Digital-First Retail
Retail Technology

The Rise of Digital-First Retail

The pandemic has forced businesses to make sudden changes in how they operate. One of the most dramatic changes for retail stores is the shift to digital-first retail policies. Here's a look at what digital-first means for resilient stores determined to survive the economic crisis.


Digital-First Business Models Help Preserve Market Relevance

Immediately after the pandemic broke out in 2020, customer foot traffic dropped by over 82 percent across the country. Suddenly there was a surge in demand for online shopping, which led to many stores issuing new customer apps. Another significant development due to the pandemic has been the growing adoption of contactless payments.

As to whether or not the rush to digital-first retail made up for lost sales, the results are mixed for different retailers. For apparel manufacturer Levi Strauss & Co., e-commerce grew by 52 percent in the third quarter of 2020. By contrast, overall sales for the same quarter declined by 27 percent year-over-year. Similarly, Office Depot saw a 20 percent spike in e-commerce for the quarter, yet an overall sales decline of 9 percent.

Retailers cannot ignore the reason why consumers have chosen online shopping: mainly for convenience. Baby boomers turned out to be the most active age group to increase online transactions since the pandemic began, according to a survey published by The Economist. Online spending increased from 25 percent to 37 percent for baby boomers, compared with Gen X spending, which jumped from 39 percent to 47 percent.


Why Digital-First Brands Are Turning to Brick & Mortar Stores

A pure digital strategy for retail doesn't work. A digital-first strategy also has its limitations. Hence digital brands are now focusing again on brick & mortar. At the same time, the combination of both digital and physical sales strategies is a compelling plan for business survival. The key is to provide online experiences in a physical store.

The connected brick & mortar store benefits from faster checkouts, greater workforce productivity and better conversion rates. It helps turn inventory faster and leads to overall stronger output. The concept of the connected store appears to be here to stay as an increasing number of stores are emphasizing this digital and physical sales blend.

Even digitally native brands that initially sought to disrupt markets online have turned back to brick & mortar to extend growth. Eyewear maker Warby Parker, for example, launched in 2010 as an online store that provided alternatives to big competitor Luxottica. Over a decade later Warby Parker owns 145 stores and builds new stores to drive further profits.

The euphoria of disrupting markets with e-commerce-only websites has worn off. Many consumers still want to visit physical stores to examine and perhaps try out new products. Brick & mortar stores also help attract new customers who may live or work in the neighborhood. Since the cost of acquiring new customers keeps rising, for some businesses it's worth having a physical storefront to interact with customers in-person.

Another option for a direct-to-consumer (DTC) retailer is to partner with a wholesaler that provides supplies to small distribution hubs. Many consumers prefer not to get packages sent directly to their residence. They want to make sure the product is delivered directly to a pick-up location to ensure it arrives at the right place on time.


Ways COVID-19 Has Changed Long-Term Consumer Behavior

COVID-19 changed several patterns in consumer behavior, from increasing online purchases to spending more time reading reviews. Here are some of the biggest changes that have occurred in consumer behavior due to the pandemic.

  1. Rise of Self-Servicing - Not only is self-servicing a viable solution to labor shortages, it can provide greater convenience for the shopper. Purchases can often be made faster in self-checkout lines. Growing strategies that blend online ordering with physical pick-up locations include BOPIS (buy online pick up in store) and BOSS (buy online and ship to store).
  2. AR & VR Stations - Augmented reality and virtual reality are effective emerging visual technologies that allow customers to try out new products in a virtual environment. Wearing a headset to see panoramic views is useful for real estate firms, as well as car dealerships and clothing stores. IKEA uses VR to promote kitchen interiors.
  3. Online Payments - Since the pandemic broke out, consumers have made major transitions toward online payments through services such as PayPal and ApplePay. Contactless payments promote social distancing and have become more widespread, particularly in supermarkets, restaurants and hotels. Digital gift cards will likely continue to proliferate in the future as a more convenient way to shop for and distribute gifts.
  4. Higher Demand for Local Stores - Consumers have become less mobile due to the pandemic but still rely on stores in their neighborhoods for daily needs. Since many small businesses shut down during the pandemic, competition has tightened. The supply chain crisis has added pressure on local shops to devise new strategic inventory methods. With less supplies available to the public for national brands, demand has increased for local alternatives.
  5. Greater Privacy Concerns - These days, cybersecurity is a major concern as it probably always will be in the future. One security breach can wipe out a business if it hasn't taken precautionary and proactive steps to protect data. It's imperative for all businesses that engage in e-commerce and store confidential data to use the most robust cybersecurity solutions available.
  6. Less Room for Errors - Fast delivery is what consumers now expect after becoming well acquainted with online ordering. Since alternatives can be found quickly in a matter of clicks, customer satisfaction has become a top priority for many brands. While the supply chain crisis has been responsible for slowdowns and shortages in product and material supplies, brands must still find ways to innovate in terms of distribution. Consumers simply have developed a low tolerance for late shipments and other errors.
  7. More Personalized Brands - Customers like to be acknowledged as supporters by the brands they choose. So there's been a growing trend toward personalization and customization in terms of brands interacting with customers. A brand can use customer relationship management (CRM) software to develop customer profiles that lead to more personalized experiences.


