Danielle Le Toullec is our Thinker Award winner for this month with her piece exploring how digital innovation has and will continue to shape consumer shopping behaviour, both online and offline.
I have a confession to make… I hate shopping. But I’d be lying if I said I didn’t love clothes.
My shopping behaviour has gradually changed over the years and been shaped by changes in technology. Specifically mobile has become the axis by which my world revolves and the source of information which informs and influences my buying behaviour.
I’m drawn in by sensory experiences; touching the fabric of a silk shirt or the heavy knitted patterns of a woollen jumper. Being able to try something on and see what it looks like on my body before handing over my hard-earned cash is an important part of the process for me. Mobile is the gateway for taking a physical world into a digital world, and streamlining the process of getting a killer wardrobe with the advent of flexibility around having free returns if in fact my purchase isn’t exactly what I was looking for.
Here are four important catalysts which are driving the most significant changes to the online consumer and retail space:
Social media – the ultimate consumer research tool
Digital innovation through social media has had the biggest impact on the way I shop. Like most people, my phone is never far from my hand. I sleep with it next to me, I rely on it to keep me connected to my friends and family, direct me when I’m lost and entertain me when I’m bored. And like many of my colleagues working that #medialyf, I hardly ever make it to the shops in time before they close! So I use my phone, namely Instagram as a fashion research tool to help me decide what I want, before I walk in a store (online or IRL). ‘Shop Now’ call to action prompts on Instagram sponsored posts, new websites that allow you to directly shop a store’s Instagram account and the advent of sites such as Like to Know It facilitates online shopping with a layer of styled curation from your favourite bloggers. You simply have to register then ‘Like’ a photo to receive an email (usually within 5 minutes) with the links to each item the blogger/influencer is wearing.
A frictionless shopping experience
Business Insider’s intelligence report into Key Trends of Mobile Payment Industry forecasted that offline transactions via mobile phones will increase from $120 billion in 2012 to touch $1.5 trillion in 2017. There has been a monumental rise in mobile payment tools (Apple Pay, Samsung Pay, PayPal Here, PayWave) and innovations such as MasterCard’s ‘Selfie Pay’, which will use biometric methods like face recognition and fingerprint scans to better secure online shopping. We are moving toward an increasingly frictionless shopping environment that will make the process a whole lot easier for time-poor, shop-o-phobics like me.
As with all innovation, change is unavoidable however it’s important to remember that humans are habitual creatures (read: lazy) and to change deep-rooted behaviour is a difficult thing to achieve. At its core, nothing is fundamentally wrong with the current payment methods (namely cash, cheques, credit or debit cards). For the widespread take up of future payments, it needs to fulfil a need and be more convenient than existing methods. Education and simplicity will be key.
A push toward the widespread digitisation of payments
Earlier this year, Sweden was planning a 5-year countdown to becoming a cashless utopia and as The Local reported, “cash transactions today represent no more than two percent of the value of all payments made in Sweden, [and that estimate] will drop to below 0.5 percent within the next five years.” Access to mobile payments has been simplified via the popular Swedish app Swish, which has made mobile payments so easy, that even homeless people and buskers are using it. This is a glimpse into a potential future of a mobile first society and its implications for the consumer and retail space.
The way forward – personalisation and messenger payments
The biggest disruptor in our online consumer and retail environment is going to be facilitated by messenger apps. Spigraph estimates that by 2017 almost 7 out of 10 people in the world will own a mobile device, this along with the fact that 1 in every 3 minutes spent on a mobile device is on Facebook or Instagram, is going to represent a monumental shift in how we consume goods and services.
As texting becomes the default method of communication, this presents a huge opportunity to shift the marketplace to where people are spending most of their time. And the volumes are huge, for example WhatsApp – “With more than 800 million active users, the app facilitates the traffic flow of around 30 billion text and 200 million voice messages on a daily basis.” The popular Chinese app WeChat is lightyears ahead of the western market, it’s a one stop shop where you can order food, send money to friends, book flights etc. and personalisation is a big part of its offering. With this wealth of data, comes endless personalisation options. Having access to real-time feedback and preferences will provide major changes in inventory management, product design and delivery in the retail industry. It will also increase profitability as retailers can create the right product to satisfy what consumers want.
On the whole, digital innovations are shaping the consumer space in a positive way, making the shopping process easier and smarter than ever before. Which is great news for lazy shoppers like me, who are all about minimum output and maximum returns! Hopefully one day, technology will figure out a way to make this happen: