Consumers Don’t Shop In ‘Omnichannel Mode’
Retail and location ad veteran Anne Marie Stephen believes brick-and-mortars are getting closer to closing the digital and physical loop.
Anne Marie Stephen is the founder and CEO of retail-focused tech advisory firm, Kwolia. She started the firm in January has been working with several major brands about their respective approaches to omnichannel — a word that Stephen has some issues with.
GeoMarketing: What is Kwolia and what are the basic services it provides?
Anne Marie Stephen: The word “Kwolia” is actually a phonetic spelling of “qualia.” It’s a philosophical term that refers to creative experience and perception at its core. When we think about the technology of convergence in retail, that’s what it’s about. It’s consumer experience and perception. Kwolia is the what we do when think about all those things together. That’s why I landed on that word.
I have been in the location marketing space for over a decade in different capacities mostly in the use of passive analytics.
Before we get to passive analytics — how did you decide to focus on location advertising so early on?
When I first graduated from university, I started working retail. That
was my experience, working in stores. I worked in sales, I worked behind the cosmetic counter in downtown Chicago. Then I went into management training program, which involved looking at store operations. You learn everything in that job.
From there I went to be a department manager, working in stores, that side of the business. I wasn’t particularly keen on being a department manager, but I wanted to experience luxury retail. So I worked at Neiman Marcus on Michigan Avenue, which was great. It was an amazing company, amazing experiences, and it really taught me how to understand the value of customer experience.
That experience informs everything that I do today. Because I have so much retail experience, it influences how I think about how technology is used the stores today in connection to customer experience, store operations with brands, and, now more than ever, the integration of the physical and the digital.
How does passive analytics come into play with the work you’ve done?
When I got into this, I got into passive analytics with video technology. For example, video analytics would fall into a passive category, which means the consumer takes no action, the shopper does nothing.
Passive analytics could entail on-camera technologies, where we’re observing the behavior of customers coming in. Historically, we looked at how many people come in a store as one aspect of that discipline.
Today, we think of passive analytics as including mobile technologies and where there is no opt-in. A decade ago that wasn’t on the map at all. That’s where it started: trying to understand what was happening with that consumer behavior in the brick and mortar environment. Simply put, it was about putting foot traffic against sales data.
Then from there, we saw everything change. Over the course of that time, e-commerce came up, then web analytics. All of that was happening while we were putting video analytics into store and evangelizing the idea of counting footfall into brick and mortar. As the pressure from e-commerce grew, then brick and mortar businesses became more interested in what the consumer was doing when they came into a store. At the very least, they wanted to know the numbers at a basic level so they could see their conversion-rate data.
That was all pre-omnichannel. From that point, around 2007, there was a wider shift toward cloud computing, and smartphone adoption was growing. It became the perfect storm for what we see today as a trajectory of mobile and impact of mobile into the physical environment.
How has the use of passive analytics evolved for retailers, particularly in the face of mobile’s growth?
The challenge of passive in and of itself is finding a measurable ROI that’s associated with it. Beacons have the ability to do some passive data, because a brand is using app data, and a consumer is using their connected tools, such as wifi.
With beacons, you can identify a consumer very specifically and get more personalization, attribution, and segmentation data from all of that information. Passive analytics certainly has a place in terms of helping understand the behaviors of the store that can be collected via beacons, via wifi. However, I think the true value is in showing how to actively connect with consumers and having a measurable path to purchase.
When it comes to beacons and passive analytics, I would layer the active data — i.e., engagement data when people opt-in to receive a message over a Bluetooth signal — over passive data when consumers don’t opt-in or when they’re not directly engaging with a coupon other message while in-store. That’s how you get a better sense of how those two pieces work together.
So does it all come down to finding the right omnichannel solution to put all the digital and physical strategies and data points together?
Omnichannel is an antiquated word. I’ve discovered that while there are a lot of tech companies out there that have great solutions, they don’t necessarily know how it all applies in a physical retail context.
What’s going to be important to a retailer? What is valuable in the data that they’re providing? How should they be speaking to it? How should they approach the market, where do they fit? Which vertical do they fit in? Lots of questions.
On the retailer and brand side, it’s asking, ‘which solutions make sense for the goals I’m trying to achieve?’ I see myself as a translator sitting in the middle, trying to sort through those pieces and help everybody get where they need to go.
Before, you knew the solution. It was very easy for both sides to vet the other. But with convergence and all the lanes merging, so to speak, retailers no longer have the clarity they seek. We have the proliferation of solutions.
Does that mean omnichannel doesn’t have a real meaning?
It has meaning because it’s a word we can all understand. But I don’t believe it actually reflects the infinite ways that retailers and consumers interact and engage.
I’d like to see a better word but in terms of shopper behavior. Consumers don’t shop in “omnichannel mode.” We shop one brand at a time; whether we have the experience online, on mobile, or in a physical environment, we want it to be consistent, we want to have the same feeling wherever we are in that engagement with the brand
That’s what omnichannel’s trying to do. Omnichannel, to be honest, more accurately reflects now how a retailer and brand operate internally. Adjusting a retail operation to new technology changes and strategies is like trying to turn a huge passenger ship around. They have to change how the operation of an organization is, where the lines of business are. We’ve seen CIOs become more business intelligent, more focused and that’s changed, definitely.
That continues to evolve. We’re seeing emergence in new titles being added to organizations, and maybe “Chief Innovation Officer,” or “Experiential Strategy.”
Retailers need a point person who has an umbrella view of the organization in some way, in tying some of these pieces together. That’s grown and changed, but it’s challenging.
The store is the last horizon in trying to figure out how advertising fits into the digital and physical retail space. That’s where beacons can be a great resource for those solutions. That’s where we need to close the loop.