How can retailers make in-store a more flexible shopping environment?

For every positive story in the retail press at the moment, there seems to be a contrasting tale of lesser fortunes. For example, Ocado has announced a first-quarter jump in sales, with average orders increasing nearly 17%, and weekly orders passing a quarter of a million for the first time. Compare this to the wider grocery industry, where profits are falling and sales are stalling, and it’s clear that more needs to be done to keep customers satisfied.  It’s not a just supermarket thing either; only last week, John Lewis revealed a near 10% fall in pre-tax profit.

What makes John Lewis unlike some of the other retail brands to have suffered a dip in sales is that they simultaneously announced a plan to drive recovery. The department store chain is moving their services to 7-day delivery, driven by the “need to reflect how and when our customers are shopping with us” in the words of Managing Director, Andy Street, as “customers increasingly want flexible shopping and delivery times”.

The fact that John Lewis wants flexible shopping as well as delivery is important. The recent success of Ocado would indicate that fulfilment is high up the priority list for consumers, but convenience and seamlessness rank highly also. PWC’s Total Retail Global Report 2016 shows 55% of UK consumers cite convenience as their main attraction to online shopping, compared to just 37% being motivated by price.

Bearing this in mind, retailers need to focus on making the store more flexible and agile, in line with shopper priorities. Click-and-collect has been the first hugely successful cross over service in this area; 60% of consumer report they have used it, and a huge 98% recognise the concept. This illustrates that, despite drops in foot traffic, shopping in-store is still an important channel for most consumers.

So how can retailers create a store environment that not only attracts shoppers, but also meets their expectations and encourages them to spend? PWC asked a sample group of online shoppers how retailers could enhance their physical stores, and better alignment of in-store and online services ranked highly. With this in mind, we would recommend retailers focus on enhancing three core aspects of their bricks-and-mortar business:

  1. Increase communication between staff, and locations, to streamline the customers experience

Poor in-store communication has long been a problem for some retailers, but improving it needs to be a priority. We know that a third of consumers have abandoned a shopping trip because they couldn’t get the information they needed prior to purchase, while 4 in 10 have left a store and sought the item elsewhere. The industry needs to understand that consumers place value on the ability to check online stock quickly (32%) and sales associates with a deep knowledge of the product range (40%).

Alongside providing training to empower their staff with all the information they need, retailers should consider investing in managed data networks to address this problem. Giving sales associates connected devices can improve their access to knowledge about the customer, as well as giving instant access to stock information, store transfers, and transactional capabilities, but these will only run efficiently with a robust supporting network

  1. Improve systems to reduce waiting times

Shoppers, rightly, demand the speediest checkout experience (35%) possible, and retailers know queuing times can have a negative effect on sales. Yet many are working with overloaded systems, which can affect not only payments, customer queries, and processing orders, but also core tasks including inventory. This has huge potential impacts on customer loyalty, with a third (32%) of consumers not returning to stores with slow service, and 1 in 5 being put off buying from that brand over any channel.

In response, retailers should review their systems and consider updating them, or even just increasing bandwidth, to avoid technical downtime.

  1. Invest in the customer across all channels, to deliver a joined up experience

PWC’s report clearly demonstrates that technology is as important in-store as online. A fifth of customers are interested in store WiFi (22%) and most use their mobile phone as an important research tool when wandering the aisles. Alongside this, many shoppers would like to receive mobile promotions in-store, be able to access loyalty programs, and make mobile payments.

With 3 in 10 believing the quickest way to answer queries is to look up the question on their own mobile device, retailers can better facilitate consumer needs by ensuring there is a fast, secure WiFi offering in place, and also providing independent technology experiences such as in-store tablet information points.

To find out more download our report More than words – Why retailers and customers are becoming disconnected by the store network – and how to fix it

The secret to successful store expansion

Online retail is no stranger to positive headlines. In fact, it sometimes seems that all we hear about in the industry is the strength of ecommerce.

And it’s these types of stories that have put stores in the spotlight for the wrong reasons. Although 90% of all sales still happen in physical shops, there seems to be far more of a focus on the aspects of bricks-and-mortar that aren’t doing quite so well. For example, in the last few weeks alone, BHS, Greggs and Dixons Carphone have been making headlines regarding store closures.

