Mastercard is on a mission to curate and create priceless experiences that money cannot buy, says Raja Rajamannar, CMO of the company, on the latest episode of the Innovators podcast.
While credit cards have historically been about giving consumers speed and convenience, over the past couple of decades they have made strides into becoming an integral part of how consumers live their lives.
“We are a lifestyle brand. Lifestyle doesn’t mean it’s lifestyle for the rich and famous -lifestyle for everyone,” explains Rajamannar. “Everyone deserves to lead a beautiful life and to grow.”
On the one hand there’s the fact the technology is more seamless – gone is the swiping and signing, and in is the tapping and dipping. And if you’re shopping online, digital wallets mean you don’t even need to remember your password.
But on top of that today are perks focusing on giving consumers exclusive access to events, services and treats that help create an even deeper emotional connection between brand and participant.
A few years ago, Mastercard noticed a change in consumer behavior and strategically shifted its advertising spend into experiences. It now hosts over 750 experiences on any given day globally, from recreating the iconic The Rock restaurant from Zanzibar in NYC’s Tribeca, to enabling card holders to shadow Cirque du Soleil cast members in Canada. This strategy is based on addressing key consumer passion points, ranging from music and sports to the environment and philanthropy.
During this episode, Rajamannar explores creating emotional connections, gives advice to brands on how to drive loyalty through having a clear purpose, and reveals an industry first: why the brand is launching a sonic identity.
Big box retailers including Walmart’s Sam’s Club, Home Depot, Lowe’s and Target are using a variety of interesting wayfinding technologies to improve customer navigation inside the physical store.
The result is designed to enable efficiency in the customer journey. This is in response to the fact that as online sales growth surpasses brick-and-mortar, customers are expecting more than just easy access to online products in physical stores, they also want to find them faster.
Cue solutions ranging from robots to augmented reality mapping. Read on for some of the strongest examples in the market to date…
Home store Lowe’s was one of the first retailers to introduce an app with augmented reality indoor mapping. Instead of a 2-D image, this mobile service projects navigation signs and price specials on top of the user’s field of view – meaning they can see which direction to go in projected through their smartphones straight onto the floor or space in front of them.
Outside of the retail space, Legoland in Denmark has recently experimented with an AR wayfinding app that helps visitors navigate around the park via a mini Lego avatar. They can also then receive real-time information on wait times ahead of them.
Sam’s Club Now in Dallas, Walmart’s test store for technology, is also focusing on a mobile-first shopping experience. Its Scan & Go app helps customers easily access products with an integrated system using voice search for navigation. When a shopper tells the app what they need, a map directs them to the item on the shopfloor.
Home Depot’s version meanwhile, allows users to use voice or visual search to find a specific item and then be shown exactly where it’s located within the store. Macy’s launched something similar back in 2016 with IBM Watson, which enabled users to ask question as to where specific products, departments, and brands were located, as well as what services and facilities could be found in a particular store.
From voice technology then comes robotics. Lowe’s was also one of the first to make it easier for customers to find help on the shop floor by deploying robot attendants. The “LoweBot” responds to voice commands, guiding customers through the aisles with smart laser sensors.
For Kyle Nel, executive director at Lowe’s Innovation Labs, the LoweBot resolves a common problem: “When I walk into a store and I want to know where something is I want to know right then — I don’t want to have to download an app — a robot can really help with that.”
Target is heavily investing in beacon technology for the sake of navigation also. It renewed its stores to use energy-efficient LED lighting with built-in Bluetooth beacons, which enable the store’s app to show customers their real-time location on the shop floor in a similar experience to that of Google Maps. They also help notify customers when they walk by one of Target’s “Cartwheel” deals.
Gatwick Airport has also invested in beacon technology as part of its £2.5bn transformation. Here, 2,000 indoor navigation beacons have been installed to help customers easily navigate around the terminals and reduce the amount of missed flights. Augmented reality plays a part here too, with a blue line mapped through the smartphone for users to show them which direction to go in.
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Chinese e-commerce giant Alibaba has partnered with Guess to pilot an artificial intelligence-enabled store of the future concept, where the technology will improve and further personalize the shopping experience.
