Author Archives: Jennifer Bosavage

by Jennifer Bosavage

Adidas Puts Shoes on (Computer) Display

The retail ideal of putting customers’ desires first often comes into conflict with the plain truth about inventory: While most customers enjoy making selections from a fully stocked store, retailers just can’t afford to carry stock that appeals to everyone who walks through the door. Even specialty stores, which have more limited inventory by their very natures, need to be selective so they don’t give shelf space to slow movers at the expense of products that are hot tickets.

Moving to a larger space is one potential solution, but opening a warehouse-sized store has considerable real estate costs attached. The ability to offer vast selection economically is one area in which e-commerce has a distinct advantage. But does that have to be? Here’s how one footwear maker thought to look outside the (shoe) box.

Athletic shoes are the mainstay of Adidas’ $16.3 billion business. A couple of years ago, the German-based company realized that while it was impossible for any of its retailers to carry a full selection of Adidas shoes, it was losing sales simply because shoppers were unaware of all the offerings available. Of course, customers could purchase online, but many didn’t because of their desire to try on shoes before purchase.

Adidas came upon a hybrid approach that would let customers enjoy a personalized sales approach, while boosting sales of athletic shoes. The company implemented an Intel technology-based interactive video wall to launch a line of specialty Olympic sports shoes, most of which were not physically carried in stores, due to inventory risk. The wall was installed in various locations, and has been responsible for increases in footwear sales of more than 40 percent in every instance so far, according to Adidas. Read that again: Every instance. Such an impact on sales is not trivial.

The reason for the success is straight-forward. The technology let customers see images of the shoes from different angles, learn their features, select sizes and colors, check inventory, and purchase the shoes. And that’s all done at the digital display.

It might seem easy to reduce the interaction between customer and shopper using this technology, but that’s not necessarily the case — it simply depends on the intent. If a retailer is aiming for a self-service model, an Adidas-like solution will fit the bill. But it can also add to the customer-associate relationship, as Adidas found. The system added a point of interaction for the associate to help involve the customer by explaining how the wall works and pointing out the innovative features, such as 3D rendering and social interaction. In addition, it provided an “endless aisle” of product for customers, who could search a complete inventory of thousands of shoes using the video wall, while the retailer could carry far fewer shoes in-store.

Understanding what the customer wants (large selection) and answering that desire (endless aisle solutions) offers a positive shopping experience that will inspire many to become loyal shoppers. While this type of solution is not be specifically tailored for an individual, it provides customization based on an individual’s preference, over and over. In that way, many customers can enjoy personalized experiences, without providing much personal data. A win for the customer, as well as the retailer.

by Jennifer Bosavage

How Technology Helps Identify Multichannel Profitability

The most successful retailers today don’t distinguish among their shopping channels — rather, they design the digital experience with store fulfillment in mind. The challenge, however, is in determining how profitable such customers are, according to a recent study released by Retail Systems Research, entitled,  “Achieving Profitability In An Omni-Channel Fulfillment Model.”

As far back as 2007, retailers began identifying the importance of the

As merchants expand their online retail marketing initiatives and strive for an integrated, multichannel approach, they need the right technology to support their operations.

As merchants expand their online retail marketing initiatives and strive for an integrated, multichannel approach, they need the right technology to support their operations.

consistency of the shopping experience they were providing customers. Back then, retailers without a robust e-commerce site were at a distinct disadvantage. Whether the site was independent of its brick-and-mortar sibling, or an extension of it, retailers knew it was another avenue of potential revenue.

