February 11, 2022

Christmas & the Evolution of the Retail Experience

Whether you’re super organised and fully gifted wrapped or more of a last-minute dasher to the shops, it’s the time of year in which each of us must tackle Christmas shopping. In fact, last year Christmas holiday shopping accounted for 19.5% of total annual retail income according to the National Retail Federation.

With the continuous drive toward digitisation, more and more people are doing their Christmas shopping online, with worldwide retail e-commerce sales growing by a huge 27.6% during 2020

The online retail experience is always evolving, and with exponential technological advances, many businesses are seeking new ways to engage their audience throughout the customer journey.

From the customers perspective, obvious advantages of online shopping include the wider range of products and retailers available, enabling you to find the best gift possible. And, the uniqueness of the range of shopping available—from small independent businesses to larger scale companies, the accessibility of the practice is appealing. This is thanks to the ease of delivery services, and of course, the ability to order many items without the need to venture out to busy streets, especially the last-minute Christmas Eve chaos.

Making Shopping “Social”

The “Instagram era” we live in has had a significant impact on the retail industry, with social shopping growing ever more popular. This is driven by Social Commerce, in other words, the use of social media to market, promote, and sell services and products which includes the following tactics:

  • Clickable items which take you directly to the product without leaving the app,
  • Adding video content to increase engagement,
  • Using influencer endorsements,
  • Enabling customers to vote on product styles and features,
  • Creating a feedback loop with customers to share comments and reviews,
  • Providing promotions and discounts to customers who share the product to their social feeds. 

The success is borne out in the statistics, with an estimated 79 million social buyers in the United States alone and it’s predicted that this figure will grow by almost 37% by 2025. 

This is much more than a niche marketing play. According to the Interactive Advertising Bureau, brands big and small spent $41.5 billion on social media adverts in 2020, totalling 30% of all internet advertising revenue.

In-Shop Experiences 

Whilst ‘traditional’ bricks and mortar high street shopping has many challenges, with lockdown being the most dramatic example, there’s a wider vision for a new type of retail evolution.

A fascinating element of the evolution of the retail experience is the elevated in-person experience. An example of this is the Louis Vuitton pop-up shop behind their flagship store in New York City; this smaller shop of Louis Vuitton’s is “completely redone every few months to capture the brand imagery of a collaboration, or focus on a product line or collection.” These unique, captivating, and artistic experiences reflect both a pro and con of in-person versus online shopping. The advantage is that consumers can experience something beyond the kind of shopping they’re used to and feel like they’re not just shopping, but having an experience which almost mimics visiting an art gallery, but the con is the limited accessibility for every customer. 

The in-person shopping experience is also being made more efficient, a good example being chains like Tesco opening “checkout-free” stores. BBC reported that Tesco explained how these use a combination of cameras and weight sensors to see what customers pick and then charges them directly when they leave the store.

Omnichannel Approach to Survival... and Success 

The pandemic has accelerated change, one of these changes being the rise of Integrated or Omnichannel sales. These involve the combining of both on and offline channels of sales and marketing strategies, ensuring the customer can seamlessly navigate between each touchpoint the brand provides to make a single purchase.

Many customers are now experiencing new omnichannel models: Buy Online, Pick up In Store (BOPIS) grew 28% in February year-over-year, an increase of 10% from the previous month. 

This multichannel approach provides an engaging and effective customer experience in all forms—whether shopping online, in-app, or in-store. In making the experience seamless and enjoyable for the user, video and other media content should also be streamlined, data-driven, personalised, and engaging. 

An example of the omnichannel approach and how some stores are combatting the key advantages of in-person shopping can be seen in how businesses have embraced “virtual appointments” and livestreaming, as detailed in the 2020 McKinsey report “Adapting to the next normal in retail: The customer experience imperative”. These elements feature content including staff responding to customer challenges in an entertaining way while simultaneously promoting their brand and product. 

In China, Taobao Live made it easier for brick-and-mortar retailers to join its livestreaming channel platform, triggering a 719% increase in participating retailers in February 2020 compared to the previous month. 

Getting Personal While Remaining Private

The personal approach, traditionally associated with high-quality in-store service, now means more in producing a successful data-driven Omnichannel strategy.

The Twilio Segment report, which collated the opinions of 3000 companies, consumers, and marketers, indicated that personalisation is evolving from a basic expectation for consumers to a level where they want brands to remember who they are. This includes where they come from, what they like, and more, regardless of which channel they used.

In terms of building customer loyalty, this has a tenuous combination of advantages and disadvantages. Although it provides a clear way to strengthen loyalty, it is difficult to achieve due to how many channels customers engage with and how their preferences and traits change over time. The same report challenges brands to rethink their strategies regarding how to best adapt to the marketplace at any given time. This includes how data is utilised and especially, how it is processed in real-time. 

In this context, it is vital to recognise that consumers are increasingly cautious—and in control—surrounding how their data is collected and used. In a recent survey by KPMG, 86% of people in the US said they are increasingly worried about data privacy, and 78% were wary about the amount of data collected alone. 

This paradigm of the need for increased personalisation with better privacy control is at the core of VML Technology and our understanding of the changing dynamics of the consumer experience. VML video delivers a unique combination of real-time, data-driven personalisation, with complete data privacy. It is a new form of video  engagement specifically designed for the challenges and opportunities of todays consumer needs. With interactive clickable elements, Calls to Action, special offers, and ‘buy now’ capabilities, it personalises video to each consumer in unprecedented ways. 

As we head into the busiest retail period of the year, it is hard not to notice the many influences impacting the how, where, and why we shop. With Christmas being a celebration of traditions and values, the converse is also true in the lead up to the 25th December—with new habits, strategies, and technologies shaping the future of retail and how we experience it.

Grace Farrell
Content Creator & Copywriter