Why the iGeneration Shops Retailers Other Than Amazon

Gen Z enjoys sharing their shopping experiences

There's no denying that Amazon is currently the retailer to beat. However, the iGeneration, also known as Generation Z, could be part of the motivation behind Amazon's ventures into brick-and-mortar. NRF reports that 98% of these shoppers say they prefer to purchase in-store, and with an estimated $44 billion in buying power, brands can't afford to ignore them.

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Born between the mid 1990s and early 2000s, Gen Z members are digital natives—they grew up with technology and are hardwired to know how to use it. Knowing this, it would make sense if this group was Amazon-obsessed. However, reports cite an increase in demand for fresh in-store experiences, and the iGeneration is already leaving behind brands that can't adapt.

A Business of Fashion article states:

"Today's teens live out their lives on social media, where social currency is built on experiences. 'They don't want to buy stuff. They're buying an experience and the product they get through it is kind of a bonus.'" 

Purchasing on Amazon is less about creating a memorable experience and more about immediacy and convenience, which is the opposite of what Gen Z-ers are seeking. Brands unavailable on Amazon should focus on building out customer loyalty programs catered to meeting the demands of digital natives. Traditional retailers can also capitalize on Amazon's strategy by launching mobile apps that streamline the omnichannel experience.  

As a Gen Z-er myself, I'm likely to post an Instagram photo showing off my new headphones, but there's no reason to include that they're from Amazon unless I'm complaining about a problem. On the other hand, if I spent the day out shopping with friends Snapchatting and taking photos, I'm more inclined to Instagram my new purchases, detailing my experiences that day and sharing where I shopped.

In short, digital natives seek shareable experiences that the e-commerce giant can't provide—unless they're trying out Amazon Go or Amazon Books stores. Learn more about how your brand can combat Amazon and win in the ever-changing retail landscape by signing up for our upcoming webinar.

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Topics: Omnichannel Trends

How to Find Balance With Mobile Apps

Shopper using a mobile app in a retail store

In today's always-connected world, many turn to yoga or meditation to find balance, but for those in the retail industry, finding harmony between shoppers' growing demands and what's immediately possible seems more out-of-sync than ever.

This year, brands must become—or continue to be, depending on their digital business maturity—consumer-obsessed and make data-driven decisions to comply with shoppers' preferences, but there's no one size fits all strategy.

Retailers need to learn to juggle engagement, innovation, and loyalty initiatives to power omnichannel experiences that drive conversions, and though it may be too late for some, there is hope for retailers seeking balance in 2017.

The answer? Mobile apps.

Engagement: Be social, not creepy

Brands should personalize user experiences that build trust without being creepy or invasive. For example, no one enjoys being bombarded with targeted ads minutes after completing an online search. However, when using retailer apps, it’s expected that they remember details, such as nearest physical store and payment information.

Salesforce reports that 64% of shoppers enjoy looking at recommended products based on their pageviews, while 79% like to receive product offerings from retailers based on purchase history. There’s clearly a consumer demand for personalization but with limits.

NRF says:

Shoppers expect brands to understand what’s important to them. They want and demand trust; if they have a problem, they expect answers. Connecting with today’s shopper implies understanding the fierce urgency of now that prevails in their lives.

This year, retailers must make connections and establish trust with consumers through social commerce by joining in on the conversation. This past holiday, 1 in 3 shoppers said they used Facebook for gifting inspiration. In 2016, 20% of total time spent online across devices was on social networks.

Instagram’s recent shoppable photo announcement, advertisements that target consumers based on emoji use, and the current chatbot craze all build the case for social commerce in 2017. To succeed at social, brands must find a happy medium between creating organic, helpful interactions without seeming pushy or forced.

Chubbies in-app messaging and live chat
Chubbies uses an in-app messages to send entertaining social content to users from their Facebook and Instagram pages (left) and takes advantage of the live chat feature to build relationships with users (right).

With apps, retailers can engage with their customers through tools, like push notifications, in-app messaging, and live chat. 92% of app shoppers are willing to let retailers use their location, providing the perfect starting point to start personalizing the experience.

Innovation: Create for humans, not for data points

Your customers are individuals, not analytics. Brands that wield new technology without a consumer-focused approach will miss the mark in 2017. 

Parham Aarabi of ModiFace, a beauty-focused augmented reality company, said, "Technology for technology’s sake rarely works. Make sure technology is actually solving a problem. Avoid things that are gimmicky, and aim for things that feel authentic and real.”

