The future of retail, where one size fits none

When writing this introduction, perhaps somewhat naively, I Googled ‘what was the most challenging time in all of history for retailers?’; thinking I could find some anecdotes about a time when retailers overcame hardships greater than those we face currently. As it turns out, the most challenging time in modern history for retailers is very much 2020. Yet they say “the greater the obstacle, the more glory in overcoming it” and as someone who has been working with retailers for many years, I can see an opportunity for marketers to step up and act as the agents of change for retailers - helping to find the light at the end of the tunnel. There is a solid recovery ahead for the retailers who pay close attention to the many and rapid changes in our industry, and make quick but strategic moves to surf the wave we currently find ourselves on. Post pandemic, the biggest change is the irreversible shift to online. As the CEO of Nike, John Denahoe, stated last month, "We know that digital is the new normal. The consumer today is digitally grounded and simply will not revert back." Our own research of over 2,000 UK consumers and 300 retail marketers showed that most retailers agree with this sentiment, but that they feel increasingly threatened by the trend, with over 70% of retail marketers concerned that increased online competition might negatively impact their performance over Q4 2020 and beyond. This year’s Black Friday is set to be the first that is defined by e-commerce, rather than bricks and mortar, with only a quarter of consumers definitely planning to visit a physical store (24%), and nearly half not planning to shop in store at all (45%). Another survey reflects this, showing 64% expect to go shopping in stores less frequently overall post-pandemic. With many traditional competitive advantages - like store location and key footfall drivers - gone for now, it is vital that retailers set their sights on e-commerce to thrive. There’s an overwhelming amount of information out there on how to succeed in this environment, but there is one core guiding principle: customer-centricity. When a customer cannot physically interact with a brand, we see the threshold of trust become higher. The hallmark of a customer-centric and trusted approach is knowing individual shoppers and treating them with the personalised service they expect. Successful retailers during lockdown have been those to quickly adopt Direct-To-Consumer models that establish direct relationships with each person and treat them as the individuals they are - such as clothing brand Hype, which increased revenue by 43% among returning customers by sending personalised messages. Before the onset of COVID-19, this personalised approach was considered a ‘nice to have’. Mass communication was standard, with the odd sprinkling of personalisation here and there. Today, when traditional competitive advantages have disappeared it becomes a ‘must have’. Our data showed that almost two thirds of consumers (66%) are more likely to open Black Friday emails from retailers if the content is personalised to items they may be interested in. Despite this, just under half (40%) of marketers plan to deploy personalised emails, showing a gap between consumer expectations and marketer delivery. Customer-centricity requires a greater focus on customer retention and loyalty. Our data also showed us that two thirds (66%) of shoppers have said that they want to shop with brands they've shopped with before this Black Friday - but marketers overwhelmingly said they plan to focus on acquisition this year (62%). As increasing online competition drives up the cost of acquisition, retailers would be wise to shift to driving repeat sales that increase a customer’s lifetime value. Ultimately, taking pride in every interaction with each customer will result in a trusted brand overall and therefore drive more sales. Technological advancements have made the customer-centric approach possible, with AI replacing the many manual tasks that would’ve taken ecommerce teams hours to complete, such as creating customer profiles, and targeting individuals at opportune moments when they’re statistically most likely to engage and buy. This focus on customer-centricity does not signal the end of physical retailing, but its role has pivoted and will continue to shift. Existing trends will be accelerated; for example stores will continue to act as places to create memorable experiences, as well as same day delivery logistical hubs, not purely places to drive footfall. The difference now will be a focus on creating fewer, better stores that exist to build relationships, create impressive brand experiences and strong levels of customer satisfaction. Crucially, offline strategies should focus on creating tangible interactions with brands in a digital way, investing in technology that informs the online strategy, and provides data to boost customer-centricity overall. Boots has done this very well, as the brand has reimagined its beauty halls, replacing beauty counters with Instagrammable furniture and discovery areas where people can see demonstrations and share data to find out more - providing more information for the brand’s omni-channel strategy and allowing the targeting of personalised offers. Despite the challenges that lie ahead, I feel very optimistic for the future. Retailers across the board need to fundamentally reimagine how they provide value to their unique customer base now that the long-term competitive advantages of previous years have gone. This advantage lies in the customer experience. Show them a personalised time, and they’ll repay you. James Dunford Wood, co-founder and chief experience officer of Ometria

The future of retail, where one size fits none

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Today’s news in brief-21/2/25

Aldi to increase store assistants’ pay from March

Primark to open first standalone homewares store in March

UK retail sales rise by 1.7% in January

Aldi to invest £67m in existing stores in 2025

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Check out our free weekly podcast

Read Next

How Temu approaches product safety

Clare Burrows: establishing a pioneering footwear brand from scratch

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