Insights

The Future of Shopping

BY CSA STAFF

By Matt Foster, Search Laboratory

The growth of mobile has made round-the-clock connectivity to the internet possible, allowing consumers to shop anywhere at any time. To cater for 24-hour convenience and on-the-go shopping, retailers are turning to innovative technology.

Digital is now commonplace in peoples shopping experience; Deloitte estimates that digital interactions influenced $1.1 trillion of all money spent in retail stores across the US. Deloitte’s 2014 Holiday Survey revealed that while consumers preferred in-store shopping to online, nearly three-fourths (74%) of respondents intend to do some form of online research prior to making purchases.

Here are some of the latest innovations:

Omnichannel retail
The challenge for retailers is bringing cohesion between each of their platforms to provide a seamless shopping experience for the consumer. In order to achieve this effectively some companies have turned to new and innovative ways to set themselves apart for customer experience.

Swedish furniture store Ikea had the challenge of finding solutions to the limitations that online retail posed. A customer at a furniture store will normally want to see the item before parting with their money. To get round this, Ikea launched a 3D app, allowing the user to virtually place the piece of furniture in their own home. When a choice has been made it can be purchased online on the website and collected from the pick-up point in-store – a perfect example of utilizing technology to improve customer experience.

Fashion retailers are the second highest earners in U.S. ecommerce sales, with $44.7 billion spent on apparel and accessories in 2013.

Whatever gains there are in the convenience of online purchases see equal difficulties, with the inability to see items physically and try the clothing on. Online stores have taken measures to alleviate this problem. Retailer Superdry offers video catwalks for each item of clothing, giving the customer a glance into how it looks on the moving body. Other stores similarly offer customers the means to try on the clothing virtually by creating an online image wearing the items.

In-store technology
In-store technologies are starting to give similar tracking capabilities than those utilised by online retailers. Euclid, a California-based customer tracking provider that offers an ‘express’ service free of charge, allowing any store to see information about footfall outside the store, how long customers spend in the store, and whether the customers are repeat shoppers.

Being able to see customers’ whereabouts and footfall within a store means the company is able to gauge what positioning for products will maximise sales.

Mobile technology that can be used in-store to improve consumer experience is also at the centre of recent developments. Mannequins have received the digital treatment, with some being fitted with Bluetooth beacon devices that connect to a phone. Customers can then pair with the Bluetooth and see information on the outfits on the mannequin.

Changing consumer behavior
Figures show that 22% of people will research a brand on social media before visiting the store or website and making a purchase, showing the importance of a complete digital experience running parallel with brick-and-mortar stores.

Consumer behaviour is set to become more focussed towards not only where items can be bought in the easiest and most efficient way, but through retailers who are able to offer the best experience right through from online browsing to holding the item in their hands.

The next wave of technology revolutions for internet order deliveries was marked with Amazon’s release about the Amazon Prime Air delivery drone. The next few years could well see our parcels and packages being delivered to or doorstep by robots within 30 minutes of ordering. Amazon was known to have requested for the Federal Aviation Administration (FAA) to lift the restrictions on drones being used for commercial use.

Pushing the boundary in technology innovation is the main drive changing the shopping experience. It is the customer however and the demand for a quicker, more friendly and convenient service which will be the focus of these innovations.

The retail market has made a shift towards on-the-go services to cater for the huge customer base who now shop on their mobile phone. This will be set to continue with brands streamlining their services to work in between online and offline platforms, connecting with a modern-day shoppers’ needs.

Matt Foster is content executive, Search Laboratory. He can be reached at [email protected].

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News

Fry’s and Ralphs execs join grocery group’s board

BY CSA STAFF

Vice presidents of merchandising at Fry’s Food Stores and Ralph’s and two other executives are the newest members of the board of the Western Association of Food Chains.

The trade group said four new members were elected to its board at its annual meeting this month in LaQuinta, Ca. Joining the board are Monica Garnes, Vice President of Merchandising at Fry’s, Dennis Gibson, president of QFC Stores, Valerie Jabbar, Vice President of Merchandising at Ralphs and Rob McDougall, President and CEO of Gelson’s.

“We are thrilled to welcome these industry executives to the WAFC Board of Directors. Their commitment reinforces our mission of advancing the food industry through education and leadership,” said Sue Klug, WAFC President and Chairwoman and Executive Vice President, Chief Marketing Officer of Unified Grocers. “I am confident that their participation will further extend our education initiatives and look forward to working with each of them.”

WAFC may not have the high national profile of some other retail trade groups, but the organization has been around since 1921. The group is focused on providing educational opportunities for food industry associates through initiatives such as the long-running Food Industry Management Program at the University of Southern California Marshall School of Business. In 2000, the WAFC expanded its scope by working with community colleges throughout the Western United States to establish the Retail Management Certificate Program that is currently available at 160 college and satellite locations and online nationally.

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SUPPLY CHAIN

Macy’s will expand CA fulfillment center to meet omnichannel demand

BY Dan Berthiaume

Cincinnati – Macy’s Inc. plans to relocate its West Sacramento, California-based direct-to-consumer fulfillment center to a larger facility in a nearby location in Sacramento County to support continued sales growth driven by its omnichannel strategy. Contingent on approvals by the Sacramento County Board of Supervisors, Macy’s will begin operations in summer 2015 at a 385,000-sq.-ft. facility, creating approximately 100 new jobs.

Macy’s multi-million-dollar upgrade to the new fulfillment center will include building modifications and the latest technology in material handling equipment and warehouse management systems.

The current 92,000-sq.-ft. fulfillment center is located about 10 miles away. The current workforce of 72 associates is planned to grow to more than 175 after the move.

“Our West Sacramento fulfillment center, combined with our fulfillment center in Goodyear, Arizona, have been very successful in serving customers in the western U.S.,” said R.B. Harrison, chief omnichannel officer of Macy’s. “The rapid growth of Macy’s direct-to-customer shipments, rooted in our omnichannel approach to business, requires us to continue to strategically add fulfillment capacity so our customers can receive their orders quickly and efficiently.”

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