ShopTalk 2018. Retail Renaissance. Adaptive Conversational Commerce. Oh My!
By Vishal Gurbuxani, Co-Founder Captiv8 & Brianna Persall, Founder of Wellspace Co.
It’s March of 2018 and ShopTalk kicked off their 3rd annual brand, retail, commerce, and technology trade show. The ShopTalk organization continues to multiply the value and size of their conference. This year the show scaled to over 8000+ sponsors, attendees, brands, investors, retail; it was impressive to say the least. ShopTalk continues to be a must attend yearly conference.
I would like to share my 10 Top takeaways from this years conference.
1. Retail is going through an apocalyptic extinction. Just Kidding. It’s is going through one of the largest renaissance periods in history
I was surprised to hear from Deloitte’s Christina Bieniek the following:
-Online sales in 2017 grew by $40 billion dollars
-Physical retail sales grew by $30 billion dollars
-The retail industry grew by 3.5% in 2017, despite GDP only growing at 2.3%
The divide between Value, Middle, and Premium continues to widen. Retail must focus on the Value Customer and the Premium Customer. Those in the middle are indeed becoming extinct.
Key takeaway: Physical retail needs to wow the consumer with value or a premium experience.
2. Conversational Commerce is here to stay. Multi-Modality, Intent, and Context will fuel the future of Adaptive Conversational Commerce
I was fortunate to attend a great discussion with Tim Chang (Mayfield Fund), Japjit Tulsi (eBay), Stefanos Loukakos (Facebook), and Zephrin Lasker (Rakuten)
– Consumers aren’t going to Google for shopping, they are going directly to the brand experience
– We now live in a multi-modality world which include: Touch, Text, Voice, Images, and Emoji
– AI mixed with Chat is the new default to experience the world
A Framework to Get Started
-Merchants/Brands should first create an online messenger presence
-Define a clear business objective from messaging
-Codify a workflow for the customer journey
Messaging apps are over 20% bigger than social networks! By 2020, the ARPU from messaging apps will exceed to $15/user driven primarily by chatbots
Key Takeaway: The future is ‘adaptive context’, where you will have coaching and curating down the funnel to conversion.
3. Nike. Technology is enabling the vision of Nike. Your not just buying footwear, you’re buying your ‘potential’.
I didn’t realize how big Nike+ had grown:
-100 million+ users of Nike+ membership
-Members spend more than 4 times the amount on Nike Store, when compared to the guest checkout experience
-Nike’s holy grail is to recommend personalized footwear and apparel based off of training data
-If you get emotional you share
Nike has gamified the line waiting experience with Nike Stash, and they are expanding from here.
Key Takeaway: Brand Loyalty fueled with algorithmic automation = right experience, right engagement, right expert, and the right product prepares Brands for the future.
4. The Future of Product Discovery is Visual. Not Text-Based
Ben Silbermann, Co-Founder/CEO of Pinterest shared the power of exploring products through visualization as opposed to free form text.
-The smartphone happened and everyone has a high res camera in their pocket
-which changes the way you communicate with everyone. Changes how you discover things.
-You don’t need vocabulary to describe your taste with words, you can discover visually and its that much more attainable for people
The mantra of Pinterest is: Inspiration -> Personalization -> Purchase
Key Takeaway: Brands need to become more visual, in order to win with product discovery.
5. Facebook. The New Retail Storefront.
Carolyn Everson, VP of Global Marketing @ Facebook discussed the new ways brands should think about converting shoppers to buyers.
-Retailers need to think of the new storefront by telling stories with images and videos
-Retailers need to stop thinking about the last-click action as their are multiple events/actions/experiences that decide a consumers behavior
-300 million stories/day
-“Thumb-stopping content” is going to be different for every individual
-What is the best ad for the individual at that time?
Key Takeaway: Upgrade your business practice. Use Stories, Videos, and Images to guide your customer through the right experience for the right time for the right conversion.
6. The Rise of the ‘Niche’ Brand. I mean the ‘Modern Brand’
Joey Zwillinger, Co-Founder/CEO of Allbirds shared his vision of the future of niche brands
-The world has become much more casual and therefore work apparel has to adapt
-Leveraging a PR/Media strategy is a great way to test the launch of a Product.