Conclusion

Even after the pandemic, businesses will be challenged to mix digital and physical environments in the pursuit to reach as many customers as possible. Retailers need to remember that while digital-first retailing allows for reaching a 24/7 global market, having a local physical presence helps nurture and maintain loyal customers.

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Omni channel Experiences
Retail Technology

How NFTs, AR and VR Are Transforming Retail Experiences | Retail Trends

NFTs can be used to buy and sell visual art, music, products and online collectibles. The acronym stands for "non-fungible tokens", which represent a modern method for buying and selling digital products online. What are the chances of NFTs playing a role in the future of retail? They've already been adopted by major brands from Taco Bell to Gucci. Here's a look at how NFTs and other types of retail tech trends contribute to the omnichannel shopping experience.


Why Are NFTs Gaining Popularity?

The perceived value of NFTs changes over time, as well as every time an "item" changes hands. So NFTs include a feature that pays creators a percentage every time an item is sold, which helps artists who want to develop revenue streams for their digital products. These products may include songs, videos, photos, paintings, and audio.

Another reason NFTs are becoming popular is because they are part of an emerging new digital ecosystem that includes blockchain and other game-changing technologies. NFTs, for example, are stored on a blockchain. Now there are sites such as Circle and Boson Protocol aiming to embrace all forms of digital commerce. Another new digital concept is the NFT voucher, which holds funds from buyers and sellers until both parties agree on terms for triggering transactions.


How Brands are Using NFTs

Since NFTs have caught the attention of online shoppers, it's now worthwhile for brands to invest in or use NFTs to capitalize on the growing excitement surrounding them. NFTs are designed to encourage interaction with followers, which can help develop greater brand loyalty. These digital products can create closer bonds between brands and fans. In that sense, buying an NFT is mainly a digital vote for the brand.


How NFTs Create Scarcity and Fulfill a Need

Part of the intriguing mystique behind NFTs is that they create both scarcity and exclusivity. An NFT, for example, may be a series of unique items only available to a short list of followers. Artists can offer NFTs exclusively to fan club members or podcast subscribers, which creates a special connection. Another option is for artists to sell licenses for using digital or associated items.

Digital scarcity can be created in numerous ways. Twitter CEO Jack Dorsey turned his first tweet into an NFT and auctioned it for $2.9 million. Luxury art speculation is on the rise, as it's possible for artists to command high value based on the belief they will become profitable, famous, and influential. Another example is when a creator establishes partnerships to create exclusive art for different companies.

NFTs that attract the most demand fulfill a need that hasn't been previously met online, such as offering a picture that captures the spirit of current news or issues. There's a need among social media users to find digital art they can share with their communities.


How NFTs Impact the Resale Market

NFTs are not limited to representing digital experiences, as they can associate with physical assets, such as unique attire in the fashion world. In the real world, the resale market attracts luxury buyers looking for good deals. These people support all forms of art and fashion. They seek to maximize their investments by bargain hunting for used items. The same concept is being applied digitally to NFTs.

Since an NFT associates with a digital timestamp, it can be used in various ways as proof of purchase for a physical item. Not only can it be used as a ticket to a show, but it can also be used as a membership card for exclusive events. In that sense, it's possible to buy then resell a ticket to a big event for a profit without ever leaving home. An NFT's creator can collect money every time the digital item is resold, similar to a royalty payment.

There's a good chance for NFTs to expand more in the resale market, which can create more excitement for people who participate. Buying and selling digital products can become a seamless online activity that generates new revenues streams for individuals and businesses. At the heart of this innovation is blockchain technology, which has already ushered in methods for creating countless new markets.


Are NFTs the Future of Retail?

NFTs have been around since 2014, but only started to gain wide attention in the early 2020s. By the third quarter of 2021, the trading of NFTs surpassed $10 billion. Clearly, there is growing market demand to buy and sell digital assets, which can be anything imaginable in the digital realm--- from games to cartoons, news clippings, poems and films.

Each NFT is unique in some way, which is part of how it gains value among a following. Since the playing field is wide open for any art form to be monetized as an NFT, it's likely that interest will grow for creative ways to build digital commerce.

The awareness about NFTs is rising. A recent Morning Consult report survey found 15 percent of males claimed to collect NFTs while only 4 percent of females said they were collectors. These female collectors often invest in high fashion NFTs. Meanwhile, crypto enthusiasts are helping spread the word about the digital marketplace. In the past, niche markets have supported the evolution of NFTs, which are expected to generate $240 billion per year by 2030.

