By Olivier Buffon, below, Head of International, Faire
In recent weeks, the media has speculated about the role and influence algorithms play in our daily lives. But consumer scepticism of manufactured online recommendations is real and growing rapidly. As a retail business owner, you should be prepared to pivot your digital strategy to avoid falling foul of shoppers’ algorithm fatigue – while still harnessing the enormous benefit data-driven insights can bring to your business.
Three years since the outbreak of COVID-19, many consumers are still grappling with significant shifts in their lifestyles and values, which is resulting in a changing relationship with ecommerce. After facing no other choice but to shop online during much of the pandemic, people are rediscovering the curated, unique experiences that come with shopping in real life creating the conditions for brick and mortar stores to flourish again.
The Office for National Statistics reported last year that although online shopping remains high, since January 2021 consumers have been steadily returning to making their purchases in-store. Online ecommerce will remain a lucrative retail space for commodity and convenience, but my advice to independent retailer owners is to take this moment to reassess how you deploy digital tools in your business.
Leveraging technology in your business planning is a powerful but often underutilised tool for creating experiences that foster a customer’s sense of connection with a store – be it local or online. Using trends data you can ensure you are stocking products that consumers in your community want today, helping drive organic and repeat traffic to your store. As consumers become even more mindful of how they shop due to the cost of living crisis, flexing this agility can give your indie store an edge over the slower moving big box chains on the high street and online.
Our recent Covid Year Three and Joy of Significance of Serendipity research provides useful insights into how data analysis and digital technology can help retailers bring more customers into their stores – it might give you some ideas for your own business too!
Consumers these days identify as ‘nostalgic’
Shoppers of all ages are growing tired of algorithm-driven ecommerce, and are actively looking for experiential, grounded shopping which builds connections and their sense of community. Research has found that 75% of consumers identify as nostalgic for what has been lost in this regard in the last decade of digitisation. This statistic doesn’t meaningfully change with younger demographics either – in fact, 72% of respondents under 30 also identify as nostalgic.
Thanks to this insight, 94% of Faire retailers are already planning to enhance their in-store customer experiences and turn commerce into an event by offering collective entertainment in retail settings, for example through hosting candle-making workshops in artisan decor boutiques, or book signings in music stores. And in North America, fully one in four Faire retailers already use a single space as both a retail shop and community hub.
Think about how you can elevate your customer’s overall shopping experience by offering unique activities or touchpoints that they can’t find online. By making your store a destination that holds value for your customers in multiple ways, they’re more likely to invest time in coming to the shop.
Shopping is now an emotional experience
How people feel when they shop – and how they feel about the retailer they are buying from – is now more important than ever. According to the Harvard Business Review, shoppers who feel fully emotionally connected to a brand or retailer are 52% more valuable as customers. And we found in our Serendipity report that retailers thrive when they take their customers on an emotional journey – whether it is one of discovery, or creating a connection with a shop’s values and story.
Think about what kind of journey you can take your customers on in your store. How you can use the physical space of your shop to help you – your merchandise placement, the lighting, and colours you use can all enhance your customers’ experiences and encourage them to spend more time in your store.
Digital tools can help you curate better customer experiences
Nine in ten (89%) of shoppers trust recommendations from people they know over brand advertising, meaning the experience you give your customers in-store becomes your business card. This may be linked to the experience of lockdown, which reminded many consumers not just of the importance of human connection and interaction in their daily lives, but of the value of their own agency too. People want to feel they are in the driving seat of their shopping experience, whether it is in person or online – and that can mean a feeling that rather than having been sold to by an anonymous algorithm, their own personal experiences, networks, and choices have brought them to the point of purchase instead.
Rather than using digital as a tool for marketing, therefore, you should instead use it for its other great retail strength: to curate and quality control the products you source for your store to help you create the best possible experience for your customers.
We’ve seen this trend play out first-hand on Faire’s platform, where thanks to the ability to choose the right products to meet the preferences of their customers, new businesses have skyrocketed as a share of our retailers – growing 2x since the start of the pandemic.
So, what’s next?
As the importance of ecommerce as a sales tool declines, we will see technology becoming a more important tool at the back end of retail businesses.
Independent shops and boutiques will embrace using technology to discover exciting new brands and products, and will focus on curating creative and compelling offerings that feel refreshing yet tailored to their customers.
I think we can also look forward to seeing in-store events become more common, further bolstering our high streets and our sense of community with experiences that respond acutely to the interests and needs of local customers.
I’m excited to see all the innovative ways retailer leaders will seize consumers’ renewed passion for in-person shopping, and the creative new experiences this will bring to the sector.
Since joining Faire in 2021, Olivier has spearheaded international expansion across the UK, Europe and Australia, growing Faire’s global community of SMBs