Located on the campus grounds of the Hong Kong Polytechnic University for one weekend in July, the concept store is showcasing Alibaba’s FashionAI technology that is built around the e-commerce platform Taobao.
“By partnering with Alibaba, a dominant technology leader, we are changing the retail experience as our customers also evolve,” said José Blanco, CEO of Greater China for Guess. “It is important that we continuously invest in new technology and platforms. This entire project came together in just five months thanks to a strong partnership between our two companies.”
Upon entering the store, users can check in with their Taobao QR codes or via facial recognition. All items are RFID-enabled, and when picked up, show up in a smart mirror. The mirror also suggests outfits to complete the look either based on the user’s previous purchases or entirely new items, while directing shoppers to where such suggested items can be found in the store.
Shoppers can also use the smart mirrors to add items they would like to try on to a virtual shopping cart, while staff populate the fitting room with their choices. When entering the fitting room, shoppers have their Taobao code scanned, which triggers a dedicated smart mirror. Interestingly if shoppers cannot find what they are looking for at the Guess-branded store, they can add clothing from other Taobao virtual stores via tablets, thus shopping cross-brand. To complete purchase, they must use the Taobao virtual shopping cart.
The store also works as an opportunity for Alibaba to refine the FashionAI concept, while better understanding how the resulting data can help brands be smarter about ordering and maintaining inventory.
“Guess and Alibaba share the same vision to understand customer behaviors through technologies, ” said Zhuoran Zhuang, vice president of the Alibaba Group. “With Guess’ retail expertise, we are able to train and refine our FashionAI system, and marry technology with fashion in a way that’s never been done before. We are looking forward to deepening our partnership to innovate personalized services offered in retail shops.”
E-commerce brands are increasingly investigating how the technology that they have refined online can be leveraged in the brick and mortar experience to give demanding consumers the same level of personalized service. In April 2017, Farfetch revealed its store of the future concept, which we delved into in further detail with the project’s managing director Sandrine Deveaux for TheCurrent Innovators podcast in June. The retailer has since announced pilot programmes at Browns in London and Thom Browne in NYC, as well as a long-term partnership with Chanel.
British department store, John Lewis, is to invest £4 million in a new customer service initiative, which will see 8,000 sales associates receive iPhones to enable them to help shoppers in store.
Loaded with a dedicated “Partner app”, the tool will give them the ability to provide information about products, view customer reviews, check stock availability in stores and in the Milton Keynes warehouse, and place orders immediately.
The aim is to strengthen the retailer’s omnichannel customer experience, and to put an end to customers having to wait for employees to go and check stock rooms.
Craig Inglis, John Lewis’s customer director said: “As online and physical worlds increasingly come together, this initiative, which forms the foundation of our digital strategy for shops, will support our Partners in offering great customer service in a digital world.”
The app was tested in Cambridge over the past five months, and will now roll out to 20 stores following a training programme this summer. During the trial, half of all online purchases made in-store during its busiest week, were assisted by a member of the sales team using the app.
“During the trial in our Cambridge store, customer feedback was overwhelmingly positive. It consistently speeded up response times to customer queries as Partners didn’t need to leave the customer to find answers, or complete a purchase. This is just the beginning. We will keep adding to the Partner App in the future with new, innovative ways to help our customers,” Inglis added.
Update: This story originally referred to the app as a “clienteling” tool, which suggests there is personal information of the shopper stored in order to enable tailored recommendations. While that doesn’t seem to be the case at this point, it does speak to where the future of the service could move.
30 seconds. That’s the time stamp being aimed for in a number of retailers’ click and collect services – an objective to get the customer in and out in the quickest way possible. It’s an ambitious goal, but a level of convenience that’s highly relevant, not to mention desired, by time-starved customers.
Arguably for fashion, however, there’s a much smarter move. Nordstrom, for instance, is starting to prove the need for something a little more personal in the transaction too.
It has just introduced a new “Reserve & Try In Store” feature to its app – a way to help make the shopping experience easier for customers who like to touch, feel and try on items before buying them. The basic premise is that you reserve up to 10 items on your smartphone, select your closest store and then head to it in person where a personalised fitting room is waiting for you with those specific pieces. You don’t part with any cash until you decide what it is you want to buy.
