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.
The global gaming market is experiencing rapid growth, with an estimated valuation of $180bn expected by 2021, according to Newzoo.
It is currently dominated by titles such as Fortnite, a free multiplayer game with 250 million users and $2.5m in daily revenue. Streaming platform Twitch, which accounts for 54% of gaming video content revenue, has also been highly successful due to its interactive network of both players and spectators.
Though relatively limited, fashion brands and retailers have been experimenting through collaborations or campaigns that nod to such popular references. Louis Vuitton had a campaign featuring Final Fantasy XIII’s character, Lightning, as the new face of its SS16 collection for instance. More recently, Moschino launched a new collection with Sims, featuring garments with Sims motifs. A virtual hoodie was also released so players could dress their avatars in designer clothing in the game itself.
What’s becoming more interesting however, is the number of brands turning to “gamification” rather. This refers to “the integration of game mechanics into an internal business process, website, or marketing campaign”. It’s a market that was valued at $6.8bn in 2018 and is estimated to rise to $40bn by 2024, according to market research firm Reportlinker.
Its growth has been driven by increased demand for new customer experiences, as well as broader access to smartphone devices. And its success has meant brands and retailers are increasingly jumping in on the action in a bid to use ‘play’ as a way to encourage shopping.
From driving discovery and engagement, to building brand advocacy and loyalty, here are five examples of those using gamification as part of the shopping journey.
Kenzo: Building exclusivity through gaming
French luxury brand Kenzo launched a gamified e-shopping experience last year to promote the release of its new Sonic sneaker. Restricted to just a limited number of players, the aim of the initiative was to highlight the exclusiveness of the product. Getting a turn at playing was not only difficult in the first instance, but once in the game, users had to virtually defeat other opponents in an effort to then get access to buy one of the 100 exclusive pairs of sneakers. The campaign challenged consumers and added excitement to the shopping journey for those lucky enough to even get the chance to hit the purchase stage.
Nike: Enabling user-testing through role play
Nike released a virtual environment called Reactland in Shanghai last year for the launch of its ‘React’ shoe. The game allowed users to test the shoe’s new sole cushioning technology in a unique digital environment. Customers could wear the shoes and run on a treadmill that was connected to a digital character on screen. This enabled them to thoroughly test the product’s durability by virtually climbing buildings and running through simulated streets. The game fueled consumer confidence in the product, leading to 48% of the players purchasing it.
Coca-Cola: Driving sales via virtual incentives
Coca-Cola created a supermarket game in Beijing and Singapore to catch consumers’ attention at the point of purchase in-store. Shoppers could connect to their mobile to the drag-and-shoot game, which involved successfully throwing virtual ice cubes into a glass of coke. Successful completion of the game resulted in prizes such as Coca-Cola discounts or loyalty points. The brand successfully targeted consumers at the moment of intent, and influenced them to pick Coca-Cola over competitors.
Repeller: Bringing play to e-commerce
Popular fashion blog, Man Repeller, recently launched a new e-commerce website called ‘Repeller’, which utilizes gamification in order to enable consumers to shop in a discoverable way. The website is divided into two sections: a normal shopping site and a play side. The play side is an amalgamation of aesthetic imagery and quirky videos, reminiscent of video gaming user interfaces, but this time embedded with directly shoppable products, including handbags, earrings and sunglasses. The somewhat wacky website is being pushed as an opportunity to drive discovery and encourage users to spend more dwell time on the site.
Lancôme: Pushing awareness through scavenger hunts
Beauty brand Lancôme teamed up with Alibaba to create an augmented reality game in Hong Kong, along with a pop-up store, to celebrate Chinese New Year this year. The app featured an AR scavenger hunt where consumers could win limited edition products and gifts by finding and scanning Lancome’s signature beauty product, Genifiques. If they captured three pictures on the hunt, they were then able to wish for any Lancôme product they desired through the app, and be in with a chance of winning it. The game successfully drove awareness of the brand through consumer generated content and brought excitement during a key time of year in the region.
