An Engaged Workforce Delivers Exceptional Customer Experiences

While we’ve known for years that happy employees are key to delivering an exceptional customer experience, it’s hard to retain our best people in such a competitive labor market. While high compensation is a strong inducement, it’s no panacea. According to the workforce management experts at Inward Strategic Consulting, Millennials–the largest generation in the U.S. labor force–are demanding a more engaged workplace. They want to work for organizations that are ethical and, further, that are willing to invest in technology to enhance the employee experience. Look for increased investments in AI that reduce busy-work in order to allow more time to focus on the customer, financial wellness programs to reduce stress and increase productivity, and employee experience portals.

Put Superfans to Work for Your Brand

Shoppers on social media want instant gratification and fast, accurate information from advertisers, but how can a brand respond 24/7 without sacrificing the human touch? Tech firm Chatdesk has a solution: recruit “superfans”–students, stay-at-home parents and others with a passion for your brand–to provide after-hours support. With Chatdesk Teams, brands can quickly and affordably augment their customer support with engaged human agents who are paid on a per-ticket basis. Not only can superfans select answers from pre-approved responses, but Chatdesk’s software connects them with AI to generate personalized messages, dramatically increasing conversions. Superfans are motivated to grow the customer base and promote the brand, and putting them to work–works!

Decentralized Structure Provides Better CX Outcomes

The days of CX being solely owned by a CMO or CXO are coming to an end. Because the customer experience is impacted by every single department, customer-facing or not, organizations are realizing the need for inter-departmental CX teams and accountability across all staffing functions. This concept goes beyond Amazon’s bringing an empty chair to meetings to symbolize the customer; it includes empowering employees to do what’s best for the customer, decentralizing communications, and rewarding those who challenge the status quo. Experience-driven businesses have recently enjoyed average annual revenue growth of 15%, compared to 11% for other firms. As more organizations restructure to include CX goals and objectives in everyone’s roles, watch for a rising top rate of growth as well as a widening gap between firms that “get it” and those that don’t. And observe a related trend affecting corporate marketing departments: by 2023, 51% of marketing organizations expect to have decentralized their marketing operations.

Voice-Enabled Shopping Expands Rapidly

U.S. voice commerce sales are projected to reach $40 billion in 2022. We’ve already shared a significant 2019 trend that saw voice assistants conveying more warmth and personality–we’ll see this shift into high gear in the year ahead as brands rapidly expand their voice commerce options. Argos, a British retailer, is utilizing Google Assistant to let customers reserve product through voice shopping before picking up at the local store; during the call, the client can engage the application in conversation and even ask for advice on choosing the right product. As consumers grow increasingly comfortable interacting, consuming content and shopping via voice command, demand will lead to increased product availability across a plethora of new voice-enabled platforms and kiosks. In 2020, brands that are paying attention will invest heavily in voice commerce–literally putting their money where their (customers’) mouths are.

Social Media 2.0

When it comes to interacting with our customers, a basic Facebook page or Twitter account is not only no longer enough but can make us look positively medieval. As consumers increase their use of social media, brands must keep up by adding new support channels and continually refining how they use established tools. An estimated 87% of companies utilize Twitter DM and 51% use Facebook Messenger to connect with customers and prospects, but to fixate on these options is no recipe for success. In the next 12 months, 94% of organizations plan to implement WeChat and 79% WhatsApp–channels that offer tremendous value across marketing, sales and customer support functions. (In just one example, eco-friendly furniture retailer, Big Brain, utilized WhatsApp to recover 70% of its abandoned checkouts.) Although firms are eager to exploit social media’s latest and greatest, and should make bold strides, a word of caution: consumers expect any new platform to provide accessible and reliable customer-focused service from Day One.

Kids Learn Life & Career Lessons at Age Four

Remember the excitement of going to work with mom or dad? Today, parents can go to work with their kids. KidZania, born in 1999 in Mexico City and now found in 22 countries, is making its U.S. debut with a children’s-size town in the Dallas‒Fort Worth area. Supported in part by Industry Partners, the 55 buildings in KidZania City will include a bank, podcast studio, recording studio, hospital, university and various shops and salons, giving kids from four to 14 the opportunity to immerse themselves in adult role playing. The goal is to expose children to different professions and industries, providing a foundation for life and career choices through the power (and fun!) of experiential learning. Participants gain financial literacy, too, conducting commercial transactions using “Kidzos” currency as part of a four-hour experience that should bring young visitors back again and again. According to KidZania CMO Susie Tsai, “It’s a safe place to learn, a safe place to fail and to just be you.” Keep an eye on this and similar innovative, large-scale projects designed to help children succeed in an unpredictable future. If they herald a true trend–time will tell–it’s one made to order for our times.

CSAT Surveys & Analytics Make the Perfect Marriage

After years of debating whether Net Promoter Score (NPS), Customer Effort Score (CES) or Customer Satisfaction Score (CSAT) is the best metric for measuring the customer experience, organizations are coming to understand that it takes more than just one number or method to determine success. Even Frederick Reichheld, the father of NPS, is forecasting data and text analytics as the new way to uncover customer sentiment and satisfaction since he feels that, in many cases, surveys have become “less meaningful,now that they’ve become inescapable.” Do not, however, count on AI as a one-size-fits-all CX solution; without follow-up surveys the satisfaction or loyalty effect of certain transactions cannot be accurately assessed without taking this additional step. And remember: don’t ask customers to document their satisfaction if you don’t have the mechanisms in place to satisfy them in a timely fashion.

Customer Experience is Determined by Best-in-Class Companies

Best-in-Class firms such as Amazon, Nordstrom and Apple drive consumer expectations and impact every interaction we have, no matter the size of our business or the type of widget we sell. As we enter 2020, companies that strive to understand how expectations are developed will realize that customers don’t care about their policies and logistical limitations: the customer experience is universal and consumers expect the same level of care and connection whether they’re shopping in a local clothing boutique, a big-box store, or online at Amazon. In other words, when developing our CX strategy, strategizing around what our direct competitors are delivering is no longer sufficient–we must emulate Best-in-Class.

