Retail Survey: The New Dynamics of Shopping!

For all the shopaholics out there, I have this one very important question; i.e. what has been your best shopping experience so far and where? Was it related to clothing or technology? Did you have it at a specialty retailer, a chain store, or a mall? Most importantly, did the joy of selecting and purchasing surpass the joy of acquiring a brand new item?

Before we set out to explaining exactly what makes a shopping experience more enjoyable for the customer, we must tend to another question related to his shopping skills: Does he know how to shop? A number of things determine those skills including the customer’s behavior, age, level of awareness, familiarity with other brands, usage of information technology and social status. With changing dynamics of retail shopping, the consumer knowledge must keep up. It is only when a consumer is reasonably informed that we can assess the ultimate satisfaction derived out of a shopping experience. Only then can we question the retail practices of a store or brand outlet.

A Futuristic Shopping Experience:

Ah, just thinking about shopping makes many of us smile, and thinking what the future holds to improve our experience makes us dreamy and excited. No matter how long we have to wait outside a mall or spend time inside comparing various products, how many extra items we buy and how many overtimes we are compelled to take in order to balance out the expenses; we just can’t deny ourselves the pleasure of shopping at an exquisite store.

Sometimes we go overboard and buy stuff we don’t need. This means spending a lot of money on things that are of minimal value to us in real life. We just succumb to the glamour and finesse of the object and regret the deal later.  “I shouldn’t have gone to that store in the first place,” we say disappointingly to ourselves. The mental and emotional satisfaction of the deal turns into a feeling of guilt and shame. It multiplies when you later find out the same object at much less price at another store. If you are already thinking “been there, done that” then chances are that you will be embracing the idea of futuristic shopping with more vigor than an average buyer.

Shopping, today, is based on technology. Almost every brand out there is busy with targeted mobile advertising. Search engines show ads based on your random searches. Conversion rates are high on pretty much every brand site. Many of them offer smartphone apps to make things more accessible for masses. But where the perfect smartphone app for marketing benefits entrepreneurs and brands, they also help the customers make sensible decisions about their purchase. They now have the comfort and privacy of their homes and time to think it through before clicking on that button “Buy”.

A Peep into the Digital age:

In the world of digital signage and payment processing, a tech-savvy customer is thoroughly empowered with knowledge at his fingertips. Imagine this: if, for some reason, a young woman needed to buy a cocktail dress urgently, she could simply log onto her favorite brand’s website, open her account, choose a dress with the help of an attendant who served her in-store two months ago, and order.

To get the accessories and stuff, she drives to a nearby outlet and another attendant has all the things ready that match her online purchase. She likes some of the items including a hand bag so she uses her smartphone to scan the barcode and finds a cheaper option at another store. That saves her about $24 but the salesperson quickly gives her a discount to match the other price and shows her a delicate piece of jewelry that complements the overall look.  The jewelry looks gaudy and expensive so she sends an image to her BFFs to ask for their opinion. After getting more votes in its favor she quickly checks her budget online and orders it to be shipped to her home overnight.

The scenario may be fictional but don’t you feel that most of it is already happening in real life retail business? Most of the technology our imaginary customer uses is being employed by certain companies and within a decade, will be available to the average retailers and small business owners. A technology based shopping experience looks heavenly for an informed customer. The web at 25 is already revolutionizing the markets but more in favor of the customers than the retailers.  Linens ’n Things, Tower records, Circuit City, etc. are already facing the music but there will be more victims – and even, casualties.

Retail Sector Technology Adoption Survey:

A research released by CompTIA in mid-2012 revealed that Information Technology (IT) development in the retail sector continues to transform it with digital signage, mobility, transparency in payment processing, and the social engagement that gives retailers capabilities and challenges alike.

The Retail Sector Technology Adoption Trends Study exposed that about seventy-two percent of retailers who were surveyed considered technology like a backbone to their business. The figure was supposed to increase by 83 percent this year. Ironically, it also became clear that most of those retailers weren’t as successful in using technology as they would like to be. Only seven percent achieved their technology goals and 29 percent reported as being close to their targets. The overall data was collected by surveying 500 U.S. retailers online in primary retail categories, such as, home goods, beauty, health, apparel, and so on.

Discussing the difficulties businesses have in reaching the optimal state of technology utilization, Tim Herbert, the Vice President of research wing at CompTIA said: “the vast majority of retailers clearly want to improve their technology utilization. For some this will involve adoption of new technologies; for others, improving the use of what they have in place.”

The survey also found out that among the most trending technologies, geo-location services rank highest on the adoption intent. One in every five retailers uses geo-location technologies to reach customers. The strong interest may be a result of putting defensive against “showrooming” which impacts the businesses negatively. Showrooming is the practice when a customer visits an actual brick and mortar retail store and then makes a purchase from another online vendor for a cheaper price.

“Location-based technologies can give retailers the tools to incentivize in-store purchases, such as special discounts for in-store customers who check-in via an app,” says Herbert.

The Winners!

The study clearly indicates that in due time, waiting in long queues at stores would become a sign of bad customer service instead of standard procedure. Therefore, every retailer would need to find out what mobile transacting looks like in their environment. There have been two winning cases so far, Apple and Nordstrom, who were the early adaptors of mobile point-of-sale (POS). Apple employees, especially, look up the product info on their iPads and checkout customers, demonstrating some of the best mobility practices.

John Kenney, SVP of business development at Stella Nova Technologies Inc. commented in these words: “There is no argument that they have a seamless and well-thought through approach. When you walk through an Apple Store everything makes sense. Store operations, merchandising, and technology all complement one another in their environment.”

Similarly, Nordstrom also incorporated the use of technology in 117 of its stores by providing 6,000 sales associates with modified iPod touches. Each device is equipped with a scanner and a credit card slider to improve the customer service tenfold. Every customer can be checked out from anywhere in the store. This awesome technology not only reduces waiting time       but also the time that a customer takes while contemplating the object. The 2012 March sales report of the company revealed that “Preliminary quarter-to-date total retail sales of $1.73 billion increased 15.3 percent compared with total retail sales of $1.50 billion for the same period in fiscal 2011.”

There are many retailer, however, who are still reluctant to dive head-on into mobility testing. Consequently, they face mixed rate of adoption and trouble implementing the technology they have acquired already. Their pace is slow as their entrepreneurial vision is yet to be fixed around mobility.