The lessons that can shape the future of retail lie in three distinct areas: invisibility, indispensability and intimacy.
Rapid technological development means that customers now expect to find what they want, when they want it, wherever it is convenient to them, making the provider almost invisible to the consumer.
The increasing convergence of sectors to address the needs of consumers has led to the emergence of new service models.
For example, the ability to support a healthy lifestyle, including medical, diet, exercise and monitoring support – all as one service, from one place – makes that service provider indispensable to the consumer.
Retail has often served as a community hub for social interaction and local events, as well as a place to shop.
Shopkeepers used to have a level of intimacy with their customers that today’s mass-market retailers struggle to replicate.
These three I’s can shape successful retail value propositions of the future, enabling retailers to differentiate between their offerings and provide tangible benefits and value back to the consumer:
- Invisibility – making consumers’ lives easier by providing them with the products that they need when and where they need them, smoothly and seamlessly, making the transaction a process of which they are barely aware.
- Indispensability – making consumers’ lives better by providing them with bundled products and services that can cater to areas of holistic need, using an ecosystem of partners that make the transaction part of a service to improve their lifestyles.
- Intimacy – making consumers’ lives more fulfilling by providing them with experiences that resonate with them, reflecting their core values, and making the transaction secondary to the services that they provide.
The three I’s should not be viewed in isolation, nor should all three be considered equal for a retailer looking to transform for the future.
Retailers looking to reshape their strategies must examine their core capabilities and corporate purpose to identify the right blend of invisibility, indispensability and intimacy for their businesses.
To find out more, read EY’s report titled How Retailers’ Value Propositions Need To Evolve For Success.
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