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For three days in October, LVMH will be opening 56 of its Maisons to the public as part of the fourth iteration of Les Journées Particulières.
The program, which will span across four continents and 14 countries, aims to showcase the expertise and creativity of its many artisans, as well as reinforce the cultural heritage of the houses under the luxury group. In order to showcase their unique identities, Houses will host events such as workshops, tours and designer and artisan meet-and-greets.
“Les Journées Particulières was designed to embody our Houses’ hospitality and energy, and echoes the vital role that the act of transmitting plays for the LVMH Group: our aim is to share our diverse heritage, extensive savoir-faire and concrete innovations,” says Antoine Arnault, CEO of Berluti, chairman of Loro Piana and founder of Les Journées Particulières. “This unmatched event has stepped up to the mark; each edition involves a growing number of Houses, talents and visitors, making this 4th edition a global celebration of the world of art, and craftmanship.”
From October 12-14, visitors will be able to partake in distinctive experiences across venues in countries such as Germany, the US, Argentina, New Zealand and Australia. By visiting a microsite, participants will be able to choose from a selection of 77 venues, many of which have never been open to public before. This includes all categories across the LVMH portfolio, from fashion and beauty to wine and luggage.
Brands participating for the very first time include Benefit Cosmetics in San Francisco, Les Tanneries Roux in Romans-sur-Isère, Rimowa in Cologne and the T Fondaco Dei Tedeschi by DFS in Venice. Moreover, brands that have participated in previous editions will be offering new experiences, such as the chance to visit the Louis Vuitton prototype workshop in Paris and an exclusive tour of La Colle Noire, which was Christian Dior’s last residence, in Montaroux, in the south of France.
The program is heavily supported by a digital campaign that will help promote the luxury group’s desire to share its history and artistry with a wider audience. An interactive campaign will be launching ahead of the open days in September, and will include “Confidences Particulières”, a series of podcast episodes introducing the creative talents behind the Houses.
“Every day at LVMH, our Houses’ talents make a difference as they embody the core values behind the Group’s success: excellence, entrepreneurship, creativity and innovation. “ says Bernard Arnault, chairman and CEO of LVMH. “The Journées Particulières is a unique event which showcases our artisans’ passion for creativity and their trades, and where the general public is able to meet the Houses’ talents. The event is an invitation to discover exceptional venues and carefully-preserved savoir-faire.”
Future visitors can pre-register on the aforementioned microsite from September 24-30. Registered users will be given priority access for themselves and up to three guests.
For this iteration of Les Journées Particulières, the addition of more Houses is an indication that luxury labels are increasingly more willing to open up their traditionally guarded gates. As luxury – and aspirational – consumers demand a story behind the brands and goods they consume, the industry is beginning to develop new tools and services that cater to that exact need.
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Coach’s newest pop-up, Life Coach, celebrates the label’s roots in New York City with a series of immersive experiences that aims to “heighten your senses, stimulate your soul and wake up all the feels”.
The activation, which is running from June 12 through to June 17 in the Soho neighbourhood in NYC, which is where the brand was founded in 1941, invites guests to participate in tarot card readings, drawing, and playing carnival games.
Visitors enter the space via a neon storefront filled with psychic symbols and Coach visuals. Upon first entering the space visitors are asked to check in, and when reaching the first room, they are met with an entirely blank canvas on which they are encouraged to draw on.
The next room represents a typical Coney Island-type of fairground scene, including old-fashioned arcade games and photo props, as well as a boardwalk made from pieces salvaged from Coney Island after Hurricane Sandy.
In the third and final room, visitors can walk through a dark forest where they can find white tents that house tarot card readers.
Speaking to the New York Times, Carlos Becil, Coach’s chief marketing officer, said of the concept: “Whether you call it mindfulness, spirituality or self-help, seeking answers is the new pop culture.”
Activities that help consumers through their self-discovery include free sessions with mystics including tarot card readers Hoodwitch and astrologists Astrotwins. The event, which has no Coach product in sight, will keep its concept of self-discovery and elusiveness by introducing surprise guests and events throughout its programming until the pop-up’s last day.
