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How to decide on which horse to back in the retail technology race

After what feels like a catastrophic start to 2018, those left watching the demise of fellow retailers, like Toys R Us and Maplin, must be worried that they may be the ones to fall at the next hurdle.

Those retailers left standing have been told at every opportunity that they must “digitally transform”, but it is clearly not easy to keep digitally demanding customers happy.

But it’s not all about eCommerce and mobile, especially in the case of retailers like Toys R Us and Maplin it was equally the store experience that has let down customers in recent years as much as their online capabilities. The stores just weren’t exciting customers.

Research from Forrester claims that 50% of retail digital executives are expanding, upgrading or making new investments in customer engagement devices in-store, while 45% are investing in devices to help the store associate deliver a more personalised experience for customers. Additionally, 56% of retailers are investing in checkout and payment technologies for their stores.

But with technologies from clever self-checkout devices to magic mirrors and innovative use of RFID tags, where are most of these technologies on our high streets today?

Cost and longevity

Most would think the big reason behind a lack in technology adoption in stores would be cost. As Alastair Lockhart, insight director at Savvy points out, hardware like digital signage and magic mirrors are expensive, especially when they need to be deployed and maintained across a vast store estate.

“Also, the technology quickly dates and becomes obsolete,” he adds. “Retailers need to be sure their investment will have longevity and will not turn out to be an expensive fad – often new technologies fail this test.”

It is unsurprising that Forrester analyst, Michelle Beeson’s research published at the end of last year, discovered that investment in technologies like facial scanning and robotics for customer experience is very low. She recommends retailers hold off until these new-age technologies mature and no longer seem like a novelty. “These technologies have gotten lots of press, but we found that digital business professionals are tempering their investment for now.”

“Retailers need to be sure their investment will have longevity and will not turn out to be an expensive fad – often new technologies fail this test.”Alastair Lockhart, insight director at Savvy

The research found only 9% of retailers are investing in chatbots, 6% in robotics, and a mere 3% in facial scanning, and despite high-profile pilots such as the Lowe's Holoroom home remodel tool, only 24% of retailers are investing in augmented reality or virtual reality for the store.

Taking the plunge

Andrew Busby, founder & CEO of Retail Reflections, says the challenge for retailers is confidence in finding the right mix of technology which suits their brand.

“Let's face it, many are still coming to terms with the cloud let alone getting their heads around 'digitally transforming' their business,” he tells Essential Retail.

“There's an abundant supply of advice from all quarters except that one size most definitely doesn't fit all. Before deploying in-store tech, brands need to fully understand what their brand stands for and why they are in business. Only then will they begin to understand what kind of experience they wish to deliver and in turn which technologies will be right for them.”

A myriad of choice

Danielle Pinnington, MD at Shoppercentric, agrees. She describes how retailers need to have real confidence and understanding of their customers before they begin throwing cash at the most innovative pieces of technology: “How can digital technology support the purchase process to encourage more shoppers to buy?”

“There are so many digital opportunities to choose from that it could well feel overwhelming - investing in these solutions takes confidence that you are picking out the right ones to take forward, the ones that will positively impact on shopper behaviour.”Danielle Pinnington, MD at Shoppercentric

But she says even for those retailers who have a clear brand vision of the digital experience they want to offer their customers, there is so much choice of technology on the market, it can be difficult to know which piece of kit to choose.

“There are so many digital opportunities to choose from that it could well feel overwhelming,” she says. “Investing in these solutions takes confidence that you are picking out the right ones to take forward, the ones that will positively impact on shopper behaviour.”

“Quietly testing”

But Steve Hewett, head of retail customer engagement & loyalty at Capgemini, says most retailers are in fact “quietly testing” these in-store technologies, while trying to overcome the challenges around cost and infrastructure complexity.

He says that often the business problem that these technologies will solve and the commercial justification isn’t clearly defined, which prevents a roll-out across the store estate.

“They become technology solutions in search of a problem to solve and a business case to justify."Steve Hewett, head of retail customer engagement & Loyalty at Capgemini

“They become technology solutions in search of a problem to solve and a business case to justify,” explains Hewett.

“There are increasingly high level of expectations by shareholders, customers and colleagues of these retailers to be ‘digital and innovating’ and combined with the bewildering amount of choice out there, this can easily lead towards too much emphasis on testing lots of ideas out vs. deploying change across the business.”

Alison Wiltshire, global practice lead of retail and consumer goods at BT, agrees with Hewett that retailers are always keen to see business cases for solutions before committing. “And the newer and more innovative the technology, the less likely there is the evidence that they seek to provide comfort for their investment. So it becomes a waiting game – waiting for another retailer to take the plunge and learn from them. The trouble is if no one leads the charge.”

Wiltshire points to the beauty industry in Europe and in the US as an example of a sector which has thrown itself into delivering solutions which “greatly increase the customer experience and fun factor”, using technologies such as magic mirrors allowing customers to virtually try on makeup.

But she quickly points out that many of the fantastic and innovative technology solutions coming onto the market are “nice to haves” and shouldn’t be top of a retailer’s priorities if they are yet to sort out their operational inefficiencies.

“Retailers have so many existing challenges and pain points to address that they need to start first with identifying if technology can help to resolve them,” she explains.

“It is also important to see the bigger picture, and how will this integrate into other solutions that a retailer has so that they can fully leverage all the benefits. Buying individual point solutions without thinking about how they will integrate is a recipe for disaster, which is why BT has adopted the approach of integration by design.”

At the RBTE show on 2 & 3 May, BT will feature its digital store concept in the Discovery Zone, where attendees can see how many of these innovative technologies fit in a real-store environment.

A light bulb idea moment

Danielle Pinnington, MD at Shoppercentric, shares her favourite innovative store technology, which featured at Retail Design Expo 2016:

“At the Retail Design Expo a couple of years ago a company showcased intelligent shelving – you’d scan your old light bulb and the rack holding the replacement would light up to guide you straight to the right bulb. Speaking as someone who regularly buys the wrong bulb, this would be enough to make me choose one store vs another, just to avoid more mistakes!”

RBTE’s Innovation & Trail Award shortlist 2018:

Akoustic Arts: The "A": the directional sound speaker by Akoustic Arts

Datalogic: EZiGO

Diebold Nixdorf: VynamicEngage

Fision AG: Virtual Fitting Room

Foko Retail: Foko Retail

Inovretail: See-watch | Staff Performance Assistant

IntelTrack Systems: Intelligent Trolley Service

Microblink: BlinkReceipt

Omnico: Omnico Mobile Self-scan

SES-imagotag: Automatic Stockout Detection

Soyooz: Soyooz

Tokinomo: Tokinomo

Ultinous: Ultinous Queue Prediction Tool with Alerting and Reporting Platform

Verifone: Best Payment Partnership

Volumatic-APG-GulfCoast: ICH (Intelligent Cash Handling)

Yoyo: Yoyo

RBTE takes place at London’s Olympia, 2-3 May 2018.

You can register to attend here 

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