Technology

With the shopping boom of the holidays behind us, both brick-and-mortar and online retailers are looking to technology to better serve their customers. These traditional enemies are using what Baseline Magazine calls a “boomerang strategy,” which draws customers from the web to the stores and back again. This attempt to integrate e-business, catalog, and traditional retail units is difficult because many companies have structures these units as competing elements. Technology seems to be the key to breaking down these barriers, as e-commerce sites merge with showroom floors.

Have you noticed the growing number of computer kiosks at your favorite stores? Retailers are enabling customers to go to their online divisions to search for colors, sizes, promotions, coupons, and additional inventory. This allows you to access the “back room” of the entire chain, not just that of the store nearest your house. If you need a size 12 that the store doesn’t have, you can order through their website right at the store and have it delivered overnight, either to your home or to the store itself. These kiosks are likely to improve functionality in the future by allowing shoppers to scan barcodes of items that bring up customer reviews, inventory levels, and special offers.

Another innovation within retail shopping was profiled in an article on CNN Money. The article describes a product called the “Magic Mirror,” which is being tested at haute-couture giant Bloomingdale’s in New York City. This web-enabled mirror allows friends and family connected to a closed internet site to review your dressing room choices and give advice about the clothes you intent to buy. Digital agency IconNicholson developed the Magic Mirror, and they describe it as an agent of “social retailing,” where consumers can share their shopping adventures with all the contacts on their social networks like Facebook or Friendster. A quick, unscientific survey of the women in my office (all two of us) gives the Magic Mirror a definitive thumbs-down, but as the social networking generation ages and develops more spending power, the concept may catch on.

The wave of new technology in the retail sector isn’t just to help the customer; retail employees are also benefiting from improved communications. Some clothing stores have begun using handheld devices to show realtime inventory levels which enable CSRs to find colors and sizes faster. This could be especially useful in footwear stores, since studies show that 25 to 30 percent of customers walk out of the store while a salesperson is retrieving a size. Another innovation to benefit retailers comes from Intellivid, which has begun installing “smart” CCTV surveillance cameras throughout stores. These cameras are not passive like their predecessors. They can track shopper’s movements and habits while feeding data into analytics software, much as e-commerce websites do. This data can be analyzed to determine shoppers’ traffic patterns, the effectiveness of display techniques, and the distribution of customer service reps. Stores also get a leg-up when it comes to locating missing children (which can lead to store lockdowns during busy shopping seasons) and theft prevention.

Retailers are also reaching out to our cell phones to improve the shopping experience. Rather than direct mail campaigns, special offers and coupons can be delivered by text message, and customers would always have the coupons with them when visiting the store. We may see streaming video of ads for products sold at a particular store, or for a nearby retailer with similar products to the ones you buy. Subway is already testing this form of advertising by sending coupon alerts to current customers when they approach a restaurant location. Cell phones are also in line to replace credit cards as a payment method, since they support RFID chips and have unique identifying numbers that help establish identity. The big barrier to this kind of speedy payment is the fragmentation within the credit card and handset industries. It will take some level of cooperation to make this happen, and these guys aren’t used to working together.

E-commerce will also see revolutionary changes, improving the usability of sites to give a hands-on feel to online shopping. Amazon has made great strides in this area by recommending books similar to those you’re looking at, which replicates the special interest displays in brick-and-mortar stores. They also have a “Read Inside This Book” feature which mimics the experience of flipping through a title in the book store. E-commerce sites are also trying to recreate the “impulse buy”, where shoppers pick up a pack of gum or a funny book they see while waiting in the checkout line or walking through the aisles of a traditional store. They’re reaching out to virtual worlds like Second Life for product placement and casual browsing. Innovative sites might also allow consumers shopping from their computers to electronically bring their home into the online store. For example, a 3-D rendering of your living room might help you decide if a piece of furniture would fit in your space and match your curtains. You also might be able to upload this rendering to a store like Best Buy in order to “test” the new stereos in your acoustical space.

The barriers are already breaking down between e-commerce and brick-and-mortar retailers, and we’ll likely see further radical changes in the future. More and more, retailers are crossing the line between the showroom floor and the online world, and customers will see more options to suit their busy lifestyles and their high expectations.

By Haley January Eckels