The next trend in retail: Digital disruption

Earlier this month, Canada’s brightest and most curious minds in digital came together in Toronto at Dx3Canada’s third annual conference for agencies, brands, publishers and retailers.

Featured speakers came from companies such as BuzzFeed, Canadian Tire, Google, Flight Centre, President’s Choice, Yahoo!, Rogers, Walmart, Visa, MasterCard, Adidas, and Twitter. Topics ranged from e-commerce, social, mobile, digital, data and content marketing.

However, one of the more forward thinking aspects of Dx3Canada was the “Retail Collective” which was curated by advisory board member, Doug Stephens, the founder of Retail Prophet Inc. In an effort to bring the future of retail shopping and experiences to today’s audience and forward digital thinkers, Stephens sought to create an example of what the store of the future would be like today.


The Future

Six forward thinking companies were part of the Retail Collective:

FittingReality: Brands itself as a cloud-based augmented reality fitting room. Think of it this way: When you’re on a retailer’s website using FittingReality’s product, you will be able to virtually try clothes on and see how you might look. How does the retailer and FittingReality obtain your image? You send it to them via your choice of a webcam, Kinect, or a mobile phone.

Hointer: This company combines the mobile tendencies of today’s savvy shopper with the true flexibility of mobile shopping. While shopping, customers can use the Hointer app to order clothing to try on in the fitting room, request more sizes, and to pay for their purchases – all from their smartphones.

iQmetrix: Allows retailers to provide an endless array of information and product experiences to discriminating shoppers using touch display screens. The company empowers the shopper with loads of product information. The hope, for retailers, is that consumers will put down their smartphone (and stop showrooming) and use the in-store technology instead.

RetailNext: This retailer-focused analytics dashboard provides insights as to how shoppers are behaving and how stores are performing, using cameras mounted in-store, as well as other strategies. As a result, stores are able to create data-driven strategies to optimize the shopper experience and profit.

Perch: Allows any surface to become an interactive display with the product being an integral part of the experience. Imagine going shopping for a pair of shoes and being prompted to pick up the shoe to take a closer look at it. In doing so, you’ll trigger an interactive display that may show you a video of how the shoe was made, testimonials on people who endorse the shoe and even social media mentions of the product. With Perch, accessing product information becomes an experience.

Nomi: This company allows retailers to use mobile technologies such as iBeacons to measure and improve retail foot traffic, loyalty, sales and even staffing requirements.

Retail: More Experience, Less Selling

Notice something obvious about the six companies above? The most interesting thing about The Retail Collective was the absence of retail. There was not a retail brand in sight. What does this mean? Most likely, the future of retail will be less about the brand and more about the experience – so much so that the experience will now become the brand.

Duncan Fulton, senior vice-president of communications with Canadian Tire and CMO of FGL Sports, was the keynote speaker on Day 2. Sport Chek is the “sports superstore” for the FGL brand. Recently, they opened a national flagship store in Edmonton’s popular West Edmonton Mall.

Going from the iconic Canadian Tire brand to Sport Chek forced Fulton and the rest of the company to change. “Buying FGL 3 years ago meant we had to work with a younger and more digitally savvy clientele.” Throughout his keynote, Fulton used the term “digital disruption”.

And the 77,000-square foot flagship is no exception. It’s not that the products are digital in and of themselves. They are still the same: sports, athletic wear, and products. However,  a consumer’s experience allows him or her to leap beyond the confines of the physical store.  “Retail is going to be about the experience within the store,” Fulton said.

In proving his point, Fulton also quoted actor Kevin Spacey (speaking about Netflix and House of Cards):  “Give people what they want, when they want it and in the form they want it at a reasonable price and more likely they will end up paying for it rather than steal to get it.”


The Sport Chek Experience

So what does the Sport Chek store feature? Besides the ubiquitous digital screens (almost 500!) and various unique digital experiences such as interactive touch, gesture, and radio-frequency identification, there is a whole lot more.

The Medical Motion GAIT Analysis allows running enthusiasts to find the exact type of shoe for them. The Wintersteiger Mercury Tuning machine provides skiers with professional grade ski tuning. For golfers there is the Swing Catalyst and Flightscope, which both tests clubs and analyzes their swings. There is also a dynamic bicycle fitting station and a rock climbing simulator known as a Climbstation Treadmill.

Inside the Sport Chek Flagship Store
Inside the Sport Chek Flagship Store

Don’t think for a second that Fulton’s reasoning for adding these experiences is because he thinks that flashy bells and whistles is what attracts consumers. Far from it. Just because he inherited a community of digital first consumers from FGL sports didn’t mean that he would ignore business strategy. “We stopped thinking about digital strategy and started thinking about business strategy,“ Fulton said.

There are two main reasons Sport Chek needs to continue to invest in “digital disruption”. The first is the ever growing popularity of e-commerce. Canadians expect to be able to shop online with their favourite brands. According to the latest numbers published by Stats Canada, e-commerce sales hit $18.9 billion in Canada in 2012. Compared to 2010, that’s almost a 24 per cent increase.

And while Sport Chek does have a robust e-commerce offering, competition from the likes of Amazon and even Walmart make it difficult to stand out from the crowd.

The second reason is the showrooming trend made popular by the increased use of smartphones.  According to research conducted by GroupM Next and Catalyst, “Showrooming is a trend in shopper behaviour in which customers visit a brick-and-mortar retail location and decide what item to buy, but instead of buying that item in-store, they use their mobile device to find a better price…” This research also showed that all things being equal, consumers would rather have a product immediately, rather than later.

With the massive digital and hands-on experiences at their flagship store (and to a lesser degree in other stores such as Toronto’s Yonge and Eglinton location) Fulton is hoping the balance will tip in favour of Sport Chek.

Karim Kanji
Karim Kanji
Karim Kanji is the Canadian Director of Social Media Strategy at iNvolved Media. iNvolved Media was purchased by Active International in 2015. Clients include popular food brands, technology brands and other CPG companies. Prior to joining iNvolved Media, Karim led the paid social media strategy for some of Canada's most popular CPG and confectionery brands for Catalyst/GroupM. Karim started in the social media space when he co-founded and was the President of THIRDOCEAN where he led the creation of digital content for companies including Scotiabank, Ontario Teachers' Pension Plan, Microsoft, Wild Water Kingdom, Palomino Systems Inc. and Techvibes. Karim has also been recognized as a pioneer in podcasting having interviewed people such as such as federal NDP leader Jagmeet Singh, former MLSE boss Richard Peddie, TVO's Steve Paikin, Canadian serial angel investor Dr. Boris Wertz, HootSuite founder Ryan Holmes, Mathew Ingram, Mitch Joel from Mirium and many, many others. As a demonstration of thought leadership, Karim led the development and execution of reports discussing how technology and digital media have impacted industries such as retail, education, health, gaming, sports and banking.

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