As Managing Director of Strategy at McCann Worldgroup Germany, Christian Bihn is well positioned to comment on the challenges that digital transformation presents for the German retail landscape. McCann Worldgroup is a leading global marketing agency with 24,000 employees across more than 100 countries.
Christian says the speed of digital transformation presents several key challenges for retailers. These include understanding complex online shopping journeys, providing personalized shopping experiences without tracking data and connecting inspirational content with product marketing.
Christian explains many retailers don't fully understand the complexity of the online shopping journey and don’t tailor different journeys to the mood of the shopper.
The Behavior of Online Shoppers Survey 2021 shows 38% of shoppers are browsing, ready to be inspired. Yet webshops today are built to cater to the 28% of determined shoppers who know what they want.
“There's not one linear shopping journey or customer experience. As a shopper, if I want to buy a specific product, I'm in search mode. I want detailed product information and then go directly to the checkout. But occasionally, I visit a webshop for inspiration. And then I don’t just want to see a long list of different products,” explains Christian.
So the challenge here for the retailers really is to identify the mindset and the mood of their shoppers, and then be present with this solution to that mindset.
"And I think this already will give the shopper a feeling of personalization, though it's not fully personalized, it's at least personalized to the shoppers’ mindset and mood.”
“Retailers should give shoppers a choice. The opportunities to explore, to get information or shop in the most convenient way. And this is what digital marketing provides. For example, if I want to buy fashion products, I might not be 100% sure what I want to buy. I want to explore various products. To see them in the right context. To see how I would look when I'm on holiday. So, inspiration really plays an important part in that shopping journey.”
“But this all then comes back to what. What is my mindset? What is my mood? What am I looking for? And so for each mood I need a different way to target that. And in the end, this gives me as a shopper a kind of feeling of personalization. So, I do not need to give away all my data to get the feeling that this brand is really thinking about what I want.”
Christian explains that you need to find a way to track shopper data by convincing your customers that it is valuable to them, to give away some of their privacy to share their data in the end.
“German shoppers are quite reluctant to give away personal data. On the other hand, on Facebook, we share pictures of our kids with all the people out there."
As a retailer, I need to give the people a reason why they should share their data with me.
"But this is not about discounts. This is not about offering a 30 cents discount off my next can of beans. This doesn’t make a difference for a consumer. For a shopper, it makes a difference if they really feel that the brand cares about me, and data can help to improve that.”
“There are excellent examples of newsletter systems that really make the most of the data to give the people the feeling that the brand really cares about them. A good example is a kids program from the biggest drugstore chain here in Germany.”
“When your kid is born you provide some relevant data. Like when they’re born, their name, gender, and this brand really goes on a journey with you together. They are empathetic, and understanding. Letting you know that at a certain age, the child will likely have teeth coming through. So, they understand that it's a hard time, but we are there for you and have the right product that can help with the pain. I think the most significant value that a brand can give you in exchange for your data is empathy.”
If you're interested in more content about data and personalisation, check out our interview "Retail promotions should become personalized" here.
Another big challenge faced by retailers in digital transformation is creating omnichannel experiences. Providing seamless experiences both online and offline. Christian explains a benefit digital marketing gives retailers is providing much more opportunity to inspire shoppers.
“Now, I can only look at a leaflet, and I can see the printed version of the leaflet. But if I have the opportunity, via an app, via QR code to explore, maybe a video or to get a behind-the-scenes, I can really dive into that. And can open up worlds that are far more inspiring than anything two-dimensional.”
“We are used to an offline shopping experience. I still love to go to a physical store, and to see the products in context. In an environment that really makes the most of the shopping experience. I think this is why it's also important to curate online products properly. So, the customer really has a good online experience that’s close to what they would experience in the offline world.”
Christian underlines digital marketers can present product information not only to inspire but also to inform. He says many online shoppers are looking for transparency. They want to know where products are made. And if they’re made responsibly.
We have a great opportunity to tell product information in a much more inspiring and fascinating way, and this is the opportunity that digital does with the product communication gives us.
"We can provide a greater assortment, but also depth of product information. We can make it more inspiring and relevant to shoppers.”
“But you need to be careful that not all shoppers at every moment of the journey want to be inspired. There's also a part where they want to simply get down to the information and want to know what the product costs, where it is produced. So, we should be careful about the right dosage of inspiration.”
Christian says speed and scale are two of the biggest challenges digital transformation presents for retailers. He underlines the importance for big retailers of having a startup mentality to adapt to the speed of digital transformation.
If you really want to ride the wave of digital transformation, you need to be agile, and ready to invest in technologies.
"That's really hard for big retailers compared to little startups, who are far more agile and reactive to new trends in digital transformation. Retailers traditionally make profits by scaling. They need to grow big quickly. Opening more stores with larger assortment than competitors. And are not known for being on the pulse of technological change.”
“I think the best way retailers can react to the challenges of digital transformation is to have a really open mindset and be very agile in the way they adapt to new trends and technologies. So, think more like a startup and have an open mindset of being able to innovate a bit faster. If you see an opportunity, just try to just grab it. Even if you don’t know whether it will scale in the future.
Thanks to Christian Bihn for participating in this interview. Stay tuned to this channel for more in-depth interviews from leaders in inspirational retail. Take a look at the iPaper Content Universe to learn more.