One of the key reasons that stores close is because they don’t resonate with shoppers; in the interactive, instant world of digital commerce, store layouts and processes can appear outdated. However, this is something that can be amended – and there’s a huge appetite amongst retailers for getting the store right and growing its presence. New research by CBRE has revealed that retail estate expansion still remains high on the agenda, with 83% of retailers adamant that store growth will not be influenced by the rise of ecommerce this year. After all, there is no online substitute for seeing, touching and trying items before purchase.

The benefits of bricks-and-mortar haven’t gone unnoticed by e-tailers. Already this year, we’ve seen their eyes move towards the high streets, with the likes of Missguided announcing its first offline stores. Yes, the business is doing very well trading as it is, but if they want to grow even further, it makes sense to offer a physical experience as an alternative too.

So how can retailers optimise their stores for profit growth – and potential expansion if they get their formula right? For starters, today’s connected consumer is all about convenience and, as we well know, that doesn’t necessarily mean choosing between online or offline retail. Instead, shoppers want to switch between the two at different stages of their journey, and they need to know that retailers will allow them to be flexible in this respect.

Achieving this level of agility means incorporating some of the elements that shoppers love about digital platforms into the store experience. Some retailers are already way ahead of the game, launching concepts that aim to convey the ‘store of the future.’

House of Fraser, for example, recently experimented with shoppable windows, whilst Tommy Hilfiger has brought the runway to the store using virtual reality headsets. These are pretty ambitious of course; the store must focus on perfecting the basics before taking this kind of leap. Investing in more mainstream technology such as mobile POS is one good example of connecting the bricks-and-mortar experience through online functionality.

Another key consideration is the interaction between ecommerce and store activity through click-and-collect. Even though many retailers already offer the service, there are still elements of the process that frustrate customers. Perfecting the ‘collect’ part should now be a major focus for stores, making it a pleasant experience for those finalising their purchase. Enabling speedy payments technology, such as contactless, will be handy here, as well as ensuring the right amount of staff are there to keep the queues running smoothly. Streamlining the click-and-collect element will increase the opportunity to encourage further impulse purchases.

Of course, not all online browsing will take place at home. In an era of smartphone addicts, it’s now habit for consumers to rely on their devices whilst in a store too. Vodat International recently commissioned some research that revealed 54% of shoppers use their smartphones to compare prices in the aisles, 46% look up product information and 44% for personal reasons, such as checking social media. The bottom line is that consumers expect to be able to connect to the web whenever suits them – and that includes within the bricks-and-mortar shopping journey.

It may seem obvious, but there are still retailers that do not invest properly in strong WiFi to encourage this behaviour in controlled circumstances. In fact, 3 in 10 shoppers don’t find the current standard of WiFi unreliable. Retailers with sub-par WiFi are not only at risk of frustrating their customers, they are also losing a valuable opportunity to understand (and react to) their behaviour patterns. Provided they select the right provider, retailers will be able to interact with, influence and capture insight on consumers when they log on to the network.

It’s great to hear that retailers are feeling optimistic about the potential of stores, especially at a time when ecommerce is threatening share of sales channel. Gone is the time where stores and online were two separate things; the future of the store is very much intertwined with digital interaction. If they go about it in the right way, retailers can now harness the power of ecommerce in the physical environment, and use it to boost profitability.

Stay tuned for our new report – Battle of the bandwidths: why customers are won and lost on the strength of retail networks – which will provide even more insights into the connected consumer.

Is retail ready for the mobile-obsessed shopper’s rise to power?

123: that’s the number of times the average 17-25 year-old checks their iPhone every single day. To put this into context, that’s 30 times more than 26-35 year-olds, and a whopping 86 times more than those aged 55+, according to the latest Kantar data.

This information is not surprising – we all know the younger generations are glued to their phones most of the time – but it does beg the question as to whether retailers are listening to such statistics?

Right now, it doesn’t matter too much on the whole, because older shoppers are those with the greatest disposable income. Last year, the average 30-49 year-old could enjoy up to £1,400 to spend on goods and services each month, compared to around £100 for the 18-30s.

However, today’s tech-obsessed shoppers are tomorrow’s young professionals, and today’s young professionals are tomorrow’s high flyers. And when their disposable income starts to grow, they’re going to be just as (if not even more) affiliated to their mobile device.

To capture this audience when they reach their most profitable, retailers need to be creating a mobile-first strategy today, which puts in place the foundations for effectively reaching customers via this ever-growing channel.

