NRF 2014 was held last week at the Javits Centre in New York City. It’s the biggest retail event of the year where vendors show off the future of the industry to all the delegates both using inspiring key notes and exciting demos on the Expo floors.
2014 and beyond:
It wasn’t too hard to identify that there were some common themes. On Tuesday afternoon I stood on the main Expo floor and just looking around I could quickly see the industry’s top of mind phrases and buzz words popping out:
As I’m sure most of you know, Jon Stine presented this morning at NRF on the results of his fourth “Catch ‘Em and Keep ‘Em” survey, which is a highly respected study done each year to identify how shoppers are responding to retail technologies. As a followup to his NRF Big Ideas session, I’d like to reproduce here Jon’s blog on his findings and thoughts. Thank you, Jon!
Want Your Share of $100 Billion? Build Customer Trust
By Jon Stine
Trust. It’s a powerful human emotion that often drives our behavior. The level of trust, or lack thereof, between a retailer and its customers can literally make or break the business. Given the importance of trust, many retailers are asking: How much do customers trust retailers? What are the benefits of increasing trust? How do retailers gather the information needed to provide the personalized experiences many customers want, while maintaining and even building trusted relationships?
These questions are especially important given the critical juncture at which we find ourselves—the convergence of people, process, data, and things called the Internet of Everything (IoE).
To help retailers build customer trust in an increasingly digitally connected world, Cisco Consulting Services surveyed 1,174 consumers in its fourth annual Digital Shopping Behavior survey.* From a behavior perspective, shoppers are becoming more digital. In fact, eighty percent of respondents are what we call Digital Mass shoppers—people who research, browse, and purchase digitally. Within this group, Über Digitals, who almost always use a smartphone to shop, increased from 11 percent last year to 18 percent this year. Clearly, your customers are digital.
Before we discuss “how,” it is important to understand “why.” Our research showed $100 billion of IoE value was available for retailers in the United States to capture in 2013 by offering more personalized shopping experiences. If you missed your share, don’t worry. This number is expected to increase slightly in 2014. Realizing this value, however, isn’t easy.
When it comes to trust, retailers are starting from a low base. When asked, “How much would you trust these companies/institutions to protect your personal data and use it to provide something you value?” respondents ranked retailers second to last, at 31 percent—behind government agencies (37 percent), and ahead of Internet companies (18 percent).
Even so, shoppers want personalized experiences. When asked, “Which personalized experiences do you prefer?” respondents ranked promotions via touch-screen or smartphone first (Digital Mass: 46 percent; Über Digitals: 53 percent). This was followed by personalized products, personalized shopping lists, and personalized service.
So, how do we solve this dilemma between a lack of trust and the desire for personalized shopping experiences, which require the collection of personal information? For answers, let’s look at a few of the research findings.
Shoppers want personalized offers that are easy to use – Most people want to receive personalized offers via email at home. This suggests that shoppers — even Über Digitals — start the shopping process while they are in their home environment. The vision of in-store offers may simply not be in sync with the reality of shopper decision making and in-store behavior.
Shoppers are willing to share information – Both Digital Mass and Über Digital shoppers are willing to share past purchase history and basic personal information (name, age, etc.) with retailers to receive a more personalized shopping experience. Topping the list of acceptable information for retailers to use are time spent in the store, location in the store, and products you try but don’t buy.
Based on our experience working with many of the world’s leading retailers, there are three key takeaways and actions when it comes to building trust:
Shopper trust must be earned. Retailers can do this by delivering a clear data policy and making the benefits of providing personal information transparent and easy to understand.
IoE is already here. To capture your share of the $100 billion value at stake, develop a strategic plan that takes into account the information above.
Über Digitals are too important to ignore. Selling to these shoppers requires an architecture and infrastructure that can support their increasing expectations for connected, digital shopping experiences.
To gain even more insights into developing trust in an IoE world, take a look at:
* This year’s Cisco Consulting Digital Shopping Behavior survey includes responses from 1,174 consumers who are representative of the United States broadband population by age, income, and region. It is the fourth in a series of popular “Catch ‘Em and Keep ‘Em” studies by Cisco Consulting Services.
A few months ago we discussed the various ways that consumer PII is compromised. The recent attacks against Target and Neiman Marcus illustrate the constant threat that payment card accepting retailers of all sizes face. Yesterday Reuters reported that similar breaches over the holidays affected “at least three other well-known U.S. retailers”. Given the current onslaught, it’s a good time for retailers to examine their detection capabilities before a payment card data attack, while creating new goals for shortening remediation windows during and after an attack.
As the cloud prepares for another history-making year in its campaign to become a part of every part of our lives, a different type of history is being made. The birth of life. As we begin a new year, many around the world are celebrating new life, building on their family foundation.
“Foundations” are traditionally thought of as ground-level, or even underground; but as we ring in 2014, it’s time to start thinking of foundation in a new light. The cloud makes the possibility of sharing our lives with others more easily than before, like birth for instance. It’s enabling this connection and allowing people to access more information, more pictures, more video, and more data, with more ease than ever before. That connection doesn’t stop at content and data points- in fact, it doesn’t stop at all.
The cloud’s biggest value is in the Internet of Everything (IoE). IoE brings new experiences and interactions to life, and the cloud will only broaden IoE’s breadth over our lifetime with all of the devices, communicating, and sharing information.
In photojournalist Rick Smolan’s Human Face of Big Data project, stunning facts about how big data and the world of many clouds are changing how we live our lives, from our very first day, are showcased. For example:
During the first day of a baby’s life, the amount of data generated by humanity is equivalent to 70 times the information contained in the Library of Congress.
One-third of children born in the United States already have an online presence before they are born. That number grows to 92 percent by the time they are two.
In 2012, the average digital birth of children occurs at approximately six months.
Within weeks of their birth, another one-third of all children’s photos and information are posted online.
In my recent post, “The Internet of Everything’s Impact on Hospitality”, I discussed how the Internet of Everything (IoE) is currently transforming the hospitality industry to more effectively enhance the guest experience while ensuring operational efficiencies and sustainability for hoteliers.
As we continue to move into a new age of mobile and connected things, IoE presents a number of advantages for hoteliers, increasing business value as well as securing customer loyalty through enhanced guest experiences. Hotels that leverage IoE capabilities are made possible through technologies such as Wi-Fi-enabled RFID sensors and Bluetooth LE.