Retailers need to find a middleground between using flashy, new technology and meeting consumer demands. In other words, this means designing integrated technological experiences with a human touch.

Here are a few examples of retailers who are embracing this:

Rebecca Minkoff

One of the pioneers of fitting room magic mirrors, tech-savvy designer Rebecca Minkoff, partnered with Samsung to broadcast a 360 virtual reality livestream of her New York Fashion show. She also partnered with Zeekit, an app that uses augmented reality to allow shoppers to virtually try on clothes.

H&M

Google and H&M recently debuted a new app that designs users a personalized “Data Dress” based on their daily activities.

Ivyrevel app
Source: TechCrunch

With AR and VR still in its infancy, it's unclear if or how this technology will make its mark in the retail industry. Does an immersive AR app or 360 VR livestream meet a specific consumer need, or does it only prove the brand is cutting edge? Regardless, we’ll see more tech partnerships as retailers seek to provide exclusive user experiences that match their brand.

Loyalty: Refine omnichannel, not only in-store experiences

Although reports continue to cite declining in-store sales, half of holiday shoppers purchased gifts in-store over last year’s Cyber Five. Retailers are responding to this by designing experiences that engage consumers throughout the nonlinear buyer’s journey.

Rose Hamilton, chief digital officer at Vitamin Shoppe, explains the company’s shift to a mobile-first strategy and how the company uses its shopping app to bring value to its customers:

“The new customer journey is not linear. They go all over the place, try different stores, try different products and places. We need to be present at every step, ready to accept them when they come back.”

Retailers must adjust their omnichannel strategy to keep up with cutting edge technology while balancing the erratic buyer’s journey. Consumers want in-store and online options, which is why omnichannel will continue to be important this year. Physical stores won’t disappear altogether, but will become more experimental—think Amazon’s line-less grocery store, which uses an app to streamline the shopping and checkout processes.

Mobile app users expect individualized experiences, which is why they’re more likely to share information with trusted brands.  Half of consumers download shopping apps at least once a month, while 66% turn to their phone to shop weekly, making them the ideal way to connect the online and in-store experiences while maintaining an ongoing relationship with shoppers.

Meet your most loyal customers where they are by providing them an in-app experience that merges the online and in-store.

Next steps

Apps are the complete package: they allow retailers to converse, customize, and experiment with new technology. In fact, 66% of companies that don’t have a mobile app saw customer loyalty decrease significantly over the past year.

Embracing new technology is crucial to remaining relevant, but the experiences must be effortless, straightforward, and tailored to the target audience. There’s unlimited potential for retailers to experiment with targeted immersive technology on mobile.

Check out our webinar recap from "Retailers: Are You on the Road(map) to Success?" to learn more about how mobile-first thinking will help your brand find zen in 2017.

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Topics: Omnichannel Solutions Apps

[FREE DOWNLOAD] "Retailers: Are You on the Road(map) to Success?" Webinar Recap

"Retailers: Are You on the Road(map) to Success?" Webinar Recap

In this webinar, Branding Brand and Forrester discussed how shopping behavior is changing and how retailers are integrating digital store technology to create better omnichannel experiences.

What you'll learn:
  • How to transform the customer experience with mobile-first thinking
  • Which retailers stand out for their in-store and online shopping
  • How to personalize your experiences starting with mobile apps

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Topics: Omnichannel Trends Solutions Apps Recap Company Webinar

Breakthrough Thoughts on In-Store Experiences

Woman scanning product tag in a retail store

As several big-name retailers begin downsizing, others are investing more in their in-store experiences—some for the first time ever—and adding mobile to the mix. Although the cards are stacked against traditional brick-and-mortar, omnichannel shopping is alive and well, and retail stores are a key component.

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Hear from top e-commerce executives and what they're saying about the importance of retail stores and their upcoming plans for enhancing the in-store experience:

Farfetch

This forward-thinking brand already uses their smartphone and tablet apps to capitalize on Singles' Day sales, shoppable video, and more. Now, Farfetch plans transition from pureplay to omnichannel retail by opening a "Store of the Future" this year, which will focus on personalization by leveraging data.

The future of luxury fashion, we believe, will involve — to a large extent — the physical store... But the future of the physical store will be augmented by digital platforms. At this intersection of physical and digital retail, many new customer-focused, unique experiences are suddenly made possible.
— José Neves, Founder and CEO
José Neves, Farfetch Founder and CEO


Rent the Runway

After its flagship store opened in New York in 2013, more locations popped up in places, like Chicago, San Francisco, D.C., and Vegas because Rent the Runway quickly realized the benefits of brick-and-mortar stores—people with appointments purchase 26x more often than online shoppers. Its stores are outfitted with check-in kiosks, which help associates learn about shoppers' preferences, and offer customers styling sessions.