Some companies already are; Walmart recently announced the launch of an SMS service, which sends shoppers verbal directions through their smartphone to the item they’re trying to find. They can then text the word ‘chat’ to receive one-to-one customer service.

Others are beginning to incorporate mobile into their outbound marketing strategy. Just this week, Pizza Hut launched a number of ‘smart restaurants’ in mainland China, which uses iBeacon technology to beam coupons, special offers and competitions to patrons’ devices.

But there is one absolutely fundamental component to any mobile-based retail and hospitality strategy, and that’s the network. To connect with customers, customers first must be able to connect – and this means having a robust, secure public Wi-Fi connection.

Free Wi-Fi is still not a universal concept in UK retail, so a huge step forward must be taken by the industry if we want to truly engage with shoppers across the devices that have come to dominate their lives.

Until consumers are able to get online in-store in a frictionless manner, retailers are missing an opportunity to build and strengthen relationships with them. This needs to be addressed as a priority, before Millennials grow up to become the country’s biggest spending group, or the chance to drive mobile revenue could slip through companies’ fingers.

Everything is connected

How many times have you wanted to plug in a new device at home and had to go searching for a spare plug point, forcing you to search for an adaptor or an extension lead? By the time you find one, you just want to get connected – concerns about cheap extension leads or incorrect fuse ratings leading to current spikes, go out of the window.

While most domestic networks can cope with device after device being bolted on, the store network has to deal with a host of device, signal, security and availability issues, as retailers add more and more innovations in a bid to improve the customer experience.

The problem is, the network is often the last thing to be considered, on the assumption that it can cope.

It can’t.

In a recent survey we conducted for Vodat International’s report – why retailers and customers are becoming disconnected by the store network – and how to fix it – 1 in 10 customers complained about both the lack of WiFi connection, and the number of sales associates not equipped with the right technology to answer their questions on the shop floor.

In addition, clearly, not all WiFi is the same, as some networks simply do not perform to the same standards as consumers take for granted in their own homes. And for the store, when the network is unavailable, trading can grind to a halt with money lost until it is restored; on a recent visit to a well-known health foods chain store, one of the tills had been down for more than 24 hours – apparently due to a simple network issue.

Smart retailers will create networks on a sliding scale: flagships get the most robust and layered network, while smaller, satellite stores will get a more basic service.

However, more and more retailers are now upgrading all their networks simply to reflect the fact that they are adding mobile payment devices, doing more online business in the store, and trying to give both customers and staff a better digital experience.

These are taking the form of either dual ADSL or 3G/4G for customers who want more bandwidth.  Those wanting business class connections with SLAs are moving to EFM and Ethernet connections.

Ultimately – particularly in an omnichannel world, where the store is the gateway not just to itself, but the retailer’s entire inventory – the network is the store, and as such deserves broad, capable and reliable connectivity.

How to embrace online in your retail store

If the path to true love never did run smooth, then it must be true love between consumers and retail stores. Despite the overwhelming majority of shoppers still using bricks and mortar for most of their purchases, the growth of online retail and, most recently, mCommerce, has forced retailers to integrate activity in the aisles with digital touch points.

But while much has been said about the complexities this brings to retailers and hospitality vendors, it seems the growth of multi-channel shopping has strong benefits. According to a new report by dunnhumby, multi-channel customers are far more valuable to brands than those who stick to one shopping channel – in fact, they are worth 28% more in terms of potential sales.

With this mind, it’s retailers with a bricks and mortar presence pushed themselves even harder to integrate digital into the physical shopping experience. And here are 3 key ways to do it:

WiFi

Research by GfK has revealed that 20% of consumers browsing a retail store are doing so whilst monitoring prices on their smartphone. This trend is known, known as showrooming, isn’t something to fear. In fact, to prove competitiveness at the shelf edge, retailers should make the process as easy as possible by ensuring your store is equipped with guest WiFi. Pair this with some form of price-matching guarantee to increase sales conversions.

Digital technology

Tablets and smartphones aren’t just convenience devices for consumer use; retailers can incorporate digital technology into store kiosks to offer unattended customer service – or use them within customer interactions to assist the sales experience. This has the added benefit of bringing online capabilities into the store, such as instant stock checks and increasing inventory availability.

Click-and-collect

It may seem like an obvious suggestion, but there are still many stores that have not perfected their click-and-collect offering for customers. Many shoppers find there is more choice and availability online, so choose to shop this way instead. Providing them with the option to pick up their order in store gives shoppers greater fulfilment flexibility. Upon arriving at the store, the shopper may feel tempted by the products in front of them – presenting your staff an opportunity to engage with that customer face-to-face and upsell.

