Retailers are facing an uphill battle; as the cost-of-living crisis continues to permeate, customers are more conscious than ever about what they buy and where they buy it. They are looking for better deals and more seamless, curated shopping experiences. Providing them with a memorable experience, both online and in-store, is key to developing and retaining that all-important consumer-business relationship whilst securing sales and growing profits.
An increasing number of retailers are using technology within their stores to achieve this. The question is, to what extent can you substitute human interaction with tech? At what point does technology do less to enhance a business and more to hinder it?
To what extent can you substitute human interaction with technology?
Innovative doesn’t always equal meaningful - in-store experiences must add value
Technological capabilities are evolving at an incredible rate, just look at the rise of NFTs, Metaverse, and Artificial Intelligence. These advances offer up an exciting opportunity for retailers to provide unique experiences in their stores. However, to really strengthen the connection with their customers, they must understand what value these experiences offer them and create a long-term strategy around this.
Customer service robots
Electrical retailer Currys recently announced its plans to trial AI-powered robots in a handful of its UK stores. The aim is for the ‘KettyBot’ to help customers find products much faster – they simply use its touch screen to select a product area and the robot then guides them to the correct department in-store. Through this technology, customers can shop more efficiently and for large warehouse-style stores with thousands of products, this offers clear benefits.
Radio-frequency identification (RFID) technology
Retailers have been harnessing RFID technology for years to keep better track of store stock. Uniqlo’s RFID- powered self-service checkouts allow customers to make quick purchases by simply placing all their items on the counter. In a matter of seconds, a screen shows you a list of the items you’re buying and instructions to pay via card – there are no security tags to remove and no need to search for barcodes to scan.
“Scan-as-you-go” options in grocery stores are a good example of older technology that still provides benefit. Customers favour convenience and speed and being able to scan and pack items as they shop saves them time. Most of these scanners also show the total price of all the items scanned, so customers have more awareness of how much they are spending.
Challenging the norm
Technology should serve to enhance in-store processes for a smoother shopping experience. However, relying too much on technology can be disadvantageous. With innovation comes a certain amount of disruption and retailers must consider how far they can push their customers.
The grocery sector, for example, is pushing towards cashier-less supermarkets. Amazon was the first to introduce its “Just Walk Out” technology into its stores to deliver a faster grocery experience to customers. This year, Aldi has announced it will follow suit and a number of its London stores will go cashier-less.
Whilst the technology is impressive, it relies on customers to trust in the unfamiliar which is always a challenge. They might grow more comfortable with the concept when it comes to buying a handful of items but how long will it take for them to grow accustomed enough to the idea to do this for their regular food shop? In recent news, Amazon closed its first-ever UK checkout-free store after less than two years.
Trying on virtual garments
M&S recently announced its partnership with Zyler, a company specialising in virtual try-on software. Customers who visit M&S’ Oxford Circus and Harrogate branches will be able to virtually try on clothes under their Jaeger brand, all they need to do is take a photo of themselves and input some basic measurements. Zyler explains one particular advantage to this is the ability to see what you might look like in items that aren’t in stock in that location.
Being able to visualise what you might look like in clothes is beneficial in an online space where there is no opportunity to physically try an item on for size. However, does this approach offer the same value in-store?
Will customers be willing to submit photos and body measurements to use this software or would they prefer to get a better feel for the item by actually trying it on? For stores without fitting rooms, this tech could provide some value but it seems unlikely to be adopted by retailers en masse. Arguably, it’s much better suited to e-commerce.
Finding a balance
As the pressure on trading economics continues, retailers must get to know their customers more in order to create experiences that are meaningful to them. Cutting-edge technology like AI, data science and machine learning are critical to unlocking these key insights and delivering a true omnichannel experience. One advantage bricks and mortar has over e-commerce is the ability to interact with customers in a physical setting. The key to leveraging the benefits of in-store technology is to find a balance between digital and human-driven processes.
This article is part of our 2023 "Crystal Ball" Trend Predictions report. Download the report here and discover more exciting topics we'll be exploring throughout the year!