As omni-channel retail press goes, online retail seems to get all the glory and physical stores all the doom. Retailers have been bombarded by a constant stream of statistics threatening their high street presence. The online marketplace is growing fast – with the UK expected to spend more than £100 billion online this year. As a result, Savills estate agents is estimating there are currently 30,000 empty shops in Britain and Deloitte is predicting that by 2020, the remaining physical stores will mostly act as product showrooms. Given the evidence, it’s no surprise retailers are concerned their online sales will cannibalise in-store revenues.
However, technology does not have to be the ‘death knell’ for the high street. With the emergence of engaging in store technologies and new contactless devices such as Apple Pay, for retailers that connect the omni-channel dots, it is possible – and profitable – to turn digital footfall into a high street reality.
Bridging the cross-channel divide
Retailers today need to understand the complex and evolving relationship between consumers and their technology. Today we carry access to virtually the entire world in our back pockets. In the UK we now have an average 5.4 devices, allowing us to shop online 24/7 across multiple platforms. We might start our retail journey on a tablet, browsing the internet for product ideas over breakfast. This can translate to a PC or laptop at work, a smartphone during our commute home, and then back to the tablet when we’re in front of the TV in the evening. Having got a few ideas for a purchase, we might then visit a store at the weekend to see the products in the flesh, but then find the best deal online before paying. With the emerging popularity of new technologies such as smart TVs and wearables such as the Apple Watch, this trend is only set to intensify. Retailers need to demonstrate cross-channel continuity in order to bridge the gap between their bricks and mortar business and the online world.
Technology as a means, not just an end
To do this, many retailers are meeting digital with digital. They are layering interactive touch-points, web-enabled touch displays and connected kiosks into their stores. M&S has introduced ‘browse and order’ hubs to stores and Argos is replacing its traditional laminate catalogues with iPads allowing easy navigation, fast track options and free Wi-Fi. Pickers in Argos have already started to find the products before the customer has finished paying. In future, we will start to see supermarket products with ‘i-tags’ or ‘smart labels’ and shelves will be packed with sensors to highlight the best wine to go with the ingredients in our trolley or highlighting products containing peanuts to a shopper with an allergy. In each case, it’s important that retailers let technology be the enabler not the end result.
The recent launch of Apple Pay in the UK is set to bring an integrated mobile wallet to consumers, providing them with a faster in-store checkout service and, as a result, a more convenient retail experience. In fact, Forrester expects the UK adoption of Apple Pay to be faster than in the US, due to our mature contactless ecosystem and support from high profile partners such as Transport for London.
To be effective, an omni-channel strategy should make the shoppers the centre of the retail equation. Click and collect services are testament to this as it gives customers the ultimate convenience of browsing online for the best deal, but collecting products at a time of their choice, rather than waiting at home for a delivery. At PC World, products can be available for collection in as little as one hour. This is an effective strategy for the retailer. According to the 2014 Pulse of the Online Shopper report, 54 per cent of online shoppers have had items delivered to a store. 43 per cent have then made additional purchases when they went in-store to collect.
Data transparency to see through the customer experience
In order for omni-channel to be convenient for the customer, and ultimately profitable, centralised data and integrated order management, POS and CRM applications are essential. This makes real-time stock data visible to customers on their home PCs and customer data visible to in-store staff so that sales assistants can recommend appropriate products to them when they visit the store. In a recent Forrester study, 71 per cent of consumers said the ability to check stock availability is important for their retail experience. However, only 32 per cent of the retailers surveyed actually had this capability on their e-commerce sites. This 32 per cent are clearly more likely to become the ‘go-to’ brand for consumers looking for convenient product gratification.
Along with boosting customer convenience, technology can allow retailers to increase dwell time in store, enhancing the customer experience. To do exactly this, Regent Street has started rolling out a mobile retail initiative. The £1 billion modernisation programme is seeing beacons installed at the likes of Hamley’s, Longchamp and Hugo Boss on Regent Street. When a customer steps into the store, these beacons connect to their smartphone or smartwatch via Bluetooth, send the customer personalised offers and point them towards relevant products based on their purchase history. Once again the theme of data visibility is prevalent here. Beacon technology allows retailers to collect essential data about customers as they track their journey through the shop. So, if a customer is spending a long time in the Lego department at Hamley’s, the retailer can target that customer with Lego offers online, translating the experience across multiple platforms.
Embrace IT and thrive
For brick and mortar retailers with e-commerce sites, the steps to achieving the sought-after status of omni-channel are many and variable. Whichever route a retailer chooses to take, it’s important to keep the shopper central to its plans. Understanding the customer’s purchase history and how they like to buy and collect their products is key. Whether a retailer chooses click and collect, beacons, i-tags, connected kiosks or all of the above, cross-channel data visibility is vital to make the omni-channel work effectively. In today’s saturated sales environment omni-channel technology doesn’t have to be a matter of ‘embrace it or die’. Rather, it’s fast becoming a matter of ‘embrace it and thrive.’