In 2022 McKinsey & Company issued its State of Fashion report that predicted NFTs would likely enter the retail trends within the year. At the same time, retailers have major sustainability goals this decade while the physical nature of how blockchain technology uses excessive energy has become a controversial issue. That means brands will need to choose NFTs carefully to stay consistent with their sustainability goals.


Examples of AR/VR Used in Retail

Augmented reality and virtual reality have already transformed the way consumers interact with products. Nike has been a leading brand at providing AR/VR experiences in its stores, allowing customers to scan products for deeper information. Another AR/VR retail example is how IKEA's app allows customers to use their smartphone cameras to visualize how furniture might appear in their living rooms.

Apple has helped pave the way toward modern retail with its physical stores, which use AR to showcase iMacs, iPads, iPhones and other products. Meanwhile, automakers like BMW have capitalized on VR by providing dealerships with 3D goggles for panoramic viewing. Customers can view showrooms of various car models without the physical vehicles being onsite.

A "metaverse" marketplace has become the harvesting grounds for NFTs. Certain industries, such as 17 percent of fashion brands, have already experimented with the medium. Addidas recently entered the digital art arena with a collection of 30,000 NFTs called Into the Metaverse. As a form of virtual reality, the metaverse is quickly becoming populated with 3D experiences.


Omnichannel Retail for Seamless Shopping Experiences

Due to all the different forms of digital media, there's a need for retail businesses to consolidate this diversity within one cohesive infrastructure. It's further necessary to create seamless digital experiences for retail customers. Timberland has been an innovative clothing brand in pioneering seamless omnichannel shopping experiences. Customers get to use tablets in Timberland stores to create shopping wish lists they can send to their email.

The key to a seamless omnichannel retail experience for customers is to offer product information through different forms of media. All the customer needs is a mobile device to participate in various omnichannel experiences.


Conclusion

Clear advantages exist when aiming for omnichannel retail experiences that include NFTs and other new digital technology. Consumers are gaining increasing awareness about engagement with digital products and services. Meanwhile, businesses, artists and resellers of various offerings enjoy new ways to develop revenue streams, such as through NFTs. As new retail trends emerge online, opportunities are growing to earn money from home from crafting a collection of digital solutions.

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Retail marketing
Retail Technology

Omnichannel Retailing: Why Retailers Need to Transition to the Bricks-And-Clicks Business Model

A new retail model has emerged based on a hybrid of physical and digital sales known as "bricks-and-clicks". This concept has helped diminish market perceptions that the era of the brick-and-mortar store is over. The booming popularity of online shopping has been so disruptive that traditional retailers have decided to embrace the direction of modern consumer shopping trends. The offline-online hybrid store model is giving physical retailers a new life.


Reasons for Becoming a Bricks-and-Clicks Retailer

This new "click-and-mortar" business model is steadily gaining adoption by traditional retailers for multiple reasons. Despite declining in-store sales in 2020 due to the pandemic, many shoppers showed up in physical establishments based on internet research.

E-commerce purchasing accounted for about 12 percent of retail sales in 2020. This market segment can be further broken down into "buy online, pick up in-store" (BOPIS) and "ship-from-store" sales. In 2019, over 75 percent of Canadian holiday shoppers conducted online research with a mobile app as part of their purchasing process.

It's clear that consumers aren't about to stop using smartphones as part of the shopping experience. Since that's the case, physical retailers have a choice to make if they want to remain in competition with online retailers.


Bricks-And-Clicks Retailer Transformation

Since there are so many marketing channels available now to businesses, smaller companies may want to focus on specific channels. Larger companies are more likely to have adequate resources for venturing into widespread omnichannel marketing. Here are some of the channels used in the bricks-and-clicks space.

  • Online Storefronts - It's easy to set up professional online storefronts with existing platforms such as Shopify, Big Commerce, and WooCommerce. These sites provide tools and templates, although they require plenty of customization to avoid looking generic. Remember that mobile users, who are the most ready-to-buy shoppers, expect a mobile-friendly experience. Content must look clear on small screens.
  • Social Media Pages - One of the most powerful commercial uses of social media is brand building. Social media also allows for digital transactions with buyer and seller tools, as well as customized campaigns. The number of retailers using social media in the past decade has grown from below 20 percent to over 33 percent.
  • Third-Party Marketplaces - Amazon, eBay, and various other online marketplaces allow you to tap into existing markets of online shoppers. Listing products on these platforms can help move sales on a global level. These popular platforms bring millions of buyers and sellers together to potentially move products more quickly than other channels.
  • Comparison Shopping Engines - Similar to third-party marketplaces, comparison shopping engines allow consumers to compare prices and find the best deals. You can sell your products on these platforms through Google Shopping, PriceGrabber, and similar sites to compete in the comparison of products.

