31 May 2018   

5 min read
Once the sworn enemy of bricks-and-mortar retailers, technology is fast becoming a very good friend, helping retailers to better curate their offerings to their customers.

“Retailers need to embrace the notion that while very different, digital and physical retailing cannot be treated as separate strategies. The very best retailers and shopping centres are blending these experiences,” says Gary Mortimer, Associate Professor of advertising, marketing and public relations at QUT Business School.

One way retailers are using technology to maximise their omni-channel presence is by making it simple for customers to order online and then convenient for them to pick up their orders.

Drive-through pharmacies have popped up around Australia over the years, but now Dan Murphy’s on the Queensland Gold Coast is taking things further with the trial of “ultra-convenient” click and collect.

As Mortimer explains, shoppers opt into the Dan Murphy’s App. Employing near frequency micro-location devices, Dan Murphy’s staff members are alerted when a customer is close by. This information enables them to prepare the order and ready for collection as the customer enters the store.

Then there’s Australia Post’s partnership with Woolworths to install at least 500 24/7 free parcel lockers in supermarkets across the country, providing shoppers with convenient parcel collection and returns for their online shopping.

Instead of having a parcel sent to their home address, shoppers can now pick it up when they do their grocery shopping instore or pick up their online Woolworths order. And, they never need to miss a delivery again.

Similarly, Zara’s new flagship store, which opened in London in May, has a dedicated area for the purchase and collection of online orders. And it can handle 2,400 orders simultaneously. After the customer swipes a receipt on a sensor, a robotic arm behind the scenes retrieves the appropriate package and delivers it in seconds.

Robbie Robertson, partner, experience design at Deloitte Consulting, also notes a shift in the US and European markets towards “showrooming” where retailers may use a space for a period to showroom their products.

“It’s like a pop-up store, but you don’t buy anything. It’s simply to let people come and touch and experience a brand. They are then driven to an e-commerce site where they can purchase the product and can then click and collect or have it sent to their home.”

Robertson says click and collect is being widely embraced by millennials. “As millennials become a larger spending group, there will be a seismic shift in this direction over the next five years.”

Radio-frequency identification (RFID) is also starting to be embraced by retailers as they meld their digital and physical experiences together.

All garments at Zara’s new London store, for example, are fitted with a RFID tags. In addition to the usual cashier desks, the store has a self-checkout system that automatically identifies garments being purchased. Customers simply confirm their items on a screen before paying with a card or mobile phone.

The Zara store also features interactive mirrors equipped with RFID that can detect garments customers are holding and let them see a hologram-style image of what the item would look like as part of a full outfit.

Elsewhere, near frequency communication, micro-location devices, such as beacons, are allowing retailers such as Macy’s in the US and Marks & Spencer in the UK to have much more direct conversations with customers instore.

This technology enables the retailer to identify where the customer is in their stores and push promotional offers to them.

Mortimer says: “We know that retailers have vast amounts of transactional data on their shoppers, based on loyalty card transactions. So, retailers know ‘who’ their customers are and ‘what’ they like to buy, but not ‘where’ they are. They may be on a train, in an office or somewhere in a shopping centre.

“Beacons connect with the Bluetooth in a customer’s phone, enabling the retailer to target hyper-personalised offers, in real time at point of purchase.

“For example, based on previous purchase history, or a personal profile, a retailer may be able to identify where a customer is within a shopping centre, or in a store, or even in a department, and push an offer direct to their phone. A coffee shop may ‘remind a customer’ at 10am, to ‘come in for a coffee’ and if the customer is loyal, may even offer to up-size the coffee.”

Robertson also points to this trend, noting it will spur on a lot more one-to-one marketing which may even correlate with the digital screens customers walk by and change their messages to those customers.

However, he expects privacy to be a big challenge here in the future. “Customers will have to consciously opt in and give permission to receive messages. I think our privacy laws will preclude us from seeing this becoming imbedded in the retail psyche in a mass way.”

That said, he believes the arrival of 5G, with its higher speeds, will further change the way we use Wi-Fi in public spaces and instore. “And we are only 18 months away from that.”