Despite the emergence of exciting new tools like virtual reality and artificial intelligence, sometimes it’s important to go back to basics.
Improving your retail strategy could be as simple as connecting more closely with consumers and using technology more efficiently.
That’s the takeaway message from the inaugural State of Technology in Retail report, released on Tuesday morning by the product decision platform MakerSights.
The survey found that for 43 percent of retail respondents, understanding customer preferences is still their biggest challenge when bringing new product to market, beating out inventory management and retail pricing. Forty-one percent also reported that acquiring and retaining customers was the most pressing challenge in retail as a whole.
With an oversaturation of retailers in the market and a new generation of shoppers to win over, the stakes are higher than ever.
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The report did have some good news — the majority of customers want to be involved in the production process and value brands that invite feedback. They identified as tech-savvy but still responded more positively to practical initiatives like buy online, pick up in-store than to conceptual additions like augmented reality. This suggests that retailers should be focusing less on gimmicks or fanfare and more on technology as a means to improve age-old concerns like customer satisfaction.
“We are seeing major shifts in consumer expectations for how they want to communicate and transact with their favorite brands. We no longer live in a world where brands can dictate trends and consumers will wait to purchase what is made available to them,” said Matt Field, MakerSights president and co-founder.
Introducing opportunities for interaction could bring in substantial rewards — 75 percent of consumer respondents said that being asked for feedback by a brand would increase their likelihood to purchase from that brand. Meanwhile, 66 percent wished for additional methods to share their opinions with brands.
It’s now easier than ever to crowdsource responses once the product is in stores, thanks to the proliferation of interactive social media platforms. However, communicating with customers at earlier stages in the cycle could provide the most valuable feedback.
“[When] a large multinational athletic brand is making updates to core footwear [styles], they want to understand how these updated styles resonate with customers who purchased the previous versions,” said Field. “To do so, they test the updated styles with both existing customers and non-customers to discern demand and identify opportunities to attract a new customer.”
Brands are beginning to capitalize on feedback opportunities at each stage between design conception and product purchase, through platforms like MakerSights, Intouch Insight and Qualtrics. The technology provides for multiple angles of testing.
Hoka One One has homed in on identifying channel preferences to help select which products should be sold through which retail partners.
Attribute testing enables a company to see which product qualities are resonating most with the consumer, which can inform marketing campaigns and future product lines. In the athletic market, in particular, finding a balance between aesthetics and performance is critical.
The survey reported that while 82 percent of respondents equated technology with efficiency, and 61 percent said investment in technology was a high priority, only 20 percent are currently utilizing product data management or product lifecycle management software.