How can Digital and Store feed and not eat each other?

Servicing the new age digital customer may feel like a gamble for retailers. True, they have gravitated towards technology, yet they remain partial to the genuine human touch. Though they are the most avid shoppers, they are also much more circumspect about their purchases. Their notoriously scarce attention spans may have become the stuff of clichés, but they are willing to engage far more proactively when a brand inspires them.

Retailers seem to be mired in a peculiar old century/new technology dichotomy as they attempt to connect and engage with today’s prized customers. The order is a tall one; failure to crack the code could be fatal to their future business opportunities.

Did you know?

According to research by Adobe, however, most brick-and-mortar retailers fall short in personalizing their offerings across channels.

The solution lies in providing an integrated, phygital experience that strikes a fine balance between digital and store in such a way that the two most effectively complement each other. The symbiotic relationship between the two is a powerful one- it borrows the best of both worlds.

Here are some of the ways by which retailers can nurture that for the best-possible business outcome:

1.Provide Enhanced Personalization

Personalization is no longer a “wish list” item for savvy retailers—it’s an absolute imperative. Today’s customers appreciate value that is delivered in context. Retailers therefore need to engage customers with precisely the right information/offers, at the right moment, on the right device.

Ally was browsing XYZ store’s site on her tablet a few days before, but had to abandon her purchase in a hurry, as she was reminded about an urgent appointment. Presently, Ally was getting back home from work when she chanced upon the store and entered it. A store associate surprised her by offering the exact pair of red stilettoes that she had earlier abandoned. Not only this, she was given a matching handbag to go with the dress that she had browsed; it seemed like one seamless interaction that made the customer cherish the whole experience.

To accomplish that, the litany of digital data streams readily available across channels and touchpoints must be captured, and then consumed by analytical models capable of finely segmenting customers.

Mobile devices, and the emerging IoT (Internet of Things) technology can be combined with innovation in artificial intelligence, machine learning and deep analytics to leverage a customer’s digital footprints (shopping/browsing histories, social media profiles and preferences) to reach out to shoppers in real-time with laser sharp accuracy across channels.

The more data points a retailer collects and integrates, the deeper they can delve into customer behavior, and the more targeted and individualized the customer engagements become.

Retailers like Macy’s have consistently outperformed competition by using shopper behavior to shoot highly contextualized alerts to visitors who have their Shopkick app installed on their smartphones. Using the geo-targeting feature in their mobile app, Lord & Taylor targets customers in the store’s proximity with offers and promotions to draw them to the store.

2. Empowered Store Associates

Not only are the retailer’s traffic-building objectives met, such technologies also offer the retailer huge upsides by boosting their cross-selling and upselling efforts. Information related to a customer’s digital as well as in-store behavior can be integrated into one system and made accessible to store staff in real time through their mobile devices. Such empowered store associates can assume the role of trusted advisors to customers, offering them customized coupons and loyalty discounts and drive cross-sells and upsells to increase basket size.

3. Digital-Physical Mashups to Augment Brand Experiences

While a large number of retailers are currently using chatbots to respond to transactional inquiries on their online sites (for e.g. - to answer quick question regarding shipping or returns), the truth is there still needs to be an element of human involvement for a truly rewarding shopping experience.

Saks Fifth Avenue, for example, has implemented instant live chat between its sales associates and customers to empower them to become “omnichannel associates,” and provide enhanced shopping experiences online, rather than only relying on chatbots.

Visual merchandizing is also becoming increasingly popular. It has the capability make your “retail space” as productive and engaging as possible. It’s everything that leaves the customer craving for more- aesthetic window displays, creative signage, innovative shop layouts and product placement. A walk through your floor should invoke the spring season outside and evoke the individual customer sentiment to plot, spot and trot!

Similarly, augmented reality has ushered in beautifully immersive experiences to the real worlds we inhabit. Virtual “try on” experiences are a first step to rise to a new level of customer engagement. L’Oreal launched its Makeup Genuis App in 2014 that allowed customers to virtually try on different shades of blush and mascara before actually purchasing them. L’Oreal’s facial recognition system showed different angles of the face bringing in interesting perspectives. It was a hit amongst users as their app was downloaded more than 20 million times. To help retailers get on the phygital bandwagon, Aspire Systems has built a virtual try-on platform that can be customized for clothing, eyewear, jewellery, footwear and many other fashion accessories.

The future of retail is certainly not about physical versus digital. It is about identifying better ways to blend physical and digital so that they can cook a much larger platter that helps to serve their huge appetite for retail food.

Author : Krittika Banerjee, Research Analyst

Practice Head: Abhishek Mahajan, Digital Retail