Category Archives: Customer Engagement & Business Intelligence

by Retail Pro

How retail technology is enhancing the in-store experience

Online sales are booming, but retail technology isn't just for ecommerce. Retailers are taking advantage of exciting new devices and software to provide interesting shopping experiences and enhance their store operations. From convenience to novelty, these initiatives are aimed at assisting customers and drawing them back to the store time and again.

High-tech brick-and-mortar
Contrary to concerns that ecommerce would make physical stores unsustainable, retailers are finding ways to bolster their sales using technology and an integrated, multi-channel marketing approach. In fact, a recent report by Accenture revealed that 88 percent of consumers research products online and then head to a store to make their purchase. While online advertising is important and influential, retailers can play on the strengths of their physical store locations to offer customers opportunities not possible through online channels.

Retailers are integrating technology into their brick-and-mortar operations in innovative ways. Here are a few examples:

  • North Face has introduced Watson, IBM's contextual computer that acts like a shopping assistant, in some of its stores, The Huffington Post explained. Shoppers can ask a kiosk questions and receive personalized answers that take shopping history, weather, location and other factors into consideration.
  • Sephora created a "fragrance finder" to help people match scents with products, drawing on a database of information and using Big Data analytics to assist customers in real time, the source reported.
  • Many retailers, such as Apple, are using mobile point of sale systems to provide convenient check-out options for shoppers. This technology also enables store clerks to better engage with customers, since they're able to assist people in the aisle and offer additional information about products.
  • Nordstrom Rack is tracking in-store shopping habits to drive major retail business intelligence initiatives. The news source added that the store is using analytics to make small – but powerful – adjustments to its store layout and other operations.
  • Ikea offers an in-store companion app to help customers navigate the store, according to the news source. Retail Wire also noted the growing range of opportunities that mobile apps offer for retail marketing. Merchants should focus on making the in-store experience more convenient and provide incentives to get consumers to install the app, the source suggested. For example, Walmart offers a "scan and go" app in some stores that saves shoppers time at the check out. 

Overall, retailers are thinking outside the box to revolutionize shopping experiences. The Huffington Post noted that the majority of customers will shop in-store if they're offered a memorable experience, according to research by Jack Morton Worldwide.

by Retail Pro

Taking the customer experience mobile

Mobile apps and shopping sites offer a great deal of convenience to consumers, but retail marketing leaders should keep the customer experience in mind when implementing their mobile options. Merchants have been focusing on enhancing the shopping experience for customers, whether that means making check-out processes more efficient or providing personalized suggestions online.

Many of these ideas come from the classic strengths of physical stores, demonstrating how excellence on-site and online can go hand-in-hand. Forbes magazine encouraged mobile app designers to take some lessons from brick-and-mortar customer engagement strategies. For example, the source explained, local stores often prioritize building relationships with patrons, which can sometimes slip through the cracks during digital interactions.

"Mobile shopping apps and sites need to offer greater levels of personalization, service and support to consumers," Brent Cohler, director of mobile product marketing at SAP, told Retail Customer Experience. "Mobile commerce is about much more than just the payment."

One way a store can improve its engagement strategy is to learn more about its customers, Forbes added. Merchants can collect data for retail customer intelligence to better tailor their apps according to shoppers' needs and preferences. The point is to be flexible and let customers see that their opinions and feedback are being taken seriously.

by Retail Pro

Retail industry explores location-based opportunities

Location-based functions on mobile devices offer merchants opportunities to target their retail marketing campaigns and collect information about shoppers' habits. For example, Apple iBeacons could be used to send customers information about products as they walk past an aisle, PC World explained. This is just the beginning, though. Retail technology can take advantage of knowing a shopper's location to provide a whole new in-store experience.

Philips recently created a system using LED lights that can receive location information from shoppers' smartphones, Tech World reported. Using an app, customers can receive directions to help them find specific items in the store. With the lighting system serving as a grid, the app helps shoppers find the products they want and can then make additional suggestions for them. The light-based system could be easier and less expensive for retailers to install than other location-based systems, the source added.

In addition to making it easier for shoppers to find their way through stores, the system provides opportunities for retailers to collect information about consumers. For example, merchants can gather information about the time of day that certain demographics are most likely to shop, according to IT World. This data can be added to the information collected by the store's retail management system to drive data analytics for better business strategies. 

by Retail Pro

Mobile payments on the rise in Canada

Canada is at the forefront of mobile payments in the retail industry. According to Venture Beat, 75 percent of Canadian retailers accept mobile payments, such as transactions completed by tapping smartphones. In comparison, the source said, only 2 percent of U.S. retailers have implemented this kind of system.

