While the retail industry felt threatened by the digital world a few years ago, digitization is by now increasingly evaluated as an opportunity. They must embrace new technology to step up to the plate of identifying the right trends at the right time and the right way to capitalize on this opportunity - and not lose sight and feel for their own business by overdosing on data and technology.
Mobile data access at the PoS
More and more brick-and-mortar retailers are transferring the online shop logic to the store and are improving where the online shops are ahead of them. One trend is, for instance, the use of mobile technology for direct data access at the Point-of-Sale (PoS): e.g. customers have the option of accessing detailed product information directly at the PoS via smartphone since QR codes on the packaging, beacons or Near Field Communication Tags (NFC) on the shelf make it possible; salespeople can use the tablet to call up detailed information on the product in a customer conversation, show customers an explanatory video for the product if required, or present a useful additional product, stock levels or the availability of goods in other stores can be called up as well and orders placed, which the customer can either pick up at the desired branch or have it sent directly to his home; customer loyalty measures can be implemented by tablet, such as registering customer cards or signing up for customer events and promotions; the payment process can also be handled directly at the PoS via tablets or smartphones, and the receipt can be sent to the customer by email upon request.
In addition, data-driven activities offer brick-and-mortar retailers a variety of options for precisely addressing consumers via different channels in terms of the general "customer centricity".
One example is location-based services: consumers are given special offers or information about a product via the smartphone as a push message at the moment when they pass the respective store; in addition, consumers can be continuously informed via pictures, videos and news about products, trends, promotions and events via social media channels such as Facebook, Instagram etc. and that way tied more closely to the shop.
Another option is to provide customers with individualized offers: depending on the sales and product preferences recorded via the customer card, they receive special offers and discounts via email or an app.
The trend of the multi-channel strategy, which combines online and offline offers, will continue to increase. However, detailed knowledge about the shopping needs of the customers is essential for success.
Tools such as Intent Recognition in the online shop, for example, enable this insight: Using AI-based analytics, the customer's intention to purchase is anticipated in order to align the page content, the product selection, and the purchase options.
Among other things, this is achieved by means of special filter methods: based on the assumption that two persons who order the same products also share an interest in certain other articles, traders can derive forecasts of their preferences from the previous purchases of one user and transfer these to a different product group or apply to new products, collections, cross- and up-sales.
In addition, the shop’s search can be optimized in such a way that synonyms are displayed as well (for example, if a user searches for "sandals", the terms "flip-flops" and "mules" are shown to the customer, too), and besides that, the search is immediately linked to suitable trends (synonym mapping) and retailers can use the analysis of multidimensional data from tracking, product catalogs and other data sources to form an accurate picture of user behavior in order to derive suitable advertising or cross-selling offers. Analyzing social media platforms helps identify what consumers are interested in, which topics they talk about the most in what ways, and how they relate to products or customer service, so that individual marketing measures can be derived from such information.
Unfortunately, there is no general dosage recommendation in terms of digitization, and every retailer must individually decide how much digitalization is actually doing good. The fact is that it doesn’t matter whether dealers use digitization to inform, make products available or use it for logistical support. Data is always required - to customers, goods, the weather, competition, stock, purchasing power, price evaluations, etc. - as well as appropriate technologies, such as specific interfaces, business intelligence and AI-based analytics, in order to be able to extract, link and inform this data from different systems.
By Daniela La Marca