It is clear that the COVID-19 pandemic has had a huge effect on our behaviour and the way sales channels are organised – but the trends that stand out, and the ones that will most affect us in the coming years, are not pandemic ‘native’ only.
These trends were already there, waiting to surface, and now they have been greatly accelerated. The new COVID-19 reality has not so much brought about a 360-degree shift in customer experience, as it has put a magnifying glass on what was mostly hidden – until now.
E-commerce is ‘everywhere’ commerce
A long time ago, we had to ‘go to a place’ to shop. When the internet kicked in, we were able to shop from the comfort of our own home, and later on our mobile phones, but we still had to ‘go to a place’ – albeit virtual.
Increasingly, however, we are moving into an era where everything is commerce and we will be shopping from streaming channels, videos, social media and messaging, and street billboards.
Everything we see will have the potential to become a transaction.
This trend comes straight from China, where people already buy from sites like China’s Yelp.com equivalent Dianping, Meipai live-streaming platforms, shopping review service Xiaohongshu, and Duoyin – the ‘TikTok of China’.
Recently, Western players like YouTube, Facebook and Instagram have been jumping on the wagon. All marketers and business owners should investigate what this trend could mean for them.
It’s all entertainment
In the next few years we will see an immense boost to the entertainment industry. Further down the line, every company will become an entertainment company to some extent.
Of course, the coronavirus crisis has played a huge role in speeding up this process. An example is the Belgian bank KBC which recently bought the rights to broadcast soccer games via their banking app, using real-time ‘push’ notifications to notify customers of goals and highlights.
Another is McDonald’s staging a week of free events for customers amid the ongoing closure of sporting and entertainment venues due to COVID-19.
The rise of emotive technology
According to the Harvard Business Review, “When companies connect with customers’ emotions, the payoff can be huge.”
This ability to generate positive emotions in a customer – called brand intimacy – helps businesses drive sales and loyalty.
Today, businesses have far more data than they used to when it comes to figuring
out what their customers feel: facial recognition, movement data, health data like heart rate and blood pressure, social media behaviour, and more.
The leap from nudging people on the basis of their behaviour to influencing them on the basis of their emotions is an increasingly small one.
One of the ways that this power can be used is to help tackle the ‘loneliness pandemic’.
According to Business Insider, the prevalence of anxiety in US citizens more than tripled between April and June 2020 (25.5 per cent versus 8.1 per cent during the same period in 2019), and depressive disorder nearly quadrupled from 6.5 per cent to 24.3 per cent.
It makes sense, then, that companies are responding. Microsoft plans to embed its Teams business software with a series of ‘wellness’ tools, including ‘emotional check-ins’, a ‘virtual commute’ to allow time to reflect before and after workdays, and guided meditation sessions.
Other companies will follow this lead and incorporate emotive technology.
The next level of digital communication
As we have been mostly confined to digital communication channels recently, these have been ‘professionalised’ at a speed that we’ve never encountered before.
As an example, webinars were once an awkward experience with a somewhat outdated look and feel, but in the past few months they have evolved to have an almost broadcast-TV-like quality.
Fantastic backgrounds, hosts that are fluent and experienced, advanced virtual ‘stages’, a production crew preventing technical glitches, skilled moderators – webinars today are at a different level than before the pandemic.
Then there is the likes of Netflix, which is reportedly testing a new audio-only feature for streaming video that would turn its shows into podcasts.
I believe that this diversification of digital channels will only increase in the coming years, most probably adding augmented reality and virtual reality into the mix.
A local comeback
With sustainability concerns on the rise and the pandemic confining us to our home country – or home city – many have found a renewed appreciation for local businesses.
Even Google has recognised this trend, partnering with the UK’s Channel 4 in a campaign to ‘celebrate the British High Street’ and encourage local purchasing.
In China, farmers began promoting and selling their produce directly to consumers with help from the country’s largest online retailers, JD.com and Alibaba.
Yet while consumers have shifted towards local appreciation, small businesses will need to move to a wholly different gear if they want to match the customer experience that the big players offer.
Partnering with large platforms – like the Chinese farmers – is one option.
Searching for tailwind markets
As tough as it may sound now, some markets won’t survive in the coming years, and – as tragic as it may be – fighting it won’t help reverse the trend.
Does your sector have the wind in its sails? Or is it sailing into a headwind, where there is constant pressure on prices and margins? If so, there is nothing to stop you from searching for a ‘tailwind’ market.
An example is Denmark’s Egmont Group, which was founded in 1878 as a printing business and evolved into one of the largest content producers in Europe, from books and magazines to films and TV.
Recently, its CEO Steffen Kragh decided to steer a fresh course, investing in e-commerce and gaming.
It differentiated itself in e-commerce by opting for niche categories where competitors such as Amazon were less active. In the gaming market, it avoided the ‘short-lived blockbuster’ strategy favoured by many publishers, and instead focused on older, more affluent game consumers.
Egmont found a way to make use of its strength as a storytelling company to fill its sails with fresh wind.
Online word-of-mouth
In-person interaction with family, friends and colleagues became extremely limited in 2020, and it’s likely this will continue into 2021. With our close networks falling away, many now look to influencers and online reviews when unsure of what to buy.
As a result, businesses are likely to spend an increased portion of their budget on the online word-of-mouth ‘machine’.
Influencer marketing expenditure was expected to reach $US15 billion by 2022 – a number I believe will be significantly higher due to the pandemic.
Another crucial part of online word-of- mouth is reviews, and as great reviews are a result of great experiences, the importance of quality products and service will only rise.
The ‘zero customer’ experience
In the next few years, we will see the rise of ‘zero-thinking’, where customers outsource certain decisions to machines.
While some consider this limiting to consumers’ choices and freedoms, open, smart and transparent algorithms can also reduce the stress of purchasing.
Subscription models form part of this trend. In the future, the model will be integrated with what marketing strategy expert Scott Galloway calls “signal liquidity”.
Signal liquidity is the volume of information that a digital platform is able to gather on each user. Watching an hour of Netflix, the company receives three signals – what you watched, how long you spent watching it, and if you continued to watch it.
In comparison, the app TikTok’s algorithm receives several hundred signals an hour.
Why is that important? Well, as Galloway explains, US-based supermarket operator Walmart – the world’s largest company by revenue – recently invested in TikTok as it moves toward algorithmic-based ‘zero-click ordering’.
In this model, a customer doesn’t choose their desired products – the company uses signals to figure out what they want, then ships three boxes of products to their door twice a week, plus an empty box for unwanted items.
The company collects the unwanted items box and uses the discarded products as another signal to refine future selections.
This and the other trends in customer experience listed are likely to shape the retail landscape in 2021 and beyond – and it’s up to business owners to prepare.
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