Forrester: How retailers can use digital to improve in-store experience

Forrester analyst claims retailers are still seeing digital and technology innovation as being about transactions, and fail to join the omni-channel experience dots for their customers

Retailers are too focused on digital technologies as transactions and should instead be looking at how to use digital in-store to deliver better, omni-channel experiences to customers, a Forrester analyst claims.

Speaking during a retail industry session at this year’s Adobe Summit, principal analyst for ebusiness and channel strategy, Adam Silverman, claimed most retailers still haven’t grasped the role digital and mobile have in building more personalised interactions with customers in-store.

“The role of digital is oftentimes just about taking a transaction,” he said. “But the power of digital is really about influences.”

According to a recent Forrester survey of ebusiness leaders, personalisation is at the top of the priority list for retail over the next few years. Unified customer account and order history across channels, along with cross-channel loyalty reward programs, are key areas of investment for the next 12-24 months.

In-store data capture has also skyrocketed, but organisations often don’t know how to action off the back of this data, Silverman said. He also pointed out only 12 per cent of enterprise data is being used for analytics currently.

“If we could get this right for the store, imagine how conversion, engagement and sales in-store will lift and the experience will change dramatically,” he said.

One thing holding retailers back is a lack of strategy around systems that engage customers. “It’s understanding customer needs and then layering on the technology,” Silverman said.

Another gap is integration of retail teams and systems. “You need integrated systems to understand where product is: Inventory, pricing, supply chain all need to be integrated. Teams need to be integrated as well,” Silverman said. “Single P&Ls are a hard pivot, especially in traditional merchant organisations.”

Too many retailers also lack clear measurements of success. “They may jam technology into the store but is it working? How do we measure success?” Silverman asked. “Often, technology is not iterated on or improved upon either.”

Data is the other significant hurdle, and Silverman claimed most retailers don’t have a single view of their customer. He blamed this on two things: Lacking a data warehouse or master customer records; and poor management around how data is syndicated and used in other systems.

“It’s also about creating those hooks – what value will you add so customers self-identify, so you can then create that single view of the customer?” he asked.

There are chinks of light, however, and Silverman noted several retailers bringing digital into the in-store environment with some success. One is fashion retailer, Rebecca Minkoff, which has placed digital screens into dressing rooms, allowing customers to interact with associates and products while they’re trying items on.

Other examples are home improvement retailer, B&Q, which is testing dynamic and personalised pricing as a customer enters the physical store, and Ugg Australia, which has digitally enabled associates with tablet devices and product inventory access in-store in order to drive incremental demand.

At the extreme end of the scale, Acustom Apparel scans a customer’s body then creates a custom pattern to fit over their body shape. “The linear thinking of retail with the customer at the end is then flipped, and the customer is at the front of that supply chain,” Silverman said.

Silverman recommended retailers focus on service and convenience, start setting the groundwork for a single view of the customer, and work on initiatives that make it as easy as possible for in-store associates to access product information and digital tools.

How Bras N Things is serving up customers the right product fit
8 Ways to Create a Successful Multichannel Customer Experience
How Kathmandu is future-proofing omni-channel ecommerce

He added a quick win is to expose inventory visibility online. “You need to be doing this for omni-channel fulfilment now anyway; 25 per cent of customers won’t go to the store if you don’t,” he claimed.

Case study: Sport Chek’s digital transformation

One retailer that’s invested heavily in digital in-store is Canadian Tire Corporation’s Sport Chek brand. During the retail session, the company’s VP of digital solutions, Frederic Lecoq, detailed how its ‘let’s get phygital’ program has changed the way its store operates.

The retailer re-opened its West Edmonton flagship Sport Chek store a year ago after a major digital transformation program. Innovations included 470 digital screens showing real-time content and information, integrating touch, gesture and RFID technology into the in-store environment, adding a 21,000 square feet atmosphere ‘store within the store’, medical motion gait analysis, dynamic bicycle fitting, a climbstation treadmill and a golf flight scope simulator.

Since then, the store has posted 50 per cent year-on-year sales growth. The retailer has just opened a second version of the store in Vancouver that’s trending the same way, Lecoq said.

