Household has identified five forces driving retail culture that will shape customer expectations in 2018
Household has identified five forces driving retail culture that are fundamentally shaping customer demands and expectations. And the customer is more demanding – people are embracing fluid identities and striving for personal development. They are slow to trust, quick to disbelieve and lack time yet crave spontaneity.
People are changing quicker than brands are responding. And so, a real time understanding of what customers actually want is more crucial for brands than ever.
The understanding of changing retail culture is becoming the most powerful weapon for engaging with, and driving loyalty from people today. It has the power to differentiate, build trust, and increase spending long-term. When 77% don’t feel connected to any brand (Harvard Business Review, 2017) leveraging retail culture can create a sense of affiliation – and that’s big business.
So what are the five forces brands need to be aware of in 2018?
1. MULTIDIMENSIONAL IDENTITY
To connect with customers in 2018, business has to shift from targeting blanket demographics to shared attitudes.
1 in 2 would hand over DNA for personalised beauty products (GlobalData, 2015).
Sense of self is being redefined and recognition of personal style preference is in demand. The rise of the fluid identity seen in 2017 will continue into 2018 as more products, services and content is produced that recognises individuality. Ultimately, product and service offers are heading towards personalisation on a DNA level. Brands will win by expressing the personal attitudes of their customers and tailoring touch points throughout the journey to individual’s needs, wants and desires.
2. BETTERMENT STATUS
Beyond optimisation, self-improvement will become an international status marker.
90% value the role that brands play in enabling their personal goals (Edelman Brandshare).
Self-improvement has become big business and with the growth of single-person households, brands will play an instrumental role in partnering with people to meet their goals in 2018. Betterment is about going beyond wellbeing to optimisation everything; finance, health, the environment. In the Experience Economy, conversion to product purchase is more challenging, therefore added value services and meaningful, generous gestures will provide relevant and desirable ways for brands to play a greater part in people’s lives. Classroom retail will come into its own, to drive footfall and increase dwell time for long term engagement and relationship potential.
3. EMOTIONAL TRUST
2018 will be about more than just honesty; trust is the lynchpin for affiliation and intimacy with today’s cynical customer.
18% confidence in ‘big business’, yet 50% happy to take AI health advice (PSFK, 2016 & Weber Shandwick, 2017).
While we have seen mistrust in ‘big brands’ this year, when there is an emotional connection brands can gain customers’ trust. This represents a rare opportunity for brands to build customer trust and gain a competitive advantage. Indeed, customers are increasingly willing to give over their personal data to brands, provided a tangible benefit is given back. In 2018, location-based services, localised production with community values, and human connection will all play a crucial role in building trust.
4. TIME MASTERY
Brands will need to go beyond speeding up experiences to flexing energy within experiences to suit changing moods.
Customers will pay 20% more for convenience (Tesco, 2017).
Time is the new luxury, and expectations are rising for an edited and personalised selection, instant and personalised service, and the ability for customers to set their own pace to discover or dwell. In 2018, customers will expect new levels of speed, convenience and timely service. Technology will undoubtedly play a role in helping retailers and brands provide an offer that matches this. In particular, new advancements in voice and facial recognition will help create a more seamless and frictionless journey for customers.
5. ENHANCING REALITY
Customers will demand more live, visceral, shareable moments everyday.
78% crave experiences that stimulate their senses and imagination (JWT, 2015).
Connected customers are seeking engaging experiences, spontaneous moments and shareable stories. In 2018, customers will expect escapism, immersion, discovery, storytelling, virtual and mixed reality in the physical retail environment – experiences that can’t be replicated at home. This is not tech for tech’s sake, but tech as an enabler. Think new subscription: rent the lifestyle; virtual try-ons; live participation and 4D storytelling.
People and how they shop is changing faster than ever. Determine how your brand can align with your customer’s cultural needs – connect with new identities; enable betterment; build trust; master time; or create new realities to move your business forward. Lead from the front and don’t get left behind.