The COVID-19 pandemic accelerated the adoption of in-store digital initiatives because of expediency. Those who had been digital leaders found themselves ahead of the curve, while those who had dithered found themselves scrambling to meet their customers’ new expectations.
The digital struggle was and is real. Pre-pandemic, a 2019 survey from McKinsey found that “About eight in ten respondents say their organizations have begun digital transformations in recent years, but just 14 percent say their efforts have made and sustained performance improvements.”
And only three percent reported “complete success at sustaining their change.”
And now? According to a study by Econsultancy and Marketing Week, “96 percent of enterprise leaders believe the lockdown has increased the priority of digital transformation for the long term.”
Just about every business is pursuing digital initiatives in their spaces. And, inevitably, some will do it well while many will do it poorly.
Miller Zell often helps clients adopt purposeful digital experiences. So here are three insights that can help guide your efforts.
Consumers are ready. Just lead them to both “Why?” and “How?”
The pandemic provided a “why” when shoppers needed both convenience and contactless options. The ensuing urgency provided them enough motivation to figure out “how” to use apps and BOPIS and other digital options that increased speed and reduced friction.
Then guess what happened? Customers made the leap and liked where they landed.
“Why didn’t I do this my whole entire life?” 64-year-old Mary Alft rhetorically asked the Wall Street Journal about her discovery of BOPIS.
There’s a lesson in this.
Any digital initiative needs advanced and thoughtful planning around engagement — both with customers and associates. When the pandemic urgency subsides, businesses will need new methods to feed customer motivation. And that’s about more than discounts and coupons.
Store associates need to thoroughly understand the technology so they can both use it themselves and show customers its usefulness and value. This means organizational decision-makers and managers also need a thorough understanding of the “why” and “how” behind a digital initiative.
COVID-19 pushed customers — even the technology-averse — to try new ways of shopping, and they often liked the new experience. Combined with a digitally savvy and maturing Gen Z, the expectations going forward should be for a growing willingness to explore and embrace new options — as long as the “Why?” and “How?” are clear.
Safe & Cool: The return of the customer experience
Before the pandemic, discussions of business environments obsessively focused on customer experience — whether the environment in question was a retailer, bank, QSR or college campus.
That was all about creating public spaces that inspired and extended customer visits and spending and then engendered brand loyalty. During the pandemic, the importance of customer experience didn’t change — what the customer wanted and needed did.
Going forward, businesses need to figure out their distinct new normal with customers, both with those who are eager to return to their previous shopping behaviors and those who will mostly retain their pandemic-inspired new habits.
That means being proactive, nimble and aggressive with data collection in order to define shifts in your customers’ thinking and habits and to anticipate their distinctive needs and expectations. Your in-store experience needs to captivate those who want to browse and fast-track those who demand an efficient experience.
Further, offering convenience will become table stakes. Businesses will need to ensure that efficiency is also executed at the highest level, meeting exacting demands for outstanding curation.
Great digital initiatives are about removing friction from the customer journey and storytelling along the paths to purchase. An evolving and holistic strategy must be constructed around those two elements.
That strategy must consider demographics, messaging and localization/personalization. Placement of screens also is critical, as is its impact on wayfaring.
This will be a huge differentiator between competing businesses. Two QSRs might offer BOPIS, but the one that provides a more pleasant, efficient and differentiated experience earns loyalty.
Digital provides different types of ROI
Even after a thoughtful, strategic execution, it’s often not easy to measure ROI when a digital initiative is fully adopted. While the understandable hope is for an obvious uptick in basket size and sales, that’s not always the case. That’s also not always the best measurement of success, particularly in the short term.
For one, digital provides a branding boost. It makes you more relevant. Customers might not always use their app in-store, but they like knowing they could. Same with an AR/VR kiosk that helps customers imagine a new dresser in their bedroom or a new shirt on their body or make-up on their face.
It might not become immediately apparent if a QSR’s new digital menu board increases revenue, but it could help contain costs by being connected to inventory or bolster future initiatives by collecting data and helping localization/personalization.
Increasing customer browse time, reducing friction or creating moments of surprise, delight and engagement represent meaningful ROI.
Customer behavior changed at an unprecedented rate amid the pandemic. As noted by McKinsey last summer, “The penetration of e-commerce in the United States, previously forecast to reach 24 percent by 2024, moved from 17 percent to 33 percent in only two months.”
That represents a stunning upheaval in the marketplace.
It also represents an opportunity for thoughtful, agile businesses to outperform their competitors.