The Internet of Things (IoT) is the New Frontier

There were reportedly 14.2 billion connected IoT devices in 2019; in 2025 we may be looking at 25 billion. This explosion of connectivity provides businesses with opportunities to enhance the customer experience as never before. By 2020, we will produce an annual data volume of 45,000 exabytes, which will enable vastly improved personalization of our interactions through AI and machine learning. A worthwhile example can be seen in the healthcare industry, which is significantly embracing IoT through the development of new wearable devices that bridge the gap between patient behaviors, needs, treatments and outcomes. One victim of IoT and all this data sharing, of course, is our privacy. Companies will increase the security of customer data through stronger policies and blockchain-like technologies, but can’t stop hackers and data thieves from exploiting personal and proprietary information. Data security and privacy will always be concerns, but we need to continue making strides in building outstanding CX programs while remaining vigilant at every step of the journey.

Many of today’s companies continue to confuse customer service with customer experience. While a critical element for any business and a component of CX, customer service tends to be transactional. Customer experience, on the other hand, begins at the initial touchpoint where marketing entices our customer to engage. The CX strategy requires a long-term commitment.

Our CX journey should never end. It must be relationship-driven, with periodic markers in the road to activate, nourish and inspire the customer to reengage with the brand. People want romance, not a one-night stand. Ensure your CX strategy delivers hope, trust and intimacy. Building strong relationships will always combat the competition, and as consumer expectations keep rising, brands that are able to navigate TCFCR’s 2020 trends will be the winners over the next decade.

In-Store Service Meets Online Shopping
Mobile technology is now available to connect online shoppers with live associates in physical stores, maximizing brick & mortar resources to drive omni-channel sales. Founded in 2015, Hero lets your customer use his device to interact in real-time with a store associate via chat, photos and video. John Hardy, a retailer of handcrafted jewelry worldwide, uses the Hero software platform to provide the type of personalized service its customers could previously only receive in-store. By harnessing the key human component at the heart of traditional retail transactions, virtual face-to-face technology such as Hero’s is a win-win for consumers and merchants. It will be fascinating to see how far and quickly it spreads and what comes next.

The Resale Evolution is Here
Vintage stores, Goodwill outlets and thrift shops have long been havens for shoppers who love a bargain, enjoy rummaging for that perfect find, and embrace the adage “one man’s trash…” Look around today and it’s pretty clear the market for secondhand clothing has gone mainstream, invested in by major retailers as an in-demand, lucrative, and perhaps inevitable part of the fashion mix. Macy’s and J.C.Penney have added entire departments selling pre-worn attire and both are now partnering with ThredUp–a leading online thrift marketplace where quality used clothing may be purchased for up to 90 percent below retail prices. According to ThredUp, which smartly underscores an environmental message, 64 percent of women have bought or are now open to buying secondhand garb. That’s up from 45 percent just three years ago, which should encourage retailers to take notice and–where used merchandise has an afterlife–action.

Brands Bet Big–Shopping and the Mega Experience
Anyone who’s seen the iconic 1967 Mike Nichol’s film The Graduate will likely recall the poolside scene where young Benjamin (played by Dustin Hoffman) is given career advice by a well-meaning neighbor. “Just one word…” the man intones. “Plastics.” Without delving into the irony of the comment, I’ll offer that if the scene were reshot today the word would be “experience.” Consider, for instance, the unprecedented investments in Area 15 in Las Vegas, with Meow Wolf as its top experiential attraction, and the American Dream Mall which just opened 10 miles from New York City with ski slopes and high-speed roller coasters–designed to draw adventurous consumers. These are likely to become go-to attractions given the planning, creativity and money being brought to bear, but some wonder: will visitors be too tired to shop?

Traveling Light
Who among us doesn’t envy those clever air travelers who can get by with carry-on luggage, even on extended trips? At least two companies are hoping to get you into those ranks. Unbound Merino has developed a line of travel-friendly fashionwear requiring minimal care. Their merino wool is odor resistant, breathable and insulating, fast drying and wrinkle free. Anatomie is another firm promising travelers stylish, lightweight, easy-care clothing that can be worn day-to-night, season-to-season. These clothiers aim to eliminate carousel waiting and lost luggage hassles. Their niche is one to watch. As experiential consumer spending grows–and it will–wayfarers who want to pack light without sacrificing style may find the ideal travel companions in duds like these.

Autonomous Delivery Takes Hold
E-commerce companies are keen to reduce the cost of delivering the last mile, generally the most expensive part of the shipping process. Amazon is piloting an automated delivery solution they’ve named Amazon Scout. The service, currently being tested in Washington State’s Snohomish County, is designed to safely get packages to customers using autonomous delivery devices. Meantime, Starship Technologies, a leader in this space, is deploying thousands of “clean and green” six-wheeled delivery robots on college campuses around the country. Pizza, groceries and sundries can be delivered 24/7 to the student prepping for an early morning exam or the household that’s run out of a must-have item in the middle of the night.

Thinking Locally
In many towns, the neighborhood stores we love have been replaced by the very same retailers found at the nearest mall. Historic shopping districts such as Georgetown in Washington, DC, which once offered shoppers variety along with loads of local flavor, are today little more than outdoor malls. This unhappy trend is compounded by the growing vacancy rate in neighborhoods where leases are now well beyond the means of small players. A solution is being put to the test in and around Fort Lauderdale, FL, by Zero Empty Spaces, which helps provide area artists with affordable studio space in vacant stores and, thus, hopes to bring community shoppers back to the neighborhood. Landlords are able to add panache to an otherwise homogenized retail mix while giving artists the exposure they need and a lease they can afford. It’s not difficult to imagine the possibilities for expanding Zero Empty Spaces. It’s a smart and timely retail model that in my view can’t move beyond Broward County, FL, soon enough.

