Targeting Gen Z with ShopperTrak retail insights

Fashion retail is famously fast-paced and inventive, but the bar has been raised even higher in 2019 as a major global generational shift takes place, with predictions showing that Gen Z will outnumber Millennials as the most populous generation - FashionUnited spoke to global retail intelligence experts, ShopperTrak, to find out why retailers should be conscious of how younger shoppers use stores. 

“The balance of power in retail is shifting towards consumers,” explains Thomas Hillebrand, general manager Europe at ShopperTrak. “Online platforms enable them to make better-informed decisions based on price, convenience, ethics, quality and peer reviews. Gen Z is not only used to all the technology, they want to be entertained.”

Hillebrand, added: “It is all about the shopping experience. Malls becoming entertainment centres and retail stores experience areas. The most successful retailers are taking a ‘multichannel’ approach, selling via both online and offline stores, using social media and referrals to keep existing customers and also attract new ones. Speed, technology and innovation matters.”

Six trends that retailers can use to capitalise on Gen Z’s use of stores:

Self-service payments for an easy life

It’s not just the grocery sector that has embraced self-service technology, recent store openings by Nike and Zara owner Inditex have included self-service facilities, enabling their core demographic to choose items and leave without passing through a traditional till-point. Self-service payment terminals and phone apps are already proving a hit with the youngest shoppers, who have been born into a world of automation and who expect immediate gratification and convenience.

Self-checkout machines free up time for staff, allowing them to balance other responsibilities much more efficiently, while traffic data can be used to optimise labour scheduling and improve store performance by adjusting the number of store associates in relation to the volume of shoppers, as well as helping improve employee engagement.

AR and VR enhances the physical retail experience

Digital signage, VR, AR and location-based marketing, which connects the digital world with the physical world, is a big opportunity in apparel retailing and ShopperTrak is advising retailers to invest in unique in-store experiences to drive traffic. 

Early trials by Zara, Burberry and Gucci have allowed customers to interact with new ranges via smartphone apps that bring displays and images to life and connect to the buy button. The challenge will be managing costs while at the same driving higher rates of conversion. Traffic data analytics can help in understanding the shopper journey and behaviour patterns that come from such new in-store features, enabling retailers to introduce news way of connecting with customers, with certainty that they will deliver value. 

Embrace gender-neutral fashion ranges

Diversity and inclusion continue to big news and there is a strong affinity amongst Gen Z shoppers for freedom of expression and the right of an individual to celebrate their life choices, and gender fluidity is a major part of this. Research shows that 56 percent of Gen Z already shop outside of their specific gender, according to a 2016 study presented by global advertising agency JWT.

H&M spotted this trend last year and launched a unisex collection with cult footwear brand Eytys to offer a selection of genderless sneakers, shoes and boots, alongside jackets, tops, trousers and jeans in a bid to offer customers styles that span genders. 

Gender neutral ranges will be new territory for apparel and footwear retailers who need to analyse their store traffic and customer behaviour data to hone their offer, explains ShopperTrak, and their traffic data will be able to reveal whether or not shoppers would like assistance, where in the store is best to locate the ranges, whether dedicated fitting rooms are needed, as well as what conversion rates are possible.

Pop-ups and ‘Instagrammable’ spaces

Pop-up stores are a hit with the Gen Z, because, as the name suggests they are temporary and therefore create a ‘fear of missing out’. In the age of social sharing, pop-up stores should therefore be designed and laid out with Instagrammable spaces that offer “unique, memorable and sharable experiences” for visitors.

Pop-ups also allow apparel brands to extend their reach into the community, and showcase their wider brand values, for instance fitness and lifestyle brand New Balance launched a pop up destination combining a pub, a gym studio and running clubs, as part of its promotion of the brand’s London Marathon sponsorship.

“Being much more flexible and getting physically close to the customers is what really matters. Online is only a click away and physical stores should only be steps away to be successful – this can be done with Pop-ups or similar formats. And it is not about the price, Gen Z is willing to pay a premium for the right service and experience,” added Hillebrand.

Conscientious consumerism comes alive in stores

Gen Z-ers and Millennials are looking to ascribe to companies that focus on sustainability and have a socially beneficial purpose and stores can help retailers put socially conscientious policies into visible action.

With the emergence of companies like Rent the Runway, Le Tote and Poshmark offering the concept of renting clothes, and buying less, high street brands such as H&M have well-publicised apparel recycling points in stores, and department store John Lewis has trialled buying back customers’ unwanted garments to reduce landfill. 

ShopperTrak advises retailers to look at their traffic data to build an understanding of how stores could be used for new recycling efforts, with the data explaining how many visitors take part, as well as which store locations are best suited to offering clothing drop off points.

Do not guess to impress, use ShopperTrak data

It’s clear that exciting new store formats will evolve in the apparel retail sector over the next few years, take Missguided flagship in London and Nike’s ground-breaking outlet in Los Angeles, both of which have been designed to attract customers who love social media, want a digital experience and expect to ‘feel’ the brand come to life in physical stores.

What’s vital is that instead of jumping on every trend bandwagon, retailers are “judicious and carefully track the traffic and conversion impact of any new initiatives and features,” adds ShopperTrak. 

Retailers, of course, need to design experiences within their stores and to do that they need to select digital technologies that match customers’ specific needs and their own brand identity. By counting traffic and analysing this alongside sales data, stores can calculate Sales per Shopper (SPS), Average Transaction Values (ATV) and conversion rates (transactions ÷ shopper traffic). Tracking improvements over time will inform future planning, and take the guesswork out of how customers want to use stores in the future, especially when it comes to impressing Gen Z. 

Hillebrand, explained: “Technology will cause further disruption. Innovations such as 3D printing, the ‘internet of things’ (IoT), wearable technology, beacons and virtual reality and augmented reality have not yet lived up to expectations, but will exert greater influence over consumer behaviour in the coming decade. Companies will seek to use data, personalisation and a focus on creating consumer experiences to attract the attention of increasingly sophisticated consumers.

“We are helping retailers and malls to understand their customers and their behaviour while giving ‘actionable insights’ to increase their store performance. It is not the one that fits all, but it is about having the right things at the right time and the right place.”

ShopperTrak’s people counting devices measure walk-ins, dwell time, bounce rates and movement around the store, and help retail companies around the world optimise their customer service and sales performance, while ShopperTrak’s analytics suite pulls insight from this wealth of collected data. 

Ultimately, retail professionals from the C-suite to the shop floor can improve their decision-making and store performance with footfall data and analytics. Emerging insights lay the foundations for elevating customer experiences and improving the intersection between eCommerce sites and brick-and-mortar locations. Traffic data ultimately enables functions across the entire retail enterprise to perform their jobs more effectively, what leads to a higher customer satisfaction and increases the Gen Z shopper experience.