Event Debrief / World Retail Congress
The annual World Retail Congress is the biggest event on the retail conference circuit, bringing together leading global brands to exchange information on the latest trends impacting the sector. Sean Pillot de Chenecey, founder of consumer insights, innovation research and brand development consultancy Captain Crikey, shares his take on the top talks from this year’s event
A key issue at the World Retail Congress’ latest event, held in Dubai once again, was that the competitive situation is getting fiercer, whether it be on or offline. And whilst ‘customer experience’ has been a staple part of virtually every trend report since time began, this year it was highlighted as being probably the No1 point for retail brand differentiation. (JWT Intelligence highlighted this issue in its 2017 trend report, saying that consumers expect more out of bricks-and-mortar retail – whether it’s an experience, or a space worth visiting even when they’re not in the market for a specific product).
Other key trends highlighted by the organisers included next generation ecommerce, new wave technology and the vital need to gain a clear understanding of how to motivate ‘individualistic but connected’ modern consumers.
And ‘connecting with real people’ was a key element in a great speech given by Muji chairman Masaaki Kanai, who explained how their combination of simple, functional designs and social responsibility have translated into massive business success. His talk was a world away from those obsessively discussing the latest AI or VR offerings launched at CES 2017, as he explained ‘we are trying to spread our concept of a more simple, delicate and caring way of life around the world. As there is a better understanding of this concept, our business is growing – indeed more and more young people are moving towards us.’ Muji also values projects that promote sustainability and well-being. ‘Products are the main part of our business but we are also involved in recreational camps, constructing green houses, building green hotels, renovating old apartment blocks and interacting in all aspects of public life.’ He also told the audience they should reconnect with the planet more, by taking care to… look at the moon. His talk was absolutely captivating. The moon – bring it on.
Meanwhile, generational targeting – and a continued obsession with understanding millennial consumers – was a theme that continued over from previous WRC events, with warnings that retailers are competing with millennials’ love of experience and also their rejection of ownership over sharing, swapping and buying pre-owned products. Robin Lewis (author of The New Rules of Retail) posed the question ‘why would a millennial come to a building when they could buy your product while they’re climbing a rock?’ In his speech, he outlined a mindset shift from ownership to access had happened among younger consumers; and that priorities had changed from value to values, focusing not on what they own but what they do. He also said trust-based relationships, personalisation and cultural symbols had become important, while retailers needed to move from bigger to smaller. He added: ‘It's a high tech, high touch world and millennials want everything now.’
Elsewhere, Martijn Bertisen, director of retail tech for Google, gave a fascinating talk on Google Assistant ‘the layer that sits on top of all the Google products’ that allows you to have a conversation with Google and the products that they have: ‘a two-way dialogue… the sort of dialogue that you have with your friends.’ He demonstrated this by asking Google to give advice on the weather… the nearest shopping mall… illustrating a service intended to allow a far more natural interface with technology to ask questions about/gain information on the world around you that wasn’t available before. So you can ask it about travel reservations that you’ve made… traffic reports based on its knowledge of where you live… and request updates on your favourite team. Or simply ask it for reminders – hence Google Assistant nudging him to connect with his mother on her birthday – which he then did live on stage in front of 2000 people.
Re: other takeouts from his talk, he said ‘if technological change comes in decades – and we’ve just come out of the smartphone decade – you’d better get on the case. Show up when consumers want you, use the data and create the experiences that connect the physical and digital world. And be fast!’ He ended with a warning that ‘over the next decade everything around us will be transformed by machine learning. So think about how your brands can make it easier for consumers to navigate the complex world of information overflow. Think about creating immersive experiences, not just digitally, but in your store or in the consumers living room. And think about how you apply machine learning on top of data to make faster and better decisions for your business.’