The “Temporary Economy” Innovates and Expands
Rent the Runway (RTR), a pioneer in the fashion rental business, is looking beyond attire. RTR’s partnership with West Elm lets customers rent quality home décor such as bedding, pillows and coordinated bundles for any room in the house. For West Elm, it’s a new way to demonstrate to its environmentally conscious customers that sustainable décor can be both accessible and shared. For RTR, it’s a natural extension of its motto “simply rent, arrange, live, re-arrange, return and repeat” and the first but undoubtedly not the last new rental category it will help to establish. Meanwhile, LUX | Miami is offering luxury cars–including Porsches, Ferraris, Lamborghinis and Rolls Royces–for one-day rental, if that’s what the customer wants, delivering an experience that’s not likely to be forgotten.

Peer-to-Peer Selling / Renting
A sister trend to both the Resale Evolution and the Temporary Economy is peer-to-peer trading. While eBay helped put this concept on the map following its founding in 1995, it was rare in those days for buyers to seek out pre-owned clothing not classified as “Vintage.” Today, companies such as Depop are growing at lightning speed by allowing their app-based communities (target demographic under the age of 26) to buy, sell and share their used fashions. While the number of online platforms promoting peer-to-peer clothing rental is growing, challenges include the expense of shipping and even thornier issues around cleaning practices–or the lack thereof. Although these remain pain points for the nascent market, demand for such services will lead to solutions that diehard customers, at least, will accept.

Driving Traffic Through Collaboration
We know e-commerce has led to fewer people coming to our physical stores. So, what can we do to turn this trend around and increase foot traffic? Walgreens and Nordstrom have an idea: Let customers of other retailers and brands pick up and return items in their stores. Walgreens, for instance, is offering pick-up and return service on merchandise purchased online from Levi Strauss & Co., Urban Outfitters and Anthropologie. For both Walgreens and Nordstrom, the tech/software firm Narvar, Inc. makes the process possible by managing order tracking and customer communication. In yet another synergistic experiment to bring in new customers, Nordstrom is offering temporary space to online brands such as Allbirds, a footwear maker that follows sustainable practices. I’m confident this is just the tip of the iceberg and that a growing number of brick & mortar retailers will aggressively pursue these types of collaborative strategies in 2020.

Putting It All Together
Many of our 2020 trends suggest a challenging future for retailers. Absent the stigma of wearing other people’s used clothing, and with a new generation of consumers willing to rent and share items they would once have bought, production can be expected to decline across a range of categories. An even more formidable factor: the sustainability movement. A monolithic trend with the weight of youth behind it, sustainable culture is poised to impact consumption at the expense of designers, manufacturers, merchants, and supply chains that underestimate or (god forbid) ignore it. One result is that brick & mortar retailers are going to find it more difficult than ever to persuade consumers to drive over and come on in.

To ensure customers visit our establishments in the future–and that’s measured in years, not decades–the retail experience must be structured around the human component. The first step is to get back to the basics of delivering on the customer’s wants and needs, building trust, and demonstrating that our appreciation of the individual shopper goes beyond the sum and substance of her transactions. As environmental factors and fast, convenient e-commerce increasingly keep consumers in their seats, it’s essential we view each person who walks into our shop as golden. Why are e-commerce merchants opening so many physical stores and pop-ups? They recognize the need to reach out and touch the customer.

Which brings to mind a little story. A restaurant in New York was catering to a remarkably diverse group of loyal patrons and its business was through the roof; there was nothing like it in the neighborhood. Eager to uncover the secret of its success, a business columnist dropped in to interview some of the regulars. “Why do you come here so often?” the reporter wanted to know. “Is it the food? The ambiance? The prices?” The response was consistent: “They know my name.”

It’s just that simple.

Today is the first morning of the National Retail Federation’s Big Show at the Javits Center. According to NRF’s site, they are expecting over 37,000 attendees and 700 exhibitors. It’s one of the most valuable shows for retailers to attend. I can almost guarantee you that none of the exhibitors will be talking about the intrinsic value of a conversation.  Almost always, it is difficult to find a contact number for most retailers and equally as difficult to reach a particular department or person in a store.  There are no direct extensions published and no system in place to leave a message.  How many times have you stood at a cashier station and heard the phone ring and ring and never get answered?

Retailers complain about the high cost of technology, increases in labor costs and reduced margins. The phone is a low-hanging fruit solution. In the article, Bob asked Robert’s son if his dad was bothered by receiving a call a night, especially at home. “No, he could not have been more pleased,” was the answer, “and the customer felt as if he was being greeted by a friend.”

If you own or manage a retail store, large or small, always have your staff answer the phone during store hours; never employ an automated voice response system. Train your associates on proper phone manners and allow customers to leave messages that are responded to within a short period of time. While customers today may not expect to speak with the President of a large department store chain at home, is it too much to expect that they can call stores during normal hours and hear a friendly, welcoming and responsive live person on the other end of the line?

I often say, customers walk into a retailer as a stranger, and with the right training and focus, can leave as a friend. Use the phone as a way to develop a friendship; the power of a dialogue between two people should never be underestimated.

Mastering good client communication is the first step to a great relationship, but it’s also important to show client appreciation through gifts, letters, and thoughtful activities. Check out these great client communication tips and show your clients how much you care about them and the business they provide. After all, without fantastic clients, you wouldn’t have your amazing business.