The entire initiative ties to a broader theme we’re seeing in consumer retail, whereby the experience economy is evolving into the transformation economy – a state that is about driving self improvement and enhancement for consumers through brand activities, rather than mere moments meant to encourage dwell time or social sharing.
The idea that consumers require more than just product to drive them into department stores in the current retail climate, is being heavily backed by the likes of Barneys New York and Neiman Marcus of late.
Both have recently launched experience-led pop-ups, designed to drive customer engagement, create hype via social media and ultimately translate visitors into purchasers.
While the two department stores differ in their approach, the aim for both is clearly driven by their realization that modern consumers require more than one-off events to continuously drive footfall and conversion.
In the spirit of thinking outside the box, Barneys New York has launched a strategy inspired by streetwear’s “drop” culture and how to build hype back into retail. The initiative launched in October 2017, but it has recently matured into a two-day event titled thedropLA@Barneys, where the retailer once again teamed up with media publisher Highsnobiety to offer over 90+ brands and 20+ exclusive partnerships with streetwear-meets-luxury designers, as well as to host designer appearances and immersive installations.
Spread across five floors, the event was attended by 12,000 people and saw a 50% uplift in sales compared to the same weekend in 2017.
Neiman Marcus is similarly translating its new strategy with the “Idea Factory” concept, which launched with a variety of in-store activities that aim to bring customers and creatives together through one-off services such as product personalization and classes. The event is happening over the next two weeks in five stores across the US.
These installations are supposed to only be the beginning for a series of initiatives, with phase two anticipated in September. For the second instalment, the retailer is looking at concepts in epicure, food & beverage, travel, wellness and social consciousness, in a bid to become more culturally relevant, says Ed Burstell, Neiman Marcus’ SVP of product innovation
The new approach shows that ultimately, the future of retail, particularly when it comes to multibrand stores, depends on embracing the values of the younger consumers, as their high spending power can’t be denied, says Jeff Carvalho, managing director of Highsnobiety.
Unveiled as part of its collection for the International Woolmark Prize Final in Paris today, the concept piece is once again a collaboration between the designers, Internet of Things platform EVRYTHNG, apparel branding solutions Avery Dennison’s Retail Branding and Information Solutions (RBIS) division and hybrid retail/media company The New Stand.
The hat incorporates NFC and QR code labels hidden inside that pull-up content on a mobile web page when scanned. What’s surfaced depends on factors like time of day, as well as location – all of it has been designed for major cultural centres and destination cities including New York, Paris, London and Tokyo.
You can read the full story on Forbes, including insights directly from the Rochambeau team on this idea of connecting consumers directly with experiences through the products they create.
One of the key trends we highlighted for retail in 2017 surrounds the idea of more visceral in-store experiences. Adding a ‘third space’, or the idea of services in store that encourage dwell time, is no longer enough however. Success will come to those who push for differentiated experiences to their competitors, with emotional and educational connections playing a significant role.
Enter then Topshop, which has just announced a series of events in its Oxford Circus flagship in London focused on helping consumers achieve a “happy, healthy and successful 2017”.
As written on its blog: “It’s all about experiences – from yoga classes to creative sessions and a series of talks – based on health, wellness, lifestyle practices and learning new skills.”
In-store events aren’t new for Topshop – it’s long held different talks and workshops, including a recent example ahead of Christmas enabling shoppers to customise their gifts. Nor is it for many other fashion and beauty retailers – from the likes of Selfridges to SpaceNK or Lululemon. But there’s a big focus today on occasions built around the lives of the consumers, and not just the items they might look to buy.
Wellbeing is central to that at Topshop, but so too are inspirational business talks and even workshops to help women in their professional, personal, financial, and habitual goals.
Inspiration comes from the likes of Apple, which has not only long run events focused beyond the items it sells, but also recently removed the word ‘store’ from its destinations altogether, and instead started referring to them as ‘town squares’ – places where consumers want to gather and spend time. It’s all about community, entertainment and education.
