Tomorrow‘s Digital Trends and Today’s Challenges
Technology has forever disrupted traditional retail models, and the emergence of the ‘digital store’ dominates today’s industry discussion. Most presentations at the upcoming NRF Big Show center on the topic, headlines proclaim it, analysts debate it, companies mandate it, and retail executives lose sleep over it.
What is the ‘digital store,’ and why all the buzz? Even in the Amazon age, the ‘clicks to bricks’ phenomenon and shoppers’ continued preference for shopping in physical locations demonstrate the enduring relevance of brick and mortar. But increasingly-connected consumers with heightened expectations are changing both its nature and its role. Today’s well-researched shoppers expect speed, choice, service, consistency, personalization, and engagement. For retailers, taking advantage of technological innovation in the brick and mortar store can break down barriers between physical and online experiences and realize this omnichannel ideal; the preferred incarnation of the digital store functions not only as a store—but also as a fulfillment center, showroom, and informative and entertaining experience. To benefit, retailers must keep a customer-centric focus and take care not to put flash before substance. Implementation strategy should 1) increase operational agility in the service of customers and 2) unlock new sources of value for customers.
Shopping With No Bounds
Customers want what they want, and they want it now. The digital store can give it to them. Some examples of agile in-store retailing include:
· Tools to support inventory visibility and accuracy, such as item-level RFID tagging, that deliver speed and options—turning individual store locations into fast-acting fulfillment centers for all channels · Endless aisle technologies that digitally extend shelf space and save sales by eliminating out-of-stocks · Store associates empowered with mPOS who further save sales, report inventory options across all channels to customers, and facilitate fast store-to-door delivery
· Applications to help associates prioritize tasks and work more efficiently while facilitating improved customer support
· Cross-channel efficiencies that enable greater investment in store associates—both in terms of training and compensation—and result in higher quality customer care
Personalized Shopping Experience
The more personalized the shopping experience, the more engaged the customer becomes. Customer analytics such as loyalty and CRM data, combined with the analysis of regional and demographic-specific shopping behaviors and online and social media trends, can power this customized journey: · Refined beacon transmissions, tailored to an individual’s shopping history and reflective of other specifics—such as weather, demographics, etc.,—can influence buying behavior · Interactive displays and smart dressing rooms can also deliver targeted suggestions that upsell, such as accessories to go with recently purchased outfits or alternate colors
· mPOS-enabled store associates can look up past purchase behavior and product specs in-aisle to influence decisions
· Customers can access fit recommendations through kiosks or other interactive displays based on personalized data
Inspiration and Excitement
The ‘bells and whistles’ of in-store technology, when adding real value to the customer experience, can further drive engagement. Possibilities include: · Customization pop-ups and kiosks that work smoothly and deliver a breadth and depth of options
· Merchandising displays that allow for real interactivity with products through a variety of media
· Informative and entertaining videos · Digital dressing rooms that allow for virtual try-on of additional sizes and colors
Retailers can use digital tools to not only enhance the real-time shopping experience for customers, but to collect data to refine and improve such experiences for the future.
Challenges and Solutions
Unfortunately, despite the promise and potential of in-store technologies, a gap exists between the real and the ideal. In his recent report ‘The Future of the Digital Store,’ Forrester’s Adam Silverman cites multiple barriers to adoption in most physical stores. These include:
· Insufficient in-store internet and Wi-Fi access that prevents customers and associates from leveraging digital technologies
· In-store retail systems that traditionally focus on transaction and inventory data, not customer behavior—creating a deficit of vital information needed to successfully drive engagement and influence shopping behaviors
· Siloed departments often structured at cross purposes with omnichannel initiatives; for example, buy online/pick up in store and buy online/ship from store campaigns require in-store associates to fulfil orders while online teams get credit for the sales, and endless aisle conversions require DCs or other retail locations to do work for sales credited to in-store associates
In order to overcome such challenges, Silverman recommends a phased transformation through a holistic digital strategy—one that accounts for each business’ particular priorities, capabilities and culture. Piecemeal adoptions of trending technologies without necessary cross channel integrations, drop ship solutions, data collection and analysis may result in consumer dis-engagement rather than the advantages of a well-founded digital store.
Streamlined and integration-friendly supply chain processes facilitate seamless supplier-retailer relationships—a prerequisite for successful digital store campaigns and omnichannel initiatives in general. eZCom’s EDI solution Lingo offers award winning drop ship solutions to support endless aisle and save-the-sale programs (as well as eCommerce based direct-to-consumer sales); Lingo’s Double Validation™ ensures supplier compliance to all retailer trading guidelines, further guaranteeing the exceptionally fast and accurate order management needed for successful omnichannel commerce; and quick-turn, expert customer service further sustains smooth and error-free supplier/retailer relationships. Newer retailer-centric technologies such as item-level RFID tagging and Made to Order (MTO) manufacturing processes are also integrated into Lingo EDI software ensuring that retailers can increase customer satisfaction with improved product tracking or quick-turn and 100% custom item production.