In order to maximize multiple channels in your marketing, you'll need to set up your backend operations for big data collection, which will generate plenty of analytics. You can then use the data to analyze the customer experience so you can make adjustments to your campaigns accordingly.


Bricks-and-Clicks Success Stories

Online stores have grabbed the headlines in recent years, so many physical establishments are responding by going more digital. Adopting a hybrid model is becoming more common. Here are a few merchants that have successfully transformed to selling online and offline:

  • Lammes Candies - Based in Austin, Texas, this candy store chain has five physical stores, each connected with e-commerce. In order to get an edge over the increased competition, it was vital for the brand to present itself with a modern interactive website. The brand has attracted interest by emphasizing relevance and authenticity in its content.
  • TYLER’S - Launched in 1978, this Tyler, Texas-based retailer has evolved from specializing in tennis and running products to aiming for a broader market. The brand now encompasses apparel, footwear, and accessories available in its nine Texas locations. Tyler's has sustained its market by enhancing the customer experience via social media retargeting on Facebook and Instagram. Other improvements have been made on navigation, search, email marketing, and fraud protection.


Conclusion

Transforming into a bricks-and-clicks operation can add new customers and longevity to your retail business. Owners must make sure the appropriate technology and tools are in place so that both store personnel and customers have a seamless experience that allows for physical and digital sales. This new model is already visible in the market and is setting new standards for retail.


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Small-Format Stores
Retail Technology

How Retailers Are Exploring the Benefits of Small-Format Stores

Despite the closing of malls and widespread business downsizing, the brighter side of the retail industry is streamlining toward more economical models, such as small-format stores.

These days, one of the top challenges for all retailers is to minimize costs while maximizing customer experience. One of the more effective ways to do that is to create broader market visibility with smaller, more personalized operations. Amazon, for example, has shown it's not just about online shopping, as it's opening a series of small-format stores. While the company already owns large warehouses around the United States, adding smaller outlets help Amazon specialize in various niches. These smaller storefronts are connected with the company's hub for processing orders.

Large retailers, like Amazon, are in an ideal position to adopt a more flexible business infrastructure that includes remotely connected smaller shops either within a physical establishment or beyond.

Here's a look at the main reasons why retailers are embracing the small store concept.


Most Common Reasons Brands Use Small Outlets

  • Less Square Footage Allows for More Stores - One of the reasons retailers are embracing small shops is to reduce rent cost for store space. A retailer no longer needs to showcase all its products in one big place, nor does it need to rely on square footage to market large products or limit the number of its stores.
  • Lower Costs Allow Better Customer Deals - The more a retailer can offer bargains to customers, the more revenue it can attract. By cutting costs associated with physical store space, businesses are in a better position to focus on customized marketing.
  • Opens Opportunities for Saturated Local Marketing - Placing smaller shops throughout a region raises a brand's profile among the local community. It allows for the brand to be exposed in more neighborhoods where it might not be as top-of-mind due to location. Even so, smaller shops can specialize in products based on location, such as offering limited apparel in residential areas.
  • Allows for More Customized Solutions - Personalization and customization are two of the most important features of modern digital marketing. Placing small stores in communities that bring the store and customer closer together allows a company to gather relevant information about customer needs to formulate custom offerings that suit their preferences.
  • Provides a Convenient Shopping Experience - The more convenience a store brings to its customers, such as opening small stores in relevant locations, the more word-of-mouth promotion is possible among customers themselves. Small store managers can corner geographic markets by learning the needs of a neighborhood.
  • Builds Greater Visibility - The more omnipresent a brand is, the wider the market of individuals it can attract. Strategic placement of small shops in the right neighborhoods allows greater access for customers to tap into customized products. At the same time, it provides greater access for the brand to reach new target customers. For example, mobile food trucks that move from neighborhood to neighborhood are paving the way for similar businesses.
  • Creates a More Diverse Customer Base - Setting up small pop-up shops that move around to different locations is a great way to increase the diversity of your customer base. Plus, as a mobile store isn't bound to showcase the same products day after day, as all products tend to be stored in a central warehouse, the products showcased on the shop floor can be changed often to attract new customers. Additionally, digital catalogs and virtual reality tools can be used at minimalistic, yet futuristic, physical storefronts as a way to present customers with everything in your catalog.

The rise of the small-format stores is in response to the popularity of mobile shopping and the need for retailers to cut high costs on square footage. It also promotes greater shopping convenience for and opens the door to more personalized engagements with customers. Merchandise does not need to be physically available at small shops, but retailers can still showcase their products and take orders using a number of mobile and digital solutions. Essentially, these minimalistic outlets contribute to increased efficiency, better customer interactions and enhanced market visibility.


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5G in Retail
Retail Technology

Significant Ways 5G Technology Will Transform Retail

Traditional physical stores are increasingly adapting to build more modernized environments. During the pandemic, digital transformation in retail has accelerated, meaning the industry is changing at a rapid pace.

