The road to responsive retail

Welcome to the world of the connected shopper. People are integrating offline and online shopping journeys more and more, and demanding flawless experiences whenever and wherever they are. As a result, retailers must contend with a more complicated, cross-channel path of consumer purchases. Friction points are more difficult to manage, potentially exposing shoppers to poorly executed experiences.

Therefore, it is critical to understand shopper behaviors and touchpoints which impact each step of their journey. Retailers who are stuck with 'old thinking' are examining hundreds of KPIs which reflect on economic performance (i.e. conversion and basket size) and cannot squeeze enough growth to keep stores relevant. On the other hand, focusing solely on results neglects the most important part of the shopper's path - experience in the funnel.

We believe that if retailers drive relevance along every touchpoint, results will take care of themselves. Many retailers have started to understand the 'behavioral retail' concept, but they over-focus on driving flawless shopper behaviors. After 40 years of dashboards, result KPIs, and managing outcomes, we have entered the new era - we call this era Behavioral Decision-Making or Behavioral Retail. That is, retailers deciding on assortment, space, and service design on the basis on how shoppers shop, and making sure that there are no obstacles at any given part of the funnel.

However, even this is not enough. Brands and retailers have a huge opportunity to foster platforms for smart shopping, to leverage digital screens (both mobile and stationery) as allies, to provide bespoke services at the POS, and to create initiatives that facilitate the frictionless shopper funnel. It is not enough to only uncover problems during the shopping mission, it is critical to respond (almost in real time) to alleviate barriers of conversion.

While StoreDNA has been a pioneer in behavioral and decision-making platforms for retail, we’re working hard on envisioning the next stage in retail decision making, which we call 'Responsive Retail'.

RESPONSIVE RETAIL

Imagine a store which senses the needs of their shoppers in real time and changes the environment to provide best possible experience at all times. Luxury stores could employ an opt-in solution with which loyal customers will be recognized and offer tailored services. Imagine a store which recognizes your favorite music and plays it when you shop with your spouse. Way-finding directories would change in real time according to the shopper age and gender. Queues would be managed in a more precise manner, notifying sales staff when potential lines form. Fixtures would be modular, and you would see a different store in the weekends when more shoppers are on the floor. Environments would be less dense, thus enabling shoppers to have more space to shop.

In thinking more about Responsive Retail, we drill down below on some key elements.

RESPONSIVE WAY-FINDING

Imagine a sign which knows where you want to go. For instance, in a three-story flagship on Oxford Street with product areas divided by gender, it would be wonderful to have adaptive signage directing men to floor two, the men’s apparel floor. All screens should be adaptive and match the shopper to his ideal assortment. In the future, we believe that these screens will be almost like commercials from Minority Report (though less intrusive and opt-in). For instance, digital spec pods in car dealerships and auto salons will recognize the buyer and adjust content real-time. If we know that young women care about color choice, we can push color configurations as the top content in the pod.

DYNAMIC QUEUE MANAGEMENT

Queues are probably the most frustrating part of the shopping trip. Most often, queues are actually caused by poor staff management and can be heavily reduced by timely responses. Looking ahead, store cameras will be able to tell when we need to open extra cash registers or send additional staff with mobile checkout to accelerate this painful part of the shopping experience. Also, digital screens could intelligently navigate shoppers to other checkouts or fitting rooms which are available on other floors. We foresee that every staffer will be equipped with digital assistants on her/his phone or watch, which will expedite back-end communication and help complete purchases in a less painful manner. Certainly, current piloting of Amazon Go stores in Seattle brings many new queue management ideas closer to reality.

MODULAR FIXTURE DESIGN

At StoreDNA, we often see that a store’s layout works great for six days in a row, but for Saturday, dense fixtures actually act as a barrier. This inhibits shoppers from moving freely around the store, causing anxiety, and increased bounce rates. If we had modular fixtures, it would be easier to remove "extra' fixtures on busy days, reducing the bounce rate and increasing overall dwell and conversion.

DYNAMIC EXPERIENCES

If you have ever been to Abercrombie & Fitch, you have heard music pumping from speakers. This is good for most shoppers, as it spikes their experiences by inducing more dopamine (research shows that people exposed to more dopamine are more likely to spend money).

However, for example, when a couple is shopping together, they should be able to talk and consult. Imagine if a store could sense when a couple enters and lowers the volume to enable conversation. Or if a store 'sees' a wondering man waiting for his spouse, it could guide him to a resting area with newspapers and coffee. These dynamic adaptations would boost the overall quality of shopping experiences and enable customers to spend more time in the stores.

PERSONALIZED SHOPPING EXPERIENCES (OPT-IN)

We believe that personalized experiences and increased conveniences are coming to those shoppers willing to share a bit more of their data.

For example, mobile phones and face scans could recognize shoppers, thus informing sales staff of their name, shopping history, and preferred SKUs and styles. A mobile phone app could show the shopper an individualized path based on her preferences and in-door GPS would lead her to the items she wants. Also, tailored recommendations would suggest complimentary items to perfect the look. Think SIRI as a personalized stylist.

These kind of applications will also prove useful in other environments such as museums. It would be great to have a personalized itinerary and curator for every visit.

MAKING SURE WE HAVE ALL SIZES

We predict that stores will have automated shoe and apparel size scanners using video and other sensor technologies. Imagine a foot scanner implemented in the floor, scanning feet as shoppers enter the door. This will allow retailers to have a complete database of sizes of the shoppers who are actually visiting. By comparing stock levels and units sold, retailers will more easily predict exact quantities in preferred sizes and fewer shoppers will be disappointed finding product they are looking for.

Let us know in the Comments what you think about our ideas and how you believe technologies will shape our future shopping experiences.