What is Responsive Merchandising?

Let’s say you’re an associate in a retail store. Your brand specializes in athletic dress pants called the Code Khakis. They’re stylish, slimfit, and with a bit of Elastane to feel as comfortable when you sit as when you stand.

You just straightened up the rack, and turn to see a potential customer walking in.

At that moment a dynamic relationship begins. You’re assuming and inferring; you’re forming a mosaic from the minutiae of details: the barefoot shoes, the skinny jeans, the branded hoodie with a polygonal logo.

They’re surveying the signage to decide where to go, making snap judgments based on their first impressions of color and layout.

“Hi there, anything I can help you with?” you ask.

Novels could be written about what happened in those few seconds. Long before you asked if they needed help, a silent conversation was unfolding. Synapses were firing on the inside, and there was subtle posturing on the outside. Decisions were made. And the relationship was only just beginning.

The hours you spent designing that gorgeous end cap? It matters. But these myriad micro-moments matter just as much, and likely far more.

As Google’s Senior Vice President of Ads & Commerce, Sridhar Ramaswamy, put it:

“The successful brands of tomorrow will be those that have a strategy for understanding and meeting consumers’ needs in these micro-moments.”

 

What is responsive merchandising?

Responsive merchandising

Responsive merchandising is the real-time understanding and attentiveness to a potential customer’s wants and needs. As in our example here, responsive merchandising works to continuously predict customer preferences and instantly recalibrate in order to create a more personalized customer experience.

In addition to your assessment of the potential customer’s current clothing, for example, you were also gathering a variety of other important details to inform and influence your interaction—from the personal such as hair style and mood to the contextual such as season.

In digital merchandising, a variety of marketing tools are using automation in an attempt to make up for the missing human element.

Take artificial intelligence, for example. As you, the sales associate, inferred, asked questions, and listened, AI can, if properly implemented, infer, listen, learn and instantly offer the customer an experience tailored to their wants.

But without the help of humans, digital consumers often get lost in the endless aisle.

So what if we viewed bounce rate the same as we did a customer walking into our store, browsing around for a few minutes, and then promptly leaving? I mean, there are entire university courses on how to create world-class in-store experiences so that customers are delighted the moment they enter. But do we view our bounce rate with the same sense of urgency?

In this age where AI is often positioned either as the future or as the enemy, it’s important to recognize that there’s a human in every single moment of AI. For the elite AI-powered platforms in the digital retail space, human preferences are the input and a more customer-centric digital experience is the output.

 

Understanding responsive merchandising

responsive merchandising

Responsive merchandising is all about absorbing critical data and taking action on insight. At some point, your potential customer exhibited their preferences for particular styles, colors and patterns of your Code Khakis. Likewise, your digital customers are clicking, pinching, scrolling and even searching directly on your site.

Physical or digital, responsive merchandising isn’t about selling; it’s about improving the customer experience in those micro-moments that pulse throughout the entire consumer journey.

It seems obvious, right? It seems like responsive merchandising is something all brick-and-mortar and digital retailers would be hellbent on improving. And yet, according to Rick Parrish at Forrester, customer experience is in a state of decline.

“There are no real CX leaders,” he wrote.

 

Establishing the responsive merchandising mindset

Responsive merchandising

How could this possibly happen? How could the plethora of marketing technology tools at our disposal not lead to an improvement in customer experience?

For starters, because the leaders behind many of those platforms have at once fallen in love with their technology and lost their sense of empathy for the customer. Some have went so far as to “AI-wash” their products. You can spend minutes on their homepage and still have absolutely no idea what they do but, hey, it’s artificial intelligence!

Another reason is because responsive merchandising demands a certain type of mindset. It takes a radical willingness to understand the customer’s problems, and this has as much to do with empathy as it does with what in Zen circles is referred to as “beginner’s mind.”

Beginner’s mind is the practice of seeing and experiencing something as if it’s for the first time. This can be practiced, for example, by attempting to sip tea as though you’ve never tasted it before. Applied digitally, it could mean getting into a mind-state whereby you can visit your site as a customer and as though you’ve not seen or experienced it before.

It may take a few of your colleagues and multiple attempts, but you’ll likely discover friction points you never saw before. Does your customer have to search for an entire phrase (or, worse, a phrase exactly as your company describes it) before they can find the most relevant page?

That’s friction, and it’s the type of friction that is probably crushing your conversion rates.

The take-home point here is that deploying some new marketing automation software is only part of what it takes to truly be an intent-driven responsive merchandiser.

 

The responsive merchandising paradox

responsive merchandising

Hands-on customer responsivity has long been a hallmark of retail experience operations. And it still is. In fact, understanding the fine lines that can exist between helping a customer and overwhelming them is as critical as ever.

But the digital shift is asking merchandisers to, in a sense, control without controlling.

For many responsive merchandisers, especially those moving between the brick-and-mortar store and the online experience, the instinct may be to establish the same level of hands-on control. While it’s tempting to load your site with live chat pop-ups so the customer knows you are there and ready to help, this often leads to an interruptive, even jarring digital shopping experience.

Because when a customer walks into your digital store, they are doing so with a greater sense of privacy and with the expectation that they can navigate for themselves.

So, sure, have the live chat option. But if you really want to be a responsive merchandiser in the digital world, it’s also important to invest in (and trust) a customer engagement platform that can, quietly and behind-the-scenes, create a mosaic of your customer and in real-time present to them the most relevant products—just as you would have done for them had they entered your physical store.

It’s easier said than done, but the future of responsive merchandising is going to demand leaning on and trusting technological solutions just as we lean on and trust our interpersonal skills.

 

How to get started with responsive merchandising

responsive merchandising

Step 1: Assess your existing retail environments and conduct a needs assessment so you can map out where you are and how to get where you want to go. Do you have a physical store? Did you recently launch on an eCommerce platform? Lay it all out, even if it feels basic.

Step 2: Determine where you are shining and struggling as a responsive merchandiser. It’s important to note that this can involve everything from how customers are greeted in your physical store and how their shipments are personalized to the effectiveness of your voice commerce offerings. It’s all worth improving, and should therefore be viewed subjectively.

Step 3: Establish SMART goals, based on the insights from your needs assessment, to set your vision and the key performance indicators that will serve as guideposts along the way.

 

A few final words on responsive merchandising

responsive merchandising

Even if you’ve only recently learned about the term, chances are you’ve been either doing it or thinking about it for quite some time. To recap, here’s the definition of responsive merchandising:

“…the real-time understanding and attentiveness to a potential customer’s wants and needs.”

Commit that to memory and you’ll be on your way to developing a more nuanced understanding.

And be sure to heed this advice from Google’s Sridhar Ramaswamy:

“Today’s battle for hearts, minds, and dollars is won (or lost) in micro-moments.”

Cameron Conaway
Cameron Conaway

Cameron is the Director of Content at Reflektion. His work as a journalist and content marketer has appeared in Forbes, Newsweek, and The Guardian, among other outlets. Connect with him here on LinkedIn and on Twitter @CameronConaway.