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Back to the human age

06. March 2018, Editorial

Human retail as the antithesis of increasing digitalisation

Thema:

Access Age
Emotion
Human Age
Human Retail
retail industry focus
shopping experience

Wherever we look in the world, it seems like everything would just grind to a halt without technology. Retail has long since recognised the opportunities offered up by digitalisation. Automation of processes, tailored deals for every single customer, and the use of artificial intelligence are just some of the apparently limitless options opened up by this technological shift. But how well is that all-important interaction between humans and machines actually working out in practice? And what should the retail industry focus on in future?

From the access age…

 

These days, the retail sector is awash with new technological and digitalisation trends. Conversational interfaces like Amazon Echo and self-teaching machines that drive forward automation such as virtual assistance and software agents are only the tip of the iceberg. The latter uses past customer profiles and consumer behaviour patterns to draw up purchase recommendations and bespoke services. In Germany, economic growth of three percent would be possible with the support of such virtual assistants and software agents, were they to be implemented nationwide. So it is not exactly surprising that so many major companies are taking a very keen interest in artificial intelligence. Multi-channel provider Otto has already come up with a technology that can reliably predict what items of clothing will be ordered and in what volumes up to 10 weeks in advance.

The number of visitors are rising, but revenues are on the wane

It is pretty clear that intelligent systems like this have a positive role to play for retail. Custom offers, tailored product suggestions and dynamic pricing are important tools in production, procurement, logistics, pricing, sales and marketing. But there are also some downsides that need to be kept in mind. Change can also lead to crisis. US department stores like Macy’s and furniture stores such as Butler had to let more than 10,000 people go in 2017 in the wake of their change processes. Retail is becoming increasingly complex. Shopping centres are becoming less about shopping all the time. Instead, they have morphed into leisure destinations, where customers go for the experience they offer.

… to the human age

 

“Organisations need to focus their efforts on the things that computers cannot do faster and that foreign workers cannot do cheaper while at the same time meeting the aesthetic, emotional and spiritual demands of a generation who are prepared to pay a premium price for these qualities.” (Daniel Pink)

 

US author Daniel Pink is right. Our society is longing for the kinds of interpersonal shopping experiences that the technological revolution sweeping the retail sector is increasingly pushing into the background. But how are retailers supposed to use empathy and a human touch to create unique experiences in a world that is groaning under the weight of technological progress? How will it be possible to trigger the full spectrum of human emotions? It might seem paradoxical, but by working together, computers and humans can go beyond simply satisfying this central human need, and do it in an emotional, authentic and communicative way.

Creative habitats

In the human age, experiences, special moments and exclusivity will take centre stage. It will be all about telling stories, conveying a sense of uniqueness and creating habitats. Many offers, events and co-working spaces are already giving an insight into what is going to matter most in future. The combination of human experiences and empathy, in tandem with analysis of customer data, creates the perfect symbiosis.

Sneaker museum

Footwear retailer Foot Locker provides a prime example of this approach in action. Thanks to a special presentation concept, their stores resemble museums. The shoes are mounted on the walls and QR codes give “visitors” the opportunity to find out more about the backstories to the individual models, tune into the history of the shoes, or learn about the basketball stars who wore them.

Secret pop-up space

Another example comes from fashion label Napapijri, which promoted its 2017 autumn/winter collection with a unique take on the treasure hunt format. As part of the campaign, the company built five mysterious doors that concealed artistic arrangements featuring its iconic jackets. Participants who completed the quest were rewarded with a musical highlight in a concert hall in the heart of Florence.

Super services

People are different by nature. Although we inevitably have various characteristics in common with others, no two people are completely alike. So it stands to reason that good customer service has to tap into a person’s nature, if it is to result in a successful sale. It goes without saying that sales assistants still need some degree of expertise. That said, responding to the customer’s circumstances and personality is paramount. And this is why individual service and specialist knowledge are among the main reasons why many people choose bricks-and-mortar stores.

Emotional decoding

Spanish fashion brand Loewe is an out-and-out pioneer in this regard. Sensors in the stores are able to tap into customers’ moods and emotions and make adjustments accordingly. They can come up with conclusions about the customer’s overall bearing from various indicators such as facial expression, body temperature and heart rate, which makes it easier for sales assistants to do their jobs. This next-level service shows that humans and machines can work together to outstanding effect in retail. more about emotional decoding

SUMMARY

  • Cross-linking of people and technology needs to be optimised if it is to result in the best possible level of service for customers.

 

  • And now human beings are on the lookout for unique emotions. Stores have to learn to treat emotional and authentic concepts primarily as creative habitats.

 

  • People are not faceless and go about their business with a great deal of dedication and passion. These characteristics are the foundation for empathy, motivation and enhancing emotional connections and authenticity.

 

  • Data and technology are not the be all and end all – human retail will bring personal interaction and empathy back into the foreground.
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