In order to survive this evolving landscape, retailers, and particularly brick-and-mortar businesses, must transform to survive. Here's a look at what 5G will do to the retail industry in the coming years.


Strengthening Retail Operations

It's clear that 5G will be a game-changer for retailers to gain competitive edges over those that don't use it.

In terms of retail operations, a major advantage of 5G is its ability to help retailers manage the backend of their businesses through the widespread roll-out of IoT solutions that can help create more efficient operations. This is because a 5G connection can support more devices than 4G, while maintaining the same download speeds and latency.

The main revolution will be digital transformation of infrastructure so that companies have hybrid capabilities for serving both online and in-store shoppers. It will also improve the accuracy of real-time inventory tracking and give customers instant product information and reviews on their mobile devices.


Enhancing Customer Experiences

Beyond improving business operations, 5G can also help accelerate the use of emerging technologies that enhance the customer experience, including:

  • Augmented Reality (AR) - Physical objects and sensory perception can now be enhanced digitally with AR interactivity. This is where the real world and digital world meet. AR allows retailers to overlay virtual images on real-world scenes.
  • Virtual Reality (VR) - VR allows a user to be completely immersed in the digital realm while shutting out the physical world by wearing a headset. Retailers can use VR to give customers personalized video demonstrations of products and services.
    Mixed Reality (MR) - As a hybrid of virtual reality and augmented reality, MR allows physical and digital objects to coexist in real-time. It is ideal for visual marketing. MR takes retailers to a level of offering 3D interactive content for customers to learn about products and services.
  • In-Store Experience Augmentation - The use of augmentation in retail stores will allow customers to experience products and services in meaningful ways before they purchase them. Retailers can enhance customer experiences by using augmentation to notify salespeople or virtual shopping assistants when customers make requests for information or images of a product.
  • IoT Sensors - IoT sensors allow for facial recognition, a technology that helps retailers identify customers who enter their establishments and also helps document shoplifters through video. IoT sensor solutions will also be able to track orders in the supply chain and improve shipments to proper locations on time. Additionally, IoT sensors can help cut waste, track inventory in real-time, and streamline operations.
  • Integrated Advanced Analytics - Having access to a wealth of data about customers will allow retailers to offer a more customized experience for each shopper. Machine learning technology will help sort through structured and unstructured data on customers to provide recommendations.
  • NextGen Digital E-commerce - Modern e-commerce systems are being designed to improve the customer experience by facilitating various payment systems through wearables. It can potentially eliminate the need for point-of-sale checkout lines.

Even with the closing of physical stores around the country, the use of 5G in retail can help save brick-and-mortar businesses that embrace it. Since 5G will provide broader bandwidth and much higher transmission speeds, the internet will become a more seamless experience without latency. This means that retailers can capitalize on utilizing 5G to improve how their businesses operate, while innovating creative ways to use technology to make the shopping experience more enjoyable and seamless for customers.


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retail trends
Retail Technology

Retail Trends Disrupting Mini-Stores and Pop-Up Shops

Market disruption can come from retailers big or small and might even lead to retail trends that change the industry. Mini-stores and pop-up shops are examples of disruption from creative and innovative small businesses.

Here are ways mini-store and pop-up shops utilizing mobile technology challenge the traditional perception that more square footage is always better.


Mobility and Market Visibility

In many ways, smaller shops are demonstrating how company size doesn’t always define efficiency and profit margin. Small companies with the ability to move around town have huge opportunities to gain market visibility and promote themselves as local niche businesses. At the same time, there are opportunities available for large companies as well because they can invest in pop-up shops for the sake of cost-cutting and becoming more mobile in the market.

Regardless of company size, pop-up shops are highly useful for brand activation campaigns and have emerged as one of biggest retail trends over the last few years. These shops allow your company to engage more with new prospects and customers in various locations that can be promoted in local SEO strategies. Pop-up shops are also useful for testing new products in the market. The real estate industry, for example, is using these short-term shops to promote virtual experiences of properties from different remote locations.


Changing Big Retailers

Several box stores are expanding their business models to embrace smaller mobile units, such as booths and kiosks, to showcase store and product brands. IKEA is one of the leading large pioneers of the small store format with its IKEA Planning Studio. This lean model emphasizes order taking and shipping directly to the customer's home. The studio focuses on solutions for urban living and provides software tools for customers that help them plan bedroom and kitchen configurations with help from an expert.

The mini-store concept also eliminates the need for people to drive to a large warehouse to shop for large home building products. Target, for example, has figured out how to penetrate communities beyond its box stores by placing smaller stores in areas that attract college students.