Today, it’s an absolute necessity for a brick-and-mortar to have an e-commerce channel, but the wrinkle is, it must be seamlessly integrated into the shopping experience. Increasingly, customers begin their purchase in one channel, and finish it in another. Back in 2007, shoppers who started in-store and bought online were called “showroomers.” But in the past eight years, because of a concerted effort by brick and mortars to stay alive and relevant, that trend is reversing itself. Nowadays, a buyer is just as likely to start the shopping journey online and complete it in store, as it is vice versa. So, while retailers met the challenge of showrooming, RSR reports that many are wondering at what cost. While 35 percent of those surveyed said multichannel customers are significantly more profitable than single channel customers, 24 percent reported they could not judge profitability. A number of factors RSR identified as crucial to achieve profitable fulfillment are addressed by solutions such as those provided by Retail Pro:

  1. Can your company track inventory across the enterprise? If so, is your company able to put the right amount of inventory closest to the points of demand, at the right time? That’s important because bringing customers to the store — where the potential for add-on merchandise is high — is preferable to the “one-and-done” reality of many online orders.
  2. Are non-store customer orders fulfilled in a way that maximizes profitability? Assuming the answer above is “Yes, I can see all my inventory,” then the retailer must determine what the most profitable fulfillment method will be. That can vary by individual case: Providing the lowest shipping cost to customer may be satisfactory in one situation, while another may be choosing a fulfillment point closest to the customer’s location.
  3. Who will fulfill the orders and returns? Retailers are loathe to adding head count, but RSR notes that in an ominichannel environment, return rates go up. Customer service becomes even more of a differentiator when shoppers have problems. Reallocating resources to service reps from other areas is a potential answer. Retailers should consider optimizing non-selling store processes, such as stock management, in order to cover the new costs associated with handling non-store orders.

Creating an omnichannel and multichannel experience that consumers see simply as  “shopping” requires the behind-the-scenes technology that will provide seamless fulfillment. Retailers that treat all channel as complementary, and integrate them into a holistic brand experience will be the first to maximize customer profitability.

by Jennifer Bosavage

Digital Engagement Drives Up In-Store Sales

Increasingly, brick and mortar shoppers are using a “strategic strike” method of shopping: They’ve narrowed down what they came for, they pick it up and they leave. Consumers use digital technology first, as part of the selection process, then visit a store for an in-person look and feel, and then, they often make ancillary

Focus on omnichannel retail strategy bolsters customer loyalty

Focus on omnichannel retail strategy bolsters customer loyalty

purchases that are unplanned, as well. A shopper, therefore, who uses commerce or mobile sites to facilitate the shopping experience is actually more apt to be a higher value — and potentially more loyal — customer than one who does not.

A recent study from Deloitte, “Navigating the New Digital Divide,” found that digital interactions are expected to influence 64 cents of every dollar spent in retail stores by the end of 2015, or $2.2 trillion. What used to be the dreaded practice of “showrooming” may actually be driving shoppers into stores. That theory seems to be backed up by Deloitte’s finding that consumers who use digital while they shop in-store convert at a 20 percent higher rate compared with those who do not report digital influence as part of the shopping process.

Deloitte reports that consumers are “hunting,” rather than “gathering.” That’s due to the ability of shoppers to narrow down selections before heading into the store. With time at a premium for so many people, doing a “pre-shopping” online helps optimize in-store time. When the “hunter” has a specific target to pick up at the store, there is more time to spend finding related accessories.

For example, narrowing down a selection of coffee pots to one or two on a retailer’s site before heading to the store provides the shopper the opportunity to simply collect the merchandise (the “strategic strike”), or to browse related items, such as mugs, beans, filters and so on. The consumer has the choice of a quick, easy, time saving experience, or of a streamlined one that offers a targeted pick up with an incidental additional purchase.

Nearly one in three shoppers Deloitte surveyed said they buy more when they use digital as part of their shopping process. Tying selling channels together — converging them — helps customers use digital technology for their initial shopping decisions early in the process, and then makes it easy for them to extend that sale.

by Jennifer Bosavage

Converging Retail Channels

In just three short years, the Web will influence $1.8 trillion in retail sales, according to Forrester Research. It’s therefore imperative for retailers to maximize their online potential, and leverage it to enhance traditional store sales, thereby improving overall revenue. By converging the sales channels, retailers can improve inventory ordering, customer satisfaction as well as loyalty.

In the retail marketing world, omnichannel is one of the biggest trends.

In the retail marketing world, omnichannel is one of the biggest trends.

GSI Commerce reports that 45% of consumers prefer shopping for clothing online. That number is likely to trend up, not down. Combined with Interactive Advertising Bureau’s finding that a whopping 80% of people shop through the smartphone, retailers, particularly those with traditional storefronts, must find a way to take advantage of e-commerce and m-commerce sales opportunities, while bringing brick and mortar advantages into the mix.

