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.
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.
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.