Tomorrow, what business, what business?

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Updated on 01/10/20

What will tomorrow’s trade look like? Between giant bankruptcies that were thought unsinkable, such as Toys “R” Us, and unprecedented financial losses in the retail sector, it is no longer necessary to prove that the old models are being undermined. People don’t stop eating or buying clothes, they eat differently. While the short-term vision and lack of decline of the big retailers show their limits, they benefit online platforms (Amazon, Cdiscount, e-commerce sites of retailers …). Lovers of flexibility, delivery, simplicity, consumers are willing to be seduced.

Proximity trade in the hearts of the French

However, many also enjoy doing their comparative studies online, before going to the checkout in store. Physical outlets would not live their last days. It seems that they suffer mainly from a lack of renewal among traditional players, overwhelmed by the expectations of consumers in tune with their time.

Between technological innovations, digitalization, local businesses… Focus on trade that is part of the urgency of societal problems of employment, traceability, costs, ecology…

Contrary to popular belief, Digital and technological innovations do not sound the death knell for physical outlets. If supermarkets are facing stiff competition from web giants, local businesses can count on their own assets. Indeed, actors of the life of neighborhoods, local shops meet the expectations of customers in search of meaning, quality products, advice. Refusing to play by the rules of the leaders, they continue to value know-how and human contact.

Thus, according to the 4th Barometer of the city centre and shops, most French people are attached to local shops. Moreover, 21% place the revitalization of shops in third place of the most important considerations for municipal elections. Young or old, small towns or metropolises, they do not see local life in the same way. For example, in municipalities with a population of less than 50,000, they are more resigned to the decline in local shops, especially food, which they place at the top of their list of priorities. In the big cities, the situation is very different. Indeed, followers of the “better life”, the inhabitants value projects in transport, sports facilities, and digital screens dedicated to commercial and local information. This is a population that seems to be more willing to put Digital at the service of local life.

Availability and immediacy, customer services “trade” way

To remain attractive and increase their sales, brands have an interest in focusing on the quality of their customer experience.

In addition to the quality of the products and their price, among the first wishes of the customers is the advice. Thus, merchants and e-retailers face the paradox of consumers who like “do it yourself” and the slightest interaction, but today more than ever ask for responsiveness on the part of brands whenever they show the need.

A “trade” mindset that Leroy Merlin has grasped well. Exploiting both the outlets and the Digital, the brand has been able to animate a real community and make them serious ambassadors. Workshops, DIY classes, tutorials, expert advice, chat… For more than 2 years, it has been offering its customers the iAdvize (1) solution, a chat system powered by experts (2) to offer the community the answers of professionals. In times of confinement, the service has even been strengthened, to limit the frustrations associated with the closure of stores.

A strategy also adopted by Mano Mano who has been offering 7/7 online support since the beginning of April(3). It provides free assistance from professionals to carry out emergency repairs.

As brand availability is at the heart of customer satisfaction, delivery also tries to keep pace. Tired of being stuck between 8am and 6pm to wait for a package? To learn with surprise that according to the delivery man you were not at home? Having to wait several days to receive the TV that is available in the store 30 minutes from your home? Aware of the mismatch between supply and demand, some delivery players are taking the opposite step. Thus, they offer deliveries during the day or by appointment.

Customer experience, the unsuspected link of physical stores and online stores

In addition to availability, it is also all other parts of the customer experience that are digitalizing. If the store envy the digital, the digital does not have all the advantages of the store. In reality, technology and innovations can address everyone’s shortcomings.

For example, mobile and connected pop-up stores are born. In addition to bringing new products to consumers, they are also key assets for brands. Thus, as close as the end customers, they are particularly relevant in the testing phase before a possible larger deployment. Some also allow us to study customer behaviour.

Shops can also take advantage of artificial intelligence. This gives them the opportunity to offer a personalized customer experience, against an augmented reality backdrop. For example, Diakse proposes to set up 3D shops to allow immersive virtual tours. For its part, Trimirror creates avatars to the measurements of customers to try on the clothes. The solution is available on mobile for home testing, or in-store testing, especially for out-of-stock items.

