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In 2017, according to Credit Suisse, an unprecedented 8,600 stores closed down globally. The key reason behind this decline was the acceleration of technology and retailers’ ineptness at understanding and adapting to the pace of change. World over, brick-and-mortar retail is still the major contributor to the overall sales. Stores provide better connect, induce impulse shopping and are preferred by most shoppers. With the ubiquity of digital technology and heightening consumer expectations, retailers are under pressure to stay relevant and maintain an edge through aggressive focus on customer experience.
Smart spaces, in-store internet of things (IoT) and digital solutions can transform customer experiences by combining the best of both the worlds—physical and digital. It is now imperative to sell experiences and not just ‘things’, by modernising traditional channels through intelligent interactions and data-driven innovations.
Shopping experience for the connected shopper Today’s connected shopper seeks experiences from the retailers. You can see these in the form of fashion weeks and music festivals to yoga classes. In-store experiences bring the joy back into brick-and-mortar stores for the ecommerce-spirited generation.
The unique, personalised experience counts more when it comes to winning and retaining retail customers. Millennials frequently share unique experiences and are drawn towards fresh content. Retailers should therefore connect with customers and provide shareable shopping experiences.
Shoppers in major US retail stores can don virtual reality (VR) goggles to get a feel of the product. A multinational retail corporation hosted professional bull riders at its stores. An athletic apparel maker has taken to offering fitness instructions to draw customer attention. A leading clothing brand is using Snapchat in a fun, experience-based way by offering sneak peeks into their upcoming collections.
The customer is essentially purchasing excitement and a crowd and social experience.
Convenient and accessible shopping options
In-store shopping needs to surmount the limitations of location, payment modes, shopping areas and in-store shopping assistance. Peer-to-Peer (P2P) payments and digital wallets intend to make in-store purchases as breezy and hassle-free as their online counterparts. Self-service flexi pick-up lockers located in public places and pop-up stores have become the most adopted strategies by retailers to be omnipresent.
For example, Toshiba’s Touchless Commerce uses facial and three-dimentional (3D) recognition technologies to enable self-checkout. China’s leading ecommerce hub has opened 60 physical pop-up stores, powered by retail technologies such as augmented reality (AR) and mobile payments. One of the leading do-it-yourself (DIY) stores is set to mirror big box retail format using pop-up stores in India.
Not about the price anymore
Millennials do not choose their products based only on the price. They insist on buying quality products that last a lifetime, and prefer local goods that are a specialty in their regions. Millennials are patient shoppers—they don't only like deals, but also wait for the lowest price.
Unmanned ‘shopping-assistance’ of the future
Personalised assistance, such as robotic artificial intelligence (AI)-powered shop assistants, magic mirrors, in-store drones or smart trolleys, is one of the pivotal ways in which brick-and-mortar stores can fight customer attrition. Large departmental stores in the US are opting for self-checkouts. A large ecommerce company recently set up the first of its kind physical store sans any sales assistants. A great in-store experience can have a cumulative effect, generating a positive word of mouth, and increasing the likelihood of the consumer re-patronising the store.
While global retailers are ahead of the game with self-service technologies, Indian players are not behind. A department store chain recently tested an AR-based virtual dressing room solution in Mumbai last year. Checkout-free stores have also made an appearance over the last year. Many big retailers have piloted and adopted this model.
Digitally remodeled stores are essential for retailers to capture and sustain their changing customer base in a maturing market. Retailers should work on reinventing their retail spaces by putting the changing requirements of customers first, curating personalised experiences, and creating unbeatable shopping experiences that even ecommerce cannot match.
After all, human beings are social animals. As long as you can engage them, they will keep coming back to the store.
By Singaravelu Ekambaram, Global Delivery Head, Retail and Consumer Goods, Cognizant