In-store optimisation: Treating physical stores as real-life websites

In-store optimisation: Treating physical stores as real-life websites

Retailers need to treat stores like websites. Just as developers use technology to evolve the quality of a company's online offering, businesses can use the same approach to gather insights on the high street and deliver a best-in-class brand experience.

Retailers should be making their stores work harder. Now, more than ever before, technology can empower businesses to act on the insights they can gather – and the reward is a best-in-class brand experience for the customer.

Stores are closing at an alarming rate. To date in 2019, Debenhams has announced 165 closures, Boots has axed 200 locations and Oddbins has shuttered 100. These are just the tip of the iceberg; in the US, 7,500 stores are set to close in 2019.

There are, of course, plenty of reasons behind these closures: economic difficulties, major shifts in customer behaviour, price-driven marketplaces and online competition to name just four. Yet regardless of what’s to blame, the message is clear: stores must work harder than ever to succeed.

We firmly believe that physical stores are still a huge part of the retail picture, but we also believe the way they work is going to have to change for them to survive – and much of this comes down to how they implement and use data.

Physical stores, like no other corporate asset, provide an opportunity to create a positive brand experience that creates brand ambassadors from customers that feel excited to come back time and time again. Once a customer is in the store, they’re a captive audience. They’ve actively taken the time to see what a business has to offer. It’s a fair assumption that they want to purchase something, and the role of the store is to make it as easy as possible to delight and convert them.

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Stores are living websites

How should modern retailers approach this? As always, the answer lies in the data.

For years, the most successful retail websites have been personalising the customer experience based on previous purchases. Data is used to identify the pain points in a customer journey and remove them. User journeys are recorded, analysed, interrogated and changed based on the findings. All of this is done to make it easier for the customer to buy their goods, time and time again.

However, physical stores need to adopt the same mantra.

As an extreme example, Amazon makes over 140,000 updates every day to refine its customer experience. While this level of change is obviously not achievable in store, the technology now exists to collect the data needed to gather the insights that can shape the in-store experience customers have. The store should be treated as a living website, which you can monitor in real time.

Looking to the future

As we’ve seen over the last few years, especially with the capitulation of former high-street staples, there are countless factors that affect physical store performance that are simply out of retailers’ control; competitor activity and economic conditions are less predictable than ever.

Efforts should be focused on the areas they can influence, with insights only they have. Using the wealth of knowledge and data already gathered from their own store networks, they should combine these with a focus on tuning their physical locations with data-led technology investments. These should not only improve the customer experience, but provide incredible insights into modern browsing and purchasing habits.

If you’re looking into options for collecting and acting upon data to optimise your performance, no list should go without these three concepts being discussed.

In-store product tracking

Technology can be cleverly used to gain insight into when products that are being viewed, picked up and put back. If rails were adapted with RFID or sensor-based technology, using tech similar to Amazon Go, crucial data could be gathered to see which products are hitting the mark with consumers. Stores should see this data in the same way that ecommerce teams respond to product page bounce rates and checkout abandonment.

From here, it’s all about understanding why these issues exist: is it pricing, packaging, or even the call to action? By collating and analysing this information and testing strategies based on it, bricks-and-mortar retailers can dramatically improve product performance.

This goes hand-in-hand with the use of existing technology at checkouts, which can easily and quickly gather data on a daily basis regarding sales volumes and peak shopping times. This can potentially be used to dictate which product stands go where on a given day, or in response to conditions of the day, such as weather.

Responsive fitting room technologies

Think of the fitting room as the basket page on a website – a consumer has picked the products they’re interested in, and close enough to buying them. As they enter the fitting room, RFID can identify the products, brands, styles and sizes being taken into the space.

This data could be used to make recommendations on in-booth displays to suggest products that could go well with them: a shirt to match those jeans, or a belt to match those shoes. These can be used as an upsell opportunity to a customer at the point of purchase.

Smart fitting rooms are most definitely the future.

For increased customer ease, products could even be added to the customer’s basket on screen and delivered to their door – or even just to the counter – removing any potential logistical barriers such as buying too much to carry, or simply making the process as hassle-free as possible. Equally, if the upsell product isn’t in stock in that store, that shouldn’t ever be an issue; it can be selected in the fitting room, added to an order and get it sent directly to the customer.

Video analytics

Ecommerce teams have used video analytics to document user journeys for years. In stores, these can be used to truly understand customer navigation paths and patterns. Video can even be used to review the performance of sales assistants, to statistically understand the right and wrong times for them to speak with customers.

This information can be logged to inform future merchandising decisions, to capitalise on what customers truly want. On top of this, it could identify aisles, shelves and tills that perform better and worse than others. There’s a huge opportunity to interrogate customer behaviour in-store, learn from it and optimise shop designs to improve both customer experience and, ultimately, sales.

Listening to customers in a new way

Customers are telling retailers so much. Every time they interact with a brand in-store, they’re giving them a piece of crucial data which, if collected, can be used to improve their experience. The technology exists to do this, and digital teams have made this discipline of data collection, analysis, testing and optimisation the foundations of their success.

This mindset needs to be rolled out to improve store performance. As ever, the answer lies in the data: use it to identify the problem, propose a test to remedy the problem, analyse the findings, then repeat, repeat, repeat.

Retailers will always face challenges; new competitors will enter the market, customer behaviour will change, the economy will fluctuate. But one thing won’t change: every time your customers interact with a business, they are telling it what they want. Now it’s time to really listen to them, then act upon it.

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