Always with the aim of making life easier for customers to smooth the buying process, some brands are taking over voice assistants to offer appointments and voice purchases. Other businesses are looking to remove the barriers to buying due to the digital barrier and product intangibility. This is the case, for example, of Zalando and his“try first, pay after”initiatives.

Mac Cosmetics offers a new kind of hybrid business

In September 2020 we also saw the appearance of a new concept between online store and commerce. It is the American brand Mac Cosmetics, which decided to create a place of a new kind halfway between the store and the trade line. The concept is simple the discovery of products is done only on social and digital networks. Thus the store becomes a place of experience and entertainment dedicated to the consumer.

In these new locations dedicated solely to the customer experience, Mac has installed 16 virtual mirrors. They allow customers to see the different looks. It is also possible to customize the products in its image. Customers can choose the shades of shadows in their palette as well as engravings on the packaging. Everything is done so that customers leave with the product made for them, by them. Thus, the brand clearly sets aside the commercial dimension to center its places around the experience.

For now, this concept has not yet arrived in France but there is a good chance that it is only a matter of time.

Tomorrow’s logistics, between cost optimization and customer satisfaction

Far from being the preserve of new business models, technology also integrates seamlessly into more traditional environments. From supply to the end customer, a brief overview of innovations at the service of today’s and tomorrow’s trade…

In a context of loss of confidence among buyers about the products they consume, initiatives are emerging to ensure the traceability of products. Like JD.com, in collaboration with IBM, Walmart supermarkets make customers accessible through an application of data such as the origin of meat, transport and storage conditions, and the temperature of warehouses.

Delivery is one of the links in the commercial chain that consumers are most eager to see renewed. In order to speed up and reduce costs, some businesses are taking the side of automation. Thus, delivery can now be provided by delivery robots and drones. However, while this technology has been in the works for many years and attracts curiosity, it is still far from being democratized. At the same time, models based on “people” as mentioned above seem to take more easily with brands and public opinion.

Tomorrow’s businesses, the supermarket wants to stay in the race

According to Linear, in 2019, Auchan hypermarkets continue to tumble. Thus, 70% of the shops, small shops, are affected by the drop in activity, generating losses of around 155 million euros. On the other hand, Intermarché and its brands are doing well and continue to seduce. This success is due in particular to the responsible approach of the company and the privileged sale of local productions.

Gradually realizing that their traditional models no longer meet their audience, different distributors are looking to re-raise themselvesto find their superb. Thus, the distributor for professionals Metro is experimenting with deferred payment to ensure that the supply costs no longer weigh on the cash of their customers.

On Bordeaux Metropole, initiatives are also emerging. Thus, the Casino Group, within the Giant hypermarket of Pessac, is rethinking its entire store. From supply to drive to inventory management, the chain has ambitious goals: reduce the number of trucks on the roads by 10%, by 95% fine particulate matter thanks to biogas trucks, by 50% food waste, double the amount of drive and home delivery orders and make half of them in electric vehicles.

To achieve this, the store has a technological arsenal, serving teams and customers. Among the most striking innovations: intelligent robots analyze the shelves to detect missing references and price errors. Augmented reality on mobile devices allows teams to manage inventory in real time. To reduce waste, computerized tracking of consumption dates allows you to make promotions on short dates. Refrigerated drive lockers are set up to allow customers to pick up their groceries 24 hours a day.

Sources:


(1) The New Business Priority, the outsourcing of the CUSTOMER relationship BORDEAUX Business 19 December 2019 by Kim Gaborieau

(2) Iadvise

(3) Ibbu

(4) Mano Mano Council

(5) Deliver

(6) Web parcels

(7) Diakse

(8) Trimirror

(9) TRY ABORD, PAY AFTER– Zalando

(10) CES 2019: 7 technologies that foreshadow tomorrow’s trade Hubinstitute – Benoit Zante – 9 January 2019

(11) Manager in Retail, between benevolence and authority BORDEAUX Business- 27 January 2020 by Audrey Kozaczka

(12) How Metro Is Experimenting With Deferred Payment with Finexkap – LSA

(13) the Casino Group, within the Giant hypermarket of Pessac, rethinks its entire store – Viméo

(14) MAC Innovation Lab, the aesthetics version tech – Journal du Luxe 30/09/2020

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