”Click and collect,” or “Buy online, pick up in store” is an example of how a mobile platform may bring a mobile shopper into the brick and mortar storefront. The mobile phone acts as a gateway; the shopper wants information quickly and in a focused manner; the site offers a way to get in and out of the store efficiently, yet with the benefit of trying it on and returning it on the spot if needed. Furthermore, accessory items are just a cash wrap away — a good way of extending the sale and meeting a customers’ needs simultaneously.

To meet the challenges of converging technology to provide a seamless buying experience, retailers are busy implementing business process integration solutions. Through BPI, a company synchronizes its purchasing channels by connecting disparate systems in real-time. A BPI solution will not only automate manual processes and streamline the communication between different systems and databases, but it also lowers operational costs and reduces dependence on proprietary interfaces.

In addition, process integration provides better insight into customer trends, reduces out-of-stocks (as well as over stocks) and increases customer satisfaction. And that leads to rising  revenue, and even a boost in marketshare.

by Jennifer Bosavage

Avoiding the Creepy Factor In Hyperpersonalization

Is hyper-personalization creepy or cool? A recently released Accenture study, “Retail Hyperpersonalization, Creepy versus Cool,”  finds that the answer largely depends on which demographic you’re asking.

While customers appreciate personalization, many are concerned about their privacy.

While customers appreciate personalization, many are concerned about their privacy.

By and large, Millennials seem more into with retailers personalizing messaging. Boomers less so. For example, nearly three times more Millennials (17.2 percent) than Boomers (6.2 percent) think being reminded while shopping about needed items is “cool.” Also, 41 percent of Millennials say they’d welcome retailers stopping them from buying electronics that are not right or are outside their budgets.

Gender influences the perception of what constitutes acceptable personalization as well. Accenture reports that 34% of male respondents think receiving suggestions personalized to account for their families’ food preferences is “creepy.” However, 40% of female respondents consider that type of personalization “cool.”

Some forms of personalization are generally welcomed, though not universally. For example, these implementations are widely considered “cool”:

  • 82% enjoy discounts or loyalty coupons;
  • 59% welcome promotional offers based on items that the customer may be considering or lingering over;
  • 54% like receiving suggestions for items that complement merchandise that the customer is currently browsing.

Conversely, there are personalization efforts that customers find “creepy.”:

  • 36% of shoppers do not want to be greeted by name when walking into a store;
  • 42% don’t want recommendations based on their health issues;
  • 46% don’t want to be dissuaded from a purchase by a sales associate with preexisting knowledge about what the customer currently owns.

That leaves retailers with some specific rules of engagement:

First, they must keep the value proposition from the customer standpoint in mind. There needs to be significant value for shoppers in order for them to be motivated to engage.

Second, it’s important that the customer doesn’t feel overwhelmed. Too many messages or promotions can easily backfire for the retailer.

Third, retailers must be transparent about how any information gathered will be stored and used. Opt-in policies let customers play an active role in the process.

Fourth, retailers should have a system in place to capture and safeguard customer information. There should also be a plan in place detailing how a retailer’s information is to be used and how it will improve business.

Fifth, and finally, building trust is key to success; retailers must work at establishing and maintaining a bond. It’s difficult to establish, yet easily destroyed.

The Accenture study notes that there are three components for implementing a hyperpersonalization solution properly: make it expected, secure and data driven. Doing so provides a foundation for success that will drive profits as well as customer loyalty.

by Jennifer Bosavage

Are You Providing a Hyper-Relevant Experience for Shoppers?

Personalization is a hot topic in retail today, and retailers are paying close attention, rolling out beacon technology to track shoppers’ actions, focusing marketing materials to capture their attention and encouraging customer service training. But a recent study from Cisco Consulting Services finds that  today’s consumers are really seeking a hyper-relevant experience even more than a hyper-personalized

Technology has allowed consumers to reach out to brands at any time and from any place, and this has resulted in customers looking for more personalized interactions from retailers, as people want their patronage to be valued and appreciated.

