Has Your Shopping Gone Nonlinear?

Ken Kaplan Executive Editor, iQ by Intel

As retailers turn to data tracking and in-store technologies to entice shoppers, many are doing it backward.

Whether it’s shopping for summer travel outfits or back-to-school gear, chances are your hunt starts well before you set foot inside any store. The ease of online shopping and the variety of goods — and good prices — available on the Internet benefited shoppers have many retailers turning to new technologies to attract people with more personal, touchy-feely in-store retail experiences.

Technologies that ensure personal privacy and put the power into the hands of shoppers rather than ones anchored purely in driving more sales is what’s behind many of today’s successful new shopping experiences.

Many retailers want to sell more and don’t think of the shopper first, said Joe Jensen, general manager of Intel’s Retail Solutions Division.

“Many do it backward,” he said.

He recommends that retailers start with ensuring personal privacy by putting power in the hands of consumers.

”Because if shoppers don’t embrace new technologies, they simply won’t work.”

Jensen said there are many interesting technology trends hitting the world of retail today, including data analytics, social networking and electronic payment methods, but the biggest thing impacting retailers is a shopper’s path to purchase, which has changed dramatically in recent years.

“Twenty years ago it was a very linear journey, where shoppers became aware of things through a national ad campaign, then they’d go to the store, maybe try samples, buy one and then become a loyal customer,” he said.

“Now it’s a scattered journey. Not only that, it’s completely different for different people. Today most times people collect feedback from friends, family or online along multiple touch points on their path to making a purchase.

According to Forrester research, nearly half of all 2014 US retail revenue will be influenced by the internet. Shoppers often start their journey online but that’s not necessarily keeping them from making purchases in retail stores. Instead, they’re bringing their research with them to stores, browsing store racks and shelves while comparing prices or out of stock items using their smartphone or tablet device.

The future of shopping will be about having the right balance and integration of technology that blends naturally into the store, which is already happening, according to Jensen. Changes in shopper behavior are encouraging retailers to more quickly embrace new technologies.

Take for example the rise in big screens inside retail stores. Every week, around 15 million shoppers enter stores operated by Media-Saturn Group, Europe’s largest electronics retailer.

These shoppers see an average of 225 screens playing videos, images and information on the in-store TV network. It’s helping to raise awareness for new products.

This is critical since as much as 95% of all new product introductions fail, according to Accupoll research, mostly due to lack of consumer awareness and understanding of the product.

Dunkin’ Donuts is using new digital signs with real-time data to help customers know what’s available and what’s not.

Another example Jensen pointed to is Adidas. The sports shoe retailer used an Intel technology-based Virtual Footwear Wall to showcase inventories from a variety of stores and increased shoe sales by more than 40% in every instance.

The giant touchscreen gave access to 8,000 different shoe models, including a 360-degree view of each shoe, list of features, and available sizes and colors. Shoppers could even make purchases on the digital display.

If 50% of the time a store has what you’re looking for, in the right size and color, Jensen said that’s good by industry standards. “But most people would say that’s not very good,” he said.

Jensen believes technology can move that up to 90%.

The idea of a connected smart store may not be new, but consumer shopping behaviors are encouraging retailers to experiment with linking everything from digital signs to cash registers, and online inventory to digital fitting room technologies like the Memory Mirror to bring more personalized, memorable shopping experiences.

Jensen said people are researching online before purchasing and increasingly when they are inside a retail store, they’re using their smartphones and tablets to compare prices. They’re capturing images of products, especially fashion items, and sharing their enthusiasm with their social networks.

Shoppers are also willing to share more personal data in order to receive deals and receive more personalized treatment.

One example of getting technology integrated seamlessly into the shopping experience is FashionLike. Retailer C&A has taken their clothing line and put it on Facebook, allowing shoppers to go online and rate the items whether they like them or not.

“They have active shelves and hangers in the store that display how many likes each article of clothing has received,” said Jensen. “Shoppers in the story can get a real-time look at what the community thinks about the clothing.”

Privacy and awareness of how personal data is collected and used remains critical but is not an inhibitor if done right, said Jensen.

“When consumers can see a clear value, that they’re getting something in return like a coupon or better awareness and access, then they’re willing to share information.”

It’s that kind of data, including in-store and online shopping history, which are helping retailers use technology to bring more personalized experiences.

In trial tests conducted by Jensen’s team at 10 different retailers, relevant ads were served up to shoppers using data shared from their smartphones, web browsing and social media interactions. These so-called context-aware ads increased monthly sales by an average of 16 percent across 15 diverse product times.

A new frontier is unfolding around shoppers who watch TV while using a second screen device. Jensen sees opportunities for retailers creating mobile apps that sync with TV programming.

“Say you’re watching basketball and during a free throw your smartphone app pops up and asks if you think the player will make the shot or not.  If you win, then you get a coupon,” he said.

While this will be a challenge for people watching on-demand, it could open opportunities that haven’t existed before.


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