We already knew Amazon was a growing, cross-channel giant, and then an eyebrow-raising pair of news items hit the ticker this week. Amazon is now the world’s third biggest digital ads seller, surpassing OATH and Microsoft and only trailing Google and Facebook. The company is also planning to open 3,000 cashier-less stores in the U.S. by 2021.
These developments may strike fear in some retailers. And while it’s fair for retailers to view Amazon’s every move as a competitive challenge, they should also pay close attention to what the e-commerce giant isn’t doing. Smart businesses already understand this mindset and are rewriting the rules of retail with a blend of data, creativity and customer care.
Amazon may be a digital Goliath, but it’s a cold and utilitarian one. Amazon’s strength is the ease of its interface – a single place to buy household products like toothpaste, extension cords and diapers with one click. At the same time, it’s not typically a place to buy more personal items or those with emotional meaning — a suit and tie, designer shoes, a bike. The opportunity for brands is to provide experiences that appeal to consumers’ emotions.
Investors understand the possibilities to disrupt commerce beyond Amazon — start-up funding for retail tech has reached about $1 billion a year. E-commerce start-ups like Stitch Fix are becoming billion-dollar companies and going public. In the past year, Walmart bought Bonobos, Target purchased Shipt, and Nordstrom acquired BevyUp and MessageYes. The money will continue to flow toward retail entities that zig where Amazon zags, providing value where Bezos and his team do not. This means venture capital and M&A activity will focus on players that deliver superb experiences with a combination of emotion and tech.
Here are a handful of innovative ways brands are employing such a game plan.
Running with the right fit
Imagine entering a sneaker shop and getting your feet assessed based on their physical measurements and how you stand, walk and run. Then imagine watching a 3-D printer create a pair of shoes that fit perfectly.
Adidas, which has nearly 1,600 stores, plans to make those futuristic ideas a reality by the end of the year. While the effort entails a limited run of one sneaker, the possibilities of 3-D printing should capture the imagination of retail and e-commerce players everywhere. Amazon plans to compete aggressively in 3-D retail, but the digital giant will have a tough time matching the offline experience for products like custom-fit shoes. Its brick-and-mortar stores are focused primarily on automated shopping so people can get in and out in record time.
Experiences like 3-D printing take shopping beyond scrolling through products or walking into an outlet — they give customers a positive story to remember. And they separate brands from the competitive pack.
Boosting personal touch with video chat
Live video chat is another emerging way to make a lasting impression on customers. While it’s early days for this feature, research firm Gartner estimates 100 of the world’s largest 500 companies will introduce it by the end of 2018. At the same time, businesses of all sizes can achieve live video chat’s benefits, which center on offering consumers the personal touch of human-to-human interaction, even if they find your brand via a digital channel.
Barbara Frères Boutique, a children’s fashion retailer with a store in Düsseldorf, Germany, uses live video chat to bring the boutique into consumers’ homes. Shoppers get the curation and consultation they’re looking for by speaking with retail assistants. Barbara Frères generates loyalty and differentiates its brand by building a personal connection with consumers.
It’s a great example of not just digitizing for the sake of it but offering a service that amplifies what makes a retailer unique. It’s not a stretch to imagine video chatting with a specialist to learn more about a mattress you’re interested in buying or to get recommendations about the hiking gear you need for an upcoming trip.
Flexibility after the purchase
Convenience counts at all points of the shopping experience, and it’s especially impactful after the purchase. Brands increasingly focus on how they can make customers’ lives easier — for instance, by offering other delivery and pick-up options, so shoppers don’t have to worry about a package sitting outside or planning their schedule around the estimated delivery time. Accenture found that 65 percent of global consumers strongly value the ability to change delivery instructions when selecting an order fulfillment company.
The iconic, 150-year-old retailer Saks Fifth Avenue offers features to be unusually helpful to shoppers after they buy, including the ability for customers to purchase online and return items to a store. Additionally, it offers dedicated phone lines to respond to alteration emergencies such as broken zippers or urgent tailoring requests.
Showing care for customers’ time
Retail start-ups Pointy and Lightspeed POS are attracting considerable funding for good reason: They erase a blind spot in the customer experience, allowing retailers to help a consumer learn what’s actually in stock in their brick-and-mortar shops. In short, their software constantly updates retailers’ web pages with product availability.
Notable brands like True Value Hardware and Todd Snyder use these systems to offer an extra level of convenience. By giving shoppers visibility into what they have in their stores, they show they value their customers’ time. And customers — who are confident the product is in the store as they drive there — are more likely to buy and return as loyal shoppers.
Don’t try to be Amazon, try to beat Amazon
A mix of tech and emotional value are the future of retail. The winning brands in the Amazon era will offer in-home, in-store and on-the-go experiences the e-commerce giant doesn’t have. Retailers around the world will stand out and win customers by forging their own identities. They shouldn’t try to imitate the digital Goliath.
Amit Sharma is founder and chief executive officer of Narvar.