The Government's newly released National Innovation and Science Agenda shows that for economic growth to continue within Australia, an 'innovation ecosystem' must be fostered, where new businesses with new ideas are encouraged to grow and flourish. With every company wanting to increase, retain or improve their customers’ experiences, this makes marketing vital to fuelling Australia's ideas boom.
High-end department store Neiman Marcus wants to improve more than its customer online buying experience. The company is working to use technology to merge its online and brick-and-mortar efforts.
For some retailers, tech isn't just about creating a better e-commerce experience. It's about bringing brick and click together to create a whole new shopping experience and to provide retailers with more information about their customers.
Neiman Marcus has been testing Bluetooth beacons -- think of wireless nodes that act as little GPS locators and communicate with the app on the customer's phone -- to guide the customer to in-store sales. But the company wants to go further.
"A lot of [what we're doing] has been about trying to bring the things that online has to offer into the store," said Scott Emmons, enterprise architect of Neiman Marcus' innovation lab, called iLab. "I think it's safe to say our e-comm team has been on the leading edge, taking advantage of technologies as they come along and mature. What I do see happening is we are focused on taking advantage of delivering new experiences in the store, too."
For many retailers, using technology meant finding ways to bring in more dollars through online shopping. That view has changed, and some retailers are looking for ways to make shopping an overall experience that includes online buying, mobile devices to search for product information, and a better in-store experience for customers.
"This is the holy grail of retail, what has been talked about for a decade," said Patrick Moorhead, an analyst with Moor Insights & Strategy. "In the industry, it's called "clicks to bricks" or "bricks to clicks." It's when you can truly link the two worlds. It's not a new idea, but one that no one has executed. It's hard, really hard."
Linking those worlds could mean a retailer would know its customers' needs a lot better.
Online, a store might know what products a customer has been looking at on its website and how much time was spent looking at a particular item. The retailer would also know the customer's shopping and browsing history and could use that information to provide the customer with recommendations or send alerts on special deals.
If that same customer was then to walk into one of the retailer's physical stores and had the store's app on her phone, the store would recognize the customer, and the app could pop up and tell her where to find the item in the store that she'd been looking at online.
The app also could tell her that the shoes she's about to walk past just went on sale, or it could alert the store's cashier that this is a loyal customer and should be given a special discount at the register.
Using Bluetooth beacons, Neiman Marcus, for instance, could point out products in the store via the app on the customer's phone or guide the customer to sales.
"You place [beacons] throughout the store and then your mobile app can react to the customer's location," said Emmons, who spoke at the National Retail Federation's annual conference in New York this week, told Computerworld. "We know you're at my door, walking through it, so I can appropriately greet and message you. We can know when you're two feet from something. You might be at checkout, and we could make an additional offer. We might say, 'Hey, you're near the restaurant and there's a chef there signing cookbooks today.' "
Neiman Marcus did a pilot test with the beacon technology, using Apple's Passbook, which is now called Apple Wallet, in three stores last year.
"We were happy with the results," Emmons said. "We got permission to go bigger. We're doing a new beacon project now. The continuation is building beacons into our Neiman Marcus app, rather than using the Apple Wallet. You are in the app with a known ID so we can do a better job of personalizing it."
Neiman Marcus is doing a soft launch with the project in a single Dallas store this week.
After the test, which will run for three to six months, Emmons and his team will decide if the technology should be rolled out to more stores.
"Part of the process is learning what we can do, what helps the customer and what they respond to, and what they don't like so we can stop doing that," Emmons said. "We want to step lightly. Just because we can do it, doesn't mean we should do it."
Ezra Gottheil, an analyst with Technology Business Research, said retailers should step lightly with beacons because it would be easy for customers to think a store is being intrusive with this kind of technology.
"It's one thing to say, 'Please tell us about yourself so we can serve you better in the store,' " said Gottheil. "It's another to remind people they are being "watched" whenever they browse. They know it, but unless you do it well, it seems intrusive."
However, if a retailer can use the technology without alienating its customers, the company would have more options for reaching out to consumers, while also gathering more information about their shopping habits.
"Once you've established that the [retailer] knows you as a customer, online and in-store, there's a lot you can do," said Gottheil. "You can have your own personal online representative, who communicates with in-store personnel… This is expensive, which means only higher-end retailers can do it, but it's a way of providing more value."