BLACK FRIDAY, CYBER MONDAY & THE FUTURE OF COMMERCE: WHAT THE HOLIDAY SHOPPING CRUSH TELLS US ABOUT ELEVATING CUSTOMER EXPERIENCES

Black Friday, Cyber Monday & the Future of Commerce | 1 The Black Friday/Cyber Monday holiday shopping phenomenon gets stronger every year.

In 2017, more than 174 million Americans — just over half of nation’s population — opened their wallets for Black Friday/Cyber Monday, up from 154 million the year before, according to the National Retail Federation.

2018 could be even bigger.

“I think this year’s Black Friday/Cyber Monday will be astounding,” says Michael Deittrick, DMI’s senior vice president for strategy and chief digital officer. “Some ecommerce websites will crash because people don’t realize how much the economy has improved. The influx of people going out and spending this holiday season is going to blow their minds.”

The test for retailers in 2018 is looking beyond temporary prosperity and taking the time to understand how mobile technologies are transforming the industry. A careful study of the data from this year’s Black Friday/Cyber Monday can help retailers see what they’re getting right and where they need to improve. The challenge is knowing which data is the most revealing.

This ebook from DMI, leaders in mobile commerce solutions, focuses on four key areas that will help retail leaders target the data they need to monitor this year to help them make next year’s shopping experiences even better.

Black Friday, Cyber Monday & the Future of Commerce | 2 1: INTEGRATING IN-STORE, MOBILE ENVISIONING AN AND ONLINE DATA INTEGRATED BLACK room to grow in improving in- FRIDAY/CYBER store navigation, store checkout, MONDAY SHOPPING personalization and EXPERIENCE rewards programs. In the U.S., Thanksgiving is A case study from our files a singular social event. Over turkey and stuffing, friends and shows how major brands family might talk over their leverage shopper-research shopping plans — standing in data to craft unique shopping line on Black Friday to snag experiences to cement big-ticket items and monitoring Everybody wants it: a seamless their smartphones on Cyber consumer loyalty. We consulted shopping experience across Monday to snap up flash deals. with a well-known athletic But there’s so much more they stores, websites and mobile apparel brand that was could be doing. devices. Savvy data analysis can introducing a network of retail help make it happen. Moreover, Imagine a retailer gamifying stores. They needed to know their holiday shopping promising new data sources why people would come to their experience: bringing can reveal emerging shopping store rather than buy online or everybody together in a trends — if you know where mobile treasure hunt. After visit a big-box retailer — and to look. dinner, they gather with their how they would use smartphones, make shopping “I suggest watching for the mobile devices. lists and share them with each other. They challenge each bucket of data from distributed “Our M3 data from over other to land the best deals commerce: customers buying 10,000 shoppers helped us and find the most via third parties like Instagram obscure products. understand what they expect commerce or messaging apps,” from the in-store mobile device Social media platforms like advises Jeremy Gilman, DMI’s experience,” Gilman says. “We Facebook and Instagram help vice president for strategy in them share shopping lists, combined that with the brand’s our Brand Marketing Customer collaborate as a team and behavioral data to uncover more close transactions. Real-time Experience (BMCX) division. It unique insights and really drive data integration helps the may be small now, but social the vision for what that mobile retailer allocate network and selling should see significant computing capacity to ensure in-store experience should be.” growth in when Black Friday/ shoppers know what’s in stock and buy what they want. Cyber Monday rolls around That data helped the retailer next year. adapt its retail presence to “It’s about building the preferences of its core differentiated consumer Data from DMI’s Mobile Maturity experiences that alter the way consumers. Similarly, a Model (M3) research is helping people engage in this process multilayered approach to Black — while keeping it fun,” says retailers optimize in-store and Friday/Cyber Monday data can Michael Deittrick, DMI’s senior mobile sales. Our 2018 M3 guide retailers in the vice president for strategy and report noted that retailers had chief digital officer. Making months ahead. it happen requires a deft integration of technologies from AI to data science to natural language processing. “That’s the value we bring at DMI,” Deittrick says.

