In the world of retail, it’s exciting to send products out into the wild. After all, customers have options for sunglasses, jeans, headphones, smartphones, and more—and they chose you.
As energizing as it is to create a product and tell its story to the world, there’s also the monumental task of building a great customer experience on the backend—the actual technical backbone that keeps your business running smoothly. These days, providing “seamless customer experiences” is far more than a buzzy industry term—it’s a revenue-impacting imperative. But as important as it is, it’s usually not the raison d’être of a retail company.
Providing a streamlined customer experience is often at the heart and soul of companies that design technology for specific functions like billing, inventory management, or customer service. The question many retailers have to answer is: Should you keep things in the family, by developing and maintaining home-grown technical solutions, or invite a third party in?
Surfing The Third Wave
At the National Retail Federation’s (NRF) 2018 BIG Show, retailers wondered how far in-house solutions might take them. Does partnering with third-party software companies risk watering down the brand, or free retailers to better deliver on brand promises?
“If you want to go quickly, you go alone. If you want to go far, you go together,” advised Steve Case, author of The Third Wave: An Entrepreneur’s Vision of the Future during a panel on tech startups and customer experience.
Not everyone agrees that this proverb encapsulates a good approach to business—or life—but Case explained that the first wave of the internet entailed showing people and businesses why they needed to be online. The job of those in the budding internet business—like AOL, which Case co-founded in 1985—was building onramps to the information superhighway. Before long, people didn’t require much convincing; everyone was connected and couldn’t live without the lifeline. This set the stage for the second wave, during which the most successful companies, like Facebook, connected people with each other—not just with technology. Today, depending on who you ask, we’re approaching the third wave. That is, unless we’re already there.
“It’s not possible in the third wave to do it on your own,” Case said. “That means developing not only the desire, but the competencies around working with partners.” In this third wave, companies of all kinds need to develop an internal mindset that accounts for external partnership to help achieve its goals.
"It's not possible in the third wave to do it on your own. That means developing not only the desire, but the competencies around working with partners." - Steve Case
The hurdle of hubris
Partnership can be a hard sell when your company likes to go it alone. For many legacy retail companies, the idea of partnership requires a shift in paradigm: thinking beyond established team silos, engrained company culture, and existing vendor relationships. Companies may have to restructure dedicated teams and budgets to bring someone outside in. Plus, as in any relationship, trusting another company with your data, or customer data, is a big deal. It can also feel like a Sisyphean task—assuming you find a great partner and you’re basking in the glow of ROI after a year or two, technology continues to advance, requiring ongoing effort to ensure you’re not falling behind.
This is exactly why partnership with those in the know is essential, explained Jill Dvorak, Sr. Director of Digital Retail at NRF. Dvorak has worked for retailers large and small over the course of her career and helped vet and implement tech solutions for retail partners.
“The gut feeling was, ‘We know our customer best, we know our product best; therefore, we know what to recommend,’” Dvorak said of the good-hearted desire for retailers to assume all consumer-facing challenges. “The people who merchandised the product, bought the product, or went overseas to source the product made the recommendations.”
It made sense to hold onto the reins, but today’s landscape is different—and not just because of emerging technologies or the speed at which those technologies evolve, Dvorak said. There used to be a more manageable amount of product, and it was possible to make personalized recommendations or answer individual shipping or inventory questions.
“I think most retailers have realized that they need software as a solution to partner with,” said Dvorak, adding that the kind of personalization customers are craving is “essentially unmanageable,” even with a limited product assortment.
I’m perfectly happy on my own, thank you very much
Lackluster customer experiences, as a function of backend issues, can be an abstract concept. The impact, however, is clear to anyone who has bought something online, tracked a package, or opted into an email newsletter and been disappointed in that experience. As an example, and on the topic of what modern retailers expect from customer service, Zendesk COO Tom Keiser shared that after years of rewarding customers with loyalty, a certain legacy airline and an unnamed denim brand still don’t have a handle on his consumer preferences—or his gender, judging by how often he gets targeted with marketing emails for women’s clothing.
