AI can complement, not cannibalise, Irish retail
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As Irish consumers continue to navigate an inflationary environment, Irish retailers need to meet elevated expectations in respect of value and customer experience to secure their share of wallet. In this competitive environment, retailers recognise that artificial intelligence (AI) has the potential to become a transformative force across a range of touchpoints in their business.
Already, many progressive retailers are leveraging AI to drive more efficient stock management, to streamline their supply chains, and to anticipate market trends. The logical next step is to utilise AI to create a more personalised experience for us, the customer – bringing together shopping history, individual preferences, etc. in a seamless manner. This requires careful consideration as despite the continued digitalisation of the shopping experience, retail at its core is built upon human connection. In rolling out customer-facing AI innovations, retailers need to be mindful of this – here’s why:
The rise of e-commerce/online shopping has led to a more impersonal shopping environment, where interactions are often limited to screen-based communication. Numerous studies post covid-19 have outlined that consumers are increasingly seeking authenticity, connection, and brands/retailers that resonate with their values in making their shopping decisions.
It is no coincidence that retailers have turned to influencers/brand ambassadors across their social media channels to build awareness/loyalty of their offering – providing shoppers with a human face/story/interaction to create a personal “touch” for the digital age. However, retailers need to recognise that this approach has limitations; in working with brand ambassadors, there is a game of brinkmanship between genuine brand connection and paid promotion – consumers are becoming ever savvier in distinguishing the same. Retailers seeking authentic brand ambassadors should not forget their own people – passionate and knowledgeable about their brand/product – informing and connecting with customers whilst highlighting the digital and physical store element of the business seamlessly.
Building communities in retail utilising both physical and digital formats is key to supporting and sustaining customer engagement. As shoppers, our desire for a sense of community is driving the trend toward experiential retail—where the shopping experience itself is part of the appeal. Offering services or products that add to our lifestyle/sense of community, rather than just selling a commodity is therefore important. Retailers that proactively use loyalty schemes, a range of in-store events, sponsorship support of local charities/sports clubs etc will be well-positioned to cultivate a sense of relationship/belonging with their customers. These initiatives should also in a non-invasive manner facilitate customer participation and feedback, allowing the retailer to further develop product offerings and service improvement.
The physical store remains an integral element of a progressive retail proposition providing retailers with the opportunity to engage with shoppers, showcase their brands, trial new concepts and facilitate accessible delivery/pick-up/return options etc to support a more user-friendly customer experience. In the era of experiential retail, stores need to be environments that feel welcoming and engaging. This involves supporting staff to provide exceptional customer service and designing spaces that reflect the vision and values of the brand. Continuous investment in the physical store aligned with knowledgeable/engaged staff all contribute to a memorable shopping journey.
If utilised smartly, AI can support the personal touch within a retail business rather than diminish it. AI tools that support the gathering of insights into consumer preferences and behaviours can deliver more personalised experiences that resonate on an individual level – as shoppers we want to feel valued and not the recipient of a mass-market, generic targeting exercise (which unfortunately is too common in the digital age). The key lies in using AI to augment/support customer interactions, ensuring that technology enhances the experience without losing the personal touch.
The Irish retail sector remains a pivotal sector of the Irish economy – driving employment and investment across all regions. Whilst AI will continue to shape the wider retail landscape, preserving the personal touch with shoppers is an imperative to sustain customer engagement. AI can enhance personnel development, store design, customer personalisation and a range of supply-chain initiatives. However, it cannot replicate the sense of community and personal relationships that remains the hallmark of family owned, Irish retailers nationwide.
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