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How technological advances in retail are shaping the future of shopping

How technological advances in retail are shaping the future of shopping

Technological advances in retail are helping to take the burden off employees while providing consumers with better customer service. Features like third-party delivery, intuitive apps, chatbots, voice searches, and image recognition offer brands a way to guide consumers to products and make purchases easier. These retail technology innovations are reshaping how consumers shop, whether they’re online or in the shopping aisle.

Third-party developers play a vital role in this retail technology, as brands often don’t have the resources to develop high-tech programs in-house. By working with outside developers, brands can bring new services to shoppers which enhance their experiences. They can offer in-the-moment advertising to drive sales while streamlining campaigns to target the right individuals. These cost-effective initiatives are changing the way customers shop while helping brands forge better connections.

Offering New Features With Third-Party Partnerships

Many traditional brick-and-mortar retailers added services like curbside pickup and delivery to their offerings in recent years. Such services were made possible via partnerships with companies like Uber, Postmates, and InstaCart. By 2021, online grocery purchases will account for $30 billion in sales, and these third-party services are the primary drivers. They allow brands to quickly roll out delivery programs with little runway or upfront investment.

Retailers are unable to implement in-house delivery programs without taking on extensive expenses. They must cover employees, insurance for those employees, and the cost of vehicles. There’s also added liability to consider, as retailers could become responsible for employees who are injured in accidents during deliveries.  

Third-party options allow retailers to pass the risk on to another company while reducing the staffing costs. The third party is responsible for connecting with contractors and vetting them, as well as maintaining the apps used for offering these experiences. Also, brands can use multiple apps and multiple partnerships to reach a wider pool of consumers and further improve services. Third-party options make delivery scalable, cost-effective, and intuitive regardless of the retailer’s size or available resources.

Creating a Welcoming Atmosphere With Virtual Greeters

Virtual greeters allow retailers and brands to welcome consumers to a location and share information about deals. These short, app-enabled messages replace the traditional door greeter while offering more thorough information than a human sales assistant could.

Virtual greetings work through beacon technology and GPS. When customers reach within a specific range, retailers can direct a message to play for anyone who uses the app. That message could include a video greeting from a spokesperson, an announcement of current events, or even rewards points for store entry. The message creates a positive experience that sets the tone for the consumer’s trip and puts them in a favorable purchase mindset.

Improving Sales With Personalized In-Store Ads

Advertising in the shopping aisle is traditionally mass market. All consumers see the same displays, end caps, and offers. In recent years, retailers have used technology to innovate many in-store advertising methods and provide personalized greetings.

Digital end cap offers:

End caps are highly desirable sales locations in the store, and competition among brands is fierce. Digital end caps provide a more flexible solution for retailers. Kroger recently implemented a test program around this using their app and its users. The company, with the assistance of Microsoft, installed end cap cameras capable of recognizing the age and gender of individuals. It would then deliver a preloaded, targeted offer based on those specifics. The display was even capable of greeting the individual by name using their membership details.

Shopping apps:

Shopping apps help brands connect with consumers in the shopping aisle. Shopkick, for example, offers a digital scavenger hunt that incentivizes consumers to seek out products by rewarding them for certain purchase behaviors. This technology offers brands an innovative way to help their products stand out, even when in-store shelf space is less than optimal.  

Omnichannel events:

Many brands are tying the digital and physical experiences together to promote new products. A recent example occurred with a cross-promotion between Disney and Levi’s. Levi’s offered consumers a unique Snapchat-enabled augmented reality experience at an Orlando store. Visitors received a temporary offer along with an exclusive Snapchat filter when they visited the location, and were able to purchase a Disney branded cap using the app. The campaign was a major success because it leveraged scarcity and exclusivity. This strategy is ideal for a new product launch marketing plan as it creates a scalable event based on a specific location.

Technological advances in retail allow brands to reach consumers when they’re most likely to make a purchase. Through technology, brands can scale and target in-store advertising materials. Such strategies improve sales while increasing the marketing ROI.

Lowering Overhead With Cashier-Less Grocery Shopping

Retailers often look to technology to solve staffing woes. By automating certain in-store tasks, like checking out, brands streamline shopping and reduce workloads. Self-checkout kiosks set the stage for a far more high-tech future, where consumers can complete their shopping trip without the need to check out at all.

A recent example comes from startup Caper. The company developed a unique AI-powered smart cart which scans barcodes and charges consumers for goods once they put them inside the cart. Caper reports use of its carts in stores increased sales by 18%, and future innovations could drive this higher. The Caper cart is just one example of how technology is changing the shopping trip entirely.

