Physical in-store shopping is far from dead; it is just transforming at an accelerating rate. According to US Census data, 90% of all retail purchases are still made in brick-and-mortar stores. That doesn’t mean there won’t be retailers who struggle, just ask Sears, Toy R Us, and The Limited; but it does demonstrate that consumers still see reasons to visit and shop at physical stores. In fact, according to IHL Group, many more new stores were opened in both 2017 and 2018, than were closed, with especially strong growth at both the high end and the low end of retail.
To be successful, retailers will have to provide an experience that on-line shopping cannot deliver. While you might tell your Echo, “Alexa, buy another box of Tide,” when it comes time for purchasing a complex product like a next-generation iPhone or for trying out a new personal care product, you will want to seek out highly-qualified, personal in-store assistance. Part of that shopping experience is social; I want to talk with a human who can understand and relate to my needs, perhaps on an emotional level; someone who can communicate the experience of owning the product and will stand behind it.
The ability of a retailer to deliver that shopping experience doesn’t necessarily come easily. It requires extraordinary real time insight into buying trends, not just of the target marketing segment, but of individual shoppers as well. This necessitates data, networks, and flexible, high performance platforms.
In a warehouse outside Tulsa, a bottle of Pura Vita water suddenly labels itself as RECALLED. Its onboard processor broadcasts the state to all nearby. Within milliseconds, the other bottles in the same case, then the rest of the pallet, then all the pallets of Pura Vita water in the warehouse register as RECALLED. The warehouse inventory management AI issues a notice of return to Pura Vita, Inc. (Institute for the Future)
Today, the technology exists to monitor the flow of individual shoppers as they move throughout the store and pause to consider product displays. The store can engage with shoppers through their app, to highlight product features, offer special promotions, answer questions, draw attention to related products or notify that an associate is on the way with help. A survey by Daymon Worldwide found that in fact 62% of shoppers use a retailer’s mobile app while they’re in store.
Electronic shelf labeling is capable of instantaneously changing product descriptions, messaging, and even pricing, to react to fast-changing marketing conditions. This provides the high frequency means to carry out scientific marketing; to experiment with pricing strategies and react to their success or non-success in near real time, just as is often done with online shopping. The technology is rapidly approaching to enable the shelves or displays to communicate personalized messages to individual shoppers as they pass by, based on rich and willingly-shared behavioral data.
Meanwhile, on the shelves immediately surrounding the recalled bottles of Pura Vita, other bottled products take note. Bottles of NutriYum, OhSoSweet, OrganiTaste, and BetterYou, constantly monitoring their peers and rivals, observe the sudden recall of all Pura Vita water. They virtually salivate at the new opportunity created by the temporary hole in the local market landscape. Within a few millionths of a second, they are adapting their marketing pitches, simulating tens of thousands of scenarios in which buyers encounter the unavailable Pura Vita, angling for ways to appeal to this newly available market. Labels on bottles morph, new sub-brands appear on the shelves as experiments, new neural ads ready themselves for testing on the next wave of shoppers. (Institute for the Future)
Here are resources to help you learn more about the network technology that is available today to help you build your retail data, networks, and flexible, high performance platforms.