Technology has allowed consumers to reach out to brands at any time and from any place, and this has resulted in customers looking for more personalized interactions from retailers, as people want their patronage to be valued and appreciated.

one.

That means that shoppers want to find what they came for and pay in a streamlined fashion. Some might want to be addressed by name, but it seems that’s not a deal breaker. What is important is getting the basics right consistently. For example, the Cisco study found 39 percent of respondents said that greater efficiency in the shopping process (e.g., ensuring items are in stock, speeding checkout times) as the top area retailers need to improve. Compare that with the 13 percent who said a more personalized shopping experience was the #1 concern.

Concentrating on efficiency has two benefits. One, retailers cut costs be eliminating waste and superfluous practices. And customers get the benefit of quicker, more responsive service. Customers end up happier, and, as a result, more loyal to those stores that make shopping easier. Retailers that build agile business processes to turn these insights into value can capture a profit improvement of 15.6 percent, according to Cisco Consulting Services.

Combining mobile technology with the in-store experience is no longer just for early adopters — it is mainstream. The next step is integrating mobile with the technology powering the Internet of things. IoT lets shoppers connect to retail in ways that makes their shopping experiences more enjoyable, and helps retailers create relevant customer experiences.

Shoppers typically want to engage a technology solution if there is a benefit for them attached. Those benefits might be in terms of cost, efficiency or engagement. To meet those needs, for example, a retailer might:

  • use digital signage to inform shoppers of a “flash” sale. The “smart sign” is notified by an IoT powered backend system about a stock situation. Preprogrammed parameters cause the promotion to launch, helping retailers clear out inventory, and can guide customers directly to the merchandise;
  • implement a buy-online-pickup-in-store solution that provides current inventory information to shoppers beginning their journey online, but opting to finish it in store;
  • provide interactive mirrors for trying on clothes, capturing the image and sharing on social media.

By investing in Internet of Things technologies, some retailers are attempting to engage consumers, attract them to stores, and attempt to cross-sell and up-sell. It’s yet another tool in a box that can never be too full.

 

by Jennifer Bosavage

Everyone Makes Mistakes: How Does Your Return Policy Rate?

 

 

Retailers hate returns.

That’s not a surprise: Returned merchandise costs the retailers money because the sale was lost, and time, because of restocking.

What is surprising is the high return rate that ecommerce retailers experience.

According to a study from Trueship, roughly 33% of all products purchased online will be returned.

Reducing that number, therefore, will result in a better bottom line.

The study found that one of the most common reasons for returns was easily corrected.

Nearly one-quarter — 23% — of shipments were returned because they were inaccurate.

On a similar note, 22% of items were returned because they were inaccurately described or pictured on the Web site.

Shoppers expect to see what they are getting; if they are misled, they will return.

And with many online stores offering free returns, consumers are not hesitant to ship back the disappointing item.

The paradox is that a vast majority of consumers, 80%, are loyal to those retailers offering “hassle-free” returns.

Free shipping for returns, including return labels and providing other services that ease the pain of returning an item often helps overcome objections to purchasing merchandise in the first place.

Knowing merchandise can be returned at no charge makes it easier for customers to obtain an item they may be dubious about buying online.

While making returns quick and easy may ultimately promote the practice of sending products back, creating a laborious process would likely turn away many shoppers, driving them to the competition.

How likely is that?

The study found that a whopping 92% of customers would continue to shop at an online store if it had an easy-to-follow return policy.

And, 82% said that they would not shop in the future at an establishment that made returns difficult.

Everyone makes mistakes; however, it’s imperative that a retailer not make one when designing its returns policy.

The ultimate objective is taking care of the customer, so removing hurdles to achieving that is key.

Zappos offers an example in delighting the customer while differentiating its brand.

Zappos, which scores high in customer satisfaction, doesn’t require receipts because all its orders are tracked automatically.

That tracking happens at every e-tailer, except many still require receipts.

Zappos also offers free “advanced exchange”: If a customer wants a different size or color, the company ships it for free, as long as the first item is shipped back within the next two weeks.