Creating More Mobile Retail Outlets

Retail mobile trucks have rolled into the mix of expanding physical businesses beyond the limits of its fixed store location. Stores on wheels allow for increased brand visibility throughout a city or region. Brands can also introduce themselves to a much broader market, as mobile stores can be planned strategically to target relevant neighborhoods. Pedestrians are particularly attracted to pop-up shops to check out new products, which creates win-win relationships.

Additionally, pop-up shops can attract social media attention among local friends looking for deals or meet-up places. These shops can benefit by facilitating a mobile-friendly environment that allows for the exchange of contact information for coupons or other offerings. The more mobile these smaller stores get, the more they can promote themselves as "covering the entire market" to meet customer needs. The advancements in 5G, AI, and VR will also allow for even more amazing developments in mobile retail marketing.

Because of these advantages, pop-ups shops and mini-stores are among those retail trends that may stick around for a good while. The small store format is evolving to connect stores and customers more seamlessly and digitally without being tied to a static location. As a result, customers that do most of their shopping at brick-and-mortar establishments can expect an increasing number of leaner and more mobile shops to expand into their locales.


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smart retail
Retail Technology

Introducing the Smart Retail Revolution into Smart Cities

Smart technology has gained plenty of attention in recent years, paving the way for retailers to upgrade the brick-and-mortar shopping experience. Local governments are adopting smart city concepts for new digital infrastructures while retailers have quietly embraced IoT sensors that monitor the customer journey. Here are ways smart retailing inspired by smart city development will impact consumers.


How Retail Can Learn from Smart Cities

The concept of smart retail is a subset of smart cities with similar goals of establishing an interconnected ecosystem that improves physical processes with analytics. Retail management platforms are steadily integrating with IoT and AI technology to enhance the customer experience, as well as internal processes. Local governments and utility companies have already pioneered the smart city paradigm that has led to more efficient operations and deeper connections with the community.

Smart cities include digital parking meters and traffic control monitoring devices that connect with the internet to allow for real-time analysis of traffic conditions. Traffic officials can use this information to make rerouting decisions due to accidents, bad weather, or road conditions. Machine learning technology can recommend alternate routes in a matter of seconds. Retailers can use this model to evaluate patterns in their in-store foot traffic, learning which displays get the most attention.


Understanding Smart Retailing

At the core of smart retailing is a mobile app that connects the store with customers. Once customers download the app, they can stay connected with the store; the same way homeowners constantly remain connected with their utility provider through an app that monitors energy consumption. A useful store app can keep customers updated on store deals and other offerings based on their purchasing history.

Smart shops are essentially physical stores that embrace smart technology to create a more compelling and diverse customer experience. These stores are increasingly becoming integrated with digital catalogs and other visual resources that provide deeper insights on products for customers.

Technologies such as virtual reality (VR) and augmented reality (AR) are blurring the lines between the digital and physical worlds. Collectively, all this new technology contributes to a smart ecosystem.

The store app serves as a digital doorway into the brand. It can serve the same function a website does, providing a convenient resource to quickly answer customer questions. Smart shops can be automated with interactive displays, driven by AI software that embodies facial recognition. Self-service checkout currently is one of the more common smart retailing strategies.

Here are two major trends currently revolutionizing the retail industry:

  • Need for Simplified Organizational Processes - Retailers can use smart technology to refine and simplify organizational processes. Machine learning software can study mountains of data to detect system inefficiencies in seconds. The technology can further be used to improve communication within the organization and among customers. Retail management should consider a modern customer relationship management platform that provides an easy-to-read dashboard and integrates with data-gathering devices.
  • Discovering Seamless Ways to Sell - Smart technologies can help improve the sales funnel and connect the customer more closely with the product. Since experiencing the product is the most crucial part of the customer journey, retailers should explore virtual options alongside other ways to make the checkout process more seamless. Thinking beyond traditional physical limitations is the key to maximizing the emerging strategies of smart retailing, allowing for more mobile-friendly experiences.


Conclusion

The future of physical retail stores will depend on how smart retail develops within the constantly evolving world of smart cities. This modern retail vision builds from the increasing popularity of mobility and the need to create more personalized experiences for customers. The internet has overshadowed brick-and-mortar stores by providing solutions through clicks. In order for physical stores to compete, they must connect more with customers on a personal level through smart technology. Ultimately, the presence of connectivity at scale in smart cities will allow retailers to drive conversion by attracting and engaging with customers at the right time, in the right location, and with the right media.


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smart retail
Retail Technology

Smart Retail and Consumer Demand Drive Conversion in 2021

Over just a few months in 2020, consumers accelerated the retail technology vertical by several years. Remote work and contactless living massively disrupted buying habits and inventory demands as retailers scrambled to accommodate the explosion of online orders. It's been a steep learning curve, but consumers have quickly adapted to the convenience of online shopping, and retailers are recognizing the competitive benefits of using automation and IoT technology.