Client Communication Tips for a Great Customer Experience

No matter what business you’re in, client communication is vital for giving your customers a great experience with your company. Great client communication helps companies retain customers and continue to grow their business. This is especially important if you have a service-based business. Poor communication with your customers translates into lost sales and won’t help your bottom line. If you’re new to client communication, here are a few tips to get you started on the path to creating an excellent customer experience.

1. Set Rules: Set guidelines and rules for managing client interactions and train employees on client communication. This makes it easier to have another employee step in and assist with conversations as necessary.
2. Establish a Regular Communication Plan: This includes how often you contact customers, when to follow up, scheduled outreach for sales, and an active social media strategy.
3. Adapt Your Communication Method: Different clients like to communicate in different ways. Some clients might prefer social media or video messaging, and other clients might feel more comfortable with traditional forms of communication like phone or email.
4.  Offer Relevant Service/Products: Not all of your products and services are relevant to every client. Familiarize yourself with your products and clients and keep communications relevant to your customers.
5. Prepare: Research client needs before communicating with them. Send surveys to new clients and get information about them to communicate better. Plan enough time for client interactions.
6. Seek Feedback: Get client feedback after communications through survey or customer service interaction. If you lose a client, find out why so you can fix problems in the future.
7. Personalize Your Interaction: Personal messages mean a lot. Personalized emails and handwritten notes are small gestures, but they let your client know you value their service.
8. Disagree (Tactfully): It’s not easy, but if you approach it the right way you can really make a difference for your clients. Don’t force your idea and provide facts and information to help them make up their own mind.

Taking the time for effective client communicationshows how much you value them and builds stronger relationships in the future. Once you’ve learned these basic client communication tips, don’t forget to show your client appreciation with gifts, notes, and other personalized items. Communication and appreciation go hand-in-hand in building a great customer experience.

About the Author:Danielle Adams is a freelance writer who works with various sites including Spoonful of Comfort. When she’s not writing, Danielle enjoys learning more about various organizational apps, hanging out with friends, and exploring her local coffee shop.

Although the onrush of AI and related technology will make navigating Customer Experience more challenging in 2019, you’ll be glad you made the trip. Keep your hands on the wheel and your eyes on the following trends.

Customer Experience Will Be Delivered with A Brand Purpose

Providing a more pleasurable experience through signature scents, luxurious décor and beautiful music encourages consumers to remember us and return, but when the experience helps them make better buying decisions, it takes on purpose. One powerful way to accomplish this is to help customers physically grasp the usefulness of our merchandise for a given situation. Quality outerwear retailer Canada Goose figured this out and has been installing cold rooms in its flagship stores so customers can try on its coats in the conditions they were designed for. It’s like a walk-in freezer: cold inside, but warming the prospect up through a very cool experience. The store is no longer a place merely to display products, but to provide brand experiences that are simultaneously engaging and practical.

Larger Phone Screens = New Opportunities for Delivering Content

As our smartphone screens increase in size, fresh products, markets and opportunities are taking advantage of the new real estate. Apple recently acquired Next Issue Media and its “Texture” app, which some describe as a “Netflix for magazines.” For $10-$15 monthly, subscribers have access to a bonanza of popular magazine content. Tubi, meanwhile, is a video app with a significant focus on the Android phone market. The service delivers free, ad-supported film and TV content from major studios. For brand advertising, one of the most exciting opportunities is in mobile gaming. To date, brands account for only 15 percent of the lucrative ad spend in mobile gaming apps, but that’s set to change. Gamers are increasingly open to ad-driven content, and according to Adweek, today’s mobile apps “are integrated with customers’ devices, ensuring publishers and advertisers can leverage key data signals to seamlessly connect a relevant message to the right user.” It’s clear that as our smartphone screens grow, so do the options and benefits of mobile advertising.

Brands Develop Secret Apps for Superfans

While “superfans” may be a small subset of your customer base, they are disproportionately important to brand success. Target, Adidas and Ralph Lauren are among the brands that employ “secret” apps to cultivate relationships with their most devoted fans. Interaction with customers on these apps produces a wealth of insight into preferences, values and motivating factors while rewarding and inspiring their loyalty. Adidas’ Tango football (soccer) app delivers an array of video challenges that gamers and hardened street footballers alike find addictive. Nike meantime has released Nike Unlocks for NikePlus members, delivering such experiential content as fitness and meditation classes, mood music and augmented reality-driven encounters with new and in-concept products. If you’re a Ralph Lauren devotee, the fashion giant’s new Polo app has everything you’ll need to shop its worldwide collections plus unique, limited-edition merchandise not available in stores. For 2018 Lauren teamed up with another institution with roots in the Bronx—the New York Yankees—to create vivid experiences for fans of all (pin)stripes. Superfan apps will be a Customer Experience game-changer in 2019. Don’t take your eye off the ball.

Voice Chat Conveys Warmth and Personality

Text messaging is convenient: you send a text and the recipient reads and responds to the message in due course. It’s perfect in many situations, but voice chat makes any conversation come to life. It’s your voice, with your tone and inflection. It’s more personal and it helps avoid the misinterpretation that can occur with text communication. An app that’s hoping to conquer this space is Zello. Described as “the push-to-talk mobile app that redefines the walkie talkie,” Zello aims to let you talk to friends and colleagues “next door or around the world.” Zello offers free personal and paid professional versions and stresses its usefulness in teamworking. As you might expect, Apple is also in on the action. A walkie-talkie feature included with the watchOS 5 software update allows voice chats on your Apple Watch. It’s too early to predict the extent to which walkie talkie-style digital communication will impact the Customer Experience, but expect to hear a lot more about this development in the years ahead.

