The Outcome Economy: from selling products to selling outcomes
Advancements in data, analytics and the Internet of Things (IoT) have allowed retailers to move from selling products to selling customers outcomes and solutions they actually desire. Smart appliances, wearables and other IoT devices are providing retailers end-to-end insights into how their customers use products and services, enabling them to determine the outcomes their customers are trying to achieve. As such, retailers now have the opportunity to improve outcomes for customers by using insights gained in the physical world to interact with them in real time.
Gartner research shows that 89 per cent of companies believe customer experience will be their primary basis for competition by 2016, up from 36 per cent four years ago. In order to meet customer needs and enhance customer experiences, businesses need to be able to harness real-time customer data to deliver value based on output. Retailers are beginning to take advantage of the Outcome Economy by using devices to facilitate seamless instore experiences for customers with integrated products and services.
For instance, Marks & Spencer installed touch screen kiosks across European stores to allow customers to move more freely between instore and online shopping channels. Macy’s and Apple are using instore beacons to provide personalised offers directly to customers through their mobile devices, and House of Fraser has inserted beacons into mannequins as part of a proximity marketing campaign, which allows shoppers to download an app, browse the store and receive specific information about the clothes on display.
Now, retailing has extended into the homes of shoppers, with leading retailers incorporating systems to allow shoppers to automatically achieve their desired outcomes. For example, HP customers can enrol in the HP Instant Ink service, giving them access to a service that automatically reorders printer cartridges when ink runs low. Similarly, Amazon’s Dash Button is a wi-fi-enabled device that allows customers to quickly reorder products when placed near a point where the product is used. For example, to purchase laundry detergent, the customer simply has to place the Dash Button next to a washing machine.
The Outcome Economy has also led to a rise of home hubs – a range of smart devices that connect to a central hub and then the internet, presenting opportunities for retailers to engage with customers after they leave the store. Through its partnership with Iris, Lowe’s is selling smart home management kits and accessories designed to deliver better outcomes for customer safety by controlling comfort, lights, temperature, security systems and more. In fact, 86 per cent of retailers surveyed by Accenture agreed that hardware-like hub devices will assist in creating the shift towards selling outcomes rather than just products.
By leveraging connected devices to enhance the retail experience in the store, across the home and through integrated solutions, retailers will increase their opportunities to boost sales, increase loyalty and provide valuable insights into what customers truly want. Retailers ready to stretch the boundaries should:
- Understand the limitations of existing legacy store infrastructure and invest in emerging technologies to enhance in-store offerings such as beacons, push promotions and contextual messages.
- Recognise opportunities emerging from the IoT and develop strategies to help increase purchases in the home and through integrated products and services.
- Build capabilities to create new channels to reach customers and collaborate with new industry business partners to develop services.
- Analyse data gathered from devices to better understand customers’ operating context and use the insights to make decisions that directly impact customer outcomes.
Glenn Heppell is Accenture’s Products Client Service Group Lead in Australia and New Zealand.