The great British department store was once an experience to savour, with their impressive ornate buildings, elegant window displays showcasing their carefully chosen wares all finished off with a professional level of ‘are you being served?’ customer service.
The question which has been raised is, will the British department store become a thing of the past due to the advent of the Internet? With global online retailers such as Amazon dominating retail purchases, coupled with time-poor consumers looking for a click and buy approach the once loved department store is fast becoming a casualty.
Iconic department stores are suffering. John Lewis experienced a 77% year-on-year decrease, Debenhams’ sales were down 20% early January and House of Fraser had its credit rating downgraded in December with recent news of them planning store closures. Are we at risk of losing these long-standing brands?
So why the shift? Shopping is no longer perceived as a leisure activity, time restricted and bargain savvy we are now witnessing a consumer who shops for purpose rather than for pleasure. Faced with high rents, increased salaries and consumers wanting more choice it is becoming difficult to compete on the High Street against the ever-evolving online alternatives.
Retail owners have started to realise that survival depends on the ability to provide innovative offerings to customers to differentiate themselves whilst developing their online presence. An example of such is Selfridges who have integrated youth entertainment and events instore to appeal to the younger market, our future generation of shoppers.
So how can retailers embrace technology and create a memorable shopping experience to survive?
Artificial Intelligence & Augmented Reality
By 2020, 85% of customer interactions will be managed by AI according to research by Gartner. AI relies on a continual process of technological learning from experience. Algorithms powered by AI can rapidly come up with alternative options which are otherwise much more time-consuming to present shoppers with real-time suggestions and support.
In the future we will see it common practice to pull out your mobile phone and ask a question as you enter a store rather than seeking out a Sales Assistant or searching through the rails yourself. We are already seeing interactive technology that enables shoppers to self-checkout in fitting rooms, and it is clear this is just the beginning when it comes to revolutionising the shopping experience.
Research from the Boston Consulting Group suggests that brands that integrate data and advanced digital technologies to create personalised customer experiences are increasing their revenue by 6-10% – that is two to three times faster than brands that don’t.
An array of tools designed to deliver a highly targeted, personal in-store experience are now available. These range from ‘Smart Mirrors’ to beacon technology and digital shelf-edge display technology.
Apple explains iBeacon technology to consumers as the enabling technology for Apple devices to alert apps or websites (which the user has opted into) when someone approaches or leaves a location. In other words, retail or other venues that have beacons in place can detect where a customer is at any given moment. Then the retailer can push timely messages to that customer promoting products or providing other useful information.
For example, someone is walking past a retail store; if they’ve downloaded the retailer’s mobile app, the company can use beacon messages to capture their attention as they go by, enticing them to enter. Once inside, beacons can be used to make personalised offers, speed checkout processes and in fact anything else the retailer can dream up.
Statistics suggest that 62% of consumers compare prices online before committing to a purchase, and 84% will use their mobile devices to do so whilst shopping in-store. According to DigitasLBi’s Connected Commerce survey, 62% of consumers purchase more items more often when provided with a personalised service and 85% of consumers are more likely to shop in places that offer exclusive promotions in-store through Beacons technology.
Another concept is shelf-edge technology using software that monitors competitor prices, brands can dynamically update their prices in real-time. Using digital content, retailers can inform customers that live price comparisons have already been conducted, providing reassurance that they won’t get a better price elsewhere. This results in a shortened buying cycle and can also help to combat the consumer trend for ‘showrooming.’
Additionally, using RFID tags in clothing stores, which work in a similar way to barcodes but contain much more information enable garment information including; style, size and colour appears on a wall-mounted touchscreen device via the RFID sensor. The screen enables the user to request alternate sizes, colours and styles from sales assistants who are alerted by handheld devices.
The customer can also use the touchscreen to browse other suggested items that can be put together to create an entire outfit. There is also an option for customers to log into their online account and add items to their wish list. The customer can then sign up to receive alerts when the item is reduced or included in a promotion.
Magic mirrors are also being designed to make the clothes fitting process quicker and simpler. Topshop have introduced a mirror that means customers don’t need to get physically undressed to try on clothes. Built-in cameras track the customer’s body and reflects this onscreen. The device then uses augmented reality to superimpose selected items of clothing onto the customer’s reflection.
It is evident that the technology is readily available to prevent the downward trend of the department store by ensuring that shopping no longer appears as a chore but as an activity that is both pleasurable and uplifting, it just now needs to be adopted and integrated before it’s too late.