Retailers Must Embrace New Shopping Experiences
2. Personalization economy. Think of this as “surprise-me subscriptions,” where experts curate products tailored to individuals and automatically deliver them to their door. Thirty-two percent of U.S. consumers said they’d use this subscription for clothing, where an expert selects items on their behalf based on previous shopping preferences and purchases. Companies like Stitchfix use a mixture of highly developed analytics and style consultants to create very specific recommendations to their consumers. Their return rates are falling by the day.
3. Replenishment economy. Automatic replenishment is when smart sensors detect when a consumer goods product is running low and automatically reorders it for delivery to your door. This removes last-minute trips to the store for consumers. Forty-seven percent of U.S. consumers would subscribe to this service for household items like laundry detergent. Another 43 percent would use it to reorder fresh food items.
4. Services economy. Also known as “do it for me” services. This is when consumers outsource the heavy lifting of household chores to others. Thirty-five percent of U.S. consumers would use this service for their laundry—getting someone else to do the ironing and folding. Companies like GlamSquad are offering this type of service for in-home beauty styling today.
RIDING THE WAVE
As expectations around cost, choice, convenience, and experience continue to increase, consumers will keep challenging the industry to evolve and innovate, driving huge growth in digital commerce. To capture the opportunity in front of them, retailers and consumer goods companies must respond in these ways:
• Adopt a partnership mind-set. Partnerships provide an alternative to the traditional build-or-buy approach to developing capabilities. To meet consumer needs and demands effectively, businesses need to embed a partnership mind-set and culture of collaboration throughout their organization and pull in others who can help create new value to consumers.
• Solve last-mile delivery. The industry needs to work together to find a solution to last-mile delivery. The answer is to create the optimal combination of cost, efficiency, and consumer experience. To achieve it, logistics providers will need to be linked, distribution technologies weaved together, and aggregators or hubs created.
• Implement advanced data analytics. The future of retail will be built on insights derived from proprietary data—in particular, consumer data. Organizations must act now to reap the rewards of the consumer data gold rush by moving from simply collecting consumer data to using it to enable better decision making.
With growing consumer appetite for new purchasing experiences, and trillions of dollars of market value at stake, turning up the digital dial and exploring the four business models will help many organizations operating in consumer industries to survive and thrive. It’s time for retailers and consumer goods companies to embrace these opportunities.
Robert Wollan is a senior managing director and the global Advanced Customer Strategy lead for Accenture Strategy. Chris Donnelly is a senior managing director and global retail lead for Accenture Strategy.
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