Reinvent stores with technology
When online commerce first came into being, the goal for retailers was to replicate the in-person experience of their stores on the digital platform. But as technology advances, the opposite is now the case, and retailers are increasingly looking to bring the rich, frictionless experience customers enjoy online to their physical outlets.
According to Mike Dowson, commercial director at Trust Systems, Covid-19 has further disrupted consumer behavior and put even more pressure on physical stores from e-commerce as shoppers have become increasingly comfortable with the online channel. There was therefore a need for change, leading to the creation of new, more immersive roles for stores and better integration into retailers’ overall digital strategies.
The most radical technological change is the cashless shop. These were pioneered by Amazon but have become an increasingly competitive area and since then various solutions have come to market with countless retailers including Marks & Spencer, Aldi, WH Smith and Tesco testing the concept.
One solution in this space is MishiPay, which provides its Scan, Pay & Go self-checkout technology to retailers such as Flying Tiger and Muji. Shoppers scan a QR code upon entering the store, then use their mobile device to scan the product barcodes before paying on their device at the end of their visit.
Unlike systems based on computer vision and smart shelves, adoption requires very little cost, according to David Grenham, Marketing Director at MishiPay, who says, “Physical retail has had to catch up with the frictionless experience [enjoyed] online, where it’s a very autonomous journey, but you miss the personal part and the opportunity to touch and take products home.”
The MishiPay solution therefore does not seek to completely replace in-store staff and do away with all forms of interaction, but instead offers a complementary alternative to checkouts that encourages interaction with shoppers – both by in-store staff and via their own device an in-recommendation engine that uses an algorithm and artificial intelligence (AI) to intelligently sell items.
“It can identify item pairs, recommend batteries with relevant products, and handle ‘customers who bought this also bought that’,” says Grenham. “It also allows for item searches, as well as offers and promotions that help retailers who have a surplus of items they want to move. Muji uses this often [functionality] when launching new products.”
The opportunity for ad interactions in its checkout stores has not been missed by Amazon, which is exploring selling digital advertising through screens and other in-store assets like smart shopping carts. This will be a much more data-intensive offering than has traditionally been the case with in-store digital signage.
Digital signage rethought
Trust Systems is also very much involved in this reinterpretation of the digital signage offering. “We needed to shake it up, make it relevant and run it in real time,” says Dowson, who works with Samsung Electronics.
“We have an opportunity to get rid of the old content that is often found on digital screens – like Easter eggs promoted around the holiday season! It’s too much about old playlists and that confuses customers,” he says, adding that the retailer may have a range of products that need to be advertised quickly and sold via discounts that target specific screens in specific locations efficiently Germany can be brought real time.
Dowson also highlights how digital signage solutions have the potential to integrate facial recognition and leverage the data that results from a customer’s activities. He points to the traditional scenario where, upon entering an independent store, people like to be personally recognized by the owner and recommended relevant products based on the owner’s knowledge.
But to do this at scale in a large retail company requires data and digital technology, he says. “This is the only way we can offer an immersive experience and promote relevant products. Retailers need to look at who’s in store [possibly using facial recognition] and promote to that group.”
Steve Powell, Business Development Partner at Kyndryl, says facial recognition and cameras in stores are increasingly harnessing the power of AI and machine learning to recognize patterns and make decisions more efficiently than humans. A system using AI and facial recognition is being tested by Asda and includes a camera in the self-checkout terminals that can verify a customer’s age when purchasing alcohol.
Glenn Edwards, Leon Restaurants
Unlike manufacturing, Powell doesn’t think AI in retail will lead to robotics and automation that reduce the human element. This is certainly the thinking at Leon Restaurants, which is introducing kiosks in its premises, with the main objective of improving the customer experience.
Glenn Edwards, Managing Director of Leon Restaurants says: “The biggest benefit is the enhanced customer experience. With ever-changing dietary habits and new laws on allergens and calories, the use of kiosks gives the guest full control of their dining experience, with all the information they need.”