Podcasting is the New Future of Media

Podcasting is one of the fastest-growing forms of digital media in the world. According to Forbes, 13 years after Steve Jobs called podcasting “the next generation of radio” that vision has been fulfilled. More than 80 million Americans now listen to podcasts regularly per Edison Research’s Podcast Consumer 2018 report, which asserts that the medium’s “share of ear” has doubled in the last four years. It’s not just Apple’s commitment but Google’s that is propelling such widespread adoption. As reported in Pocket-Lint, a new Google app for Android—the company’s first dedicated podcast player—provides access to over two million podcasts. Google plans to apply AI in a number of ways: offering automatic subtitling, on-demand language translations, improved search functions and a smart suggestion engine. So what’s in it for brands? First, relative to other performance media the costs of producing a podcast are low, with few barriers to entry and an accessible audience for relevant, free programming. Check out branded podcasts from GE, eBay, ZipRecruiter, Basecamp and Sephora, and if you don’t want to produce your own podcast, advertise. SmartAsset explains the advantages podcast advertising has over other digital media: “When you listen to a podcast, the host or hosts generally read out the advertisements … there are no annoying pop-ups, auto-playing videos or intrusive ad breaks that are loud and out of sync with the tone of the program.” There’s no easy way to skip ads in a podcast and—for now—it’s a buyer’s market.

Projection Mapping Creates an Immersive Experience

Projection mapping lets firms engage customers in unique and often mind-blowing experiences. State-of-the-art projection mapping tech allows imaginative image and video content to be projected onto 3-dimensional surfaces—a big leap forward from flat, monotone walls and screens. As David Title, Chief Engagement Officer at Bravo Media, an experiential marketing studio, explains, “Projection mapping has a unique ability to transform an environment in ways that traditional screens and LED arrays simply can’t deliver. With an ever-increasing demand for immersive experiences we expect to see projection mapping used across industries, from retail and hospitality to real estate and public spaces, to engage, inform and delight.” Words we most often hear from spectators are “exciting,” “amazing” and “unforgettable,” and creative brand marketers are testing the possibilities across a range of industries; among the 60+ examples linked at GES are Southwest Airlines, VW, New Balance, Pepsi, LG, H&M, Mattel and Harrods. Although full-blown projection mapping “events” are out of reach for organizations with limited marketing budgets, there is enormous incentive for tech firms to produce applications that small to midsized companies and nonprofits can afford. Brainstorm your dream application, and if you find it too costly at today’s rates, treat it like the weather in New England and wait a minute.

Paid Loyalty Programs Gain Deeper Engagement

The traditional “free” customer loyalty program is here to stay but paid and VIP programs are trending at the top of the pack. Research shows that loyalty program members who pay or purchase to belong are incentivized to follow brand messaging, utilize member benefits and share personal information beyond the contact basics. Along with the more obvious perks and benefits, fee-based programs have been demonstrated to create a sense of exclusivity not found with the free variety. The result is something akin to true loyalty, and brands such as Amazon, GNC, Hilton, Bed Bath & Beyond, GameStop, Sephora and Renovation Hardware are making hay. Amazon has been remarkably effective in convincing affluent customers to pony up $99 annually for a Prime membership—an astounding 82 percent of U.S. households with annual incomes exceeding $110,000 are members—and these members are spending 250 percent more annually than non-members. (Amazon’s recently announced increase to $119 yearly should have relatively little impact on these numbers.) LoyaltyOne tells us that “sixty-two percent of consumer respondents said they would consider joining a fee-based rewards program if their favorite retailer offered one.” Among Millennials, the numbers are even more compelling, with “75 percent of 18-24 year-olds and 77 percent of 25-34 year-olds saying they’d pay to belong.” Enough said.

AI Moves from Personalized to Predictive

AI lets firms use the information they collect about the buying habits of a given client to create a more personalized experience and predict future actions. Predictive consumer analytics is not new, and neither is Amazon’s use of it. As early as 2010 Jeff Bezos described “business intelligence and data analytics, machine learning and pattern recognition, neural networks and probabilistic decision making” as among the techniques and technologies the firm was already exploring to build its customer base. A pioneering Amazon application allowed the etailer to predict when a caller was checking on an order, prompting the system to bypass superfluous auto-response options and get him directly to the information he was after. The company never ceases to build on such innovation. In February 2018, Wired spoke with Amazon VP of Devices and Services David Limp about a reported transformation in how Amazon predicts which and how many customers will buy a new product. “I’ve been in consumer electronics for 30 years now, and for 25 of those forecasting was done with [human] judgment, a spreadsheet, and some Velcro balls and darts,” Limp said. “Our error rates are significantly down since we’ve started using machine learning in our forecasts.” United Airlines, Netflix and Spotify are some other notable brands applying AI algorithms to their customer data and creating win-win outcomes.

Regardless of industry, businesses need to continually assess how customers view the experience they deliver. And while we know consumers prefer self-service and that firms can reduce overhead by using AI to address that preference, we need to be mindful that when a customer hits a wall she wants a human being to intercede. Therein lies the prize, because the human element will continue to be the key differentiator between your company and the competition. So stay human, and remember: the customer is still king, and in the tech-driven experiential age, Customer Experience—not service—is the king-maker.

Specialty Stores Thrive; Department Stores Surrender

Department stores have become damaged through perpetual deep discounting and their failures to motivate staff and excite consumers. All around us, once-dominant chains are shrinking and shuttering at a frightening pace, with venerable Sears and Toys R Us among the casualties. At the same time, specialty shops offering unique merchandise, highly trained (and well-compensated) sales associates, and irresistible services and spaces are booming. No retailer better exemplifies the trend—or its staying power—than Mitchells, a “luxury brands specialty store” that’s set the bar with its exceptional customer service; exquisite designer clothing, jewelry and accessories; and multi-generational relationships with designers and consumers. Jack Mitchell, CEO of the company his parents started in Westport, Connecticut, went on to write Hug Your Customers and, later, Hug Your People—titles that concisely sum up his retail recipe for success in a world of unlimited choice.

