Dispense with the idea that your mobile app and your ecommerce site are electronic versions of your store. They’re an opportunity to extend the consumer’s experience with your brand. Sephora customers can try on make-up everywhere, its expertise is carried around by the consumer.
As part of my series about the “How To Create A Fantastic Retail Experience That Keeps Bringing Customers Back For More”, I had the pleasure of interviewing Rob McGovern.
Rob is a serial entrepreneur who has founded three high-tech companies. Rob is the CEO and founder of PreciseTarget, a data science company that provides consumer insight and acquisition data to fashion brands in the retail market. PreciseTarget is transforming how retailers connect with shoppers by combining AI and machine learning to analyze and segment consumers according to each individual’s tastes and preferences in apparel.
Rob started his first successful company, Careerbuilder.com, which transformed the recruitment industry and now serves over 25 million monthly users, in addition to having enabled over 100 million people to move up the career ladder. Following CareerBuilder Rob founded Jobfox.com, which learned an individual’s professional skillset, experience, and goals, and matched candidates with only those jobs with exact an fit. JobFox was sold in two private transactions.
Rob started his career at Hewlett Packard where he spent 10 years in sales engineering and product management positions. His last position was based in Grenoble, France, where he was a member of an R&D team developing advanced networking technologies.
In his free time, he’s an instrument-qualified private pilot and an avid, 4,000 miles-per-year cyclist.
Thank you so much for joining us in this interview series!
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
This one goes to my mother. She never finished high school and came from a poor coal mining town. She was blessed with the DNA of an entrepreneur and went on to start many successful businesses. These included a real estate company, a seashore hotel, a breakfast cafe, and pinball arcade, and a soft serve ice cream parlor. She inspired me to always think about what’s possible.
Is there a particular book, podcast, or film that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
One of my all time favorites is Predictably irrational by Dan Ariely. He discusses how consumers are naturally irrational and gives advice on developing products and services that address the most common irrational behaviors. For example, his testing proved that consumers have a strong bias to choose the middle choice in a product line. He advises companies to design their middle of the range product the most profitable, and bracket it with higher and lower priced products that will rarely be purchased.
What do you think makes your company stand out? Can you share a story?
My assets drive home every night. We’re fortunate to have a team made up of the brightest minds in the data industry. One secret I learned long ago is that brilliant people attract other brilliant people. We all want to hang out with smart people who will inspire us with ideas and inspirations.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
Love what you do. We only live for 28,000 days, of which about 10,000 will be spent working. Life is too short and precious to spend it doing something you don’t love.
Ok super. Now let’s jump to the main questions of our interview. The so-called “Retail Apocalypse” has been going on for about a decade. The Pandemic only made things much worse for retailers in general. While many retailers are struggling, some retailers, like Lululemon, Kroger, and Costco are quite profitable. Can you share a few lessons that other retailers can learn from the success of profitable retailers?
One lesson is to throw away the notion of an omni-channel. Many retailers use this to describe their various channels, which might be their in-store experience, their website, and their mobile application. The problem is the retailers view each of these as a unique channel. The consumer looks at a retailer as one entity, regardless of where the purchase happens. Here’s a way to give a brand a report card. If I walk into the store and buy an item, will I be able to see this purchase recorded in the store’s mobile app? I’ve noticed that Home Depot now has this capability in their mobile app. A store brand is one entity to the consumer.
Amazon is going to exert pressure on all of retail for the foreseeable future. New Direct-To-Consumer companies based in China are emerging that offer prices that are much cheaper than US and European brands. What would you advise retail companies and eCommerce companies, for them to be successful in the face of such strong competition?
I would emphasize the importance of velocity. Traditional soft goods retailers look at the year as having four 14-week seasons. It started with fast fashion, but now major players like H&M, Zara, and Uniqlo are dramatically accelerating the pace at which they update their product assortments. Zara is now updating every two weeks. Offshore manufacturing and efficient supply chains are enabling very fast cycle times. Consumers are learning to expect this.