BC Business reported that 80 percent of the Canadian population is expected to have "tap and pay," or contactless payment, capabilities by 2016. These transactions are facilitated by smartphones and wearable technology, which are gaining prevalence in the country. The speed and simplicity of tap and pay options provide another example of how retail POS systems are aiming to bolster sales by improving the customer experience. Venture Beat mentioned that these options are increasing per-sale purchases, driving Canadian retailers to implement the retail technology and banks to partner with technology companies on applications.

As with all POS systems, security remains a major concern. The tap and pay option might offer some advantages, though. BC Business explained that cyber criminals can't use the applications as widely as credit cards,which reduces the threat of payment information being stolen. According to Venture Beat, these processes can also make use of chip technology that is inherently more secure than credit card systems.

by Retail Pro

National Retail Federation predicts 4.1 percent growth in 2014

Despite a rough January, merchants can look forward to retail industry growth for the coming year. According to the National Retail Federation (NRF) 2014 economic forecast, retail sales are expected to increase by 4.1 percent in 2014. This is up from the organization's 2013 projection, which anticipated a 3.7 percent growth. Improvements in the economy and job market are contributing to this trend.

"Measured improvements in economic growth combined with positive expectations for continued consumer spending will put the retail industry in a relatively good place in 2014," said NRF President and CEO Matthew Shay.

However, the NRF noted that merchants still face a number of challenges, including debt ceiling debates, healthcare expenses and the effect of weather trends. Harsh winter weather is believed to be the culprit for disappointing January sales, according to The Wall Street Journal. The news source attributed a 9.6 percent decrease in sales to the "polar vortex" weather, which kept many shoppers indoors.

At the same time, the NRF predicted a growth in ecommerce this year, and retailers can use online retail marketing strategies to help overcome Mother Nature's obstacles. For example, merchants can use retail customer intelligence to send targeted ads for items customers might need during winter storms. 

by Retail Pro

Creating loyalty programs that work

Retail marketing includes efforts to draw in new shoppers and hold on to existing patrons. Loyalty programs can be a component of this strategy and retail customer intelligence can enable merchants to tailor these initiatives to their consumers' preferences.

According to a McKinsey & Company study, as reported by Forbes, retailers could do more to make their programs worth the investment. The study found that heavy investors in loyalty programs grew at the same rate or more slowly than other companies since 2002. With the right strategy, however, merchants can turn their loyalty programs into assets that engage customers and drive sales.

McKinsey & Company recommended incorporating loyalty programs into the shopping experience, instead of running them almost as afterthoughts at the cash register. Similarly, Business 2 Community advised retailers to make sure their loyalty programs cut across all store operations, creating a seamless omnichannel experience. Merchants can tie in their online branding by taking social engagement into consideration, the source added.

Creative approaches to loyalty integration, such as adding a mobile payment component, can also foster loyal customers without putting too much emphasis on the program, McKinsey & Company said. Overall, retail reports and data analytics can help merchants design stronger loyalty programs that offer the right incentives for their consumer base.

by Retail Pro

Retail marketing insights in CVS’s tobacco decision

CVS recently announced that it will stop selling tobacco products by October. Despite some backlash on social media networks, retail customer trends indicate that the pharmacy's decision might have been as strategic as it was health-conscious. The store's effort to stay ahead of changing consumer demand and re-brand itself as a comprehensive health center exemplifies how retail insights can lend a competitive edge.

"Ending the sale of cigarettes and tobacco products at CVS/pharmacy is the right thing for us to do for our customers and our company to help people on their path to better health," said Larry Merlo, president and CEO of CVS Caremark. "Put simply, the sale of tobacco products is inconsistent with our purpose."

While a desire to promote healthier habits may be at the core of CVS's decision, the move was also strategic. The number of regular smokers in the United States has fallen below 20 percent of the population, due in large part to the success of ad campaigns and studies linking smoking to cancer, FoxBusiness noted. By pulling out of a declining market, CVS can focus its resources elsewhere and appears as a leader in the industry. Much of the positive feedback has recognized CVS's commitment to health, according to the news source, an association CVS has fostered by expanding its services to include immunizations, clinic services and consultations with pharmacists. 

by Retail Pro

Retail customer trends reveal struggling middle class

During his 2014 State of the Union address on January 28, President Obama focused on the middle class. He described new opportunities for entrepreneurs, initiatives for better education and advances in universal healthcare. However, retail customer trends point to a different shift: a shrinking, struggling middle class left behind by the elite.