Consumers Spend As Channels Blend

Today’s customer is channel agnostic, switching effortlessly between online and bricks-and-mortar buying and employing a blend of shopping techniques: patronizing physical stores for tactile and social experiences, conducting product/pricing research via smartphone, and taking advantage of super-convenient online ordering and delivery options. “We don’t hear customers talk about channels very much,” James Nordstrom, president of Nordstrom Stores, told Diginomica. “Customers value experiences, and so the more successful we are in creating a great shopping experience, no matter how they’re choosing to shop, I think the better our business will be.” To exploit the trend, make your customer’s experience a good one no matter where he shops you.

The Circular Economy Expands, Retailers Go Sustainable, and Customers Approve

Serving the goal of sustainability, a circular economy is a regenerative human-managed system in which waste is minimized by slowing or closing energy and material loops. The economic model embraces durability, reuse, repurposing, refurbishing, recycling, and upcycling, and is being embraced by a growing cohort of environmentally-friendly merchants and manufacturers. Companies such as Unilever, Patagonia, IKEA, Lush Cosmetics, and New Belgium Brewing not only have the distinction of executives who can sleep at night, but legions of loyal, educated and affluent customers who reward environmental leadership at the cash register and like to tell their friends about it. Take Patagonia, the cultish outdoor clothing chain that has championed Earth-friendly practices and policies for over 30 years. The retailer’s Worn Wear program provides generous merchandise credits for returned Patagonia clothing in good condition. The returns are sorted into three categories: “Rewear” for clothes suitable for second-hand sale; “Reuse” for well-worn items to be turned into other products; and “Recycle,” which converts everything else to textile fibers and industrial products such as insulation. According to CEO Rose Marcario, Patagonia “wants everyone to become radical environmentalists by keeping our stuff in use longer.” Retailers with their eyes open won’t need a degree in climate science to know which way the wind blows.

Members-Only E-Commerce Becomes More Personalized

Amazon is far from the only retailer that’s innovating in e-commerce. Walmart describes Jetblack—a service launched from the retail giant’s tech incubator “Store No. 8” (not really a store) earlier this year—as “a new shopping service that combines the convenience of e-commerce with the customized attention of a personal assistant.” More pricey than Amazon Prime ($50 monthly for Jetblack vs. $12.99/mo. for Prime), the service is going after an upscale, busy clientele including “time-strapped urban parents.” A member simply texts her shopping request and Jetblack goes to work, delivering the appropriate merchandise within two business days—just 24 hours for popular items—at no additional charge. The launch publicity stresses an entrepreneurial, team-oriented approach to the question, “What if we doubled down on the customer experience and leveraged emerging technologies to build the most effortless, customized, and curated shopping experience possible?” The underlying system reportedly combines the skill and knowledge of expert human buyers with the speed and precision of AI and aims high to satisfy the unique needs of each member customer. If it flies, and it should, we’ll be hearing a lot more about this and other hyper-personalized services to follow.

Cashier-Less Checkout Expands Rapidly

As Amazon expands its Amazon Go chain of self-service convenience stores, dozens of startups are competing with established firms to master and lead this potentially game-changing retail model. An innovative Chinese entrant, BingoBox, has taken the cashier-less concept to another level, automating virtually every aspect of store operations in more than 300 unmanned outlets. BingoBox stocks snacks, beer, and just about any essential food or household item you might need in a pinch when other stores are closed. Shoppers scan a QR code to gain entry and pay for their purchases via mobile app. Other checkout-free startups include Zippin, with a recently opened concept store in San Francisco, Inokyo in Mountain View, and Santa Clara’s AiFi, which promises an affordable, flexible system for mom-and-pop stores and larger retail operations alike. This is an important trend that many of us will want to watch, but here’s the million-dollar question: Will automation that eliminates human staff find a home across the broad retail spectrum, or be consigned to the convenience store market where today’s innovation is occurring?

Retail Metrics Shift from Store Sales to Various Touch Points

While the same-store sales metric has long served as a baseline indicator of retail success, a number of industry analysts are questioning whether the metric is appropriate to measure modern retailing, according to recent reporting in RetailWire and Retail TouchPoints. Stores don’t always serve the same function that they did in the past, when they had one job—to complete the sale. Today’s stores have taken on a number of new roles, including marketing to boost brand awareness. That may mean the store no longer carries and sells products; that it has become an experiential destination center, showroom, and/or distribution center. Clearly, when sales are frequently completed in a channel other than the store, judging performance based on sales numbers alone is misguided. This is a reality that Wall Street investors and shareholders are learning to accept as retailers convert their stores into something new.

AI Becomes A Valuable Tool to Personalize Service

Retailers are using AI to personalize customer service, and the trend is picking up steam. Fifty-five percent of retailers plan to leverage the technology within three years, according to the 2018 Customer Experience/Unified Commerce Survey from Boston Retail Partners (BRP). Among the many applications: merchandise recommendations based on a customer’s response to a short survey, and the ability to contact a given client at the most favorable time of day. In April, Starbucks rolled out voice recognition ordering in South Korea, extending its mobile order-and-pay technology by integrating with Samsung’s AI chatbot, Bixby. Customers can use their phone in a conversational way—as if speaking with a real-life barista—to learn more about available beverages. Meantime, The North Face has adopted IBM Watson’s cognitive computing technology to help consumers find just the right jacket. But here’s the thing. While AI implementations will permit innovative businesses of all kinds to increase client satisfaction, Starbucks and The North Face know full well—as any customer-centric organization should—that connections made between two people will always trump “equipment” no matter how many bells and whistles are thrown in.