One of the benefits of eliminating cashiers in the store is that it allows consumers to check out faster. This option speeds the path to purchase and makes consumers less likely to back out of a sale. Smart carts aren’t the only options in this realm, either. Many retailers look to scan and go technology which allows consumers to check out on the sales floor without ever having to stand in line.

Image Recognition Guides Consumers to Products and Unlocks Features

Image recognition is gaining a lot of attention for its potential in retail. Growth in AI allows developers to categorize millions of images along with their meanings. Machine learning teaches these systems to recognize critical components and match those features to existing data. There are two primary developments for retail image recognition of which brands should be aware.

2D in label recognition:

2D image recognition turns the labels of products into their UPCs. This process is useful in both managing supply and delivering customer experiences. Consumers could, for example, scan a product's label with their smartphone to unlock features like product information, deals, and rewards points. It also allows brands to monitor stock on the shelves and reorder products proactively.

3D in reading consumer behavior:

The application of 3D image recognition is a bit more controversial, as it leverages technology to read a consumer’s facial expressions and make a determination about their overall satisfaction. It can also enhance rewards programs by using stored facial data to recognize consumers quickly and greet them by name.

These image recognition programs improve the customer experience by cutting out steps in the path to purchase. Consumers can simply take a picture of an item to find a place to purchase it or order it online. They can access more information and enjoy improved branded interaction. Image recognition is likely to play a more prominent role in marketing in the years to come, as retailers discover new ways to leverage the technology.

The Growing Impact of Voice in Online Shopping

The ever-increasing popularity of the smart speaker has expanded the use of voice search and by extension, voice ordering. Voice technology presents a new opportunity for CPG brands to reach consumers by leveraging their brand’s reviews and existing reputation. This opportunity lies in how voice search indexing will differ from that of its text-based counterpart.

Voice searches are different from text-based searches as keywords play a less critical role. There are a finite number of keywords to use and consumers ordering via voice tend to err on the shorter side of phrases. Competition among those short verbal phrases is high, even in the early adoption phase.

Content strategies around voice must leverage user-generated content to enhance their visibility. A consumer may issue a voice search for “bandages,” as an example, and the smart speaker will return the results with the most relevance and the highest ratings, with little regard for the brand’s own advertising. Average sales, ratings, and customer reviews will drive brands to the top of voice search, which increases their likelihood of gaining sales from these searches.

Enhancing Chatbots With AI for Delivering Top Tier Customer Service

Chatbots are certainly nothing new in customer service, but they are much smarter than they used to be. About one-quarter of all organizations will use the services of these chatbots by 2020, and it’s very likely consumers won’t even notice that they’re communicating with a computer.

Retailers already have extensive data on hand from prior customer chat interactions. Using that data, they can establish templates for an endless list of customer complaints and scenarios. Essentially, these programs create customer profiles and categorize them. They then answer the consumer's questions using natural language which is almost indecipherable from a human customer service agent’s.

The benefit of these programs lies in their ability to triage complaints. They won’t eliminate the need for associates entirely, but these bots can handle far more of the conversation based on today’s technological advancements. In some cases, they can take the customer all the way through to resolution, which allows companies to better allocate staffing resources.

Preparing for Technological Advances in Retail

Brands that wish to leverage the newest technological advances in retail must carefully evaluate the cost. Third-party partnerships allow them to enjoy the benefits of these programs without the high upfront cost of developing features in-house. However, brands must thoroughly vet these partnerships, as working with less reputable third-parties can damage the customer relationship.

It’s critical that brands carefully review data collection and storage policies of these third parties to ensure customer information stays protected. They should also seek out developers that follow industry-recognized reporting standards to reduce the risk of becoming victims of ad fraud. Third parties who are verified by TAG and have audits completed to MRC compliance standards tend to pose the least risk, as they must follow stringent reporting standards when communicating results to clients.

Technological advances in retail help brands better allocate staffing resources while providing scalable in-store marketing. They enhance the customer experience by expediting shopping trips through delivery, cashier-less shopping, and image- and voice-based search. Brands can best prepare for the future of retail by partnering with third-party developers to deliver unique, heightened customer experiences that drive brand affinity.

Shopkick partners connect with consumers at brick-and-mortar locations by leveraging our intuitive app as part of an in-store marketing strategy. For more information on becoming a partner, contact us.