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Abstract below, session transcript available here.
Madison Riley, the head of North American retail and consumer products group with Kurt Salmon, recently addressed an audience of retail-based company representatives in New York. The subject of his speech was the changing complexion of the retail space as the consumer experience fluctuates. Riley sees changes like the unprecedented customization that the internet allows as changing the fundamental ways in which consumers act: “The consumer space is evolving quickly. Just how much it’s changing, the pace of change, and technology and consumer attitudes and behaviors are moving in an ever-faster clip. Our point of view is that it’s going to continue.” As the internet matures, companies like Nike, Vans, and Converse can offer a product made on-demand for an individual consumer, which necessitates change in storefront models as well.
What the modern consumer wants, according to Riley, is three-fold. First, the consumer demands access. Since he is able to find so many products on the web, he expects those same products to be available in retail outlets. Second, there is information. Riley estimates that the information that constitutes the world wide web could fill 36 libraries of congress, which means that the consumer is better-informed than ever before. Last, is connection. Modern consumers expect to garner an emotional connection to the goods and brands that they buy. “Then you layer on top of that what’s happening with e-commerce, mobility, television and catalog, which has always been around – tremendous access that the consumer has to your products and services.”
This changing landscape in the retail world has moved the power from the seller to the consumer. Where pre-internet, retailers were able to work more or less in a seasonal fashion, the advent of web-based sales has created a consumer climate in which people expect a constant selection of new goods. “The power that is in the consumer today versus the power that was really residing with brands and retailers in the past, there’s been a fundamental shift.” Now brands like Zara and H&M have to constantly overhaul their inventory every few months.
Perhaps the biggest shift, according to Riley, is that consumers tend to look for consumer experiences, rather than just products. The emotional connection that modern consumers derive from the experience of shopping in certain places over others, The North Face instead of The Sports Authority, for example, makes providing an experience an integral part of retail strategy: “I mean, if you think about your own purchases, we buy something material and over time, the glow of that can fade, unless it’s wrapped in some kind of a customer experience, both before, during and after the sale.”
What makes this new retail world exhilarating for Riley is the inability to judge its potential: “If you think about the fact that things are changing so rapidly and we don’t really know how to predict exactly what will be different six months, 12 months, 18 months or 24 months from now, it’s much more about that issue of the process.”