The customer benefits because he or she doesn’t have to worry about carrying two items on a credit or debit account.

Most shoppers are disappointed their merchandise doesn’t live up to their expectations, and didn’t want to go through the return process in the first place.

Streamlining that process by reducing the pain points provides customers motivation to become, or remain, loyal shoppers.

by Jennifer Bosavage

Biometrics: More Than a Way To Turn On Your iPhone

Biometrics is an emerging technology in retail, used primarily to verify identity. With the debut of Apple’s iPhone 5 with fingerprint sensor in 2013, biometrics

Biometrics predicted to become more widespread at POS systems.

Biometrics predicted to become more widespread at POS systems.

became part of the household vernacular. Samsung and PayPal followed soon after with fingerprint authentication. Today, biometric technology can be integrated into banks, ATM machines, USB keys hooked onto computers, as well as POS systems.

In addition, retailers are looking at the technology to help prevent loss due to ID theft. Biometrics are incorporated into fingerprint identification, as well as palm-vein readers and facial recognition solutions to offer a convenient and additional layer of security, help prevent fraud and provide a better customer experience. Biometrics can also offer retailers controlled access and accurate attendance records, leading to a more secure workplace environment. With system and hardware prices dropping and reliability and convenience going up, more retailers are using some form of the technology.

Marius Coetzee from Ideco told BizTechAfrica that biometrics were critical for fast, accurate customer ID verification — which results in fast, accurate decision making: “Point Of Sale based biometric verification is a critical aspect to reducing losses caused by increasing levels of ID fraud. Once customer details are registered, you can trade with certainty at every point of transaction.”

According to Research and Markets, the global market for biometrics is on track to post a strong CAGR of 19.6% between 2014 and 2020, reaching a projected $30.1 billion by 2020, up from roughly $10.3 billion in 2014. Fingerprint recognition is estimated to be the largest technology with market, valued at $3.2 billion in 2014 while Civil ID — the use of biometrics to identify or verify the identity of individuals when interacting with governments — will be the largest application with global market of $4.6 billion in the same year.

Retailers will increase using biometrics in multiple combinations to ensure security in payments, but, eventually, the technology could eliminate the need to carry a payment card or even a smartphone by letting users authorize payments with a fingerprint alone.

by Jennifer Bosavage

Beacons Show the Way To Increased Loyalty

Beacons let retailers them to collect data that can be analyzed and put to work in the form of  personalized content that resonates with customers. The end goal? To encourage not only purchasing, but also store loyalty. A recent partnership between an advertising firm and a mobile technology company illustrates that increaing interest in using beacons to enhance the storefront and shopper relationship.

Retailers know how important offering excellent customer experiences is for their operations - by offering effective service and engaging patrons in a meaningful way, businesses are sure to see boosts in their retention and loyalty rates.

Retailers know how important offering excellent customer experiences is for their operations – by offering effective service and engaging patrons in a meaningful way, businesses are sure to see boosts in their retention and loyalty rates.

Freckle IoT, an ad tech company, has announced its partnership with Blue Bite, the Mobile Standard in Out-of-Home, which implements mobile technology for the retail industry. The relationship will aid in the deployment of 60,000 beacons nationwide. Connecting Freckle IoT’s open beacon ecosystem to Blue Bite’s location partnerships and mTAG platform helps advertisers launch innovative, integrated marketing campaigns that connect with consumers across digital, mobile and Out-of-Home environments with scale.

Retailers are leaders among industries adopting beacons, as they use  them to provide customers with product information, flash sales or deals, and to speed up the checkout process with contactless payment systems. Geo-location lets retailers send relevant information — such as discounts, special events and other promotions — directly to shoppers. That’s an effective means of competing against e-commerce outlets, which gather information every time someone visits the page, regardless of whether they purchase.

Beacons do require buy-in from the customer; customers must enable bluetooth and accept location services on their mobile devices, and opt-in to the retailer’s marketing program to receive in-store notifications. Those layers help to reduce customers’ concerns that their privacy is being invaded. User consent provides the foundation of all push-notification programs. And some applications don’t need specific information. For example, Apple, creator of iBeacons, has rolled out the technology in all of its U.S. stores, but doesn’t collect any specific user information about shoppers. For now, the company is simply using the sensors to show customers how beacon technology works.

