Despite the surge in e-commerce sales, 65% of people shopped online in 2015, however, only 15% of consumers opt to shop exclusively online, according to a survey from Forrester and Retail, indicating shopper are using a multichannel model. Furthermore, Accenture found that 68% of all Millennials demand an integrated, seamless experience regardless of the channel. That means being able to transition effortlessly from the smartphone to computer to physical store in their quest for the best products and services. Thus, retailers will continue to focus on improving the in-store experience, whether to service people who purchase exclusively in-store, or to manage the omni-channel retail experience.
While 50% of consumers agreed that shopping online was more convenient than in-store, a quarter of those polled said that brick-and-mortar stores felt like a ‘let down’ after transacting online. While retailers are deploying tactics to bridge the digital divide, customers want retailers to do more to connect their online and offline shopping habits; such as recognizing previous purchases and offering related products or proposing similar that are currently on ‘special offer’. They want a stress-free environment with an infinite assortment of readily available deals, coupons and discounts, the ability to shop with mobile, browse online or in-store for the best opportunities, and an atmosphere that inspires and stirs their imagination.
67% of North American consumers and 56% of European consumers said it’s important retailers have one view of them as a customer. They want this ‘single view’ to be used to personalize their in-store experiences, but also to make their buying journeys seamless across shopping channels. Retailers can improve consumers’ experiences by bringing the best of the world of e-commerce into the brick-and-mortar environment, this means digitalizing brick-and-mortar outlets, to deliver more tailored and connected interactions that make customer service faster, more efficient and more informative.
Creating new in-store experiences and services
Evidence of the neglected in-store experience emerged when consumers around the globe were asked to identify which shopping channels needed the most improvement. The top answer, at 3%, was the physical store. Close behind, at 3%, was the integration of store, online and mobile shopping into a multichannel experience.
Once, going into a store and buying something was considered an experience in itself, today’s consumers crave something more special, more exclusive and more memorable. Technology is the keystone to turning the customer experience into a positive one. Some of the initiatives retailers are trying include:
1. Virtual Distribution Centres
One way to leverage stores and improve the customer experience is to use stores as virtual distribution centres. Target plans to convert 1,800 stores to mini fulfilment centres, and already ships 25% of their online volume from stores. It’s another way to get closer to the customer from a pickup and delivery perspective — reducing time-in-transit and shipping costs in the process.
2. Endless Aisles
You may have heard a few different terms regarding the endless aisle such as drop shipping and virtual merchandising. All of these terms refer to a retailer’s ability to sell items to customers that are out-of-stock in-store, but not kept in local inventory. Retailers instead make the sale possible by selling inventory kept by external suppliers. To the customer though, it appears as if you sold the item.
Among those at the forefront of this innovation is the fashion group Aurora. This retailer has integrated its stock system to create a single stock pool across all channels. Under the banner ‘Anywhere Everywhere,’ the group aims to fulfil orders from distribution centre and stores. Tesco are testing the “endless aisle,” where a new type of digital signage displays all of a store’s products so customers can purchase them without having to walk around the store.
3. Virtual Reality / Augmented Reality
Retailers like TopShop and Burberry know that their young, fashionable clientele are digitally savvy. They’re using cutting edge technologies to provide the kind of slick, digital experience their customers enjoy. Topshop has experimented with using Oculus Rift VR headsets to give its customers the experience of having a front-row seat at its London Fashion Week catwalk show, while Burberry and Shiseido both use augmented reality to show how people would look wearing their beauty products.
Almost certainly the “next big thing” in in-store technology are ‘beacons ‘. Beacons enable stores to identify individual shoppers who have installed the store’s app on their smartphone. They can then propose personalized offers and discounts to that shopper as they browse – based on the data they already have about that customer’s preferences and previous purchases. Beacons are already being trialed by Macy’s, Waitrose, American Airlines and Odeon, among others.
Brands are also using this technology in conjunction with other analytic tools, so that the brand can not only send a notification to the customer when they pass by the store, but ensure that the notification relates to an item that the customer has already shown an interest in.
The use of digital engagement and entertainment in-store will help increase dwell time and satisfaction of the shopping experience. By implementing digital signage in retail stores, retailers can deliver targeted messages to customers in real-time, with the option of integrating iBeacon technology, Queue Management and Video Wall Synchronization to drive in-store traffic and leverage sales. 80% of brands experienced up to 33% in additional sales through the use of digital signage, according to a Nielson Consumer survey.
The days when a shop was a shop is over. With the growth of e-commerce, a shop’s purpose is no longer as clear. A shop can now be a showroom, a collection point or mini distribution centre, or an experience. It is clear though that many retailers still see brick-and-mortar stores as a critical component of their long-term strategy.