Retailers need technology, but require humans to survive

Retailers need technology, but require humans to survive
February 6, 2019  |  BY

There’s no question that 21st century retail success depends on technical advancement. The companies that figure how to best implement artificial intelligence, apps, machine learning, and other technologies will most likely lead the pack. But it turns out this can be a one-sided relationship. Consumers want more – in this case, more humanity.

That’s the overwhelming finding from a PwC survey of 15,000 consumers. In the U.S, 82% of consumers want more human interactions while 74% of non-U. S residents feel the same way. Approximately 75% believe the overall shopping experience is more important than price tags. Retailers may rightly respond that the survey is stating the obvious. “Of course people matter”, they would say. But what are they doing about it? 

Some are indeed taking the right actions to add more of a human touch to their retail operations. One method is to develop interesting environments where people want to stay for a while. It’s not only about shopping – they enjoy the pure experience of being there. This is achieved, among other ways, with innovative merchandising, modern architecture and design, coffee and cocktail bars, and employees who treat customers more like people than consumers. In this way your store becomes an outlet for the community, not just a retail destination.

Speaking of community, a number of what were once “e-commerce-only” companies are opening up brick and mortar shops. They’ve realized that despite the convenience of online shopping, there’s no better way to connect with consumers than with real human interaction. Amazon, Warby Parker, and Casper are just some of the brands using this strategy. This extension to physical stores doesn’t only boost emotional connections and brand appeal, it also increases the bottom line. Remember that e-commerce still accounts for approximately 10% of all retail revenue.

Another way to enhance the human factor: Give employees more freedom and flexibility regarding how they interact with customers. The days of strictly following employee handbooks step for step, from a script, seem to be going away, as those forced, rehearsed interactions only make people feel like commodities. This is critical – the PwC survey shows that 56% break brand loyalty after multiple negative experiences; 32% do the same after only a single off-putting experience.

We’re not suggesting that companies should focus more on people and less on technology. Both are critical. The key is to complement the strength of tech with the strength of your people. That idea is perhaps best exemplified with data. While you need technology to assess and analyze data, you also need people who understand how to use that data. Be sure to hire the right data scientists and analytics professionals. These people help to make sense of the data, and how it can be used to learn about customer behavior, predict trends, alter marketing campaigns, and drives sales.

The bookstore is filled with science fiction about the perils of a world taken over by technology. While those are mere stories, they do provide important commentary for today’s retailers. We have to remember that technology can perform amazing tasks, but it can never replace the humanity required to build successful retail companies and long-term customer loyalty.