Convenience Beats Low Prices

The use of IoT technology in retail is creating new ways of attracting customers with conversion strategies that weren’t available a decade ago. The saturated world of online shopping means that loyalty is no longer tied to prices and products. 97% of consumers have abandoned a purchase because the service wasn't convenient enough, showing that e-commerce needs to compete on more than price. If retailers are to be successful, then their next frontier will be creating and building loyalty through engaging customer experiences.

As consumers have become more digitized, they have developed a different relationship with physical stores than previous generations. Additionally, shelter in place and social distancing measures have significantly increased the demand for retail experiences that minimize in-store proximity to other people. Between physical stores, websites, social media, and mobile apps, more channels and technologies are available to drive customer conversion than ever before.


Click and Mortar Business Models

In the future, stores will behave like websites, and websites more like stores. The challenge for retailers and distributors is to decide which technological solution is the most appropriate for their needs. Retailers will need to engage with customers whether they show up in-person or online and do a better job than the competition. Many new retail automation technologies are emerging to fill this need and enable the future of retail.

Retail Technology Applications:

  • Product History
  • Loyalty Rewards
  • Remote Management
  • Product Reordering
  • Brand Protection
  • Loss Prevention
  • Personalized Recommendations
  • Inventory Management

Every company's approach to automation will be different based on the staff's level of technical sophistication. So the best strategy is to design your customer experience, then add technology to enhance it. One of the fastest growing service areas is Buy Online Pick Up in Store (BOPUS), also known as “click and collect.” It provides customers the convenience of shopping online with the speed of picking up in-store or curbside from the safety of their vehicle. Multiple solutions can be addressed using IoT and automation technology to help retailers create a frictionless customer experience.


Hyper-Personalization

Modern consumers expect companies to know their individual needs and personalize their experience. Retailers who can provide these experiences through technology will have higher customer satisfaction rates to drive loyalty and return visits.

In order to customize experiences, retailers will need to keep track of customer behavior. Data on what they purchase, when, and how often allows retailers to address customer needs proactively. The ability to simulate alternative decisions with AI and study high volumes of data to predict the best outcome with machine learning creates the feedback loops that power personalization at scale. When customers share things about themselves, it allows retailers to make better product recommendations, and project inventory needs with greater accuracy to prevent supply chain bottlenecks.


Store Associates Wanted

As technology automates more retail activities, we will see an evolution of the store associate. With less mundane tasks to complete, there will be room for creating new roles and cross-training to perform other in-store activities around customer service or picking online orders. Up skilling will also be necessary for stores using augmented reality shopping tools and newly implemented POS systems.

Store associates are the greatest asset to in-store sales because having great associates helps drive customer loyalty. People like one-on-one relationships, and smart retailers know they can never underestimate the value of human interaction. More retailers will start to turn their focus in-house, making sure employees are passionate about the company and more engaged to provide that exceptional customer experience.


Looking Forward

The future of customer service will be proactive rather than reactionary. Previously, more emphasis was placed on using data to learn what happened in the past, which was important for operations and budgeting. Unfortunately, demand volatility has prompted new ways of doing business that require taking a holistic rather than a historical view to anticipate customer behavior. In the new retail environment, the focus will shift to predictive metrics that can be used to influence business decisions in marketing, management, and product development.

What do the experts have to say about the future of retail? Find out by joining our webinar Rethinking Retail with IoT on Thursday, January 21, 2020.


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augmented shopping
Retail Technology

How AR Shopping Improves Customer Experience

Retailers are now embracing augmented shopping to bring customers a more enhanced and futuristic journey. New technologies like Augmented Reality (AR) and Virtual Reality (VR) are building a competitive edge over stores that ignore this digital transformation. Here are ways this unstoppable revolution is impacting the retail industry.


Creating Smart Shopping Environments with AR and VR

The evolution of augmented shopping is in its early stages, but its adoption in retail is steadily spreading. It facilitates the consumer's ambition to learn as much about a product before committing to an expense, which helps give them peace of mind they've made the right decision.

Some of the pioneers leading the way to inspire AR/VR deployment include retail giants IKEA, Wayfair, and Lowe's. Now that these companies have shown how the technologies work and can improve the customer experience, more stores are jumping on board. Not only will augmented reality improve the physical in-store experience, but it will also provide flexibility for customers to test new products at home before deciding to visit the store.


