Today’s stores are buzzing with technology. Scanners, digital signage, digital displays, kiosks, tablets, hand held devices, POS, RFID and inventory systems are working in silos. How does a retailer bring all these investments together, map it to customer needs, and ensure an ecosystem that drives real-time customer engagement?
Beam Me an Offer, Scotty: Influencing Customers
It may seem that most retail stores have been built the wrong way. It is only when a customer has finished shopping and is checking out, does the store know who the customer is. Using credit card and loyalty card details, the store finally figures the customer’s name, rudimentary purchase history and the actual ‘size of basket’. At this point, all the store can tempt the customer with is an additional pack of bubble gum or a magazine. It is too late to do anything else. By contrast, online customers tend to first log in and allow every action to be tracked. Now brick-and-mortar stores can also get to know customer details before the first purchase is made. This presents an exciting new opportunity, making it irrelevant to depend on check outs for trivial increase in sales.
For several years now, retailers have built a formidable arsenal of in-store information display systems. These include digital signage, flat screen TVs, kiosks, interactive POS and store associates armed with tablets. For the last few years retailers have been busy investing in mobile applications that help connect with the customer. More recently they have placed their bets on increasing their social conversations. Now, it is time to tie all this together and begin a seamless, personal, insightful, funfilled, and rewarding conversation with the customer. It is time to make smartphones and other intelligent devices work for them, instead of moping that customers are ‘showrooming’ – the practice of purchasing items online from within a store using a smartphone after finding better prices online.
The reality is that as many as 80% of shoppers still visit stores1 The question is, “Can these shoppers be influenced by connecting devices within the store?”
Using mobile technology to recognize the customer, retailers can ensure greater predictability in shopping outcomes. A large retail chain in the US found that a one point improvement for in-store close rates translated into US$200 million in incremental operating income2 . That kind of gain can be real for most retailers. What retailers need to put in place is a well-thought out connected device ecosystem. Such an ecosystem nudges customers towards buying more by beaming offers that are beneficial to customers.
Starting the Connected Device Conversation: Recognizing the Customer
The crucial element in recognizing the customer and creating a personalized experience begins by ensuring the customer is persuaded to download a store app to their mobile device. This can be done by permitting the app download over the store Wi-Fi, over Bluetooth or NFC.
Several retailers have begun to target customers, making them offers as they pass by the vicinity of the store. Starbucks, for example, inserts a ‘passport’ into the customer’s smartphone. When the customer is driving past, the application recognizes the customer, maps the customer to data from internal and external sources to throw up offers that are immediately useful or those that fuel the customer’s curiosity. The practice is sometimes referred to as geo-fencing.
In-store sensors can use the same application to track customers as they walk through the store. But this is not necessarily the only way to track customers. Customers can be asked to tap their phones against sensors at the entrance, use facial recognition to be instantly identified or simply be persuaded to login through a kiosk at the store before shopping. Now the store knows the customer, the customer’s mobile number, unique loyalty ID, email ID, past shopping history, CRM interactions, social exchanges etc. Armed with this information, the store can begin to personalize the shopping experience