Black Friday, Cyber Monday & the Future of Commerce | 3 2: DATA, SITE SEARCH AND STORE NAVIGATION CASE STUDY: DMI IN THE GROCERY AISLE layout, shelf placement and sales conversions. The client was an international canned-goods manufacturer The same concept applies to with a unique challenge: online searching — it’s the first Grocery store shoppers thing shoppers do, on PCs and increasingly prefer prepared meals and fresh produce. in-store mobile devices alike. They’re just not buying from Retailers need to optimize site the soup and spaghetti sauce Mobile devices will help Black search for common queries aisles like they used to. Friday/Cyber Monday shoppers and provide a recommendation track down the products engine for relevant products The company hired DMI to help out. Our team knew from they crave. Their efforts will when consumers seek products our Mobile Maturity Model provide a wealth of data on the that aren’t in stock. research that a certain kind of effectiveness of website search mobile-enabled shopper has a “Shoppers should never get technology and healthy appetite for apps from blank search results,” Bradley in-store navigation. retailers and brands. They like says. “That just cuts them off at to join loyalty programs and “Location-based data will show the knees.” they’re comfortable buying where shoppers are, in-store or with a mobile device. Data to monitor from Black outside the store,” says Elisabeth Friday to Cyber Monday: So, DMI helped devise a Bradley, DMI’s vice president Conversions from search pages, program to connect these for business development, consumers with the food drop-offs after searches and specializing in commerce manufacturer’s brand. clicks on relevant products. solutions. Retailers’ apps can use “Look at your top search terms “Our research found that mapping and image-recognition and make sure people can people love to be able to get technologies to guide people find those products,” Bradley into and out of a store quickly, toward the products they especially larger stores,” says advises. “If they’re not finding desire. Data from their travels DMI’s Jeremy Gilman. “Our them, why?” can reveal links between store innovation process leveraged that insight and went one level deeper to talk to, specifically, grocery store shoppers and, more specifically, moms who are planning meals for their family. How can we create tools that might make it easier for that mom or household to plan those meals?”

DMI’s solution: Digital coupons and other content that rewards these high-mobile moms for seeking out the client’s canned goods in the store aisles.

Black Friday, Cyber Monday & the Future of Commerce | 4 3: STREAMLINING CHECKOUT AND PAYMENTS

challenge of abandoned carts.

“The best thing you can do is reduce friction at checkout,” Bradley says. That could include adding people in-stores to manage lines and close transactions; condensing online payment pages; and providing Cart abandonment is one of the multiple online most-watched data points in payment options. online and mobile commerce. But that KPI gets you only so “Google Pay, Apple Pay, far. “Consumers abandon carts Amazon Pay, PayPal — all of all of the time,” DMI’s Elisabeth these payment services are Bradley says. “The real question seeing an increase in usage due is why.” to the ease of use and reduction in friction at checkout,” Bradley Retailers need to scan for says. Yes, it costs money to data revealing the underlying implement digital payment behavior that causes Black systems. Transaction costs take Friday/Cyber Monday shoppers a slice out of already to ditch their digital shopping thin margins. carts. “Whether it’s pricing sensitivity, tax sensitivity, “But you can make the money shipping sensitivity, it’s got to be back hand-over-fist by reducing something pretty fundamental if friction for the consumer,” you get a drop-off at checkout,” Bradley says. Bradley says.

Moreover, enabling multiple payment systems is becoming more critical to tackling the

Black Friday, Cyber Monday & the Future of Commerce | 5 4: ENABLING CONVERSATIONAL COMMERCE

not a bot-first play — it’s a bot- human mix.”

You can document chatbot and voice effectiveness by tracking how many times consumers reformulate their questions to get the response they’re looking for. Another option is to use Chatbots and digital assistants natural-language analytics to like Amazon’s Alexa are scan for customer-frustration increasingly important to retail cues and emotional language sales. In the store, young people that helps you better understand with smartphones may feel the shoppers’ experience. more comfortable texting a Machine-learning algorithms salesperson for assistance than can meld image recognition with walking up to them and asking natural language processing to for help. At home, people are help shoppers find exactly what learning to order products and they’re looking for. But every services over their time your voice assistant fails, it’s smart speakers. a reminder that people buy For retailers, the core challenge from people. is pushing the boundaries of “The human-assisted piece of automation without this is critical,” Deittrick says. frustrating consumers. “You can’t just turn everything “You can only converse so much over to a bot.” with a bot before you need a human,” DMI’s Michael Deittrick says. “So, when we talk about conversational commerce it’s

Black Friday, Cyber Monday & the Future of Commerce | 6 A FORWARD-LOOKING APPROACH TO BLACK FRIDAY/CYBER MONDAY

As you sift the data from Black Friday through Cyber Monday, remember that today’s mobile shoppers prize convenience and punish frustration. That’s the first-order challenge to address in the weeks ahead.

The second-order challenge is digging deep into the data for signals of where consumers are going and how you can help them on their journey. It’s not about apps, devices or commerce platforms. It’s about listening to the intelligence they deliver.

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