How Brick & Mortar Retailers are Evolving to Keep Up with Online Competition
Contrary to popular belief, brick and mortar stores aren’t dying, they’re just evolving. Physical stores once provided customers with what they needed – tangible items just down the street, a wide selection to choose from, and a means to connect with the community. Now, with emerging technologies available to enhance the retail experience, consumers still get what they need, but better. Items arrive in hours at your door, the selection is too massive to even comprehend, and consumers connect with brands just as much as they connect with other shoppers.
With these obvious advantages to online shopping, it’s no wonder that brick and mortar stores are worried. However, these tech-driven changes have provided a clear view of the potential differentiators that exist for physical stores. People still crave experiences that require their physical presence, like emotional connection, undivided attention, and the ability to touch, try, and take something home. Brick and mortar retailers are at an advantage because they cannot only satisfy those exclusive needs for shoppers, but they can leverage what they learn from online shopping habits to give consumers a well-rounded experience that inspires brand loyalty, great reviews, and happy customers.
Retailers want to provide the right experience through all channels to entice consumers and win their business. In order to stay competitive in the changing landscape, many must refocus their efforts on bringing customers to their physical stores. Previous strategies and incentives for driving traffic to brick and mortar locations simply won’t cut it anymore. Instead, many retailers are taking advantage of technology to generate data, increase customer convenience, meet customers where they are, and tap into human emotion. Some of these tactics are even inspired by online retail. Throughout this past year, several new trends have emerged to best give customers what they have come to expect. From cashier-less stores, to smart vending machines, to artificial intelligence and even drones, there are many ways brick and mortar retailers are evolving to keep up with their competition.
In this blog series, we’ll explore several of these different ways that retail businesses are enhancing their in-store experience for customers. First, we will start with a perk that has driven this massive trend toward online shopping – added convenience. Shopping online might not always be the most convenient option for certain purchases, so retailers want to balance that ability to ‘try before you buy’ with the right quick and seamless experience in their stores.
Ways Retailers are Improving the Experience for In-Store Shoppers
Smart Fitting Rooms
In our fast-paced society where time is increasingly more valuable, the convenience online shopping has brought to buyers is a large reason for this seismic shift in the retail industry. After all, what could be better than the ease of making purchases while sitting on the couch in your pajamas? However great that may be, there are a whole host of reasons why it might not make sense. How can I be sure that the dress I want to wear to my friend’s wedding fits well, looks great, and feels comfortable if I don’t try it on? Enter the smart fitting room! By combining the latest technology with an in-person shopping experience, consumers can have increased convenience with some perks that shopping online doesn’t offer.
Major retailer Neiman Marcus rolled out digital mirrors that allow shoppers to view their outfits in 360 degrees, save the options they like, and try on other colors without the hassle of removing their clothes. Other options exist for trying on glasses or beauty products virtually, allowing customers to peruse a larger selection in a shorter amount of time. Smart fitting rooms can help improve the customer experience in less obvious ways, too. By tracking inventory and interest through the use of digital mirrors, retailers can use the data to keep up with supply and demand while reducing waste.
Artificial Intelligence
Artificial intelligence has become increasingly valuable for retailers looking to improve the overall customer journey. AI and machine learning are used to personalize the shopping experience, increase efficiency in systems and staff, improve customer service, and automate tasks for store employees. Kiosks or mobile applications with the intention of assisting customers in-store are increasingly popular among large retailers. The odds are good that you’ve spent some time lost in a hardware store before. With various offerings stacked on shelves stretching toward the ceiling and spanning several acres, it can be a challenge to find what you need in a short amount of time. Lowe’s uses artificial intelligence as a solution to this common problem. Their LoweBots roam the store to help customers and keep tabs on inventory.
AI is a great asset for customers and the employees that serve them. More and more retailers have some AI on staff to provide speedy service and answer basic customer questions so that humans can focus on other aspects of the sales process. Macy’s, the large department store chain, has developed an application that allows customers to easily find what they need in the store, check stock, or request human assistance. In fact, this app can use specific markers to detect when a customer is frustrated and alert an employee.
Artificial intelligence in retail software solutions has hugely impacted customers by providing unique opportunities for additional personalization. In fact, some might even say AI can read minds. Clothing retailer Uniqlo has introduced a kiosk meant to assist customers in a uniquely personalized way. Using neurotransmitters, the machine can gauge a person’s reaction to a variety of fashion options shown on screen, and then make recommendations based on those reactions – no button required! Technology like this is important because it delivers increased speed, better customer service, and the ultimate satisfaction of leaving the store with exactly what you wanted.
