by Derek O’Carroll
During the pandemic, retail had to migrate solely online — and with this seismic shift, shopper expectations have permanently changed. A smooth transaction and quick delivery is no longer a perk for customers and is simply the baseline expectation. Consumers everywhere now seek a rewarding and enjoyable online shopping experience: one to rival, if not replace, the real thing. So what does this mean for retail brands?
Welcome to the ‘Digital Neighborhood’
The concept of ‘place’ has become meta, and COVID-19 has only accelerated this convergence of the digital and physical world. Consumers have work meetings from their homes, young teens meet on ‘Fortnight’ to socialize after school, and many hang out in digital spaces to watch virtual streamed concerts. In essence, there are digital neighborhoods forming, and they are here to stay.
A digital neighborhood is just like any other neighborhood, but it is online. It happens when consumers are brought together via multiple platforms and virtual spaces to explore and form a community. It might sound futuristic, but it is a trend that every retail business needs to get on board with — and fast — because in the digital neighborhoods of the future, shoppers will ‘show up’ to online stores as an event, not only to browse and buy goods, but also to socialise and be entertained, just as they do in physical stores. If brands are not plugged into these emerging digital neighborhoods from the start, and if they lack the ability to rapidly and continually evolve as new apps and technology do, they risk being locked out.
Making Online Shopping More Immersive
As ecommerce becomes more social and experiential, the range of channels available to both consumers and retailers will expand and diversify. In social media, Youtube, TikTok, and Instagram are practically digital cities already, made up of endless influencers and brand ambassadors, integrated shopping options, and numerous selling opportunities for brands and business owners. Instagram’s shopping feature now allows users to pay for items in-app so followers can buy products without stepping away from the conversation.
However, despite this cultural evolution for retail, the experience of shopping online can still be boring. The intention is to scroll and select with ease, and tools such as Amazon’s auto-replenishment feature means shoppers do not even have to remember what they like. Although, this may not even be what consumers want. According to the Future Commerce ‘Vision 2021’ report, 51 percent of customers admit that during the pandemic, they have missed the socialising element of going into physical storefronts, and one in four still watch classic shopping channels like QVC. For now at least, that sense of interaction and community is lacking in online retail.
The next step is for retailers to diversify their technology in order to keep up with this consumer appetite for a more immersive shopping experience. Because experience trumps loyalty, if a retailer cannot (or will not) provide the shopping experience customers in these new digital neighborhoods crave, they will simply find another retailer who can.
Are Retailers Up to the Challenge?
In recent years, brands have proven they can successfully evolve in line with consumer expectations as they have added the role of conversational facilitators to what they offer. Today, customers expect their chosen retailers to recognize their potential as impactful cultural entities, and use their influence to speak out on important causes.
For instance, the Black Lives Matter movement of 2020 put the spotlight on brands to champion diversity and inclusivity — not just within the workplace, but also in their marketing and product ranges. A slew of new wide adoption of efforts erupted, such as the 15 Percent Pledge, which had retailers including Sephora, Macy’s, and Rent the Runway commit 15 percent of their shelf space to black-owned businesses. So brands can successfully evolve to meet consumer expectations, the only difference with embracing digital neighborhoods is that retailers must have the right tech at their fingertips.
How Can Retailers Stand Out on the Street?
For brands that want to stand out on the virtual streets of the digital neighbourhood, it will become essential to have the functionality to make sales through numerous channels. That will lead to greater system complexity and an operational minefield. In this environment, no one vendor can provide the best functionality for all the applications needed for running a modern ecommerce experience. Furthermore, reliance on legacy ERPs is preventing retailers from quickly upgrading and evolving their tech stacks, and in the future, this is going to cause major issues. For example, if your ecommerce business cannot immediately connect to the latest hot sales channel, using TikTok as an example, then consumers will go elsewhere.
As a result of this shift, companies will require the flexibility to rapidly select, integrate and assemble best in class functionality for specific business requirements and switch out technologies when they no longer are fit for purpose. The solution for this is to adopt flexible solutions and open API where brands can curate dynamic and interconnected tech stacks with systems that enable them to quickly integrate a changing roster of best in class tools and applications. This is essential to simply keep pace in an already saturated B2C market and more brands will be building out agile tech stacks through API to keep up with customer demand.
API adoption will be the way forward for ecommerce brands to develop and nurture their customer experience investment and remain plugged into the evolving digital neighborhood. While the upcoming desire for consumers to be able to ‘buy wherever they are’ will unearth operational complexities, with the right operating system, it will not be intimidating. A flexible tech stack will ensure you are two steps ahead of the most innovative online merchants, utilising various best in breed systems to support consumer expectations, rather than relying on one vendor to produce standard functionality fit for everyone.
Since joining Brightpearl four years ago as CEO, Derek O’Carroll has led the retail operations platform from stagnant growth to more than $22 million in revenue, nearly 1,000 customers worldwide, and managing more than $5 billion in orders. Shortlisted for CEO of the Year at the Digital Masters Awards in 2019, the father-of-two is now recognized globally as a retail expert.