Clienteling in retail has come a long, long way over the last decade. Brands have gotten a much better grasp on their customer data and have been using new tools to provide much more personalization both in-store and online. And just looking at our own data here at Endear, clienteling is only ramping up among the best retail brands.

But don’t just take our word for it. According to a report by 360iResearch, the global market for personalization software is projected to grow at a CAGR of 23.67% by 2030. The investment that brands are putting into hyper-personalization shows a dedication to clienteling for one simple reason: it works.

So where does clienteling go from here? With new technology such as generative AI hitting the market, as well as retail competition heating up like never before, what will be the major trends in clienteling in the near future? We’ve got you covered. Let’s dive into five trends in clienteling we’re expecting to see in 2024 and beyond.

The fusion of physical and digital experiences, known as the "phygital" approach, is revolutionizing the retail landscape. This blend aims to offer customers the tactile satisfaction of in-store shopping along with the convenience and extensive information available online.

Sure, shoppers are already using their smartphones to aid their shopping experience, but the phygital possibilities go far beyond that. For instance, brands like Burberry have already embraced the phygital trend by integrating RFID (Radio-frequency identification) chips into their products to provide multimedia content to customers in-store. Similarly, Sephora’s Virtual Artist app allows customers to try makeup virtually from the comfort of their homes, or in-store so they don’t even have to use physical makeup samples.

Then there is even more futuristic tech coming to blend the digital and physical world further. Shopic is transforming your average grocery cart into a smart cart, allowing shoppers the convenience of automatically totaling up the price as they load up their carts, and providing a way to pay right from the cart using a variety of payment methods.

Soon many stores will have more interactive digital displays, in-store augmented reality corners, personalized digital coupons delivered to phones while shopping, and more. All these phygital tools will help customers shop the way they want to shop: with convenience, with more information, and with more clienteling-levels of personalization.

AI is making significant strides in retail, particularly in enhancing customer service and personalizing shopping experiences. Chatbots, for instance, are becoming increasingly sophisticated, capable of handling a wide range of customer inquiries, thus freeing up human resources for more nuanced customer interactions – as in delivering elevated clienteling services to your top shoppers.

Moreover, predictive analytics and AI-powered recommendation engines are being used to better anticipate customer preferences and provide personalized suggestions, a step towards hyper-personalized clienteling. An example of this is Blend, a UK startup that uses AI to learn user behavior to recommend apparel they actually want in near real-time.

AI also facilitates better demand forecasting which is crucial for inventory management, thereby reducing carrying costs and out-of-stock scenarios, ensuring that customers find what they need when they need it. Again, letting AI run the inventory process can free up more human time to do what we do best: provide clienteling service to other humans.

Automation, powered by technologies such as Robotics Process Automation (RPA) and Autonomous Mobile Robots (AMRs), is driving operational efficiencies in retail, from the warehouse to the show floor. These advancements are not only streamlining warehousing and inventory management but are also speeding up order fulfillment and facilitating contactless payments.

Amazon’s automated warehouses and cashier-less stores are well-known examples of retail automation, and we expect this to become the norm for many retail brands as automation costs continue to trend down. In fact, McKinsey reports that 52% of all retail activities can be automated, and with competition growing every year, any advantage matters for retailers who want to keep their customers.

Keep your eyes peeled for more self-serve kiosks, automated price changes via digital price tags, show floor cleaning robots, intelligent fitting rooms that bring clothes with a press of a button, and drones in the warehouse for inventory management. Yes, all these technologies exist already, and we’re about to see an explosion in robots and automation in retail in the next five years.

The era of generic promotions and mass marketing is giving way to hyper-personalized retail clienteling. With sophisticated CRM systems and big data analytics, retailers can now segment and target customers with unmatched precision. And we at Endear can say with certainty: the brands that are doing so are seeing the best profit margins.

Brands like Starbucks and Amazon used to be the benchmark by offering personalized recommendations and promotions based on individual customer preferences and purchase history. This level of personalization not only enhances customer satisfaction but also fosters brand loyalty and encourages repeat purchases. But now, personalization technology has been much more democratized so that smaller retailers and businesses can enjoy the benefits of intelligent customer targeting.

What does hyper-personalization look like? Imagine receiving a text as you walk toward your favorite store with pictures of three jackets in your style and size accompanied by a 15% promo. Then imagine tapping the ones you want, and they’re waiting for you in the fitting room. This level of real-time clienteling is the hyper-personalized shopping future that is just around the corner.

Gen Z, a demographic known for its unique consumption patterns, is urging retailers to rethink their clienteling strategies. This environmentally-conscious yet fast-fashion loving generation craves personalization but is also deeply concerned about data privacy. In other words, they embody contradictions that make them hard to figure out! But we have to, since Gen Z already commands $360 billion in purchasing power and growing.

Brands that align their values with those of Gen Z, for instance by adopting sustainable practices and ensuring data security, are more likely to resonate with this demographic and win their loyalty. Insider Intelligence reports on what other causes that Gen Z may want to support with their wallets:

But Gen Z is still figuring out their identity as they grow into adulthood. To provide clienteling services to this generation, retailers have to keep a finger on the pulse of their young shoppers.

In conclusion, the intersection of technology and evolving consumer preferences is propelling retail clienteling into a new era. These five trends highlight the roadmap towards a more customer-centric, efficient, and technologically advanced retail industry. By adeptly navigating and integrating these trends into their clienteling strategies, retailers will not only meet the expectations of modern consumers but are also likely to emerge as leaders in the future retail landscape.