The retail experience is getting a faceliftBY Australian Retailers Association
No business has proven to be immune to disruption, but bricks-and-mortar retailers have been something of a canary down the coal mine into how disruptive the move to online and cloud can be.
Data from the ABS suggests that online retail continues its march forward, making up 6.1% of total retail spending in July – the same as was recorded in June, and up from 5.5% in May – despite overall retail sales figures inclusive of physical stores falling 0.1% from June to July.
But retailers don’t have their heads in the sand on the issue and are trialling new ways to connect with their customers to bring them back to the physical shop floor. Autonomous shopping in physical stores, blending the digital and physical experience within traditional bricks-and-mortar stores, and technologies such as voice commerce are beginning to emerge which will change the way we shop in-store.
The caveat emptor is that these new systems will bring potential concerns around complexity and a possible lack of interoperability. How will these systems communicate and work with existing systems?
But first, let’s dive into the benefits, which could be profound and reverse the fall in foot traffic.
Blending Two Worlds
If consumers are immersed in the digital world, why not extend that experience in a bricks-and-mortar store?
There are a few ways to blend the two worlds. ‘Endless aisle’ shopping via in-store kiosks and mobile web access points lets customers browse and buy goods that are not in stock within the store. Equipping sales staff with quick access to individual and inventory data helps personalise the customer experience and ‘save the sale’ by checking other stores for inventory, competitors for price matching, or assisting online purchases.
Take Sephora, which operates over 2,500 stores worldwide. Sephora offers a digital makeover guide that blends technology and personal time with a beauty advisor to provide tailored makeover options and images displayed on the phone. The retailer’s in-store makeovers are then electronically captured into the customer profile to aid product purchases, resulting in– personalised relationships.
Autonomous or Cashierless Shopping
New to the retail game is autonomous “grab and go” shopping. Take Amazon Go, which is trialling the approach with physical stores: consumers with the mobile app can walk into any Amazon Go store, select products and walk out – the “virtual cart” does the rest.
Startups such as Grabango, Standard Cognition, Trigo Vision, and Zippin have opened stores or are partnering with retail brands to bring autonomous shopping into traditional stores, taking the legwork out of it for retailers.
Customers know what they want; some retailers are happy to go out of their way to provide the seamless experience customers desire, and those retailers stand to differentiate and tailor to a specific market of shoppers.
Voice commerce, which lets shoppers select and buy goods via a digital assistant, adds a new channel to traditional in-person and digital purchasing. Amazon’s Alexa devices allow consumers to browse, purchase and reorder products through speech. And AI-driven Alexa will recommend products based on consumer history.
Google is also moving quickly into voice commerce. Officeworks and Woolworths are just two examples of retailers taking the lead on the voice commerce front through integrating offerings with Google Assistant.
Ensuring Interoperability to Limit Complexity
The accelerating speed of innovation in retail depends in large part on integrating information and applications so that processes run seamlessly and reliably.
How does a blended experience communicate with the point of sale? What about the back-end and digital assistants?
These experiences will only deliver benefits if they can provide the right data at the right time to each integrated application and individual involved in a process. This accelerates the speed of retail and equips merchants to delight customers, drive sales, and achieve new cost efficiencies.
If this isn’t possible, the customer experience will ultimately be siloed from the rest of the business.
While the customer experience is paramount, unless there is a benefit to the business itself, retailers are digitally transforming for the sake of it, at a high cost, and at a time when retail is facing headwinds, and margins are slimmer than ever. Retailers need to innovate, but in an integrated manner to establish a sustainable system.
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ABOUT THE AUTHOR
Australian Retailers Association
Founded in 1903, the Australian Retailers Association (ARA) is Australia’s largest retail association representing Australia’s $320 billion sector, which employs more than 1.3 million people. As the retail industry’s peak representative body, the ARA works to ensure retail success by informing, protecting, advocating, educating, and saving money for its 7,500 independent and national retail members throughout Australia. For more information, visit www.retail.org.au or call 1300 368 041.