The company has worked with Vita Mojo and Centra to create the entire infrastructure, which includes aligning the customer kiosks with its kitchen management system, point-of-sale, CRM (customer relationship management) platforms, and warehousing and work scheduling.
“Over 80% of the restaurants are now fully operational and we will complete the property rollout over the coming weeks, along with our new restaurants across the country going live online,” says Edwards. “In restaurants that are now fully equipped with kiosks, over 85% of transactions are now processed through them.”
An added benefit of the kiosks is the data they generate, which helps with menu development based on customer habits and needs, says Edwards. “Our mission is to put the data in the hands of restaurant managers, so they can make intelligent decisions to improve the guest experience. All of our systems report to BI [business intelligence] Dashboards for real-time reports that enable localized decision-making in the moment.”
Tablets in bike shops
Instead of using kiosks, Ribble Cycles has instead introduced Android tablet devices to its six showrooms, positioning them next to each of its bike models. Matthew Lawson, Chief Digital Officer at Ribble Cycles, says: “The showrooms are designed as an extension of our digital presence and we are using the space to allow customers to continue their shopping journey as a rich experience.”
The tablets dynamically pull the relevant bike information from the Ribble website, which is determined by their location in the store. Since the information comes from a central repository that flows into all touchpoints and channels of the company, changes only have to be made once and are distributed across the entire portfolio. “It means everything is consistent and takes a load off the team in the store,” says Lawson.
The checkouts and website are also powered from this single backend infrastructure, ensuring the customer is viewed from one view. This allows the customer to log into the website and continue their shopping journey that they may have started in store and checkout seamlessly.
This cross-channel journey is further enhanced by “Ribble Live”, which is GoInStore technology that connects shoppers on the website with an in-store specialist via video connectivity. “Not everyone can visit our showrooms, and people often have a single question they want to ask of an individual before committing to a purchase,” says Lawson. “That leverages the capital investment in the showrooms.”
This live video interaction is so powerful that it generates 10x the conversion rate of an online-only customer and the average order value is 40% higher. “It humanizes the digital process,” adds Lawson.
The final element of the technology offering in Ribble Cycles stores are the digital screens, which will soon allow customers to press play on the tablet devices and trigger video images of the relevant bike on the large screens. This content can also be managed from the head office’s CRM system.
As all Ribble cycles are built to specific customer requirements and its products are only sold direct to customers, the finished products are either picked up at a store at a later date or delivered to the customer’s home. This requires management of the fulfillment process, but it’s not high volumes that would give Ribble a headache.
This can pose serious problems for other businesses, especially supermarkets, where the speed of delivery of online orders is an important factor. Colin Coggins, chief commercial officer at Fabric, which works with companies like FreshDirect, Instacart and Super Pharm in the US, says the ideal solution for such retailers are micro-fulfilment centers (MFCs). These semi-automated warehouses can be integrated into existing branches that are always close to customers.
Colin Coggins, Cloth
“Our MFCs are in close proximity to the end user, which allows for quick delivery,” says Coggins. “They achieve impressive throughput and efficiency through dense product storage and software-controlled robotics to accelerate order fulfillment, item pickup, picking and packing. Humans and robots can work together in our MFCs to achieve a more efficient, profitable and sustainable approach to order fulfillment and delivery.”
They can achieve a 200 percent increase in the number of items processed per day compared to a traditional fulfillment center and require about half the floor space in just 10,000 square feet.
Coggins adds, “Retailers understand that in order to meet changing customer expectations for faster deliveries, they need their fulfillment operations much closer to their customers, and to do that profitably, automation is key. Micro-fulfillment is becoming the standard that, through the combination of customer proximity and automation, enables retailers to quickly scale their e-commerce business.”
Such solutions show how much more advanced the digital space has become since the dawn of online shopping and how physical space can play an integral role in the overall shopping journey – but only if the appropriate technology is implemented.