It’s all about the convenience of online shopping but with some real world experience thrown in; all of that negating the need to drag a package home, try the items on once you get there and then realise what it is you don’t want before going through the often laborious returns process. It follows others including Westfield, Asos and Jaeger trying out real-world fitting room services attached to online orders in the past.
The whole thing is also just a lot warmer. Let’s face it, no matter where you go, the majority of click and collect systems feel like a cold and hard transaction. You show up to a counter often hidden at the back of one of the floors, stand in line for a considerable amount of time (despite that 30 second goal), hand over your information and wait while the parcel is found for you. Generally speaking, when it comes out, it’s not even wrapped in the nice packaging you might get in store, but in the sort that usually comes with an online sale.
Everything about it is impersonal. In fact, there’s little to differentiate it from standing in an Argos store waiting for your number to be called to collect the box on the rack you’ve been waiting for. Great for Argos, not so suited to a tactile fashion brand.
And all of that comes at a time when consumer demands have never been higher. Click and collect is an expectation now; not a novelty but the norm. If you don’t offer it, you’re behind.
In fact, omnichannel at large is an expectation; 68% of millennials now demand an integrated, seamless experience, regardless of the channel, according to Accenture. With services like click and collect, there’s more need than ever therefore for fashion brands to do something different to stand out from the competition.
After all, 78% of millennials also say they’d rather now spend money on desirable experiences over products. Never before has the experience economy been so ready for exploitation. Having a fitting room attached is almost not enough of a leap therefore, which is why artificial intelligence (AI) has a part to play.
Beyond the offer from Nordstrom, what if the reserve opportunity became a personal shopper service? Not in the traditional sense, but in a way that means those 10 items you’ve reserved also come with further suggestions for items you might like. Some basic data insights tied in, and the system should be able to recognise other pieces you’ve browsed ahead of time, perhaps lingered over for a little longer on the app, watched the videos for and so forth.
Add in a recommendation engine, that AI in action, and it could also include another rail with looks it knows match your tastes, coordinate with the ones you’ve reserved and even marry up to your purchase history. All of that done on an opt-in basis, of course. It’s a ripe opportunity for upsell and cross-sell, not to mention with an engaged customer already committed to dwell time.
That fitting room you try it on in should also be a connected one, like the Polo Ralph Lauren experience from Oak Labs (as above); with a sales associate on speed dial to get you other sizes, colours and more, as well as immediately check you out. This heightened version of convenience is also the perfect move for renewed clienteling; more than just a member’s club with a stylist on hand (as Nordstrom also offers), but a hands-on personalised experience enriched by machine learning.
This would suit luxury brands – especially those already operating in a relatively connected space, like Burberry. But so too could it run the gamut of digitally-savvy high street retailers, department stores and beyond.
Yes there are going to be those consumers who want to get in and get out; pick up their order and leave, make use of lockers, drive-thrus and more, but there are also those who would like something a little more enriching, seamless and useful for the time spent. A personalised version of what’s otherwise become nothing more than a transactional Argos encounter, rather than an engaging brand experience.
Luxury was late to the digital party and for the most part hasn’t acquitted itself well ever since. Which is why the regular ContactLab/Exane BNP Paribas reports into just how good the purchasing experience is for consumers is always interesting.
The report looks at factors such as digital touchpoint like abandoned carts, customer service, ease of ordering and general communications, plus physical touchpoint like packaging, delivery and much more.
Last year it did this from a Milanese viewpoint and this year it was New York. So what did it learn?
Well, Balenciaga and Fendi topped the performance ranking this time after ContactLab did its usual practical tests. It bought and returned products from 31 brand websites and five multi brand e-tailers.
Kering (Balenciaga owner) and LVMH (Fendi owner) must be happy as they were joint first. Kering scored again in number three position as Saint Laurent (or is it YSL these days?) took the bronze medal. Chanel and Coach shared fourth place, just missing the medal-winners rostrum.
Dropping back this time were Cartier, which had scored well last year but was in eighth spot this time, plus former high-ranker Louis Vuitton at only number 17. Hugo Boss was a lowly 31. Gucci stayed at number 16.
Burberry and Prada both improved. But given that Burberry was only at number 13 when it prides itself on being very digitally-focused, that’s not great. And poor old Prada only managed a rise to number 27 so its much-talked-about digital turnaround obviously hasn’t kicked in yet.
