How technology has changed commerce over the last 20 years?
In the past, relations between sellers and buyers were formed through personal interaction. The more time customers spend in the store, the more the seller understands their buying preferences and behavior. Sellers could predict which brands buyer A will prefer, at what time buyer B was most likely to appear, and so on. These ideas were then used to personalize the service and improve each buyer’s shopping experience.
However, this approach cannot go beyond a few buyers. The store, which takes more than 2000 visitors a day, can not maintain an effective personal relationship with all its customers. Nor can it use manual tools to accurately determine their customer preferences. Besides, data obtained from multiple customers can not be used to predict what random visitors who come from the street will prefer.
Online shopping has changed customers
The positive experiences with online shopping have changed customers forever: they are used to receiving an almost endless selection of goods, numerous detailed product information, clear statements about availability or delivery dates, and personalized suggestions with suitable additions or alternatives to a selected product. It is no wonder that almost 90 percent of consumers assume that most stores will offer digital services in the future.
Digital technology for a shopping experience with all the senses
A visit to a concept store Alexander Black shows how digital technology revitalizes the traditional store. Here, visitors can try on clothes and film them, and then judge their new outfit on a large screen or ask friends for their opinion via social media platforms.
When potential buyers place a product on a counter with an integrated touch-screen display, they automatically receive a lot of information about it — its origin, the materials used, available colors and care instructions. And, as with Amazon, recommendations.
Digitization in online retail and stores: More than concept studies
A pilot project at Gallerie Commerciali Italia proves that in-store digitization goes beyond concept studies. Business owners have implemented a combination of infrastructure services, customer relationship management (CRM), and in-store solutions in three shopping malls in Milan to increase the popularity and volumes of sold goods. A specially developed mobile app offers various services: customers can find their car in the parking garage more easily with the “Car Locator”, vote on music to be played in the shopping center, and receive personalized vouchers.
But that’s not all: the project also includes interactive promotion systems that address customers not only audiovisually but also via their sense of smell. The display columns, which are located at several points in the shopping center, recognize the gender and age of the customer via camera and can display corresponding offers.
For example, the lady sees a handbag from the current collection, and the promo column emits a subtle leather scent. The cheeseburger displayed to the hungry youngster smells deliciously of bacon.
In addition to the WLAN infrastructure, which can be used by visitors free of charge, were installed cameras and beacons. In such a way the operator of the shopping mall can see where many customers are, which paths they take, in front of which shop window they spend most of the time. This information can be used to make the mall even more attractive.
Digital Store on Wall Street
The British fashion label Thomas Pink has also recognized the importance of digital data for the store of the future. At its store on Wall Street in New York, the provider of exclusive menswear uses video sensors to record the movement of goods and visitors in the store. Big-data analyses are used to forecast the purchasing behavior of customers and to optimize store design and workflows. Thomas Pink also uses RFID tags to record almost 100% of the inventory. In this way, time-consuming manual inventories can be avoided, and even incorrectly sorted items of clothing can be found quickly.
Solutions like these require powerful information and communication infrastructure because it is not enough to offer visitors digital touchpoints in the store.
The Acuitas Digital Alliance includes BT, Intel, RetailNext, NexGen Packaging, SATO Global Solutions, and Valmarc Corporation. Together, the members of the alliance are already presenting the next digitalization scenario in Alexander Black’s New York demo store: an interactive changing room. The customer in the changing room will receive suggestions for suitable items of clothing via an interactive display. When the client selects via touchscreen what he or she wants to try, the salesperson receives a message on his or her smartphone or tablet. In the meantime, salespeople can attend to other customers in the salesroom. This increases staff efficiency and customer comfort. Just like in online retailing.
Digitization of online commerce: Five steps to a digitized store
Digital technologies offer a lot of opportunities for “real” retail stores. To use them successfully, retail companies need a clear concept and the appropriate measures to implement it:
- Involving digital customers: beacons can locate visitors in front of the store or in the store via Bluetooth and W-LAN.
- Support sales staff with mobile devices: because the online offer is always larger than the one in the store, a salesperson cannot know every alternative to every item. But he or she must have direct access to them when talking to customers.
- Digitize store logistics: when customers go into the store, they expect support and advice from the staff. To give them what they want, RFID tags provide real-time information. For example, a pair of shoes that a customer has put back in the wrong box can be found quickly.
- Protecting systems and data: the protection and security of all data in the store and throughout the corporate network are the basis for the functioning of the systems and the trust of the customer.
- Analyzing data consistently: customers who share their data with companies expect something in return — they want to be served faster, more personally and better. By consistently evaluating all relevant data with special analysis systems and implementing the insights gained in the process, companies are able to meet this expectation.
Ultimately, the technology has revolutionized the way buyers interact with sellers. Today, business owners have access to more customer information than in the past. Technology solutions also allow them to optimize their stores and operations for increased productivity.
In 20 years, technologies have changed the usual concept of commerce beyond recognition. At the beginning of this century, no one could think that stores would become so multifunctional, and their main goal would be customer comfort.
However, it’s important to stay in touch with your customers. This requires an optimal customer/staff ratio. Fortunately, retail analysis technologies provide the means to measure (and optimize) this performance in stores.