According to The New York Times, businesses that traditionally cater to the middle class, such as discount clothing stores and mid-line restaurants, are struggling as high-end stores profit from the increasing wealth of the upper 20 percent. Economists Steven Fazzari, of Washington University in St. Louis, and Barry Cynamon, of the Federal Reserve Bank of St. Louis, explained that the economic recovery is being driven by the upper class, the source added.

In fact, recent Pew research found that fewer Americans consider themselves middle class, identifying instead as lower class. From 2008, the percentage of people who identify as lower class rose from 25 to 40 percent, the survey revealed, and middle class declined from 53 to 44 percent.

For retailers, these trends may indicate a need to reconsider their store operations and marketing strategies. Growing economic disparity may make it difficult for businesses to cater to both the elite and more economical consumers, The New York Times said.

by Retail Pro

What millennials really want from retailers

 

 

As millennials come of age, they’re an increasingly important demographic for the retail industry.

Although analysts use different starting points for the generation, most people generally regard millennials as the group currently ranging from late teens to early thirties.

According to Venkatesh Bala, chief economist and director of the Economic Center of Excellence of the Cambridge Group, in an article for Quartz, this group encompasses up to 80 million people in the U.S., spends around $600 billion annually and could account for $1.4 trillion in commerce by 2020.

Therefore, merchants have a vested interest in understanding this demographic and its retail customer trends.

 

Information drives millennials

Much has been said about the technology habits of this age group, inspiring retailers to focus on mobile and ecommerce strategies.

However, the real takeaway is that millennials want more information, are good at finding it and use it when making decisions.

Millennials are resourceful at price-checking and comparison shopping, Bala emphasized – they know how to use sites like Hukkster.com and have more options at their fingertips than ever before.

For that reason, it’s important for merchants to consider their online presence.

With or without ecommerce software, retailers can take advantage of the Web by making sure millennials can find their information.

Staying on top of competitive pricing is crucial for marketing to this generation, which tends to be thrifty.

Growing up in a recession has proven difficult for the age group as they transition to adulthood.

Pew revealed that millennials are underemployed and many are living at home with their parents.

CNBC remarked that millennials are still catching up from the slow start that defined their entrance into the job market.

Consequently, it’s important for retailers to understand more specifically what these consumers need and how they’re balancing their budgets.

 

In-store experiences and engagement

According to research by Merchant Warehouse and Retail Pro International, millennials prefer to buy certain products in stores, including apparel, footwear, home goods, furniture and jewelry.

They might still check information online before making a purchase, but they want the physical store experience for these items.

Some merchants are catering their in-store experience to these younger consumers through strategies like “pop-up” retail stores or modern retail technology, Bala explained.

He noted that Nordstrom has crafted a more edgy, youthful image by using mobile POS systems and offering brands that are relevant to millennials.

Overall, millennials want convenience, options and engagement.

Omnichannel marketing is a useful approach because it engages younger consumers and leaves them with both consistency and options.

by Retail Pro

Mobile is central for retail marketing in 2014

With smartphone and tablet use growing globally, merchants are planning to refine their mobile presence in 2014 to stay competitive. The drive to be visible and engage consumers across devices is a core component of multichannel store operations. As part of an effort to improve the customer experience, retailers are prioritizing mobile for the coming year.

According to the 2014 Shop.org/Forrester Research Inc. State of Retailing Online survey, more than half of retailers intend to improve their mobile presence, focusing on responsive design, mobile site optimization and tablet redesign. In 2013, smartphone revenue grew 113 percent and tablet revenue grew 86 percent from the previous year, the survey found. This was driven both by the increasing prevalence of mobile device ownership – especially among wealthier demographics – as well as the greater availability of mobile apps and coupons, Business Insider noted. 

Forty-six percent of retailers plan to redesign their websites, according to the survey, and site experience is instrumental to customer conversion. Mobile improvements are part of a general trend toward increasing personalization and convenience for shoppers. These strategies are made possible by advances in retail customer intelligence, which merchants can incorporate into designs for their mobile websites and apps.