Even organizations with the most distant view of the retail industry are talking about the importance of improving the customer experience (CX); retailers themselves are certain that it is their utmost priority.
In a recent RSR report, Ramping up Retail Innovation, which is sponsored by Software AG, 71% of winners and 68% of others said that CX is one of the top three opportunities they have. Customer loyalty came second, and 63% of winning retailers want to turn their customers into advocates, with improving products and services third (59%).
This is not to say that profit goes out the window, but winners are looking toward the means and not the end, said RSR. This is probably why retail winners are the real innovators and the others are followers.
So what kind of innovations do retailers find most important? Again, the customer is the key; 90% of retail winners and 70% of others said that customer-driven innovation is very important to them. But technology-driven innovation was also very important, creating a tie for first place. Without technology, new customer-driven innovation would be hamstrung.
“Retail winners are simply more bullish on innovation,” said RSR, and they understand it better than the others.
Many innovations do not come from inside retailers’ own organizations, so much as from customers and tech companies. RSR’s survey said that 73% of winners get their ideas from customers, with 71% coming from internal sources. It seems that winners really listen to their customers and also have some good creativity inside their own companies. Non-winners are more likely to adopt others’ innovations as their own, said the report.
It’s not just customers and colleagues that can come up with ideas, though. Technology companies are a rich source of innovative creativity and 66% of winners get their ideas from their current vendors. This gives vendors more incentive to create innovation labs and experiment with new ideas – a win/win situation.
Consultants are also considered pretty ingenious, with 63% of winners getting ideas there, as well as other tech companies and even the press. And many are not afraid to go out and buy the companies that they think are most interesting. Think Amazon and Whole Foods – taking a great innovation and absorbing it for at least a short-term competitive edge (at least).
“We can see that retail winners are actually far more open to new ideas from a variety of places than their peers,” said RSR in the report.
I have discussed the many challenges out there for retailers, not least of which is Amazon. But retail winners understand the value of innovation from a laser-like customer focus to having a rich ecosystem of idea-generating sources.
Read the full report below for more information.