Physical retail is going through a major technology transformation in the race to keep up with competitors. But other than the Amazon Go stores, we don’t hear much about it.
Look closely, though, and evidence of this shift is everywhere — from cameras to sensors and smart lockers. Here are three high-level areas turning physical retail stores into smart shopping hubs:
1. Personalizing The Customer Experience
Few things are more frustrating than reaching out to customer service and having to enter in all your data — full name, account number, order details, etc. — before you can even get to the reason you contacted them in the first place. Or how about receiving an offer for products you aren’t interested in purchasing? It can feel a little like reintroducing yourself to a friend every time you see them.
To solve the personalization problem, retailers are using technology to get to know their customers better. Stores like Target and CVS have installed beacons, wireless devices that communicate with customers’ Bluetooth-enabled cell phones while they’re shopping. Based on where customers are in the store, this technology can provide shoppers with relevant deals, discounts and special events in real time.
Not only does this personalize the experience for customers, but it encourages sales, too. Beacon technology creator Swirl found that 70% of shoppers were more likely to make purchases as a result of beacon-triggered content.
Retailers can also gather data about their customers through multichannel interaction using services like Salesforce and Microsoft Azure. These technologies give retailers insight into all customer touch points — whether it’s the store website, a social media platform, or an app. And as shoppers move between online and offline activities, the data they’ve shared travels with them, enabling retailers to create a seamless, personalized experience.
To add even more personalization, recommendation-focused artificial intelligence (AI) can suggest products during the online shopping experience. So, if a customer adds a new blouse to their cart, the technology can find matching jeans, shoes and accessories to go with it.
2. Streamlining Shopping With Smart Tech
Amazon took in-store shopping to the next level when they introduced Amazon Go. With a grab-and-go style, there’s no waiting in line and no checkout. All shoppers need is a smartphone with the app installed.
Thanks to the convenience of mobile shopping, this is the kind of quick, hassle-free experience customers have come to expect from the offline experience. They don’t want to be waiting around in line. According to a survey from Box Technologies, more than 40% of customers leave their carts if the checkout wait time is more than nine minutes. And 86% of them avoid stores with long lines.
More retailers are partnering with startups to streamline shopping, attract new customers, and bring e-commerce customers back to the store. Cashierless checkout, pioneered by companies like Standard Cognition, Zippin and Sensei, uses computer vision and AI-powered technology to let customers skip the checkout line. The system recognizes items as shoppers walk out, charging them automatically via a mobile payment app. No lines necessary!
This article provides a nice overview of innovations and trends in cashierless stores. It’s important to note that the checkout experience in stores cannot be fully automated as there are millions of Americans who don’t have bank accounts or credit cards. They must be able to pay in cash. San Francisco is considering banning cashierless stores, and we’ll likely see at least one checkout line reserved for cash payments in otherwise cashierless stores.
3. Using Buy Online, Pick Up In Store (BOPIS)
BOPIS is quickly becoming an essential part of the smart shopping experience, as it blurs the lines between online and offline shopping. A survey by TotalRetail found that 68% of shoppers made multiple BOPIS purchases, and 50% chose online retailers based on the availability of in-store pick-up. According to Retail Touchpoints, 90% of retailers plan to implement BOPIS by 2021. BOPIS is called “click and collect” in Europe and has been a fairly established pattern of shopping there.
An emerging, rapidly evolving technology that enables a seamless BOPIS experience is smart lockers. Just like ATMs made it much easier to get cash from your account, smart lockers make it much easier to get what you ordered. Companies like Smiota, an organization I worked for earlier in my career, combine enterprise software, lockers, and machine learning to great effect to provide a delightful BOPIS experience. Others, such as Parcel Pending and Luxer One provide hardware solutions and are also leading the charge within this industry. Lockers are available in a variety of specifications to accommodate orders of different sizes as well as refrigerated or frozen goods. Using smart lockers for BOPIS is simple for everyone involved — a customer places an order online, the retailer prepares the order and secures it into one of the lockers and the customer arrives to unlock their order with a smartphone app or keypad. It’s because of this simple customer experience that we are seeing rapid adoption of smart lockers for BOPIS. Home Depot, Stein Mart and Costcoare great examples of this implementation.
It’s clear that BOPIS is here to stay and will increasingly become another option for customers to get what they ordered faster.
The Future Of Retail
The bottom line? Retailers are changing the way we shop, making the experience specialized, simplified and smart. We are seeing similar trends in the travel and lodging industry where hotels are streamliningthe experience for their customers. These trends show us that brick-and-mortar businesses in all walks of life can effectively compete with online businesses by intelligently leveraging their assets and physical infrastructure. What matters is how you merge the offline and online to provide a unified, frictionless and delightful experience to your customer.