As retail continues to navigate the twists and turns of its so-called apocalypse — ushered in by the rapid rise of digital and the equally frenetic fall of stores — a bevy of tactics have been touted as the industry’s saving grace.
From in-store extravaganzas to texting with would-be clients, desperate retailers have been trying their hand at a range of strategies designed to lure in digital-savvy shoppers.
Here, a look at the evidence behind the hype.
Automation, iPads and Kiosks, Oh My!
Increasingly, consumers — particularly millennials and Gen Z (digital natives) — are starting to favor in-store technology such as iPads, automated checkout machines and service kiosks over sales associates while they shop.
Case in point: A March 2018 survey by consulting firm HRC Retail Advisory found that 85 percent of consumers would rather check prices at scanners than interact with a sales associate for product information. Meanwhile, 76 percent said apps that provide personal recommendations are important to their shopping experience.
But that’s not to say retailers should take a one-size-fits-all approach to implementing innovative gadgets in their physical spaces.
“Identifying the right technologies and pairing it with the right in-store experience for shoppers of different generations will be critical to retailers’ long-term success,” said HRC president Farla Efros. “Those that curate and customize the store experience and services to suit shoppers’ needs will see the benefits.”
Similarly, it’s critical that retailers choose innovation that is efficient, easy to use and free of glitches. Faulty or inefficient technology could be more harmful to customer relationships than not having fancy gadgets at all.
To compete with their peers, offer convenience and create a more personalized experience, footwear and apparel sellers have started texting customers to update them on the status of a order, follow up on a store or website visit and alert shoppers about new product drops.
Since texting has become one of the most popular methods of communication among the masses — research from messaging platform Quiq found that 66 percent of consumers prefer messaging over making a phone call — it makes sense that retailers have joined the craze. (A Pew Research Center study even found that teens in particular prefer texting almost exclusively, devoting phone calls to only their most personal relationships.)
What’s more, some studies suggest text message open rates are as high as 99 percent — compared with an average email open rate of 25-35 percent.
But there can be pitfalls. Insiders warn that messages that appear “spammy” or generic and only attempt to promote more purchases can be offputting to customers. (Hint: Gen Z and millennials despise being “sold to.”) And whether a company invests in an automated texting platform or has dedicated employees to do the deed, implementing this tactic is going to require a financial investment that must offer a return to the business.
Offering shoppers an experience that can’t be duplicated online has become an important strategy for traditional brick-and-mortar players amid competition from Amazon.
In December, Walmart and Target were among the big-name retailers to pull out all the experiential bells and whistles for the holiday season. The latter offered interactive toy demonstrations, holiday treat samples, a “Star Wars” event and a photo booth — putting “a twist” on a traditional picture with Santa. The former hosted more than 20,000 holiday parties at its Supercenters and boasted 165,000 product demos so customers could test and taste top items.
The results? Target blew past earnings forecasts for the holiday quarter thanks to its efforts to digitally optimize stores, while Walmart’s holiday profits missed the mark.
The verdict: It’s difficult to blame or credit in-store experiences for each retailer’s success or failure during the period — and it’s worth noting that both have seen gains more recently as they continue to make their stores more shopper-friendly. Experts widely agree that stores that are unable to entice shoppers with some form of experiential element are more likely to fail in the current climate.
As always, when retailers decided to add experiences to their mix, it’s critical that their decisions are driven by market research and what makes sense for their customers.
With so many companies using new and sophisticated technologies, the need to hire more skilled store associates has been rising in retail. At the same time — particularly for traditional “sit and fit”-style shoe stores — finding workers who understand the nuances of comfort and style has become a priority to win over shoppers from online players.
Just this week, Kohl’s announced its plans to get a two-month head start on seasonal hiring for the holidays — a move seen as indicative of how competitive the employment landscape has become for retailers.
But employers seeking vast proficiencies in potential candidates must contend with the fact that it will require a much greater investment to hire such workers. (Store-level retail jobs have historically had a lower barrier of entry than other industries such as engineering, finance and health care.)
Meanwhile, it can be equally as costly to train workers each time a new technology is implemented in stores and online.
The level of expertise required among workers to offer an optimal ROI for retailers can be tough to gauge. For one, HRC Retail Advisory found in March that a whopping 95 percent of consumers prefer to be left alone while shopping — indicating that they’re increasingly abandoning the hands-on and personalized service traditionally associated with salespeople. Conversely, 52 percent of shoppers indicated that they desired the help of an associate when selecting technology-related items.