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NRF 2016: Consumer empowerment no fad, says M&S

Retailers treating consumer empowerment as a passing fad rather than a paradigm shift have got it wrong, says Marks & Spencer CMO

Consumer empowerment is not a passing fad with a foreseeable end, according to Patrick Bousquet-Chavanne, executive director of marketing and international (CMO) for Marks & Spencer, at the NRF Big Show 2016 in New York.

Speaking at the show, run by the National Retail Federation, Bousquet-Chavanne said that consumer empowerment as a result of technology enablement was a paradigm shift rather than a fad.

“Consumer empowerment is not a trend,” he said. “We are still finding people that believe it’s a trend that’s going to go by. It’s not. It’s actually a paradigm shift in the business and it’s only going to carry on in the direction of the consumer.”

To cater to customers who use multiple channels to interact with retailers, Bousquet-Chavanne suggested exploiting technology to offer a personalised community experience at the speed the consumer wants.

“Customers want a meaningful relationship that enhances their life with you as a retailer and as a brand,” he said.

“Technology means that the customer has multiple points of interaction, multiple touch points, and there has to be a synchronisation across those touch points.”

According to Bousquet-Chavanne it is becoming harder for retailers to offer customers the experience they want because omni-channel retail means customer loyalty is no longer dependent on location, and customers are not content with offers that appear irrelevant to them.

“Customers are no longer kings – they are omnipotent gods,” he said. “It’s a new type of collaborative relationship that is required, one that is dynamic.”

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Marks & Spencer launched its customer-focused Sparks loyalty programme in October 2015 as its way of targeting this new type of consumer. To ensure the scheme catered to customer needs, the retailer involved around 100,000 customers in the development process.

Sparks offers customers rewards for interacting with the brand online or in store, ensuring customers who make small repeat purchases are just as valued as those who make one big buy.

Eventually customers can spend their “Sparks” on an experience they could not get in store, and are sent tailored offers based on their interactions with the brand.

“You have to reward the total relationship, not the monetary value and the transaction value,” Bousquet-Chavanne said.

Infrastructure upgrade

The retailer underwent several IT transformation projects so it could cope with the new system, and Bousquet-Chavanne said the retailer could not have “given birth” to the new service without the infrastructure upgrade.

Marks & Spencer terminated its Amazon AWS contract and launched its own e-commerce website in 2014 as part of its omni-channel plans.

The company also launched a dedicated e-commerce automated distribution centre to assist its warehousing and logistics, and improve its rapid data sharing and customer insight to ensure that customers are offered the service they want.

“Insight is great, but insight shared is a much better proposition,” Bousquet-Chavanne said.

But the IT shift wasn’t the “most challenging” part of the restructure, said Bousquet-Chavanne, it was the recruiting of new talent for a new way of working.

“New ways of working meant a much more collaborative push to the solution and the propositions that we are crafting for consumers every day,” he said.

“From a position of working very much in silo – our food business, our home business, our fashion business – we started integrating the proposition of the entire organisation against a single view of the customer.”

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