Mall Brands Enter the Subscription Service Rental Market

Ann Taylor and Express are notable among the fashion retailers that offer rental subscription services—an innovation that helps to offset reduced in-store traffic and create a new revenue stream. With Ann Taylor’s Infinite Style program, for $95/month subscribers receive up to nine garments every four weeks. “Wear it. Send it back. Get more. Exchange as many times as you like with free shipping, both ways.” Meantime, Express Style Trial works on a set-of-three basis and looks attractive at a flat monthly cost of $69.95. “This service allows our closet to become your closet. Start closeting items by browsing our site and viewing everything Express Style Trial has to offer. Check out New Arrivals for new styles each week.” In addition to helping clothing retailers maximize their inventories, affordable monthly rental programs such as these hold particular appeal for younger customers who may not have otherwise recognized the brand. Now it’s something they’ll want to talk about. According to Allied Market Research, the online clothing market rental market will exceed $1.8 billion by 2023.

In recent years, retailers have increasingly overlooked employees as their most important competitive differentiator, instead focusing on technology solutions that promise to reduce overhead and automate every conceivable aspect of the business. AI is a remarkable tool with capabilities we’ve only just begun to unleash, but as an executive obsession I fear it will further devalue our people. As enthusiasm for AI, unmanned stores, and ingenious self-service options swells in 2019, remember that when (not if) the machines drop the ball, customers will be most grateful for the human being in the room.

And consider the philosophy of MM.LaFleur as articulated by Rachel Mann, director of offline retail, when she said, “for us it’s all about the human experience—a refuge from Alexa and all of the choice and robots … it should be like you’re meeting your friend and she’s giving you good advice.” Now that’s a trend you can bank on.

The other day I decided to conduct a mystery shopper e-commerce visit.  I searched the Macy’s site for jewelry and then sorted my selections by price. What popped up? An engagement ring for $36,475.90. (Yes, an extra 90 cents!) Is an average shopper going to buy an expensive ring without being able to easily ask a question?  I don’t think so. It gave me an option to increase the quantity so I added 6 rings to my shopping cart. It accepted the 6 items totaling $186,027.06 and let me know that I had saved $32,828.04. Wow! It also gave me a message, “Congrats, you get free shipping.” Well, I would hope if I just spent $186,027.06 they would include shipping charges, especially since 6 engagement rings probably weigh less than 1 lb.

After my first attempt to purchase the 6 rings, I decided to replicate my search to take some additional screenshots for background information for my blog. This time a “chat box” popped up. I was first requested to enter my name and email address before I could start chatting. I thought how many sales has Macy’s lost because some shoppers may want to get their question answered before sharing their contact information.

My conversation was as follows:

Richard: Hi, I want to know if I purchase 6 rings can I get an additional discount?

Chat agent, Hello, thank you for chatting with a Fine Jewelry expert at Macy’s. Please give me one moment to review your comment. (two minutes later). I’d be more than happy to assist you. May I have the Web ID number for the item you have questions about? The Web ID number can be found by scrolling down under the product details. I can see if any discounts apply. (I was surprised the chat agent didn’t have the technology to know what item I was referencing)

Richard: I told her I couldn’t readily find the number, but gave her a detailed description of the ring.

After a few back and forth questions I asked,

Richard: May I speak to an associate over the phone to ask some additional questions?

Chat agent: Yes, please call 1-800-289-6229

Richard: When I call will I get a person directly or do I have to go through menu options (don’t forget I’m thinking about making a purchase for $186,027.06)

Chat agent: You will be able to select the jewelry department and get a live associate.

Richard: Okay, thanks for your help. Have a nice day.

I dialed -1-800-289-6229 and was responded to by a voice recognition system that did not understand my question. I said, “I saw an item on your website and have a question.” After many back and forth conversations between the voice recognition system and me, I hung up.

I’m not picking on Macy’s, but can you imagine all of the e-commerce potential sales that are abandoned.  Wouldn’t it make more sense…

• If there is a chat agent available, that you don’t have to be required to provide your contact information before the shopper’s question is answered?

• There is technology available that allows the chat agent to automatically know what item you are viewing?

• There is a direct line to the fine jewelry department. The potential order was for $186,007.06.

Many retailers have just reported highly successful financial earnings. A substantial percentage are touting their e-commerce focus and results. The economy is strong and consumer confidence is fairly high. If the economy hits a wall retailers need to think of ways now that make sense to continue moving forward.

If you are responsible for an e-commerce site, do a mystery shop like I did.  Inquire about purchasing one of your more exclusive or expensive items and see how the process is working. For higher priced items, a live associate who can easily answer questions can help make the sale. To me, almost all e-commerce sites would be much more successful if their telephone number was prominently highlighted on the home page. Added to that, a telephone posted that went directly into a customer service department filled with live and educated associates.

Unfortunately, most e-commerce sites are designed to be devoid of human to human interaction. In my view, a big mistake.

What do you think?

I recently attended a retail conference. One of the panelists was asked to describe the future of retail. Their answer? Unmanned stores! I was horrified, but not surprised. Retailers are consumed with technological advances, and even though they talk about the customer experience, the trend does not include the interaction and connection between a customer and a sales associate, two human beings.  The retail associate is taking a back seat in the customer experience scenario.  In my opinion, this is the wrong track to take and retailers are missing their opportunity to create the glue between the customer and their business.

As per Indeed, one of the leading employment search engines, the typical tenure for a retail associate is less than a year. I realize that this number might be influenced by part-time and seasonal hires, but how many times have you gone back to the same store location and were able to find the same person who helped you on your last visit?

Even on-line only retailers such as Amazon, Warby Parker, Bonobos have opened physical stores. The rationale: customers want to see and touch the product. We are also now in the era of experiential selling and many stores being built or refurbished are showcasing expensive artwork, sculptures, waterfalls, yoga studios, etc. If you attend the National Retail Federation’s Big Show in January, you will find thousands of vendor booths displaying the latest technology advances. I believe in comfortable, feel-good environments and technology that enhances the customer experience. However, some companies are allocating increased budgets to create a more attractive and tech savvy environment while decreasing the expenditure for hiring better associates and providing them with training and benefits. Not a win for the retailer.

