Shoppers expect more from a smart store
Retailers are investing in smart stores. In-store technology provides valuable insights into customer behaviour, but shoppers expect to receive something extra in return. Retailers are now tasked with enabling their store associates to provide shoppers with the service and the information they demand.
A smart store can generate a wealth of data about customer behaviour. Beacons connect with the retailer’s mobile app installed on shoppers’ smartphones, making it possible to not only send regular customers a message as they enter the shop, but also to record and analyse the route they take through the store. If they log onto the store’s Wi-Fi network, it gathers information about the apps and websites they use while on the premises. Networked cameras record how long people stand in front of particular shelves. RFID tags register how often an item of clothing is taken into the changing room without actually being purchased.
And that’s not all. Thanks to the Internet of Things, new applications are on the horizon that offer even more information. In the Netherlands, for example, a number of food retailers will soon be trialling an intelligent display for special offers. It is fitted with a sensor that not only registers the location, movements and the temperature, but also the weight to monitor how full the display is. The sensor provides insight into the success of the special offers for both the retailer and the supplier and issues an alert if the display needs to be replenished or replaced. In combination with other technologies, it is possible to precisely analyse which customers are tempted by the display and which shoppers take the special-offer items from the regular shelf location. In other words, we will soon be able to know just as much information about visitors to brick-and-mortar stores as we already know about online shoppers.
Sharing product knowledge
The information flow in a smart store must be a two-way process, however, customers might be willing to share some details about their behaviour, but they also want to receive information in return – often from a store associate – according to the findings from research conducted by Onepoll on behalf of Manhattan Associates. The study, which investigated the expectations of several thousand consumers across Europe, revealed sharing product knowledge to be by far the most important role for store associates. This was indicated by 51% of shoppers in the UK, and an even higher percentage of consumers in Belgium (58%), the Netherlands (61%), Germany (65%) and Spain (79%). Consumers consider it to be significantly more important than other tasks such as checking whether an item is in stock, suggesting complementary products or sharing personal experience of a product.
The problem is that product ranges expand and change so rapidly that it is impossible for store associates to know the details of each and every item. Meanwhile, customers often do their own research beforehand, or sometimes even on the spot using their smartphone and the retailer’s Wi-Fi network, and there is a good chance that they will have gone online to check out competitors’ prices. For whatever reason, the majority of consumers find that they often know more than the store associates themselves – so there goes the associate’s hope of holding a persuasive sales pitch. Yet none of this is necessary, because whatever the customers know, the store associates can know too, providing they have the right technology. Moreover, that technology can give them access to even more useful information such as instruction videos or customer reviews.
Save the sale
Customers have increasingly high expectations of store associates, including that they jump into action if an item is out of stock in the store. Not so long ago, an out-of-stock situation was a sure-fire way to lose the sale. The customer would either go elsewhere or go without. Nowadays, 40 to 50% of customers want a store associate to order the item for them, e.g. for home delivery or by reserving it in another store. Retailers that have access to the necessary inventory information can keep their customers happy and secure the sale. Customers’ expectations are also changing when it comes to paying for their purchases. More and more shoppers like the store to offer a mobile point of sale system, or they prefer to use their smartphone for ‘scan & go’ based on an app that supports mobile transactions, so it is perhaps no longer enough to have just a traditional checkout desk as the point of sale.
As these cases illustrate, in-store technology is indispensable, not only because of the ‘wow’ factor, which was mentioned by ten to 20% of the respondents, but above all because technology is functional. It helps shoppers to find what they are looking for, it can recognise customers so that they can receive personalised advice and special offers, and it speeds up the payment process.
Consistent customer experience
Despite all this new technology, one thing remains as important as ever: a seamless digital and physical shopping experience. A store is only truly ‘smart’ when the consumer receives the same service, experience and treatment there as they do in all other channels. Whether a shopper opens the mobile app on their smartphone, visits the online store on their laptop or simply calls the store, they should be able to receive information about the status of their order or personalised special offers in every channel. Retailers are making process in this respect; an impressive 63% of all European consumers perceive the customer experience to be consistent both online and offline.
There are notable differences between countries, however. Only 47% receive a consistent customer experience in the UK, compared with 77% in France.
In his role as Senior Vice President EMEA at Manhattan Associates, Henri Seroux has seen evidence that retailers are indeed working to deliver a consistent brand experience: “In fast fashion that means offering not only low prices, but also high availability. It’s particularly important to have online visibility of all the inventory locations in the entire distribution network when stores don’t stock every shirt in every size or colour, for instance. A customer who then orders the shirt they want online might not necessarily need to have it home-delivered the very next day. They might be prepared to wait a couple of days and collect it from the store instead, to avoid having to pay the delivery charge. But if the customer then gets home and asks Amazon’s Alexa or any other voice assistant to check the order status, they must receive the correct answer. For retailers, the challenge is to strike the right balance between costs and service.”
Likewise, other retail segments are increasingly realising how important it is to offer a consistent brand experience, such as the designer-label stores in the exclusive shopping streets of New York, London, Paris and Shanghai. “In the luxury goods segment it’s all about providing very personalised service,” says Seroux. “The purchase of a designer bag is almost ceremonial, and personal contact is extremely important. Imagine that a woman falls in love with a bag during a trip to New York. At the airport, she uses her smartphone app to reserve it from the Paris branch. The challenge is then to ensure that the bag will be waiting for her there, preferably along with all the other items that she is interested in according to her personal profile. Customers don’t pay for a bag like that at the checkout either, but rather in an intimate face-to-face setting. Technology is the enabler.”
Retailers are starting to invest more in brick-and-mortar stores again, according to a study by Forrester Research on behalf of the USA’s National Retail Federation in spring 2018. Almost half (43%) of the retailers surveyed expect to grow their number of stores, while 24% are also trying out new concepts such as convenience stores and pop-up stores, and 12% are opening new warehouses. An increased physical presence is important because the top priority for retailers today is the ability to ship online orders quickly. Furthermore, shops play a key role in click-and-collect and ship-from-store services.
Investing in technology
Seroux reiterates the importance of technology: “Imagine a scenario in which a customer receives a personalised special offer, orders the product online but subsequently returns it to a store. This requires the store associates to have access to the online order so that the customer can receive the applicable refund. The transaction needs to be correctly reconciled internally too, and that calls for an integrated system. But other technology is also available, such as for setting up promotional campaigns, managing in-store inventory or generating 360-degree views of customers across all channels. Retailers that want to gain the optimum return on their investment in brick-and-mortar stores have no choice but to invest in technology.