Streamlined Operations
If time is money, giving some back to customers is highly beneficial for retail organizations. Using custom software and technology to streamline store operations means that a customer’s every physical interaction, from the moment they walk through the door to the moment they wave goodbye, is quick, intuitive, and seamless. Every aspect of the buying process is crucial to developing a connection with a customer and increasing their lifetime value to your company. That means it’s essential to take steps to prolong that great experience even after customers have handed over their money.
At pop-up stores for trendy clothing retailer Zara, customers can pickup online orders. BOPIS (buy online, pickup in-store) is nothing new. This option has been popular in recent times for people looking to get tangible products fast while avoiding crowded stores and long waits in busy seasons. However, dealing with both in-person and online orders in a store can be a challenge for the employees. When shoppers come to pick up, they use their mobile phones to enter their code and activate the robot in the warehouse that will grab their order. The robot promptly delivers the package to a dropbox, and the customer is on their way. Streamlining this process not only helps those customers there to pick up, but frees up the in-store staff to help other shoppers still deciding on what to buy.
Other retailers are moving typical store functions to the cloud to further streamline their operations and delight customers in-store. For instance, many stores have a traditional fixed point-of-sale (POS) system – shoppers move to a fixed location to check out. Moving the POS to the cloud has been a game-changer for many retailers. This transition allows clerks to make transactions via a tablet anywhere in the store. This means customers can often check out quickly with less wait time. For some, a cloud-based POS helps retail companies stay true to their brand. For skincare brand Jurlique Australia, the transition has made a big difference in how customers feel about their experience at the store. After a relaxing spa treatment, it’s much more comfortable to complete the transaction there instead of having to go back into a busy store and wait in line to pay.
Cashierless Shopping
Grocery shopping last week after work meant that by the time I loaded up my cart, I was so ready to get out of there. Tired and hungry, I found myself wishing I could wheel my cart out the door without having to unpack it on the conveyor belt. Impossible, right? Not so fast! We’ve taken the idea of self-check-out even further, making it even more convenient for customers to really ‘grab and go’ in brick and mortar stores. Amazon, that massive online retailer, has broken into the brick and mortar space lately with Amazon Go. This clever concept means you turn on your app, walk-in and grab what you need, then just walk right out of the store. Follow along with your app as it logs everything you pick up and charges you for what you take with you. Other retailers like Sam Club’s and Giant Eagle are exploring this technology as well, and more are sure to follow.
Cryptocurrency
Retailers, especially those targeting younger consumers, have begun accepting cryptocurrencies like Bitcoin for purchases. Consumers like the additional security blockchain technology provides as well as the convenience. Retailers accepting payment for products and services with cryptocurrency is a draw for customers that prefer to stay away from traditional banking, pay with foreign currencies, or those making large purchases such as jewelry or furniture. In fact, even Kentucky Fried Chicken has gotten on board this trend, offering the ‘Bitcoin Bucket’ in Canada.
Augmented Reality
Augmented reality is used to outfit virtual fitting rooms, create engaging window displays, and help customers navigate through stores. This technology is especially useful in programs designed to help consumers envision products in their own home. By scanning a space with a mobile device, anyone can select a product and preview it in a room. This is great for the average consumer, as well as for those on the job. For instance, the salesforce for Coca-Cola is armed with tablets that show their potential clients where they might place a vending machine.
Augmented reality also allows consumers to try products on their own bodies. Instagram is a great platform for those looking to find new beauty products – with additions to the app’s shopping feature, customers don’t have to rely on the model to know if it’s a good fit. They can easily upload a picture and try that lipstick color on their own face.
Striking the Balance Between Convenience & Experience
Time has become an incredibly precious resource in our society and patience truly is a virtue. Our relationship with work has changed, making it feel like we are always on the clock. With this increased flexibility often comes increased employer demand, leaving Americans feeling like they have less free time. And it turns out, most of the free time we do enjoy is spent on our devices.
Retailers have gone to great lengths to meet consumers where they are, connecting with them in various ways through their devices. In our next installment of this series, we will dive deeper into the ways that retailers increase shopper engagement and provide a great in-store shopping experience through their smartphones. The most obvious way this happens is through mobile e-commerce. However, though it might be very convenient, it may not be the best draw for those that are looking to step away from the screen.
Looking to learn more about how to roll out some of this technology and delight customers at your brick and mortar locations? Give Geneca a call for a free consultation!