I chaired an innovation session with BMW and Bacardi, and having spoken on brand experience at the last WRC (and it was interesting to note that, in one of the last speeches of the event, Mindy Grossman of HSN stated that she thought ‘customer experience’ was an overused phrase, and that the real trend in this area is ‘living a connected life of meaning through inspired product, innovation and technology’). This year I concentrated on another key issue; stagnating mass markets being replaced by fragmented niches of growth, where the much-hyped and long-heralded world of ‘Hyper Personalisation’ is proving key. This ranges from a mass of next-generation products and services for New Families & Households (where ‘what is a family’ and ‘what is a home’ become ever more key issues) to personalised experiential retailing that creates unique journeys for each customer, encouraging them to spend, spread the word and return. Meanwhile, we’re seeing unparalleled-personalised offerings c/o the beauty industry where (referencing Mintel’s ‘2025’ report) ‘30% of US women say they’re interested in trying a facial skincare product with personalised diagnostic tools’. (Hence connected face-masks that suggest your optimal beauty routine, and smart devices that monitor the local weather and pollution levels – and makes product recommendations based on skin monitoring.)
Meanwhile, according to WGSN ‘the media obsession with magic mirrors highlights the equal consumer obsession with being able to digitally view personal desired styles or colours before committing to an appointment’. So connected beauty devices are just one illustration of how technology is transforming beauty on a hyper-personalised level.
High-end personalisation is also thriving due to demands for ‘experiential luxury’, which as reported by Euromonitor illustrates the shift from ‘having to being’ particularly for Gen X consumers. This trend is also changing Millennial consumer expectations, as customers demand that brands fulfil or even predict their needs. Elsewhere ‘personalised learning’ also sees universities innovate with customised curriculums. And this is being driven in a totally glocal market way as well i.e. via Airbnb hosts being encouraged to offer personalised travel advise re: the best ‘secret places’ that their neighbourhood has to offer. (Which is why I once found myself on stage standing in front of a shot of the world’s finest bar, Genuine Liquorette in NYC).
It’s this issue of getting closer… getting personal… that’s improving the bond between consumers and brands. And the absolute key issue here (as ever) is emotion. Just look at some of the incredible personalised packaging options coming out of the small-batch brewing world for an obvious example. And it’s not just alcohol – Mintel report that 44% of Chinese consumers are interested in personalised packaging for carbonated soft drinks. All the above personalised offerings stand out against an issue mentioned earlier – the boring, stagnating and bland mass market that envelopes so much of the planet. The next generation of brands, particularly those aimed at difficult to engage younger consumers or the ageing hipsters of Gen X, are looking to deliver hyper-personalised offerings often via packaging; which many consider to be the key brand connector re: brand engagement or rejection for consumers who want everything to be accessible… but also to be customised and unique.
So getting closer and making a connection via hyper-fragmentation seems a really dynamic space to be in. From packaging that you can draw on to VR experiences built just for you to immersive physical retail offerings, linked of course by hyper-targeted communications, brands that ‘get personal’ do seem to be the future.
But the final word on WRC has to go to Alibaba, where Guru Gowrappan, global MD, pointed out how consumer behaviour is changing in an ecommerce driven environment. The spectacular success of its Singles Day generated $17.8bn in 24hrs in 2016, with 37% of those sales being for international (as in non-Chinese) brands. It even sold 100,000 cars in that 24 hour period. But the killer stat for me was the result of a ‘Superbrand Day’ that it conducted in liaison with Maserati, linked to the launch of its luxury SUV. As Guru Gowrapen said, the results stunned everyone when they sold… 100 Maseratis in 18 seconds. Nice.
The next WRC is being held in Madrid in 2018, by which time Alibaba will have shocked us with another set of amazing stats and a whole new array of issues will have impacted retail.
And that’s just one reason why the World Retail Congress never disappoints. You arrive thinking that you’re on top of all things retail-trend related, and leave with a completely fresh set of viewpoints.
Look at the moon or immerse yourself in next generation phygital retail? Or both? Or more? Your choice.