The Social Revolution Reshaping Retail

THOUGHTS & INSIGHTS FROM NRF 2013 "Now, you know the rest of the story." - Paul Harvey 

Over 27,000 people from 70 countries gathered in New York this week to attend the NRF 2013 retail "Big Show." Post the holiday season, this trade event is the wrap up gift to close the previous year, think about the new year, and more importantly filter through the messages on the long term trends of the global retail industry.

Several retail trends that have partially shaped the weekly news postings and personal blogs were evident starting from the opening sessions of this trade event:

• The amount of information that all of us have to filter to understand and make sense of our world is growing at exponential rates. As IDC reported in December, the world's data is growing 14% faster to 40 Zettabytes by 2020. To put that amount of data in perspective, 57 ZB is equal to 57X the number of sand grains on all the global beaches. ₍₁₎
• Information is growing partly because we as humans are increasingly seeking greater visual stimulation. To make sense of all the noise, we are turning from just words to pictures, and at an accelerated pace from pictures to video. Over 4 Billion hours of video are watched on YouTube every month. 72 hours of video are uploaded on YouTube every minute. In 2011, YouTube had 1 Trillion video views. ₍₂₎
• The social media ecosystem continues to grow. 1 billion people are now on Facebook. There were 175 million tweets sent from Twitter every day in 2012. Every second, two new members join Linkedin. Social media has overtaken porn as the number one activity on the web. _{(3) (4)}
• Social is forever tied to mobile. As reported by Citi Research at NRF, global smartphones grew 52% in 2011 and are expected to grow another 50% in 2012 to 731 million units. Global tablets sales will grow 60% in 2012 to 117 million units and are expected to sustain a 40% growth level through 2014. ₍₅₎
• Mobile is forever tied to shopping. The number of mobile shoppers in the USA is expected to grow to 111 million people by 2015. ₍₈₎ Fifty three percent of smartphone users in the USA use their devices to compare prices. ₍₅₎ Showrooming is here to stay.

What does all this mean in terms of driving future retail business growth?

As IBM pointed out this week at NRF, where and how you listen for what your customers are telling you is changing. Progressive companies understand that the information explosion described above is an opportunity to mine customer preferences, both their likes and dislikes. All that Big Data has within it granular pieces of information that can get your best customers buying more and help you find new ones increasingly through social word of mouth.

• According to the author of the book Socialnomics, there is a successful model for driving greater customer loyalty. It does not start and end with the sale. It is a loop that starts and ends with listening, increasingly on multiple social channels. Listen, interact, react, sell, then listen again are the key steps to greater customer engagement. Why is listening through social media important? 53% of people on Twitter recommend products in their tweets. 90% of people trust online recommendations from people they know. Only 14% trust a traditional advertisement. ₍₃₎
• As discussed in multiple of the weekly posts and blogs, market segmentation is increasing, not decreasing. Through social media and the world wide web, consumers are finding both their like minded friends and their favorite stores. New businesses are emerging that can cater to very specific consumer sub-segments on a highly profitable basis. Global barriers are breaking down as a virtual store can be opened 24 hours a day, almost anywhere in the world. Have you heard of Asos, the most visited apparel website in the world, or Mercado Libre, the largest pure play Ecommerce marketplace in LATAM, or Belle, which is best positioned to be the leading specialty retailer in China. ₍₆₎
• The pressure of telling the whole story in those 140 Twitter characters is growing. Messages are getting shorter partly because of the amount of information available, and partly because of our decreasing attention spans. If you want to be impactful, all your messaging going forward needs to be many less words and many more visuals.
• The next wave in helping shape the success of brands from a consumer point of view will be video content increasingly delivered on mobile devices. Video has a 41% greater click through rate than just plain text. ₍₇₎

Favoring visual examples of what's ahead, here is a few favorite videos with a short synopsis on their content:

1. Social Media 2013 - Link http://ow.ly/gM80S - Key statistics of social media activities in 2013.
2. United Break Guitars - http://ow.ly/gM8cw - Viewed almost 13 million times. Taylor Guitar provided two free guitars and turned the United PR issues into a positive marketing opportunity. The video also helped the authors' singing career. Yes a book then followed.
3. Coca Cola Security Cameras - http://ow.ly/gM92h - What security cameras capture from around the world from a positive side.
4. Nike Michael Jordan Failure Commercial - http://ow.ly/gMkIV - Viewed over 5 million times, Michael Jordan explains how he succeeded.
5. Procter & Gamble The "Best Job" in the World Commercial - http://ow.ly/gMl3r - From a multi-cultural perspective, this video clearly describes who has the best job in the world.
6. Volkswagen "The Force" Commercial - http://ow.ly/gMlv4 - Viewed almost 56 million times, a child finds that he has the power of the force.

The "Social Media 2013" video above provides a great synopsis on the growing social conversation and its impact on business. The rest of the videos cited have one common theme which may have been important in the past, but is mission critical to the future of business. The theme is very simple. In a very short time span, each of the videos tells an impactful story.

The basics of great customer engagement are simple and yes they relate closely to the movie industry. Think of how you felt after walking out of a great movie. Next contemplate how you are going to transform that feeling into snippets of visual content story telling to get your customers more engaged with your products and your brand.

The focus going forward needs to be on emotion enduring messaging (positive & negative); in visual short bursts that tell a great story. Turns those short bursts into a campaign and greater customer loyalty follows. A great example highlighted at NRF was the "Coca Cola Opens Happiness" campaign. Social media can and should be an information platform from which to draw the stories that will impact and motivate your target audience.

Pleasure seeing many of you at NRF 2013. Hopefully, it was a thought provoking event and it will lead to some great visual story telling in your businesses for a profitable new year.

Now you know the rest of the story for a great 2013.

(1) http://ow.ly/g7T7q (2) http://ow.ly/gOgum (3) http://ow.ly/gOfAF (4) http://ow.ly/gOgYC (5) Citi Research, 2013 Retail Technology Deep Dive, January 2013. (6) http://ow.ly/gBQ3Z (7) http://ow.ly/gOi2V (8) http://ow.ly/gOwpH