It's more like a club, or a place that you feel like you're kind of a member of.... We find for a lot of our customers, that experience is what makes them fall in love with our stores.
— Maureen Sullivan, President
Maureen Sullivan, Rent the Runway President


Nordstrom

Nordstrom plans to focus on uniting its online and in-store experiences after seeing sales drop for over a year. A new associate app is expected to enable employees to send recommendations directly to their customers from the retailer's online catalog. The company is also exploring self-checkout. 

The way customers are choosing to shop in a more digitally connected world continues to change, and we know we need to find ways for our stores to evolve with them. This is a challenge but we also see a tremendous opportunity to leverage our stores in ways that will allow us to serve customers into the future better than anyone else.
— Erik Nordstrom, Co-president
Erik Nordstrom, Nordstrom Co-president


Nike

Since the downfall of some athletic and department stores, Nike is dedicated to customizing experiences in their own stores. A multi-floor store in Manhattan offers brand enthusiasts adaptive lighting in the dressing rooms to see what clothing looks like in different locations, testing floors for specialized shoes, same-day deliveries, and more. Mobile integration plays a key part in their strategy, where shoppers can book one-on-one appointments for consultations. 

Consumers just expect more. They expect more immersive experiences at retail like you are seeing here.
— Heidi O'Neill, President of Global Direct to Consumer
Heidi O'Neill, Nike President of Global Direct to Consumer


Barnes & Noble

Potentially looking to expand its customer base, Barnes & Noble built a restaurant inside the store, which locally sources beer and wine, and is completely surrounded by book displays. Associate and customer ordering systems are an integral part of the in-store experience.

We know we have a lot to learn, and we welcome that. We want this to be a special place … and we will work to keep improving.
— David Deason, VP of Development
David Deason, Barnes & Noble VP of Development


Are You on the Road(map) to Success?

Branding Brand and guest speaker, Forrester Principal Analyst Brendan Witcher, discussed how to transform your omnichannel retail strategy and which retailers are leading the way with their online and in-store innovation.

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Topics: Omnichannel Trends Solutions

The Pros and Cons to This Year's Most-Wanted Shopping Feature

Buy online, pick up in store is this holiday season's most wanted shopping feature.

“Buy online, pick up in store” (BOPIS) is about to have its best year yet. About half of holiday shoppers expect to use BOPIS more than they did last year.

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This trend stems from more and more shoppers expecting fast, free shipping in addition to people being more comfortable with researching and buying online. It’s also a hit among app users—86% say they’re interested in BOPIS via mobile shopping app.

Although it’s popular, “buy online, pick up in store” may not be easy to implement, but you might see a boost in your customer experience and conversion.

The benefits of BOPIS

There’s an opportunity to resolve the issue of abandoned carts on websites and apps with “buy online, pick up in store.” NRF found that most people leave products behind because shipping costs made the total more than expected (56%) or the order value didn’t meet the free shipping requirement (45%).

Letting your customers click and collect their items in the same day guarantees a cheaper alternative to traditional e-commerce and a faster purchase-to-procurement timeline. 88% of millennials say they buy online and pick up their purchases in store to save money.

The downfalls of BOPIS

There’s really only one downside of offering “buy online, pick up in store:” you need to make sure it’s seamless and convenient. Forrester says:

It isn't easy orchestrating all the parts to make it look effortless to the customer — from a single view of inventory to staff training and compensation to eradicating old but very human channel conflict fears—but doing so meets expectations.

BOPIS, ship to store, reserve online, click and collect, or whatever you want to call it isn’t a new phenomenon, but it’s a trend that’s come to be expected from omnichannel retailers (much like fast, free shipping). Smarter retailers are taking it a step further by transforming their stores into mini fulfillment centers, according to NRF.

Holiday 2016: Consumer Shopping Survey

We discovered what people plan to browse and buying during the 2016 holiday shopping season. Check out what we found in the survey results. 

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Cyber Five 2016: Consumer Shopping Survey

People who purchased holiday gifts between Thanksgiving and Cyber Monday revealed what they thought of their online and in-store experiences. Take a look at the survey highlights to find out how shoppers felt about this year's Cyber Five.

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Topics: Omnichannel Trends Survey Holiday Solutions