A Q&A with Coherent Path Co-Founder & CEO James Glover
From artificial intelligence (AI) and machine learning to augmented reality (AR) and virtual reality (VR), one thing is certain: the evolution of technology is continuing to keep the retail industry on its toes. No one knows this better than our very own CEO, James Glover, which is why we asked him to weigh in on the most impactful retail-related technology trends of 2018, and how they’re propelling the industry forward. Here’s what he had to say:
What are your top technology-related predictions for the year 2018?
In our digital reality, we have so much information and I think harnessing data from all silos – for all industries – will be a huge focus in 2018. For retailers especially, having a good understanding of their customers, from their online behaviors to shopping patterns, and effectively leveraging as many data points as possible to deliver a positive customer experience, is paramount. A recent Forrester report found that 85 percent of retailers consider their use of data for personalization to be effective (51 percent very effective), yet 59 percent of shoppers believe retailers are ineffective at making them feel well known. That’s a pretty significant discord. Smart retailers will invest more heavily in technology that can help them make sense of their transactional data to better serve their customers, and I think we’ll see more of that in the coming year.
What were the top three biggest retail-related technology trends of 2017, and will these trends carry over in 2018 or do you think they will change? And, if it will change, what will the top three trends of 2018 be?
I think the biggest retail-related technology trends of 2017 come down to the use of analytics, mobile and automation, in email especially. I don’t think that will radically change in 2018, but rather, will be amplified by the ‘Amazon effect.’ To compete, there needs to be a stronger focus on leveraging data to deliver a truly customer-centric experience, which needs to be special and seamless.
In 2016, retailers sent 14.6 percent more emails in the second quarter than they did during the same period a year earlier, according to Experian Marketing Services. I’m confident they continued to increase their frequency in 2017 too. We’re now reaching the point of saturation, and we can no longer simply increase frequency and expect to grow revenue through this strategy. Revenue per send is the metric – while this may have declined a bit, overall revenue goes up because frequency has gone up. This has been happening for the past 10 years or so. Retailers need to start gleaning insights from their data, using AI and machine learning to deliver better, more relevant emails – not just more.
Mobile delivery will be another big focus in 2018. eMarketer recently reported that more than half of emails worldwide (55 percent) were opened in a mobile environment in 2017, significantly more than both webmail (28 percent) or desktop (16 percent). Despite this, a recent study from Coherent Path and RSR Research found that 60 percent of top retailers didn’t send any mobile optimized emails, and only six sent 100 percent of emails optimized for mobile. Even though consumer behavior would suggest that mobile-optimized email should be a base expectation for any strategy, retailers are not there yet. That needs to change.
To achieve anything at scale, automation is key and that will still be the case as we head into the new year. Automation and machine learning-powered technology can help with back-end operations, expediting once-manual processes and creating faster, more convenient customer experiences. Customers expect an Amazon-level or better experience—and a lot of that experience and competitive edge from Amazon is based on its operational efficiency and distribution. To remain competitive, all retailers must meet (and ideally exceed) their customers’ expectations, and using automation to improve operations is a major contributor to that.
What will be the biggest technology trend disruptor for the retail industry in 2018?
Shopping has always been a visual experience, and virtual reality is taking that to new heights. It’s still in its infancy, but VR will enable retailers to deliver more engaging, immersive experiences in custom-created surroundings that tie together online shopping ease with 3D experiences. From a marketing perspective, this can help retailers engage consumers in more meaningful ways, increasing the amount of time a customer interacts with a brand and creating better and more memorable experiences, which is a win-win for everyone.
We’re already seeing retailers test out augmented reality to improve the customer experience. Converse created a mobile AR app to allow their customers to try on shoes. Sephora recently introduced “Sephora Virtual Artist,” an update to its iOS app that enables shoppers to test out the store’s makeup from anywhere. IKEA created an AR catalog app to help customers visualize how certain pieces of furniture would fit and look in their own homes. The list goes on, and it’s growing, especially for retailers who offer ‘try before you buy’ strategies.
How will 2018, technology-wise, be different from years past in retail business?
Customers’ expectations have risen – they know you have their data and they will demand that it be used wisely. There will be no excuse for every engagement not to be personalized and entirely customer-centric across all touchpoints, and I think retailers are truly beginning to understand that and are (smartly) tasking technology with the job.
I’m hopeful that retailers will move beyond buzzwords like ‘personalization,’ which often manifests as rudimentary ‘you may also like’ recommendations, and start truly leveraging the power of machine learning and automation to put the wealth of customer data they have to good use. Not only will this enable retailers to expose new and different parts of their product catalog, but will also create a culture of loyal, repeat customers—something that’s going to be essential for survival as the retail industry continues to evolve.
Part of this interview appeared in Footwear News.
Also published on Medium.