What are the most common mistakes you have seen CEOs & founders make when they start a retail business? What can be done to avoid those errors?
Not embracing data. There’s still far too much gut-feel and human-driven merchandise planning. Tomorrow’s successful retailer will have more data scientists than merchandisers.
This might be intuitive, but I think it’s helpful to specifically articulate it. In your words, can you share a few reasons why great customer service and a great customer experience is essential for success in business in general and for retail in particular?
The barriers to switching are becoming lower and lower; thus, every interaction includes the risk of losing the customer. Warren Buffet is famous for saying ‘It takes 20 years to build a reputation and five minutes to ruin it.’ Our data indicated that Millenial and Gen Z consumers are avid brand switchers. Brands must step up to a generation that scores very low on loyalty.
We have all had times either in a store, or online, when we’ve had a very poor experience as a customer or user. If the importance of a good customer experience is so intuitive, and apparent, where is the disconnect? How is it that so many companies do not make this a priority?
Customer recognition is a challenging problem for brands, particularly in ecommerce. Consumers are more than willing to login and reveal their identity if they recognize a benefit. You sign-in to Spotify because there’s a quid pro quo of personalized music. Similarly, when we are signed into Amazon we can complete purchases with one or two clicks. If I were a retail CTO I’d increase my focus on personalizing online experiences by a factor of 10.
Can you share with us a story from your experience about a customer who was “Wowed” by the experience you provided?
Our privacy agreements with our customers restrict our ability to disclose this information.
A fantastic retail experience isn’t just one specific thing. It can be a composite of many different subtle elements fused together. Can you help us break down and identify the different ingredients that come together to create a “fantastic retail experience”?
First I’d say personalization is still an unmet need in retail. Consumers are frustrated when they receive generic emails from retailers, rather than promotions that include products personally selected for the consumer. If you’re afraid that consumers will unsubscribe from your emails that that might be a sign that you’re sending the wrong emails. Second, if you want to engage young people, make their mobile phone part of the experience. Sephora allows you to virtually try on make-up in their stores using their app. If you want to try a product you can superimpose it on your photograph image, which is a form of augmented reality. Third, test drive the Home Depot app. Aside from tracking your instore purchases, it also gives you in-store step-by-step navigation that is unique for each store. It will guide you to the precise spot in the store to find your product.
Ok super. Here is the main question of our interview. Based on your experience and success, what are the five most important things one should know in order to create a fantastic retail experience that keeps bringing customers back for more? Please share a story or an example for each.
1. Become a uni-channel. Your customer wants one relationship with you, not separate relationships corresponding with your mobile, ecommerce, and in-store channels.
2. Data is the path to personalization. We’re shocked how little retailers know about their customers. There’s a new class of insights data that’s available that helps overcome the sparse data problem.
3. Upgrade your email strategy. It’s your lowest cost marketing tool suffering from a lack of attention.
4. Start using predictive data for assortment planning. The old adage in retail is the money is made on the buying not the selling. Buying and assorting the right products can be substantially improved using AI-generated data.
5. Dispense with the idea that your mobile app and your ecommerce site are electronic versions of your store. They’re an opportunity to extend the consumer’s experience with your brand. Sephora customers can try on make-up everywhere, its expertise is carried around by the consumer.
Thank you for all of that. We are nearly done. Here is our final ‘meaty’ question. You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Let’s figure out a way to interest young women in computer science. You might not know this, but much of our computer science world was invented by women. Ada Lovelace invented the first computer program, Grace Hopper invented the idea of compiled software, and Margaret Hamilton pioneered embedded software that helped NASA develop the Apollo program. Women are equally capable as men, they outnumber men in college enrollment, and we’re missing out in a male-dominated tech profession. If you want to build software that’s designed for everyone, then have everyone as its developers.
How can our readers further follow your work?
Founder and CEO
This was very inspiring. Thank you so much for the time you spent with this!