Modern AR/VR Use Cases

  • In-Store Navigation at Lowe's - Home improvement store Lowe's was one of the first retailers to utilize the AR-based in-store navigation app concept. It allows users to navigate through big stores, providing optimized routes. It can further direct a customer toward discounts and items the customer might want based on their purchasing history.
  • Crocs on Smartphone Screens - Foam shoe manufacturer Crocs provides an app that lets customers view product details by holding their smartphone camera over the product.
    Nike's "Try-Before-Buy" Approach - The shoe maker's AR app lets customers measure their feet and find recommendations for shoes based on key factors such as foot size and shape, lacing, and shoe materials.
  • Furniture fitting at IKEA - Furniture retailer IKEA has launched a proprietary app which allows customers to view what furniture would look like in their homes. The 3D experience creates a perception of walking around or sitting in the room while interacting with objects.
  • VR via Softengi's Real Estate App - IT provider Softengi develops custom software for various industries including real estate. The firm has designed a real estate app to allow homebuyers the chance to witness the time-lapse photography of the home's construction via a VR headset.
  • Audi's London VR showroom - Automaker Audi creates a virtual environment for customers that allows them to test-drive a new car wearing VR glasses without ever physically stepping outside the showroom. This technology eliminates the need for actual vehicles to take up so much floor space.


Outlook for AR and VR Applications

The future of AR and VR looks clear for retailers. Within the next few years, over 120,000 stores will invest in AR to account for as much as 3 percent of store revenue. Better product imagery is a proven way to increase conversions as people process images 60 times faster than words. Once consumers become aware of these technologies for an enhanced shopping experience, they may not want to go back to the old world. Trying items before you buy is often the key that converts sales, which retailers cannot ignore.

Perhaps the most appealing aspect of what these virtual technologies offer is that they open the door for more customization and engagement. Customers can now try on new clothes at an accelerated pace to evaluate more choices in less time. The technology allows for customers to even walk virtually through warehouses to view hundreds of items. Retailers no longer need to invest in large and capital-intensive physical locations. Future malls will likely be a collection of showrooms without inventory, dedicated to immersive product experiences.


Conclusion

The retail industry views augmented shopping as an opportunity to delight increasingly tech-savvy customers on a more compelling level. It will give customers a chance to learn about and experience products in profound ways that didn't exist before. So look for AR and VR to revolutionize the shopping experience to make in-store and online experiences more memorable and enjoyable.


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retail pos system
Retail Technology

Painless Checkouts: The Rise of the Retail POS System

The evolution of the retail POS system has accelerated in recent years to make physical checkout a frictionless experience. Retailers know that long checkout lines can lead to lost customers, so they are steadily embracing more mobile-oriented point-of-sale technology that cuts down on customer wait time.


How a Mobile POS System Facilitates Remote Sales

A mobile POS system is one that can move around within or outside a physical store. It allows employees to accept purchases from a remote location through a mobile device. Apple has been an early pioneer in using this system at its stores. This technology has a direct impact on improving the customer experience in a personalized manner. Here are ways POS technologies are revolutionizing the retail industry.

  • Take Pressure Off Employees - Going mobile with POS reduces the long lines that trigger excessive customer complaints. Employees will be more productive toward company goals as engagement time with customers improves. Long checkout lines can intimidate employees as much as customers, whereas a mobile checkout solution eases the process on both ends.
  • Shift Smoothly from Inquiry to Sale - A single employee can seamlessly manage the complete customer journey with help from a mobile device. The employee can answer easy to complex questions, drawing from a primary menu of digital resources. Once the customer has decided to make a purchase, the same employee can process the transaction.
  • Add Flexibility to Sales - Instead of one stationary terminal that shoppers must pass through, sales transactions can occur with more flexibility. Now customers have multiple checkout options and less reason to walk out of the store frustrated.
  • Make Stores More Digitally Resourceful - By increasing their digital and mobile capabilities, stores can gather more data to generate valuable analytics. POS systems can help collect contact information and other data on shoppers that can be used for market research and reaching out to customers in a more personalized manner. It also transforms business models toward greater sustainability and less need for paper consumption.


Learning from Mobile POS System Innovators

So far, small and mid-sized companies have mostly led the charge toward mobile POS systems, although a handful of giants such as Apple and Warby Parker have been leaders as well. They've helped pave the way for advancing the mobile retail POS system as an eventual retail industry standard. One of the reasons Apple stores are so successful is because their floor teams are equipped with mobile devices to approach customers ready to answer basic questions.

Apple's retail model frees up floor space and eliminates the need to make a stationary POS the store's focal point. Warby Parker uses a similar model of well-trained sales agents approaching in-store customers with tablets to take orders. Brick-and-mortar retailers that follow the models set by these early mobile POS pioneers will gain a competitive edge over stores that resist the new direction.

Would you prefer purchasing endless paper rolls for receipts or cutting that expense and sending email receipts instead? Do you want to end long checkout lines that give buyers time to change their minds on purchasing decisions? Allowing customers to complete the in-store buying journey with mobile pos technology is the clear direction for retailers in the years to come.


Conclusion

The modern mobile retail POS system is steadily advancing with substantial opportunities for future growth. It should not be considered a gimmick or a trend, as this system is poised to take over the retail industry. The reason is simple: it dramatically improves the customer experience compared with long lines that waste time. Nowadays, this checkout process makes life much easier for retailers, employees, and customers who will begin to prefer stores that adopt mobile POS technology.


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