Get ready for a vast array of real-world analytics and an armada of touch screens to invade your favorite brick-and-mortar shops. Advertising that targets you by age and gender, touch screens that let you check out, order from other stores, or return/exchange items yourself, dressing rooms that recommend a shirt that looks great with your pants; the shopping experience as we know it is about to change forever.
Brick-and-mortar retail hasn’t changed too drastically since the early days of the shopkeeper. It’s long been an experience based around tangible goods hanging on a wall, and a clerk behind a counter. Wooden boxes and coins have been replaced by cash registers and credit cards, and chain stores have moved the experience from the owner to an underpaid clerk. However, from evaluation of products to payment, the process of a retail purchase has looked pretty much the same for thousands of years.
Now we are about to experience a shift in retail moving from pure human interactions to interactions guided by technology-enabled physical spaces.
Three things have happened that will ensure a wholly different retail experience moving forward.
1. Technology is available to automate the experience
From sensors like RFID, cameras and mobile traffic to touch points like the iPad and integrated payment products like Square, the technology that can be leveraged by retailers has exploded in the past few years. It is now trivial to have a computer recognize a repeat visit, accurately judge a person’s demographic and customize an experience for that person.
2. Consumers have changed their perceptions towards privacy and expect more from the stores they patronize.
The ability to predict buying preference based on age, gender and purchase history is perhaps the oldest and most fundamental sales technique. Since trade first appeared 10,000 years ago, the vendor with greater intelligence and a better relationship with his customer had the advantage. With products like Immersive Labs’ , customer demographic targeting becomes an automatable technique and retailers are starting to employ adaptive experiences based on real time video analytics. While there is some backlash, and the FTC has stepped in to offer guidelines, Customers have shown that they prefer to be marketed towards based on their demographic and history, it’s something they’ve come to expect from years of online purchasing and it’s about to break through the brick and mortar.
Additionally, for routine purchases, consumers are more comfortable using technology than talking to a human. Zipcar revolutionized the car rental experience by getting rid of the person behind the counter and replacing them with an app. Rather than being a help, clerks can stand between the customer and the product they want. With customers finding better product recommendations and reviews on their phones, and checking out faster at a self service stations, the clerk becomes a gatekeeper and a potential source of frustration.
3. Retailers have recognized the benefit and are ready to make the investment.
Lower overhead, happier customers, higher revenues – it’s clear that technology, implemented seamlessly, is a sound investment.
Reducing headcount is at the top of the list of most companies of looking to minimize overhead. Decreasing staff has a compounding benefit; not only does it save salary expense, but benefits drop and associated HR costs, training costs, and administrative costs drop as well. If these new digital experiences allow this to be done while increasing customer satisfaction, there is an opportunity for a substantial return on investment.
Solving challenges like dwell time, loyalty, integrated online/offline experiences, or inventory shortages will increase revenues at an incremental cost. By using analytics to recognize implicit behaviors and capturing explicit customer interactions with touch screens and mobile devices, retailers can enhance a unified Customer Experience (CX) cycle that draws a common thread through marketing, e-commerce, in-store, and supply chain, driving an increase in bottom line.
Now begins the difficult task of defining the ideal experience for a given retail environment and a specific brand, assembling the ingredients to make it possible, and integrating it from supply chain to campaign. The consumer will have a smoother more personalized experience, better customer service and lower prices. The retailer will see a lowered overhead, greater sales and more loyal customers. Retail is about to truly go digital and a trip to the market will never be the same again.