Empathy-Driven Technology Will Fuel The Next Era Of Retail

Paula Kennedy Garcia is a global innovation and foresight strategist.

Today’s retail landscape is not defined by in-person shopping or e-commerce; it’s shaped by both working in tandem, creating increasingly more immersive experiences that target and appeal to a broader customer base.

We’ve already seen the shift from brick-and-mortar stores to online shopping, a trend accelerated by the pandemic, but retail owners have not given up on physical store presence and are reinventing customer experience with the best of both worlds, merging interactive experiences online with similar “phygital” engagement in stores. For the customer, this raises the expectations for a consistent and seamless brand experience, which means the design and delivery of support along the customer journey must ensure that information, preferences, convenience and trust are engineered flawlessly from tech-infused engagement to knowledgable digital and human support interfaces.

As shopping evolves into a confluence of e-commerce and physical retail, consumer data is growing exponentially in parallel to advances in AI. Savvy retailers are using intelligent innovation to reimagine how and where personalization can help them win market share, build loyalty and advance their brand into a new age. They are embracing an omnichannel strategy that blends the best aspects of new technology with empathy and human connection.

The Rise Of EQ Commerce

I believe that the next evolution of retail will be heavily influenced by “EQ commerce,” a term I’ve been hearing frequently in strategic foresight articles and industry groups. Customer journeys are no longer straightforward and transactional. They are complex and omnichannel, and indeed emotive, with customers moving seamlessly between online and offline spaces.

EQ commerce recognizes that, as retail and e-commerce become more immersed in AI and other technologies, we must remember to lead with empathy, personalizing experiences and humanizing digital processes. By using technology to build connections and create experiences tailored to customers’ individual needs, brands can win market share and drive brand loyalty. The industry is leading the charge with creative and diverse innovation, infusing the buyer journey with tech including first-touch empathic conversational chatbots to guide and support everything from browsing to post-purchase inquiries, intelligent online search, personalized recommendations and sizing guidance, virtual try-ons and gamified and tokenized loyalty and fandom.

On the support side, human-in-the-loop workflows optimize operational efficiency and knowledge management, automating repetitive tasks and surfacing secure customer insights and information to resolve as much of the customer inquiry as possible before human support needs to intervene. When it is required, AI is elevating the role of the support agent with summarization tools of historical issues and interactions, intelligent workflow processing that auto-fills templates and email responses and the ability to source and surface complex information and tacit knowledge that removes the former long hold times and lower resolution rates for customers who were obliged to wait. End to end, the customer journey is more slick, more informative and more satisfactory than ever before.

The Value Of Life-Centricity

The design for “Consumer 2030” is not new; indeed, it is already far along in its evolution.

The creativity of virtual stores and early-stage Web3 interaction is creating next-generation omnichannel shopping and strategies that are appealing to all customer groups and even establishing new generational brand loyalty earlier in the life cycle.

Innovative brands are widening the lens through which they look at their audiences. Research from Accenture found that businesses that focus on life-centricity, “a broader view that allows them to see customers in their full lives and adapt to their ever-changing needs and priorities” are three times more likely to outperform competitors on speed to market, five times more likely to outperform on customer lifetime value and 9% ahead in growth rate. To thrive in the future, life-centric brands try to understand how consumers’ sometimes paradoxical behaviors are driven by outside forces, such as economic, social, environmental and political instability.

Brands are experimenting with creative engagement approaches to appeal to a broader audience across traditional demographics, for instance, appealing to younger generations via digital assets such as NFTs and multimedia experiences and older generations with strategies that aim to create value throughout their lifespans. In this immersive digital world, we need to be agile and dynamic in building customer personas and designing experiences that center around how customers like to shop, engage and buy.

Luxury brands, including Gucci and Louis Vuitton, have set an early high bar as examples of innovative design as a catalyst for new customer acquisition and new revenue generation, investing in immersive digital experiences, such as online games, NFTs and virtual wearables, to engage different audiences. Some are designed to attract buyers who already have spending power, while others are geared toward cultivating brand loyalty in the next generation of customers via accessible digital assets.

Building on the checkout-free Amazon Go model, global retailer Uniqlo is another example of the increasing use of radio-frequency identification (RFID) technology, wireless tags that provide real-time inventory tracking data, into its stores to create more interconnected in-store and digital shopping experiences.

What’s Next For Omnichannel Retail CX

According to recent research, 71% of decision makers in retail said AI and machine learning are leading their IT and business strategy. I believe key focus areas include metaverse or immersive experiences, tokenized incentives, Web3 shopping experiences, hyper-personalization for omnichannel marketing and gaming platforms for brand engagement and community building. In addition to the aforementioned customer engagement innovation tools that are already in play, AI is also proving to be a vital tool in brands’ ESG and circularity strategies, enabling improved demand forecasting to manage production and reduce waste.

As we move into a new era of physical and digital convergence in retail, I believe empathy should be at the heart of innovation. E-commerce and digital experiences should feel less transactional and more personalized and VIP, whether or not they require a human in the loop. This new chapter opens up limitless possibilities for brands to develop creative, user-centered and convenient interactions with customers, today and in the future.

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