Currently, less than 1% of the 3.5 million retail stores in the United States have rolled out beacon technology, according to Umbel, a business analytics company. That number is rapidly growing however, with household names including Macy’s, Lord & Taylor, Starwood Hotels, McDonald’s and Major League Baseball rolling out solutions.

The Freckle IoT partnership makes use of Blue Bite’s expertise in the area  of Out-of-Home mobile activations and takes advantage of the company’s extensive roster of location partners. Freckle IoT’s open beacon network connects the company’s rising number of application partners with its beacon ecosystem, addressing the challenge of scalability in proximity deployments.

As more retailers employ beacons, shoppers will find them in more unusual places — including transit, street furniture, airports, college campuses, movie theaters, bars and taxis — working to provide rich content through mobile or wearable devices and target in-app advertising on a hyper-local level. Brands can deliver innovative, contextually relevant messaging to engaged and interested consumers who want to be connected and be a part of an enhanced shopping experience.

by Jennifer Bosavage

Three Customer Experience Tips To Improve Loyalty

Forrester has released its Customer Experience Benchmark results for 2015, and while e-commerce does well, the segment’s brick and mortar brethren are a bit behind the eight ball.

It should be noted that Forrester has changed the way it judges CX excellence. To rank at the top of the pack, the 299 brands studied were required to demonstrate they had designed and delivered a customer experience that created and sustained customer loyalty. That makes sense; after all, loyalty is a dynamite way to prove consumers like a business. Repeat customers are retail gold.

Another change impacted retailers directly: Forrester split the retail industry into two groups – those with physical stores and those without. Retailers without stores (“digital-only retailers”) remained in the lead, beating out hotels and parcel shippers for the top spot. However, those with stores fell multiple places in the industry standings.

Forrester elaborates on that finding in its report. But it is worth considering in what the e-commerce experience is proving better than other industries, as well as physically present retailers. A few lessons, then, that we can discern:

  1. Personalized attention. You might say this is a no-brainer for brick
    Retail industry leaders are using technological advancements to improve the customer experience.

    Retail industry leaders are using technological advancements to improve the customer experience.

    and mortars. But being in the same place as a customer does not necessarily mean the sales associate knows what to do. Shoppers’ complaints run the gamut from feeling “creeped out” from too much attention, or “neglected” by a too-aloof approach. Online retailers often send a “thanks for shopping” email that provides an acknowledgement of the transaction, and, if timed correctly, brings the retailer to the top of a shopper’s mind. When was the last time, if ever, a physical store sent out such a missive? The relationship does not end when the shopper leaves; it’s just beginning. While the advantage of having a physical salesperson interact appropriately with customers is clear, it’s a double-edged sword: No one claims to feel “ignored” by an online retailer. The onus is much greater on a physical store to understand how your customers shop. Which brings us to:

  2. Know your customers. All that data you are collecting needs to be analyzed and put to work. Who is shopping and when? What are they buying? Did someone help them? How did they pay? All that information is critical in learning how to best serve the customer, and to connect with them, with the goal of nurturing a repeat customer. Online retailers are expert at this, culling information, using analytics tools to decipher it and then employing that knowledge to drive traffic. Special offer emails are great examples; retail powerhouse Amazon uses data collected from a customer’s shopping history to send specific offers tailored to their interests. Brick and mortars can do the same.
  3. Make it easy. If a customer has a problem, how easy is it to rectify it? What is your return policy? Can a shopper use multiple payment methods? This should be a simple point of distinction for many brick and mortars, but isn’t necessarily. Shoppers do not want to be challenged, for example, when making a return. Does it really matter that the shopper wanted to think she’s a size 4 but turns out she’s an 8? No one wants to face an inquisition at any point while shopping. Focus on the “1-click” mindset: The shopping experience, whether leisurely or a strategic strike, should be dictated by the customer, but the transactional part is controlled by the retailer. Make that quick and painless and it will complement any customer-directed experience you provide.