Expect to see more of this trifecta as 2017 progresses. In the meantime, check out the list of what Topshop has on offer from January 26-29 over on its blog. All events cost £5 to book, though are cleverly redeemable on product in store thereafter.
The fashion industry – from your department store to your luxury boutique – is undergoing significant change at the hands of the digital revolution. That’s not new in concept. Neither, mind you, is talking about things like artificial intelligence, virtual reality or blockchain as emerging technologies.
Put those two together however, and things start getting interesting. Broad business adoption of machine learning (for instance) is one thing, but in the context of the impact that then has on shopping, we start to be able to see what the future might look like.
At this time of year, the web is inundated with predictions for what lies ahead, especially in the marketing and technology space. Yet, at a point when consumers are not only more demanding than ever, but market conditions are increasingly volatile, keeping abreast of such movements has also never been so pertinent.
This isn’t a list that pushes the likes of mobile or omnichannel strategy, no matter how far off retailers actually are from achieving the latter particularly, nor is it a focus on areas including the fashion week cycle or sustainability, despite how important these are to shifting business strategy. Rather it’s an opportunity to remind yourself of some of the key things to think about from a digital marketing and tech perspective as you head into the New Year. If 2016 is anything to go by, it’s set to be an interesting one…
1/ One-to-one relationships will be possible at scale
Personalisation at scale is becoming ever more of a reality thanks to the role that artificial intelligence and machine learning is playing. Nascent at this stage (particularly when applied to the fashion and retail space), we’ll see significant uptake next year and beyond, whether that be around driving recommendations, offering natural language search responses or building out more intelligent customer service. The outcome, in theory, is the idea of returning to the store of yesteryear, where the owners knew every shopper on a one-to-one basis. This time, it’s not only at scale, but constantly learning so as to keep improving the experience. It also comes with significant value exchange attached for the shopper, both online and in the real world. The nuance that goes into fashion selection makes this one of the harder areas to play in, but the company that figures out how to tie that together with personal data on a shopping level, is in for a win.
2/ The bots will arrive (they have already)
For now, AI is largely being applied in the messaging space. Burberry, Nordstrom, Tommy Hilfiger, Sephora, Everlane and American Eagle are just some of the fashion and beauty brands already experimenting with chatbots – machine-led customer service tools on Facebook Messenger, Kik and the like. Bar the odd gifting experience, this has largely been about relatively basic campaigns so far; more a bid to hit the early adopter goalpost than successfully convert consumers via new means. Looking to 2017 however, the software is only likely to improve as it learns, but so too are the brand approaches to nailing this as a channel. Look out for more ‘conversational commerce’ tied to both online and offline shopping up ahead.
3/ Frictionless brick and mortar retail will become an expectation
Technology in the store is only increasing. Rather than the sort of garish initiatives we’ve seen to date – press-worthy campaigns based on big tech geared to the customer experience – we’re moving into an era where what’s put in store has to recognisably enable a more frictionless style of shopping. Ever demanding consumers are expecting to get what they want more quickly and easily than ever, especially when it comes to the payment part – hence the launch of Amazon Go, a new checkout free grocery store, and even the self-checkouts at Rebecca Minkoff. It’s about the Internet of Things (connected stores, collections, fitting rooms and more) having a useful consumer impact. It’s this sort of heightened level of convenience that will be the ultimate customer experience in 2017. Easier said than done for businesses restricted by legacy systems, but those looking to improve on it from an omnichannel perspective will lead the pack.
4/ You’ll need to think about designing for the voice interface
If we’re talking about the Internet of Things, there’s going to be an increasing amount of focus put on voice in terms of a user interface. This is the next big platform for interaction with services – whether via devices in the home, or smartphones on the go. Apple’s Siri, Microsoft’s Cortana, Google Assistant and Amazon’s Echo device, featuring Alexa, are all playing in this space; the question is, what does this look like for retailers (beyond Amazon)? It’s more likely to impact the consumer goods space initially, but fashion brands have an opportunity to experiment and potentially a need to future-proof here too. Mary Meeker of KPCB predicts that by 2020, half of all web searches will use voice or image search rather than text. “More efficient and often more convenient than typing, voice-based interfaces are ramping quickly and creating a new paradigm for human-computer interaction,” she said. Again, it’s about frictionless experiences – information through to purchase within one simple stream rather than multiple clicks away.
