As one of the most customer-centric industries, the retail sector faces a tough choice: transform in-store experiences with digitisation or continue using legacy systems that will very likely result in poor market share. Research that has been undertaken by Cisco, in fact, predicts that four out of 10 retail brands are at the risk of a shutdown by 2020 if they fail to transform themselves using digital strategies.
4 out of 10 retailers are at the risk of shutdown if they don’t consider digital transformation according to Cisco.
Having said that, revamping in-store processes and shaking up customer experience can be quite a daunting (and expensive) task. Retailers need to strike the right balance between physical and digital to achieve success. Experts suggest that a combination of online and offline initiatives will go a long way in reinforcing brand presence. For instance, a report by Deloitte highlighted the following technology trends that will shape digital retail:
- Reimagined in-store shopping experience, focusing on inspiration or convenience;
- Conversational commerce: adoption of connected devices and voice user interfaces (VUI);
- Robotic technologies and AI-assisted shopping;
- Applying agile methodologies at scale.
Why the in-store experience is still relevant
While customers continue to opt for in-store shopping due to the social and tangible experience it provides, their expectations of a retail store are rising. They want an experience as immersive as online shopping; one that is highly personalised and engages with them at every step of the journey.
54% of retail executives believe that the digitisation of their stores is moving too slowly, according to research by Capgemini.
In an interview with rsmus.com, John Nicolopoulos, National Retail and Restaurant Sector Leader, remarks: “The benefits of a brick and mortar store include direct consumer interaction, brand promotion and the idea that a physical store truly compliments the online shopping experience. The consumer may research a product online, maybe even purchase it there, but many are having the product shipped directly to the store for pickup as well. While there, customers may buy additional items at the store, encounter product promotions which furthers brand interaction, experience direct customer service and may receive additional discounts or giveaways. Department store retailers or stores like Target all benefit from a physical space to sell their goods, but other retailers in sectors like entertainment, health and wellness and grocery, for instance, also benefit from the brick and mortar concept. This in-person engagement develops a memorable experience for their consumers, something that is key to building long-standing loyalty. E-tailers are also seeing the benefits of a brick and mortar as more and more are opening stores to advance in-person engagement where customers can touch, see, try on and experience the products they want.”
So, if you are looking to go down the digital transformation route, here are some technologies to consider –
- Warehouse management systems: Digitization of your back-end systems can improve time to value and boost agility. A simple move like giving your staff mobile capabilities can significantly boost efficiency and help them with real-time inventory and supply chain management.
- Mobile Pay: Whether its mobile PoS or self-checkout, customers want easy payment solutions. There is a rapid shift from cashless to cardless and technologies like M-wallets and ApplePay will need to be integrated across retail stores. More recently, Amazon Go’s model has set a new standard for seamless payment. The jury is still out on its successful practical implementation.
- Beacons and data analytics: Beacons are small devices that use Bluetooth technology to send personalised messages to customers notifying them of offers and deals. According to estimates by Business Insider, beacons would help generate US$ 40 billion in retail sales in the year 2016. Using beacon technology, retailers can target customers when it matters the most. For instance, retailers can target customers when they are in specific locations. Beacons can also provide intelligence on customer behaviour that can help retailers to provide offers that are relevant to them. Data analytics also plays a pivotal role in giving retailers insights about their customers. Retailers need to use these to understand customer behaviour, create personalised touchpoints and offer tailor-made experiences.
- Chatbots and AI: An article on altexsoft explains: “The growing adoption of artificial intelligence and massive popularity of chat apps unlocks opportunities to automate several routine business processes, such as customer support. Using a smart bot to handle most of the typical issues, like answering standard questions or handling returns, retail companies can reduce staff, while improving efficiency and customer satisfaction.”
- Virtual reality: Several prominent brands are integrating VR experiences within their showrooms to enable potential customers to enjoy the product’s features before purchase. The beauty of such technology is that it can transform an ordinary physical space into an immersive experience. Moreover, it helps customers visualise how the product or service will fit into their daily lives. For instance, home interior stores are using this technology so that customers can see what a piece of furniture will look like within their homes. Another common example of the implementation of VR is in fitting rooms, where clients can see how clothes and accessories will look on them without having to physically try it on.