Shopping used to be simple. You drove your car to the shopping mall or town centre, parked, visited some shops, then packed everything in the car and went home. Now retailers are creating personalised online shopping experiences and apps offering Augmented Reality functionality. Is there really a need for all this digital engagement or are retailers just getting caught up in a wave of hype?
Unfortunately for the traditionalists, I don’t think this is hype. The online shopping experience has grown to be preferred by many customers exactly because it can be more personal. When a retailer knows what you have bought in the past, and all your likes and dislikes, then they can create recommendations and offers that are laser-focused. Walking into a store can feel extremely anonymous when you have become used to online shopping.
And some technologies may create a digital transformation in their section of retail. Look at the furniture business for a good example. It is difficult to know how that attractive table and chairs in the store will really look like at home until it has been paid for and delivered. If it doesn’t work out, then bad luck. Ikea is offering an Augmented Reality app that lets customers virtually place any of their furniture in the home without even needing to visit a store.
But digital engagement is not just about innovation and personalisation. There is solid evidence showing that customers who shop in-store and also online are much more valuable to retailers than shoppers who only ever shop in-store or online. These omni-channel shoppers should be nurtured by making it easier for them to use and blend both channels.
As this Harvard Business Review research demonstrates, this may require a strategic shift in how the retailer uses their space in-store. Omni-channel shoppers generally spend 4% more in-store and 10% more online than single channel shoppers. The in-store environment may need to be redesigned to support shoppers who are also comfortable online – easy access to the loyalty scheme and personal offers or recommendations are particularly important.
Retailers have often feared the ‘showrooming’ effect where shoppers test products in-store as they gather information, then order online from the cheapest seller. In fact, many customers are actually ‘webrooming’ today – they gather information online and come into a store to make the final checks and purchase. In many areas of retail, such as car dealers, this has made a dramatic difference to the sales process. Customers often walk into car dealers today knowing exactly what they want because they have been researching their options for months.
The implication is that if you are not a digitally engaged retailer then you cannot meet the customer expectations of today. There is now a symbiotic relationship where the online experience is supporting the in-store experience and vice versa. Retail leaders will focus on their omni-channel shoppers to ensure they deliver a great experience online and in-store. Leave a comment below and let me know what you think, or get in touch on LinkedIn.