By Alchemmy’s Anjali Kajan
On November 2nd Alchemmy partnered with more2 to host a panel discussion on the future of the Retail Sector, in light of Alchemmy’s recent report ‘Future of Retail: Is Gen Z leading the way?’ As change and disruption have become the norm in the industry over the past two years, the audience enjoyed hearing discussions on changing consumer behaviours and new technologies, and what this means for retailers, focusing on how we can learn from the emerging consumer group, Gen Z.
Lucy Gibbs, Director of Retail and Consumer of Alchemmy, emphasised that Gen Z are leading the way with these new technologies and attitudes to shopping. It is vital that retailers tap into their mindset to understand how to build resilience and agility in uncertain times.
The first part of the evening considered ‘Will customers compromise Values for Value in a cost-of-living crisis?’ With inflation at an all-time high, the cost-of-living crisis has been met with a rise in importance of brand values. 75% of Gen Z respondents say values alignment is important when making purchases, choosing values over value; they are the least price sensitive generation, but the most loyal.
In the run up to peak retail season, successful retailers will use tactical discounts, rewards and messaging, to create connections and drive loyalty. It is particularly important to do this early on with Gen Z customers. Julie Reynolds-Smith, Senior Strategy Manager of Boots Opticians, highlighted the importance of addressing Gen Z needs, wants and attitudes, as they are our future. She also argued that sustainability is not a choice, it’s a given; brands and products need to be sustainable and customers do not expect to pay more for it.
The panel then debated the question: ‘Is Automation the answer to unlock growth?’ 54% of Gen Z are happy to see automation used if it provides a faster service and 4/10 trust companies with their data. Chris Simpson, CMO and Digital Director of more2, suggested that this is because Gen Z accept that their data is captured everywhere. Therefore, they expect it to be used correctly to deliver value.
AI is embedded in the customer journey more than people realise today, from customer recommendations, smarter stores, optimised customer journeys, and demand forecasting. This not only benefits customers, but also provides huge cost saving opportunities. Brands are becoming smarter in their use of influencers, and using young influencers as peers, however this all needs to be underpinned by data models, governance and ethics.
Finally, the panellists considered ‘Will the metaverse be the next frontier of retail?’ With Gen Z speculating that they will move away from physical and even website stores in the future, the panel agreed that retailers must respond to these changes now by innovating and embracing technological advances. Audience polls revealed that only 27% of the audience have used AR/VR in a retail environment so far.
Jennifer Drury, CEO of Brandlab360, observed that there is typically a lot of negativity around the metaverse terminology. This came across at the beginning of this discussion – only 38% of the audience said that the metaverse will be the next frontier for retail. Whereas over half of Gen Z are interested in the potential retail dimensions of the metaverse. Chris Simpson suggested that a reason the metaverse is particularly interesting for Gen Z is that they like to blur lines – they shop, watch movies, and talk to friends at the same time. Similarly, the metaverse is a blurring of boundaries (physical and virtual).
At the end of the discussion, the audience were asked the same question about the metaverse. This time, 48% said the metaverse would be the next frontier of retail. The panel successfully persuaded some mindsets in the audience, with much more positivity in how they view the metaverse.
However, to effectively adapt and grow from Gen Z, Andy Mulcahy, Strategy and Insight Director of IMRG, highlighted that we need to be mindful of trying to put this group into a bracket. Realistically, everyone is an individual and it is more complicated than simply assigning characteristics to the whole group.
Alchemmy can help retailers navigate these issues by helping identify opportunities to fuel growth, putting insight and analytics in the hands of decision makers, while ensuring organisations are built for agility. Find out more here.
Thank you once again to our expert panellists Andy Mulcahy, Chris Simpson, Julie Reynolds-Smith, Jennifer Drury and Lucy Gibbs, and our fantastic host Maya Kolaska, for a great evening.
Watch our video to see what the evening was like and listen to the panellists’ key takeaways.