Essentially, consumers buy into brands, not channels. They don’t care how the touch points they use test retailers’ resources; they want their goods in the most convenient manner, with a trusted and consistent experience every time.

Retail businesses that understand this behaviour, and work to integrate all their channels into a single brand experience, will be the ones to benefit from the added potential value of multi-channel shopping.

5 in-store challenges that didn’t exist 10 years ago

Whether it’s customer service, product ranging or managing profit margins, there are some challenges that have been on retailers’ radars for decades. However, the rising ecommerce challenge and rapid technology advancements over the past 10 years have impacted retail businesses in ways they could never have predicted.

Here are five challenges that the digital era has presented to retailers:

1. Click and collect

Although it was being trialled in the early 2000s, click and collect has increased exponentially over the past few years. It does create great up-selling opportunities – research by Deloitte has revealed multichannel consumers spend 82% more per transaction than those who only shop in store – but it also creates several logistical headaches, such as accommodating a new channel of distribution and return, along with adding another function to retail associates’ workloads.

2. Showrooming

One of the biggest changes in the way consumers now shop is their use of mobile in high street stores. Many retailers lose sleep over how to tackle shoppers browsing in-store but buying online, perhaps from a competitor. And these worries are not without reason; according to Microsoft, 42% of UK consumers admit to showrooming.

3. Webrooming

Thankfully, improvements in internet connectivity over the past decade have also facilitated physical retail, as those that don’t fall into the showrooming category often choose to webroom – research online before buying in-store. However, this places greater strain on customer service expectations, as consumers tend to be armed with knowledge and require detailed answers to complex questions before deciding to make their purchase.

4. Staggered technology

Retailers are working harder than ever to make the store environment more compelling by introducing features such as mCommerce, digital advertising and personalised mobile marketing via iBeacons. This creates a huge IT headache though, as retailers have to find a means of seamlessly integrating new technologies with legacy systems.

5. Great expectations

Ultimately, the more digitally dependent consumers become, the more they expect – and quickly. Ecommerce introduced the idea of a wide range of products being available at your fingertips, and improvements in mobile have extended this connectivity on the go. This is putting more pressure than ever on the store to deliver the same levels of satisfaction as online, despite core activities such as price updates, payment options, inventory tracking and product displays being much harder to implement outside of the virtual arena.

How can stores engage with mobile-ready consumers?

The concept of shopping online through your mobile phone has been widely adopted by consumers, but it seems the appetite for mobile engagement in-store is stronger than ever before thanks to the latest developments in smartphone technology.

New research released this month by IMRG showed that 4G is accelerating the use of mobile devices in the physical retail environment; 70% of smartphone users with 4G capabilities, regularly browse retail websites, with 48% of 3G users also using their phone for shopping purposes.

Although some of this activity will involve establishing direct online connections via websites and apps, consumers’ reliance on their mobile phones presents a major opportunity for bricks-and-mortar retailers to engage with them in-store. As mobile networks roll out their 4G coverage across the UK, retailers can use their in-store Wi-Fi facilities to connect with all shoppers using internet-enabled phones in the aisles.

By encouraging visitors to log onto your Wi-Fi, you can capture their details and activities, which enables you to market products and offers to them more effectively – both during their visit and afterwards, through other channels. Recent statistics by Savvy Marketing show 65% of UK consumers are open to receiving targeted offers to their mobile phones.

In addition to encouraging sales, personalised marketing also nurtures long-term customer relationships. This recent blog in Big Hospitality looks at the topic in greater detail.

One of the big plusses of Wi-Fi over mobile-based connections is reliability, as 4G is not available across the whole of the UK at present. However, creating a relationship in which consumers log-in rather than use their mobile’s built-in connectivity, is dependent on the quality of your Wi-Fi service.

A separate, secure network solution for public use is the essential foundation for any retailers hoping to bring digital consumer engagement into the store environment.

Hotels should capitalise on broadband services

The hotel industry could learn a thing or two from the retail industry, for which broadband technology is now a well-established fixture. The hotel industry is all about customer service and given that customer expectations are greater than ever, broadband services are critical to delivering complementary services and driving sales.

Primarily used to cut the cost of telephone calls, broadband networks in retail are now seen as the backbone for managing the store environment in a more dynamic way. Not only better connecting the retail estate, but delivering value added services.

