365 Retail recently caught up with Angel Maldonado, CEO of search and discovery platform Empathy.co to discuss the company’s record growth, recent consumer research and discuss retail trends following the Covid-19 pandemic.
What inspired you to found Empathy.co and why?
Two simple ideas. First, the realization that evoking positive feelings in a digital product is the ultimate objective. Technology works when positive emotions are generated. Secondly, seeing Search & Discovery as communication where context sets quality.
With this in mind, I set out to create a company culture that understands users as people, metrics as circunstancial and the elicitation of a trust, understanding and joy as objectives.
With Empathy.co, we have created an offering that allows brands to become a companion to the consumer, via a secure, ethically transparent and trustworthy commerce experience that puts the customer at the forefront of search and discovery.
We see you have experienced 124% rise in revenues recently, is that a reflection of the retail industry’s desire to improve its online search and discovery tools?
I think it’s more to do with an industry-wide realignment of brand identity which now values customer retention at least as highly as customer acquisition. This shift requires retailers to demonstrate ethical practice in their handling of data, and for them to showcase that they value each individual consumer – improved search and discovery tools which puts the customer first is perhaps the most efficient and effective ways of demonstrating a consumer-centric approach in online retail, hence the significant uptake in the Empathy.co platform.
Of course, we must also mention the elephant in the room, that is Covid-19. The pandemic has forced many retailers to shift their services to an entirely online platform, and due to permanently altered consumer expectations, it’s highly likely that a majority of retailers will continue to value online over physical sales even beyond the lifting of social distancing restrictions. With such a crowded market in online retail, it’s important for brands to step apart from their competitors, and said brands are starting to realise the power of embracing empathy in their identities – we expect even further growth as this trend continues.
You recently commissioned a major study into the behaviour of online shoppers, can you tell us about some of the key findings?
Essentially our findings quantified the concerns that online shoppers have about how their data is being used. The survey of 4,000 UK consumers revealed that over 40% of shoppers are concerned about how brands use their data. This concern is having a detrimental effect on online commerce, for example, nearly one in four (22%) shoppers admitted to regularly using guest accounts to purchase online goods to avoid handing over personal data.
Similarly, 42% of online shoppers revealed that they are careful when providing personal data and accepting legal notices. Perhaps most interestingly only a very small fraction (13%) of the respondents said that they are not concerned about how their data is used at all and will hand it over whenever necessary. Also, only one in 10 said that they like that businesses remember their tastes and preferences via the use of cookies.
Ultimately a negative perception towards misuse of personal information on online platforms is developing. 18% even admitted that they think the purpose of Facebook is to spy on us and sell us data, and 12% said that they think Amazon consciously make cheap copies of top selling third party products.
How do you think retail brands can do more to win trust with their customers?
Winning back the trust of customers can be a long term process, but one which is absolutely vital to brand perception in this new digital age defined in large part by ethics and trust.
Key advice for retailers is to ‘show’ customers that they are worth trusting, and not just ‘telling’ them that they are – the consumer of the modern day is extremely aware and over inflated marketing campaigns designed to demonstrate exaggerations or falsehoods will be dismissed quite quickly.
Instead, brands should demonstrate solidarity with their customers – using personalised experiences to ease the consumers shopping experience without the fear of data harvesting is important, and enlisting transparent search and discovery services is key in enabling. The pandemic also provides a good opportunity to showcase ethics in how staff and long term customers are treated, and brands that are ahead of the curve are doing their best to be open and honest during this difficult time.
How has the Covid-19 crisis impacted the way retailers operate online?
Whilst it is true that online retail and eCommerce had been surging in popularity in the years leading up to the pandemic, Covid-19 still inherently altered the online retail experience to its very core. The government-mandated closure of physical stores saw online traffic surge, and those BUSINESSES which did not adapt quickly enough were soon left behind.
A prolific case of this includes the purchase of struggling fashion brands Top Shop and Miss Selfridge by online retail giant ASOS.
So now, online retailers are operating in an extremely crowded market, and standing out from the crowd is growing increasingly difficult. This is why more and more are looking to improve their brand image with platforms like us, to drive customers away from brand names which aren’t as trustworthy, or do not emote a positive shopping experience via their outdated online platforms.
What are your predictions for the market in the next 12 months?
It’s difficult to predict what lies ahead as this crisis has exemplified. With this in mind, if we pay attention to the defining characteristics of the market today, we can agree that social change is shaping a new landscape where individuals seek more meaningful relationships. There is a thirst for a more just, ethical and sustainable value together with a strong need to exercise freedoms and individuality. A perfect storm for a cultural and socio-economic revolution of which the next 12 months may provide important clues to which we must pay attention.
Companies that deliver and constitutionally accord to these new social cravings will be relevant while those who don’t will have to become status quo defenders, which is, in my view, a shorter game.
