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What if the CEO asks me about… the latest online customer solutions?

Published on 01 December 2020

It's a new world

Nine months of extreme disruption has accelerated retail brands' need to maximise their online shopping experience. With the impact of Covid-19 to be felt for the foreseeable future, and the future purpose of the physical store being re-examined, there is no doubt that online will continue to be a key consumer interface.

One perspective is that given by Laura Saunter, from WGSN, the world-leading trend forecaster, who recently commented in our Summer edition of Retail Compass

"The Covid-19 pandemic has driven a shift towards a frictionless, low-impact society in which brands and consumers have little to no interaction within a physical space."

How is the consumer experience adapting?

As a brand, all of your consumer touchpoints are shaping the rapidly evolving online consumer experience. For example:

  • the way you grab consumers' attention through "activations" outside of traditional sale transactions, such as products being available within a gaming platform or interactive social events hosted online like Instagram Live; 
  • the way consumers explore your products pre-purchase, either on your own sales platform or a third-party platform/e-commerce marketplace – the rise in AR/VR try-on services being a great example;
  • payments - whether contactless/touch-free payments or buy-now-pay-later; 
  • after sales services like returns and customer support, e.g. QR return codes, livechat/chatbots/videochat; and
  • how you get to know and understand consumer preferences, for example using membership schemes and micro-communities on social media platforms which can allow you to send consumers personalised and behaviour-targeted material. 

What are the key legal issues I need to think about

One thing that most of these customer solutions will have in common is that they will involve you partnering with a third-party specialist provider. So, we’ve picked out some of the key legal issues which you will need to think about before starting on your journey:

  • The contract: consider your approach to contracting with the chosen partner. Are you going to be contracting on the partner's standard terms or do you have leverage to negotiate? The more bespoke the solution, the more likely it is that you will be in a position to negotiate the terms.   
  • Specification: it is critical to the success of any project that your requirements are clearly set out and agreed from the beginning, especially with more cutting-edge solutions. This may sound like a simple task, but it can be one of the most time-consuming and complex stages of the project. And a word of warning – inadequate specifications are one of the most common causes of disputes further down the line, so it is worth taking the time to get it right.
  • Project timeline: agree a realistic timeframe for implementation – given the nature of these solutions, it is obviously critical to get to market as soon as possible, but such complex projects are notorious for overrunning which can then impact other areas of your business and blow your budget.
  • Integration: some tech solutions will redirect consumers off, or onto, your online platform. Given the importance of a "frictionless" online experience for consumers, think about how the tech solution will interact with your platform. And do any existing contracts for the operation of the platform need to be revisited in light of the proposed changes?
  • Exclusivity: the retail consumer picture is rapidly changing, with new solutions being developed and launched all the time, so be wary of signing up to exclusivity provisions in any new contracts. On the flip side, if you are creating a bespoke solution with the provider, consider including an exclusivity provision to stop competitors using the same system (subject to any competition law considerations of course). You should also check whether any exclusivity provisions in your existing contracts prevent you implementing new solutions with a different partner.
  • Personal data collection: new consumer solutions may involve you collecting whole new kinds of personal data. For example, if you offer customer support via video chat, you will have a live feed into consumers' homes. Reputationally, it's crucial that you are handling personal data lawfully and transparently in line with GDPR. Also carefully consider how any third-party partner will be using any data which they access (will any be used for their own purposes?) and what data will be shared (e.g. analytics on how consumers interact with the solution). These aspects can (at least partly) be de-risked by having robust contractual protections in place with the partner. If you are driving towards more personalisation, be aware that aspects like customer segmentation, profiling and data aggregation can be difficult to navigate from a compliance perspective (more so in light of the ICO's new Draft Direct Marketing Code, which we considered in our Summer edition of Snapshots). 

Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice. We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date. You should seek legal or other professional advice before acting or relying on any of the content.

If you have any queries or questions on this topic please do get in contact with Simon, Paul or your usual RPC contact. 

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