On the private network, staff across the retail estate are connected in real-time, payments are highly secure and PCI compliant and the management of sales and merchandising data from the stores is used to analyse performance – with multiple stores and head office all connected via the network.

Operationally, broadband can also be used for e-learning, IP video and loyalty schemes.

On the public side, the network can support a host of engaging services, such as, media displays, MPoS, connection to online via a tablet and free WiFi services.

Free WiFi is now also expected in hotels and most importantly customers want good connection when using their laptops or tablets devices – especially when it’s for work purposes. The overall network service needs to be seamless and stress free so customers aren’t left waiting around to make a transaction because of bad connection.

Public networks can be used to deliver promotional content on media screens, better promoting hotel services such as Spa treatments and additional sporting activities.

It’s a win, win situation for both parties, with customers getting the most out of their experience and hotels capitalising on their facilities while delivering a more seamless service.

4G – hype or alternative to fixed line internet access?

There has been a great deal of news in the national media and on TV about the launch of 4G services in the UK, particularly since EE (formerly Orange and T-Mobile) was awarded the first 4G spectrum last year, resulting in the imminent auctioning of spectrum licences to other mobile operators and download speeds potentially faster than fixed line broadband.

The question is; have we at last found a technology that will replace fixed line broadband services in business premises and at home and therefore negate the need for a standard telephone line?

Well it’s not the first time the telecoms industry has faced this question. It was also posed when 3G services were launched in the mid 2000’s, offering theoretical speeds in excess of the fastest service at the time. The reality being, that even though 3G offers extremely fast download speeds, few of us have ever experienced what the technology is capable of.

The main reason for this is, congestion on the networks, or put another way, the networks have been unable to cope with customer demand, particularly since the explosion of smart phones and tablet devices. As a result, actual speed is greatly affected by a user’s location and how busy the local network is, i.e. how many times have you been stuck in a traffic jam or at a busy event and been unable to get a reliable connection?

Most network operators are investing significantly in their networks to support 4G, evidenced by the merger of T-Mobile and Orange, and Vodafone’s acquisition of Cable & Wireless. So we can at least hope that the experience on 4G will be sufficiently better than 3G. With the impact of the investment in networks by the mobile operators yet to be understood and Ofcom’s aim in auctioning licences to achieve 98% UK coverage by 2017.

The reality is that we won’t know for some time whether 4G will be a technology that we can use as a reliable replacement for fixed line network connections – particularly in a business scenario.

As a network specialist, Vodat International continue to monitor the progress of 4G services as they are deployed by the operators and will keep readers updated on its progress.

How Mobile brings retail channels together

Critics are rejecting the idea that retailers are operating in an omni channel world; they claim that most retailers are still not even multi-channel, saying that they may have optimised their operations and communications through each channel, but not across channels. Mobile is clearly one of the ways in which retailers can provide a consistent, seamless experience to customers, almost regardless of the channels.

Retailers can use mobile devices in various ways to interact with customers and improve their experience, from tablets used in-store for mobile PoS, visual displays and online services, to sending electronic coupons and gift vouchers to a customer’s phone, keeping them updated on offers.

For instance, in store, tablets connected to the internet via WiFi are a great way for retailers to offer their entire product offering, where previously they could only offer a limited range. This delivers better variety and availability of products which in turn helps drive sales.

A great example of this is our recent project with Reiss, the international men and women’s fashion brand, which has introduced iPads across all UK and US stores with a new fully managed WiFi network, in a bid to complement its multichannel offering and give customers full visibility of its entire product range.

Mobile gift vouchers are a great way of building customer loyalty and enticing customers back in store. Typically, the best deals are available online, so mobile vouchers play an important part in customers feeling that they can also receive good value for money in store. A step up from this is using mobile for up selling, if retailers can identify specific customer purchases, a mobile teaser campaign can be launched to promote products related to their purchase.

Another method of delivering vouchers to customers via mobile is the use of push notifications. When a customer is within close proximity to a store, a direct message can be sent via short-range networks such as Bluetooth, with offers and discounts to persuade them to venture in.

A great example of the use of mobile technology in retail is the recent project with Reiss, the international men and women’s fashion brand, who has introduced iPads across all UK and US stores with a new fully managed WiFi network in a bid to complement its multichannel offering and give customers full visibility of its entire product range in-store.