What’s so interesting about this particular report is that it’s not about the things we often notice first, such as high profile websites or social media engagement; it’s purely about the nuts and bolts of buying and returning goods, because that’s what the customer does and that’s how the customer interacts most with a brand. Given that online accounted for all of luxury’s growth last year and is expected to do so for the next few years at least, you’d think the experience would be prioritised.
You’d also think luxury retailers rather than monobrands might perform better with their long traditions of customer service, but some of those don’t acquit themselves that well. Saks was only in 13th place, Nordstrom 18th, Barneys 26th and Bergdorf Goodman an unimpressive 35th.
Who was the top retailer? Net-a-Porter in sixth place. I must admit, the experience of buying from this company (and its Yoox arm) is generally excellent. It wasn’t always. Many a time I’ve paid extra for Saturday delivery from Yoox only for something to arrive on Monday. While Net-a-Porter once took five months to refund me for an item returned the day after delivery. It was only a small amount and I completely overlooked not getting the refund until it just showed up nearly half a year later.
But that was five years ago, since then the company has shown why it’s the luxury e-tail leader.
“Net-A-Porter is digital native and is extremely consistent in assuring a top luxury performance in the majority of the more than 100 digital and physical touch points we have been evaluating along the online purchasing process,” said Marco Pozzi, senior advisor at ContactLab. He added that US department stores came out better on the digital touch points (especially Nordstrom and Saks) but they’re “average or lagging on physical touch points”.
“It should not be difficult for department stores to improve packaging, fillers, documentation and overall care in order to give a more luxury and less Amazon-like feeling to online customers,” Pozzi said. “Of course this requires focus on the problem, and for sure additional costs.”
The stores do rate highly on returns though, especially Nordstrom, which is unsurprising as multibrand retailers have a long tradition of liberal returns policies while luxury brands themselves are frequently very unforgiving if you change your mind. However, ContactLab said Burberry and Cartier top the returns service rankings.
This post first appeared on Trendwalk.net, a style-meets-business blog by journalist, trends specialist and business analyst, Sandra Halliday.
This week’s round-up of relevant fashion business, digital comms and tech news neatly sums up a series of things to be tracking at present: the evolution of social media businesses into greater advertising and commercial retail opportunities, the role customer service and messaging apps play together, the explosion of all things virtual and augmented reality, and an ongoing bevy of start-ups to know about.
Meanwhile, also worth reading this week is detail on David Lauren’s promotion to the role of chief innovation officer over at Ralph Lauren, Dior’s catch up strategy on YouTube, and the growth of physical stores by online players including Warby Parker and Bonobos.
Fashion ‘unicorns’ have become an endangered species [BoF]
Dior’s borrowing Chanel’s strategies to catch up on YouTube [Glossy]
If there’s one thing that’s grabbed everyone’s attention this past fortnight, it has of course been Pokémon Go. The augmented reality mobile game has reportedly gained as many users as Uber and Tinder, topped Twitter’s daily users, and started seeing people spend more time with it than in Facebook. It also caused Nintendo’s share price to increase by more than $7bn.
Beyond that, the news to know in the fashion, digital comms and technology space this week (and there’s a lot of it!), spans everything from an experiment with DNA in textile design to the plethora of changes at the helm of the industry’s luxury houses, the impact artificial intelligence might have on brands, not to mention how we’re faring with virtual reality so far…
Fashion that gets under the skin – designer creates leather prototypes grown from Alexander McQueen DNA (as pictured) [NY Times]
Macy’s is set to launch an in-store shopping assistant powered by artificial intelligence thanks to a new tie-up with IBM Watson via developer partner and intelligent engagement platform, Satisfi.
Macy’s On Call, as it’s called, is a cognitive mobile web tool that will help shoppers get information as they navigate 10 of the retail company’s stores around the US during this pilot stage.
Customers are able to input questions in natural language regarding things like where specific products, departments, and brands are located, to what services and facilities can be found in a particular store. In return, they receive customised relevant responses. The initiative is based on the idea that consumers are increasingly likely to turn to their smartphones than they are a store associate for help when out at physical retail.