5/ Digital realities will steam forward
As far as emerging technologies go, it’d be hard to miss everything happening in the realm of virtual and augmented reality. Goldman Sachs theorises retail will be one of the first industries to be disrupted by the two combined, leading to a $1.6bn market based around 32 million users. Already heavily played with across the fashion, luxury and beauty space, albeit largely for PR purposes, we’ve seen everything from storytelling to fashion shows, not to mention practical applications for things like make-up try-ons, as per the likes of beauty brand Charlotte Tilbury. It’s the latter idea of functionality that will continue apace in 2017. Forget mere gimmick, or even gamification (as seen with Pokémon Go, which will arguably be referred to as the turning point for the mass adoption of AR) – these digital realities are set to help shoppers and businesses alike in numerous new ways, making them a highly relevant tool to explore. If any further indication was needed, just look to Alibaba – the Chinese e-commerce giant invited shoppers to not only visit a Macy’s store using VR, but enabled them to pay merely by nodding their heads.
6/ Blockchain will become part of business vernacular
Blockchain still remains somewhat in the confines of tech discussions rather than one too familiar in fashion circles, but behind the scenes it’s making significant headway. It’s referred to by Gartner as a “type of distributed ledger in which value exchange transactions (in bitcoin or other token) are sequentially grouped into blocks”. The blocks can’t be modified, but can be viewed, meaning a huge benefit lies in the added trust and transparency that provides. It was once about cryptocurrencies alone, but can now be applied to a multitude of verticals, including fashion, where there are interesting impacts to be had from a supply chain perspective particularly. Blockchain can facilitate storytelling around provenance, and even serve as a marketing and branding tool, as already tried and tested by Shanghai Fashion Week brand Babyghost. It’s the security side to help combat counterfeit goods that seems most pertinent however. As JWT Intelligence wrote: “Blockchain’s transaction ledger is perhaps the most secure tool available today to verify authenticity, a major concern in the luxury goods sector.”
7/ You’re going to need a ‘live’ strategy
Live video isn’t a new concept, but it gained serious ground in 2016 off the back of big launches including Facebook Live and more recently both Instagram and Twitter’s own versions, not to mention the continuing role Snapchat plays too. The result is serious marketing thinking in this space, which will roll forward into the New Year for those looking to gain a competitive lead within social media. It’s not overly surprising; standing out has never been harder on each of said platforms, especially in an increasingly pay-to-play market, meaning those who take the plunge as first movers, stand to gain significant advantage, albeit for limited time. Both Benefit Cosmetics and Primark are worth looking at in the Facebook Live space. WARC warns brands to think about things like quality over quantity and recognising the three-second window you have to grab a viewer’s attention.
8/ We’ll see more of a shift to visceral experiences
Contrary to the very idea of tech in the store, or digitally enabled experiences both online and offline, will come more in the way of the physical, visceral side of retail in 2017. Adding a ‘third space’, or the idea of services in store that encourage dwell time, is no longer enough however. Success will come to those who push for differentiated experiences to their competitors, with emotional connections playing a significant role. As Doug Stephens, futurist and author behind Retail Prophet, recently wrote: “In a world where almost every aspect of our lives is somehow tethered to technology, experiences that engage our bodies, our senses and our souls are at a premium. Digital is what we’ve become but visceral is what we crave.” Fashion brands and department stores especially, will need to start taking a leaf out of the likes of Apple’s book. It has recently removed the word ‘store’ from its destinations, and is instead referring to them as ‘town squares’ – places where consumers want to gather and spend time. It’s all about community, entertainment and education, whether that includes tech or otherwise.