Just last Tuesday, Senior executives, industry luminaries and subject matter experts convened at the SoHo House in Manhattan to discuss a long-overlooked segment in digital commerce that on a daily basis can drive significant consumer acquisition and incremental revenue opportunity: those site visitors that are ‘Shopping for Others’.
Leading industry analyst Deborah Weinswig (Managing Director, Fung Global Retail and Technology) moderated an executive panel including Milton Pappas (SVP Digital Marketing, Hudson’s Bay), Victor Ortiz (VP Digital Product Management, Toys “R” Us), and Roy Erez, (CEO and Co-Founder, Loop Commerce) to uncover the blind spot around “shopping for others”, how to better understand its challenges and opportunities, and the strategies available to address and build on this (more sophisticated and much bigger than previously assumed) product-gifting category.
As Deborah highlighted in her introductory remarks to open the panel, e-commerce growth has been causing serious disruption in traditional retail, and “we are starting to see some real changes in commerce.” She later summarized the wide-ranging panel discussion into three primary areas of focus:
- Retailers need strategies to reduce consumer gifting anxiety
- Personalization is expected by loyal consumers, and gift data is critical to personalization
- Gifting enables experiential retailing, impressive new consumer acquisition, and more efficient product returns
From his vantage point at Hudson Bay (with retailers like Saks Fifth Avenue), Milton shared that experience was key to the loyal Saks consumer, and that the retailer has been working hard to link store and online experiences. He mentioned that the Saks website now allows customers to chat with a stylist on the home page, and even choose the specific store and associate they prefer to work with. A great example of technology helping to addresses a shopper’s anxiety from Milton’s perspective.
With gifting, according to Milton, awareness and education of customers is critical. For example, letting them know that when they use GiftNow, they don’t need to worry about size or color while making a purchase choice, a major hurdle when it comes to shopping for others.. Additionally, Saks uses GiftNow as an acquisition tool for new customers, he said.
Milton also referenced returns as a major challenge in retail, explaining that anything that reduces returns therefore increasing profit margins, and satisfies customers is important for the business. Saks also has the advantage of physical stores, which enable customers to make returns in person, along with the use of technology features like Fit guides to help reduce return rates, he noted.
Although he provides a different perspective and deals with very different merchandise assortment and retail footprint at Toys “R” Us, Victor had very complementary insights. Shopping for others is foundational for the toy retailer, with use cases ranging from newborn gifting, to birthday parties, to impulse purchases. When asked how Toys “R” Us thinks differently about the customer gifting experience, Victor responded that “nearly everything at Toys “R” Us is a gift, even beyond the birthdays, karate awards and good grade incentives.” While they had long realized the importance of shopping for others, they had begun to think more about the financial and operational burdens of gifting — from the inefficiencies of holiday shipping windows to the cost of physical product returns, which he mentioned was a big challenge and opportunity for them.
As the Co-founder and CEO at Loop Commerce, Roy has spent much of his time over the recent years thinking about consumers shopping for others online. Loop’s innovative GiftNow digital gifting platform represents the leading solution to help address this gifting blind spot for retailers. He shared some of Loop’s experiences coming from years of analysis and experience, as well as consumer insights about gifting anxiety, with the all-too-familiar analogy “Facebook tells me it’s a birthday and, oh my, how do I buy and deliver it now…?” as well as the importance of subtle but critical issues that GiftNow resolves, like ensuring the recipient won’t see the price or pay extra for shipping and taxes.
Roy also offered insights for gifting summarized from Loop’s network of retail partners. Regarding the evolution of retailer perspectives on gifting, Roy said that he has seen a shift over the last few years, with retailers much more open to “asking for help” from technology that reduces funnel friction, rather than erecting barriers. He also commented that with traditional gifts it’s hard for the retailer to close the loop. “Now, with the technology of product gifting, we can connect the dots,” he said. “And it’s amazing how much more info you actually get.” Additional gifting functionality and capabilities is becoming a must have and a new standard to be “added to the bucket of tools a retailer has to increase sales,” he said.
The evening was a refreshing and collaborative first-of-its-kind discussion, and in the networking session that followed executive after executive reiterated the value of the panel and the questions from the audience, being an eye-opener in a time where there’s a growing need to create new opportunities for customer acquisition and incremental sales. We look forward to scheduling our next event, and possibly sooner rather than later!
Fung Global Retail and Technology G-Commerce report