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Digital innovations shaping the way we shop

circuit-board, digitalWith the online shopping experience evolving and bricks and mortar stores striving to stay relevant and profitable, we’re in for some interesting tech innovations in the retail environment this year.

Your wallet is no longer a wallet

This has been coming for a while, but the release of the iPhone 6 (Australia’s favourite smartphone/life companion) and ApplePay should see mobile payment begin to be widely integrated into the retail experience in 2015.

Most new Android phones already have the capability, but as the iPhone has almost 40 per cent market share in Australia, it will be the catalyst for the technology to catch on instore. With more layers of security than cash and traditional cards (fingerprint security, PayPal style thirdparties, and ‘tokens’), mobile payment looks to become the safest way to shop. The only downside is now you need to sort out a spot to stick your licence.

Taking online offline and back again

For years it’s been gospel for retailers to compete in the digital age, online is where it’s at. Even the Harvey Norman’s of the world could only resist e-commerce for so long – much to Gerry’s disdain, however, there’s been instances in the last year of e-commerce first businesses reversing the trend and opening bricks and mortar stores, and it’s only going to become more prevalent in 2015.

Why? Well, Gerry was partially right. Most overall sales are still taking place offline, so for these e-commerce first retailers to gain significant market share they need to span both environments.

Secondly, there’s simply elements of offline shopping that can’t (yet) be replicated in the virtual world, so for UK beauty sites like Birchbox and Australian optical retailer Clearly, the need for the personal touch and tactile interaction meant moving into the physical space was a must to complete the consumer experience.

These shoes are talking to me

Beacons have emerged as a viable way to blend the instore and virtual environment to enhance the shopper journey. Embedded throughout stores, these small devices trigger smartphone apps within range to reach consumers with relevant and targeted content as they navigate the store.

Retailers such as Macy’s, American Eagle, and Aerie in the US are currently partnering with Shopkick to provide location specific rewards, coupons and product recommendations throughout their stores.

The fact that these beacons have the added benefit to retailers of providing data and insight into in-store foot traffic and customer preferences means that we’ll be seeing a lot more of them (or not – they’re pretty small) in Australian stores this year.

Your phone’s a personal shopper too?

Love the latest look that (insert celebrity here) is rocking but no luck finding it on the rack? Why not take a snap of it and let an app do the finding for you!

US retailers, Macy’s and Neiman Marcus, are using an Image Recognition Shopping App to allow customers to submit an image of an outfit they like, and the app will direct them to a similar item from the retailer’s range to either purchase online or instore.

At the moment there isn’t much uptake in Australia (as the software isn’t without its share of limitations) but as the tech gets better, these apps will become more commonplace for retailers looking to enhance the customer experience and their own bottom line… Surely this is the ultimate app for impulse purchases!

Ready to wear tech

Wearable tech is set to really explode in 2015. With most of the big players now in the market (Apple iWatch, Sony and Samsung smart watches… Hell, even Ralph Lauren has a ‘smart’ shirt) , innovative retailers will be looking for ways to leverage the wearables boom within the brand experience.

At present there aren’t a lot of case studies as to how this has been done to great effect (Tesco in the UK has created an app to work with Google Glass (RIP), as has Kenenth Cole in the US.), and even to what lengths you could interact a smartwatch that you couldn’t do to a smartphone, but with the sector set to grow rapidly so too will retailers utilising wearables to connect with, incentivise, and collect data from consumers.

Augmented reality in retail

2015 is the year Marty McFly is attacked by a virtual Jaws billboard (the shark still looks fake) in Back to the Future 2 and the film has turned out to be pretty prophetic, with virtual and augmented reality now a feature of the instore experience.

Whether it be as an experiential Virtual Reality installation with Oculus Rift like Topshop’s AW14 Catwalk in their Oxford St Flagship store, or augmented reality POS in American apparel to show garments in different colours and styles, AR and VR are becoming more common applications to enrich the shopper journey and encourage brand participation.

Big data

While it doesn’t have the wow factor of AR, or an early adopter hype of a smart watch (but is entwined in both), the biggest factor in innovating the consumer journey and improving the instore experience will be the utilisation and application of big data and analytics in (or near) real time.

By using applications to mine insights from big data, retailers can tailor their staffing, stock, pricing and environment to create the optimum shopper experience for their customers, right down to individual shopper personalisation… which is actually a slightly unsettling thought (google ‘Target big data pregnancy’, you’ll see what I mean).

If there’s a common theme amongst these innovations, it’s that the customer is still king, and a positive consumer experience is key to success in a competitive environment stuggling with low consumer confidence.

The more retailers can use technology to interact and inform consumers and streamline the shopper journey, the more chance they have of building the bond between shopper and brand, and their profits in turn.

Dave Ridgley is a frequent occupier of the ‘man-chair’ in retail outlets. He’s also Creative Director at 31ST:SECOND. For more on 31ST:SECOND and their work, visit www.31stsecond.com.au.

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