SMB retailers should cast mobile in ‘theatre of the store’

Leslie Hand is standing with her legs slightly apart, her head bowed over the smart phone in her hands, pretending she is in a checkout line frantically doing price comparisons before handing over her credit card.

This is a portrait of the “omnichannel” shopper, the kind of customer all Canadian retailers need to begin cultivating, according to the research director for IDC’s Retail Insights division, who spoke at a summit on retail and mobility in Toronto late last week. While many U.S. chains have already been rolling out customer-facing apps and revamping internal IT infrastructure to create greater throughput and efficiencies, the picture here is far less bright.

According to a survey of approximately 150 retailers Hand and her team conducted earlier this year, only 14 per cent of Canadian retailers fall into the camp that has successfully transformed store experiences through mobile technology. The majority, 35 per cent, admitted they are essentially “non-mobile” so far, with only potential plans for pilot projects.

“A lot of it is about thinking about the theatre of the store – What does it feel like to the customer?” Hand told attendees. “What will make them want to shop at your store more than anybody else’s?”
No one knows the answer to that question with any certainty, but there are enough examples of retail mobility in action that Hand said even small to medium-sized merchants can begin to use the technology to drive results.

According to the IDC survey, 51 per cent of SMBs see improving customer loyalty as their top issue, following by 31 per cent who cited improving employee access to information.

“They don’t have as many stores, and they don’t necessarily have the same buying power,” said Hand. “They’re integrating channels to have better access to inventory information and accelerate their ability to leapfrog, from a technology perspective, the large-scale guys.”

Hand defined omnichannel shoppers as those customers who want to interact with retailers via multiple channels, but who also want to see consistent levels of service, regardless of touchpoint. This means trying to get that person standing in the checkout aisle to look up from their device, see other items on a shelf or talk to an associate on the floor. It also means location-based offers via SMS or text message, and even point of sale kiosks inside the store.

“They need their sales staff not running around the store putting products away, but helping the customer with mobile devices,” she said, describing the ideal state as “O3” – omnichannel optimization and orchestration.

A good example of a Canadian retailer who has already started down the path to O3 is Black’s Photo, which in the last year has added more than 350 kiosks to their chain and built out a significant portion of their business online. According to Phil Chapman, vice-president of imaging and business development at Black’s Photo Corp., a big shift happened when the company was acquired by telecommunications carrier Telus Corp. Now, every Black’s sales associate is carrying a smartphone with them, and has rolled out apps that let customers order prints for pickup and pull images from Facebook or Picassa for printing.

“Our focus is about being on the go. More images are being captured now than ever. The problem is that people may not be doing anything with them,” he said. “Our job is to make sure they do.”

U.S. mobile retail examples

While Hand praised Canadian Tire for its apps and kiosks as well as a recent e-commerce app from Sears Canada, most of her more cutting-edge examples of mobile retail were based on work by U.S. firms. Some ideas that Canadian SMB retailers might steal include:

  • Guess: Using customer relationship management (CRM) data, the company is allowing customers to share offers and product info with friends via social media platforms like Facebook, and pushes targeted and personalized content and offers.
  • REI: Rather than try to avoid comparison shopping, the outdoor clothing chain has mobile apps and Web sites that encourage consultative/interactive selling, showing technical characteristics that differentiate various product lines. This information is being delivered on a kiosk as well, with mobile POS planned later this year.
  • Pacsun: The clothing manufacturer has created a photo-based electronic “lookbook” where you can engage with someone in the store and walk through outfit combinations on a tablet.
  • Lowes: In an effort to appeal to home renovators, an application called MyLowes allows customers to easily track their online and in-store purchases so they’ll only get exactly what they need for a particular project.
  • Stop&Shop: We’ve all gotten used to self-checkouts like those stationed in Ikea, but this grocer’s app lets customers scan items on their own iPhone as they shop. This can make it easier for stressed out parents, because the child can do the scanning, increasing engagement. Once they’re done, customers simply walk to the self-checkout lane, scan their frequent shopper card and pay.

Hand also profiled up-and-coming retail chains that Canadians may never have heard of, like C.Wonder, which sprang to life complete with mobile POS, a mobile inventory system, integrated RFID, and even apps that allow adjustable lighting and choice of music in fitting rooms.

“You just have to imagine: What if you didn’t have all this legacy business and technology, and could start from scratch?” she asked, adding that retailers should study customer behavior to ensure they optimize the right channel for the right purposes. Smart phones might be great for research, but holding up a tablet, she said, “This is the device where they tend to actually pull the trigger and buy something.”

Shane Schick is the editor-in-chief of IT World Canada.

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