put gas in it...if you put high quality customer data in, that engine will run very well."
It brings a brand’s relationship to its customer closer. They can segment audiences with marketing. In turn, a better understanding of customers can inform product innovation.
One area where this plays out is through loyalty programs. These can help inspire repeat purchases, while also allowing brands to obtain the data that informs everything else.
Here, too, it will be important to think across across brick-and-mortar and online experiences. Custom apparel retailer Indochino is taking such an approach as part of its omnichannel strategy.
There’s plenty of room to experiment.
These are suggestions for where things are heading. What they will look like has yet to be determined. No matter what the topic, a message resonated throughout the convention center at McCormick Place: It takes testing, learning and iterating to arrive at what works.
That could mean testing a new approach to marketing on an emerging channel. It can feel like brands are required to be everywhere.
Erika Silberstein, president of commerce at Wine Enthusiast Companies, said the important thing is, "Thinking about a customer, and not a channel...Who are you reaching in the end?...People are whole people."
Along the way, the important thing is to center listening to those customers, and allowing their voices and preferences to guide you.
It could lead you in a different direction than you assumed you would go. That's what adapting for the future is all about.