I’ve also experienced this first hand: After ordering a shower curtain from a direct-to-consumer retailer, the first email recommendation made by the brand after my purchase was… another shower curtain. These are admittedly small infractions but may add up to a larger problem in aggregate, across your customer base, and especially as customer expectations continue to rise.
Small infractions, but may add up to a larger problem in aggregate, across your customer base, and especially as customer expectations continue to rise.
This is where tech partners can lighten the load. Dvorak used a knowledge base, a common customer-facing self-service tool, as an example. Instead of only having an FAQ page on your site, as many retailers do, implementing a help center with dynamic content, that allows you to make real-time changes, can provide valuable insight into what your customers are searching for. Some providers even leverage artificial intelligence or machine learning to suggest relevant help articles.
“If you’re not able to see what the customer wants and be a little bit ahead of the game, you are 100-percent flat-footed,” Dvorak said. “If you’re only reacting when a customer tells you something is wrong, that’s not next-gen retail. That’s retail 2.0, and most customers want more than that.”
Single and ready to mingle
Having a desire to surpass customer expectations is great, but the gap between that desire and taking the steps to implement the right software can feel, at times, like the Grand Canyon.
In Dvorak’s experience, the first step is to identify the right tech partner. Yet even when you find them, most require investment up front. That’s why the second step is to figure out your budget and ensure that you get the most bang for your buck. Let’s say you want A/B testing, a website heatmap, and a solution that makes tailored recommendations to shoppers on your e-commerce website. Instead of looking for one vendor for each task, is there one or two companies that can do all of those things? Fewer vendors also mean fewer sources of truth when it comes to data.
Dvorak acknowledged that existing systems aren’t typically 100-percent broken, and it can be difficult to convince those holding the purse strings that anything needs fixing, especially without a proof of concept. One solution is to select software from companies that offer free trials before purchase.
Providing a proof of concept is a compelling way to make an argument for change.
Silvia Campello, President and CEO of intimate apparel brand Cosabella, suggested finding a tech partner trying to expand their case study program in a panel about AI in retail. She also recommended keeping preconceived notions at bay. In other words, instead of thinking of your tech partner as an entity that executes directives, be open to their point of view and expertise from their corner of the market. As Dvorak said: “You don’t know what you don’t know.”
The key ingredient: Trust
Technical requirements aside, the search for technology partners has to include an element of trust. A good way to tell whether a partner is in it to win it is whether they love your customers as much as you do. The right partner will, because they don’t want you to fail, Dvorak said.
Since trust is earned, it’s incumbent upon the tech partner to live up to it beyond the nuts and bolts of the contract. For example, will they share lesser known features of the software that the entire organization could use? The right tech partners will put effort into analyzing and understanding your business, the problems you’re trying to solve, and your specific customer needs. They’ll help implement their software so that it helps put you at a competitive advantage.
The right tech partners will put effort into analyzing and understanding your business, the problems you’re trying to solve, and your specific customer needs.
It’s never as simple as adding one line of code to a website, Dvorak said. You have to test. You have to have a proof of concept. And you have to understand that for it to be done well, these are likely long-term relationships instead of a six-month contract.
Adopt a “You, Me, and We” approach
Just as a couple isn’t merely the sum of two individuals sharing space and emotional energy, the business partnership also creates a third entity that needs to be considered and cared for in addition to each individual partner’s needs and wants.
Dvorak recommends treating tech partners as an extension of your in-house team—not a satellite that’s only informed about changes on a need-to-know basis. Tech partners might have better, or at least differently valuable, insight into your customer data when they’re integrated into the team at this level.
Furthermore, both sides have to get something out of the deal for it to be considered a success. What are each party’s metrics for success? From the outset, ask yourself: Can you grow together given your respective goals?
“They’re not a vendor; they’re a partner,” Dvorak said. “If you’re all in it for the same reasons, and you treat each other accordingly, I think it’s a huge win.”
Tara Ramroop is a content marketing manager at Zendesk and frequent contributor to Relate. A loquacious Libra lady of letters, she firmly believes the craft of storytelling makes the world a more understanding and, well, relatable place. A Bay Area native, English degree be damned, she has no qualms about saying or writing "hella." Follow her visual stories and occasionally cheeky captions on Instagram @roopisonfire.