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How Do Retailers Bring Online Standards to the Offline Experience?

Business

Mar 2, 2022 - 6 minute read

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Pat Moynihan Independent Consultant

Pat Moynihan has 30 years’ experience in the delivery of quality IT systems and running significant IT functions. He is a senior IT leader in both the Retail and Telecoms sectors, where he worked for Primark, Vodafone and O2. He has extensive technology management experience and a successful track record in digital transformation, innovation programs, organisational and people development. He is exceptionally customer focused and has delivered significant business value through the use of business intelligence technology and tools. Above all, he has a consistent track record in change management and delivering business results.

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A few years ago, in a past life as IT Director for a fast fashion retailer, I remember spending a long time pouring over the performance stats available from the online website. We took it very much for granted, but we were able to quite easily identify:

  • who was visiting the website,
  • where they were coming from,
  • how much time they spent on the site,
  • who was leaving after only looking at one page,
  • what exactly they were doing,
  • what was working; and (more importantly),
  • what wasn’t

As you can imagine, this was incredibly valuable information, and it was put to good use. But at the time it did occur to me that, if we had the same information for each of our retail stores, that would be transformational. Unfortunately, I was a bit ahead of the technology at the time. I did consider how we might make use of the ubiquitous device in everyone’s’ pocket — the mobile phone. We didn’t pursue it further at the time as the business was already very successful, and nobody was really interested in using technology to drive sales when the sales were so strong.

Now, things have changed… Brick-and-mortar stores are struggling to find their place in customers’ lives, coming off the back of COVID-19, where online has only grown stronger. Ecommerce is now setting the bar for efficiency and customer experience. Many retailers are taking another look at how they can transform the customer experience in-store, as it still falls short of the online experience in terms of levels of choice, information and convenience.

Thankfully, the technology has now more than caught up with the need and there are multiple technology solutions available to gather the necessary data and give a much-improved experience.

But where to start? Let’s look at the performance data that was so easy to get online and see how technology has advanced to allow this now offline.

Identifying Customers’ In-Store Shopping Patterns

I believe the biggest change in this area is in customers’ attitude to sharing data. They are happy to share their data, as long as they have given permission and they are rewarded with personalised offers and better deals. Loyalty programmes have been around for a long time now, but by incorporating the use of customers’ mobile phones, they can now do so much more for the customer. The retailer can identify the customer as soon as they enter the store, push them personalised offers, show them more detail about their products, such as the country of origin, etc. For example, a retailer can offer a discount on a cup of coffee, having identified that the last time that the customer visited they bought one.

Alternatively, with Amazon’s Just Walk Out checkout-free technology, the customer simply taps in and walks out with their purchases, identifying themselves and allowing the retailer to determine the time spent and path taken while shopping. Amazon’s solution, with the use of cameras and other sensors, can also identify what they have bought, but also what they looked at but didn’t buy.

The Power of Real-Time Information

From a physical point of view this is a little trickier than online and perhaps not as relevant. But retailers can attract customers into store by pushing notifications to their mobiles as they pass by. In shopping centres, it is possible to track which stores they visit or not, offering retailers valuable insight.

The best example of online-to-offline integration is ‘Click & Collect’. Customers start their journey online, browsing the full inventory with the power of personalisation and “what goes with what” type of information. They click to order exactly what they want and choose where and when to collect the item — collecting offline.

The opposite approach is now also being pursued, i.e. offline to online. H&M has been offering this innovation for some time. The customer can satisfy their need to examine products’ quality, size as well as their look and feel by physically touching the product. They can then switch online to get exactly what they want. They can scan the barcode of the product, see what colours and sizes are available in-store and in the warehouse. A single click can then be used to purchase their exact choice, allowing them to either collect in-store or get it delivered. This is described as “the Endless Aisle” approach and really does tick the convenience box for the customer.

How Retailers Can Leverage Technology to Digitise the Store

The Internet of Things (IoT) combines several technologies that enable retailers to run their stores in the same ways as they would online, with real-time dashboards.

  • Traffic counters counting incoming and outgoing traffic will give an accurate measure of the number of customers coming into the store. Combining this data with point-of-sale (POS) data will allow an analysis of customers who visited the store but didn’t buy anything.
  • Tracking WiFi usage will give an accurate map of the traffic flow. Points of saturation and low areas of footfall can also be easily identified.
  • Cameras can also be used to monitor traffic and profile customers, and not just physical movement and appearance, but also sentiment. At an NRF visit a few years ago, I got a demo on the Google stand of real-time sentiment analysis. I stood in front of the camera, and it was able, by using sophisticated AI, to determine my mood. Simple stuff at the time, a happy face meant good mood, etc. So, the technology now exists to identify one or a group of unhappy customers in a store and send an assistant to go to their aid.
  • RFID has been around for a long time. But is now going through a renaissance, according to McKinsey. As tag prices have dropped, it is becoming more prevalent. And, why not? In current times the most critical requirement of all retailers is the ability to know what stock they have and where exactly it is. RFID delivers on this requirement.
  • Near Field Communications (NFC) is also now coming into its own. By putting NFC touchpoints around the store, customers can view information on their mobile phones on product information, such as the country of origin, without downloading an app. With the use of Blockchain it is now possible to identify the exact source of every product in the store. The problem now is how to share this information easily with the customer in-store. One way of solving this is by combining NFC with the customer’s mobile device: “tap here to get more info, no app download required”.
  • Of course, the most obvious use of IoT is the checkout-free store. Decathlon has been using RFID to speed up the checkout process for a long time. But Amazon has gone a few steps further by enabling the ability to bypass the POS and “just walk out”.
  • Smart shelves use IoT technologies to push personalised advertising, identify low and out of stock items and identify slow-moving and non-selling items.
  • Robots are also being used to free up staff to do more customer-facing duties. Walmart has been using robots to scan shelves for out-of-stock items and cleaning. This technology has become so ubiquitous now that it has made its way into the home in the form of robot vacuum cleaners!

Summary

In summary, many technologies now exist to gain the same insight into a physical store as a website or app. They can deliver real-time information and enable retailers to personalise service and anticipate customer needs. This allows the raising of the bar for customer experience and brings online standards to the offline experience. Many solutions are now well-proven in various in-store scenarios, but it can be difficult to choose the right solution for a particular problem. It’s important to have an experienced retail software partner who can help you to manage complex integration, future proof the solution and help with ongoing support.

For more information on how the smart use of technology can help your retail business stay ahead of the pace of change, download our industry report: “Top 5 Retail Tech Trends for 2022”.

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Pat Moynihan Independent Consultant

Pat Moynihan has 30 years’ experience in the delivery of quality IT systems and running significant IT functions. He is a senior IT leader in both the Retail and Telecoms sectors, where he worked for Primark, Vodafone and O2. He has extensive technology management experience and a successful track record in digital transformation, innovation programs, organisational and people development. He is exceptionally customer focused and has delivered significant business value through the use of business intelligence technology and tools. Above all, he has a consistent track record in change management and delivering business results.

See all Pat's posts

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