“Why did we do it? Most of the time we’re putting technology into the store and marketing from a ‘why not’ perspective,” he said. “We need to shift our mindset and ask: ‘What are we doing this for?’.

“Digitising the store is about redefining the experience to create value for the customer.”

Lecoq said the first important step was for his team to build relationships with the technology function. His next piece of advice for other retailers was to forget about campaigns and put the emphasis on content.

“Consumers are always on and they’re snacking content. We have been building a content factory and content is one of the initiatives behind this,” he said.

Other key ingredients include measuring everything in terms of ROI and effectiveness around each step of the customer journey, and turning point-of-sales into points of experience.

“The future of retail is all about content, data and connectivity. Be nice to your tech people,” Lecoq added.

Forrester’s top tips for personalising commerce in-store

  1. Location context is key to success.

  2. It’s about moments of truth. “You need point solutions to be integrated at a store level and have data integrated around those solutions,” Silverman said. “It’s also about task management and analytics: If I understand Jason is in the kayaks section and I’m an expert on kayaks, I should be instructed to talk to Jason in real-time.”

  3. Associate-assisted personalisation shines. “They are your personalisation engines in-store – conversion rates double when the associate is involved,” Silverman said.

  4. Authentic experience means the phone stays in your pocket. “I’ve seen demos where the phone is out and consumers are just looking down at the screen, but I don’t envisage shopping in-store that way,” Silverman said. “It’s about the environment changing around you – lighting, digital screens, for example.”

  5. Aim for service, not offers. “Most of the beacon interactions today are offers – after the second alert, I might be interested in product, but with third alert my phone is staying in my pocket,” Silverman said. “Instead, why not open a VIP experience with the phone?”

  6. Pricing becomes dynamic. Retailers have done this for a long time online but it will come to the fore in-store too, Silverman claimed. “Mark down optimisation at a retail level has been happening, but we’re going to see dynamic pricing at store level and even customer level in the store.”

  7. New digital store platforms will emerge such as mobile point-of-sale and digital experience platforms. These will work need to work alongside operational pieces such as task and labour management in-store, Silverman said. “Retailers need to connect these together for digital operational excellence and customer experience excellence.”

More from Adobe Summit 2015

Nadia Cameron travelled to Adobe Summit 2015 as a guest of Adobe.

CMO Australia conversation on LinkedIn: CMO Australia, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+: google.com/+CmoAu hi

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Data has the power to build or burn brands

A brand can be severely wounded by use or misuse of any of its assets and you could say data has the greatest power of all to inflict damage.

Lucy Acheson

Head of data strategy and customer experience, LIDA

Totto and your inorganic future

At Cannes Lions this year we’ve been treated to many artificial intelligence (AI) insights. It’s one of the major discourses of our time.

Richard Brett

CEO, opr

Personas of one and the rise of ‘always there’ marketing

I’ve got some bad news. The ‘always on’ marketing approach that many companies have only just fully implemented is already out of date.

Nigel Roberts

Founding partner and strategy lead, Yell

Promotion is difficult. You should be able to do it. Sometimes it turns out bad, and when you turn to professionals, it turns out well - ...

Jordan Samuil

Village Roadshow partners with Lion for pourage rights and promotional partnership

Read more

This is very good news for Australian SMEs as ActiveCampaign is an very powerful marketing automation / email marketing tool that costs a...

Lawrence

SMB marketing automation provider sets up Asia Pac HQ in Sydney

Read more

Thanks for the info! If you are looking for commercial real estate in Mumbai, visit us at Jagaha.com! We have over 20,000 verified proper...

Gizelle

Salesforce ups the Marketing Cloud ante with Datorama acquisition

Read more

Completely agree! For the best commercial properties in Mumbai, visit our website - Jagaha!

Gizelle

Salesforce ups the Marketing Cloud ante with Datorama acquisition

Read more

Carisoprodol is used for treatment of pain.so it has some amount of drug use it carefully . Get its complete usage and prescription from ...

jensons henry

CMO profile: The strategy behind Cash Converters brand and customer experience reboot

Read more

Latest Podcast

More podcasts

Sign in