Retailers are spending significant dollars to get traffic into the door. This includes social media outreach, multi-channel marketing campaigns and expanding loyalty programs. If a retailer is focusing on increased traffic, but not investing in their staff, it’s a waste of resources. Getting customers to visit your physical locations make sense, but not having experienced help to leverage the brick and mortar asset doesn’t compute.

Most marketeers are talking about the importance of establishing an emotional bond with consumers. I agree. But where is that bond the strongest?  Specifically, between two people; the customer and the associate. It’s Mary, the sales associate, who has built a strong human connection with Sally, her customer. Mary knows Sally’s needs and can sell what’s most appropriate for her. If Mary leaves for a better paying job, the emotional connection is lost and the customer, Sally, is now forced to find another Mary at a competitor.

Retailers need to rethink how they hire, train, compensate and retain experienced and tenured  retail associates to service their customers, the ultimate asset.

What do you think?

• Don’t hand your business card to someone before you engage in at least a short, but meaningful conversation. Randomly handing out cards is a waste of paper and does not create a good first impression.

• Send LinkedIn invites to all panelists and speakers either shortly before, during or after an event. Generally, the panelists are experts in their field and filled with knowledge. When sending the invite after you have met, reference something said or mentioned that got your attention. That gets their attention.

• The best networkers are considered, “Givers.” Givers understand networking is about people helping other people. The other three types of networkers, which are not effective, are “askers,” “takers,” and “traders” according to a great book on networking by Jack Killion, Networking All the Time, Everywhere with Everybody 

• Invite people you meet for coffee or breakfast. When you meet with people in their offices, the conversation is 90 percent business; when you meet people outside of their offices it’s mostly personal with little or no distractions from other colleagues.

• When you invite people for coffee or breakfast, it should be your treat. If people insist upon splitting, that’s okay, but as a general rule, it’s rude to invite someone out and expect them to pay. It’s like inviting someone over to your home for the first time and asking them to bring their own food.

• Giving a person a copy of your favorite book adds a nice touch. People appreciate books and love to learn what book might have helped you in life be a better person, more successful, etc. Certainly, if you are an author, giving them a signed copy of your latest book is the ultimate gift.

• Take good notes. I prefer a notebook. I find when I take notes on my iPhone, I’m distracted by open emails and texts. Without notes to review later on in the day or week you will most likely miss a follow-up. People value when you remember what they said, where they grew up, how old their kids are, etc.

• Always put your phone on silent and if you are expecting an extremely important call, ask the person if they mind if you take a call that might be coming in. Ideally a meeting should be scheduled without interruption.

• Meet periodically to catch-up. It might be every 4 months, 6 months, etc. As is true, “out of sight, out of mind.”

• When someone asks you to explain your business, always ask them, “What other questions do you have?” instead of “Do you have any other questions?” The former continues the conversation, the latter implies you are short on time.

Remember in many cases you only have one opportunity to turn a first encounter into a successful relationship. Remember, too,  that the sole purpose of a business card is to relay contact information, not to initiate a relationship. Business cards, as stated before, are pieces of paper.  A conversation makes the best first impression. It’s an encounter where the other person thinks , “I want to get to know him/her.”

The next time you go to any event business don’t fill your pockets with a bunch of business cards. Instead think about how many productive and meaningful relationships you can cultivate. Networking is about getting to know people as people and helping them to achieve their goals. If that is your focus, your goals will be achieved over time. Effective networking is long-term, but it’s worth it.

Retailers confuse customer loyalty with repeat business. Yes, loyalty and repeat business both go to same “church,” but are not in the same “pew.”  A customer can be loyal to multiple brands at once. The key is to increase market share from your existing customers and turn one-time shoppers into repeat customers. I have heard from many retailers individually that when a customer purchases a second time, it can be as much as 40% more than the first transaction. Again, don’t make the mistake of confusing loyalty with repeat customers.  Loyalty is just one step in the process to guarantee a long-term customer.

Recently, Macy’s reported a statistic that had not been issued before. The number was that 46% of Macy’s revenues ($24.86 Billion) come from 9% of their customers. That’s an interesting stat.  While the number doesn’t exactly fit into the typical 80/20 rule where many b-to-b companies report that 80% of their revenues come from 20% of their largest customers, it’s close.  In the retail market, certainly worth noting. I can guarantee that the 9% are not customers making a single purchase but are repeat shoppers. I’m also extremely confident that these customers are not being served by random Macy’s associates, but by their favorite salesperson.

My wife and I live in Manhattan, not far from Macy’s on 34th Street, the world’s largest department store. We rarely shop there, but when a friend gave us a Macy’s gift card at Christmas and we needed some new pillows, we decided to visit Macy’s bedding and bath department. So, on a freezing cold morning in December, we met a sales associ­ate on the sixth floor named Rochelle, who greeted us not only with a big smile but also like we were old friends. “I’m glad you’re inside where it’s warm. You must have something special in mind. How can I help?”

We came for pillows and left with more. It was all because of Rochelle. She was eager to help and knew her stuff so well that she was extremely helpful. She gave us her e-mail address and said we could reach her anytime with questions. When we said our good-byes, we did leave as friends. We hadn’t been to Macy’s in years but knew we would shop there again. And, we did. Over the next two years, we purchased numerous items from Macy’s because of Rochelle. Rochelle turned us from a rarely-Macy’s shopper to a repeat customer.

The strongest bond is between two people – one consumer and one store associate. Focusing on how to generate a larger percentage of repeat customers, one-by-one, will provide higher revenues, profits, referrals and most likely happier store associates.

The term, Customer Loyalty,is passé. Developing a strategy to generate repeat customers is, once again, worth repeating.