Are You on the Right Path of Reinventing the Store?
If we go back to the good old days of retail shopping, we can imagine ourselves entering into a store and the store owner identifying us in person and guiding us to the products/ racks of our interest. He may also be offering some discounts, informing us when a new product of our interest arrives in the store. Time has changed so as our shopping patterns and experiences. However, still our longing to have that level of personalization in shopping experience remains inherent in us. This expectation is satisfied to a larger extent in the world of e-commerce. Physical stores lost this tinge of personalization in between. However, the real time shopping experience physical stores can bring in, makes stores continue to be the nerve center of retail, even in this era of e-commerce revolution. Re-inventing the store or augmenting this real time physical store experience with a tinge of personalization along with other next generation capabilities is the hot trend in the retail landscape.
According to a survey done by Happiest Minds Technologies, over 90% of revenue still come from physical stores for large Omnichannel retailers. Given this continued attraction and volume of transactions in stores, there is a need to constantly upgrade, modernize and re-invent the experiences that customers have come to expect from their in-store shopping journeys.
We see three paths to such re-invention initiatives.
1. Modernization / Digitalization of traditional and core processes
Traditional retail functions in-store have long been heavily manual and process driven. This with potential leakage issues results in inaccuracies primarily with respect to the inventory view. Receiving, stocking, stock counts, visual merchandising, shelf labeling, planogram compliance monitoring and many such processes are overdue for a re-haul. However, digitalization in retail has brought in a range of innovative digital solutions to address these issues. This includes.
Mobile enabled receiving systems: The onset of mobile technology especially smart phones changed the way consumers shop today. Smart phones bridge the gap between online and offline worlds. Smart phones are largely used in scanning products, receiving offers through mobile coupons, making payments, and producing digital receipts during retail purchasing. It also allows retailers to interact with potential customers who opt for loyalty programs/ promotions and push contextually relevant and time limited offers or promotions after identifying customer’s particular interests.
Image based planogram compliance tools: Planograms visually represent the product placement in a store. It helps in offering the best customer experience by showing where the products should be placed in a store for maximum sales. However, manually implementing this is time consuming and laborious. Planogram compliance tools with digital image recognition technology efficiently automates this task, thereby enabling retailers to address inventory distortion and out of stock challenges to a greater extent.
Smart shelves for auto-stock counts:
Smart shelves or electronically connected shelves enable retailers to auto track the inventory in a physical store. This will enable the inventory and store executives to address the out of stock challenges by refilling stocks from stock room as they get depleted from the store shelf, Intimating about the demand of certain products or out of stock situation and informing warehouse / Direct shipment vendor for immediate replenishment. It enables the store executives to have a seamless information exchange with various participants in the supply chain and proactively avoids “loss of sale” scenarios to a larger extent
Electronic Shelf Labels: Electronic shelf labels automate the traditionally manual process of changing prices in retail stores. This will enable retailers to manage products at the point of purchase, with dynamic price changes in a physical store. With the capability to display texts, pictures, logos or barcodes the versatile solution helps in remotely managing shelf-edge pricing, product information and promotional offers efficiently.
2. Personalization/ clienteling led selling
Customers who are used to the convenience of online shopping now turn to stores only when there is a specific need that stores beckon to fulfill. This could be the need for touch-and-feel of certain goods, for potentially speaking to product experts (sales associates) to aid purchase decision or for instant gratification where they cannot wait for delivery of an online order. In such a case, the store associate becomes a crucial actor in ensuring customer needs are fulfilled in-store. The need for demonstrating good knowledge of the products and for clienteling with a contextual awareness of who the customer is becoming increasingly important. Tablet based solutions and associate enablement platforms that would empower associates with knowledge of products, inventory positions as well as customer at right business moments are being increasingly considered for high-touch segments – like luxury retail, white goods/ home improvement and custom ordering scenarios.
3. Innovation to create next-gen experiences
Innovation is most effective when there is real and tangible wow factor generated with customer/ end recipient. The physical stores are getting transformed to meet the changing demands of the next gen shoppers and provide custom shopping experience which they expect.
Proximity / In store marketing initiatives: Proximity Marketing, marks a new trend in retail business landscape. Beacons the tiny and inexpensive, micro-location-based technology devices send radio frequency signals and notify nearby Bluetooth devices of their presence and transmit information. Smart phones can capture the beacon signals and can estimate the distance by measuring received signal strength (RSSI). Based on the proximity of the customer the store associates can send targeted offers to the customers.
Interactive kiosks/ digital displays –The touch-screen enabled, large interactive kiosks or digital signages enable the transition of in store advertisement to sales. It increases the overall customer experience by entertaining customers during the wait time, increases traffic and sales potential.
Augmented reality enabled experiences: Virtual trial rooms, virtual makeover, virtual furnishing, gaming consoles are augmented reality experiences which can streamline your retail merchandising process in a more efficient manner.
Gamified Experiences: New age retailers identify gamification as a great way to get consumers interact with the brand in a holistic way. It uses game design thinking and mechanics in non-game context to engage users and impact their behavior. Nike fitness tracker is one of the examples of the successful gamified experiences in retail. Nike turned running into a data-driven social sport that gives users access to tons of data about their personal achievements through running.
Highly non-intrusive checkout processes: When it comes to in-store experiences, the customers demand for the speediest check out process instead of waiting for their turn in large queues. The 360 degree scanning technologies are the innovation in this space which allows the shoppers a faster check out. With fully automated Tunnel scanner, customers can keep the products in a conveyer belt and the products get scanned while moving fast through the tunnel. They will receive a receipt with the barcode, which can be scanned at self-checkout stations in the store pay the amount. Another innovation in this arena is the checkout mats, where the payment for items in bricks and mortar will occur through a network of sensors placed strategically around stores. These sensors will enable retailers to identify the customer when he/ she walks in. The stores will be having the preferred payment information regarding each customer in their files. The sensors are also attached with products also. This will help customers skipping the hassles of traditional check out process and walk out with their purchased products.
The most prominent characteristic and critical aspect of the digital age is not the shift in technology but the shift in customer behavior. At a time when customers are ready to pay money for experiences rather than ‘products’, and technologies are available to offer the experiences, stores will definitely get transformed into “experience centers” which lures the customers in. In this age of Omnichannel retail experience, digital transformation for retailers is not only about customer centricity, agility, innovation, data intelligence and new value propositions, but also about streamlining processes, reduce costs and improve efficiencies across the transactional cycle by transforming.
About the Author: Anitha Rajagopalan is a Principal Consultant with Happiest Minds Technologies. She has 11+ years of experience in the IT industry on Digital Transformation Strategy, Consulting and Thought leadership. Her expertise and interest lies in enabling Retail organizations build transformational Digital Commerce and Omnichannel Business Capabilities leveraging multiple technology levers’.
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