-They scoured to find new/sustainable materials that can be given to the public for consumption
Paul Berberian, CEO of Sphero
-The most powerful endorsement of a brand, is a child telling their parents they used a product in the classroom and want it at home
Alexandre Douzat, CEO Ollie Pets
-Their highest points of differentiation are traceability. You can see how they make foods and how the test it through the use of videos/media
Key Takeaway: Niche Brands are now the Modern Brands for consumers. Brands should realize that the lines between school, work, and home are getting more and more blurry. It’s time to connect the experiences together.
7. Private Label is the future of the Department Store
Molly Langenstein, GBM for Macy’s Inc, discussed the new strategy for Macy’s survival.
– Private brands are more profitable for Macy’s
– Owning the design and the development of exclusive products provide clear differentiation for multi-brand retailers
– Speed to Market: Owning the product lifestyle calendar and retail distribution channels provides the flexibility to react in-season to trends and consumer demand signals
– The consumer lifestyles create deeper connections between the product and the consumer.
– Consumer Insights. Create a culture of testing and learning by engaging directly with your consumer.
Jan Wilmking, SVP Private Labels, Zalando
-Every second Zalando sells 3 products
-Use data driven supply chain for private labels to reduce the time to market and inventory at distribution centers.
-Data is the core and voice of the customer
Key Takeaway: Mixed Retail Brands need to pursue a Private Label Strategy fueled with a data-driven supply chain strategy to win.
8. The Evolution of Food. Un-Doing to Re-Doing
Seth Goldman, Executive Chairman, Beyond Meat & Co-Founder & TeaEO Emeritus, Honest Tea, Beyond Meat and Honest Tea
-We as a society are moving away from conventional food like Wonder Bread
-Innovation is critical for Wellness, Simple Ingredient Use, and Transparency
-Can we redefine meat? Not just protein from animals
-Safeway and Krogers put Beyond Meat next to Real Meat and it was revolutionary
Framework for the Future of Food
-Driven by Health and Environmental Concerns
-Usually not in the playbook of Large Food Companies
-Taste is still paramount
Key Takeaway: The Future of Food Movement is critical to humanity’s survival. We must first Un-Do Food in order to Re-Do it.
9. The Future of Marketing in a Connected World.
Martin Barthel. Global Head of Retail @ Facebook
– The product catalogue needs to become personal
– The physical store opens to digital. Stores have faced an uneven playing field online . Now, with digital, stores can optimize in-store sales
– Brick and Mortars stores will not go away but things might be bought in the store but was probably discovered by mobile first
– People check phones 80x / day
– Merchandising becomes immersive. Product Categories for dynamic ads — to promote entire product categories (ex. leggings, socks)
Time to embrace video
-79% of viewers would rather watch a video then read text on a page
-Video is now being used at every stage of the customer journey
-IG stories used to connect in a more live way with people
-Augmented commerce — can “try” our products and move it around with clicks etc. One more step closer to the real thing
Key Takeaway: Physical stores are part of the new customer journey. They will be for fulfillment and not for discovery. Physical Retail needs to have an integrated digital experience to survive.
10. Building Digital Brands with AI and Influencers.
Jennifer Goldfarb, President @ Ipsy
-Ipsy is differentiated because of authenticity
-Built entire business around creators/influencers from the start (even before it was popular)
-Customers want to be heard and listened to and ipsy talks back and responds to the feedback
Guido Campello, CEO @ Cosabella
-Cosabella was created out of the need for a VPL (visible panty lines)
A/B Testing: Lets the AI make design suggestions that would be the most effective. Product Personalization: Using technology can personalize product on your screen before your eyes
Key Takeaway: Leveraging Influencers at scale can be the only marketing a brand needs to do, to build their audience, product requirements, and community. Leveraging best of breed AI with an Influencer Strategy are requirements for how all new digital brands get built.
And that’s a wrap! I hope you find these 10 core takeaways from Shoptalk valuable as you think about the future of commerce in our ever connected digital world.