Who needs data & technology?

Scanning loyalty card

Think you don’t need to get to grips with data and technology in-store? Think again says Velocity Worldwide Chief Operating Officer David Morgan.

“In days of old, when knights were bold, and smartphones weren’t invented, the shopkeeper told us what to buy, and retail choice was prevented.”

Apologies for cannibalising that old, often rather rude, “rhyme”, but 100 years ago this was the picture. The local community store was the key destination (and often the only option) for food and household needs. Shoppers, their families and their needs were known by store owners and recommendations were common; the service was personal and purchases could be delivered to home if wanted.

Over the decades, stores got bigger and the shopper was asked to do more and more for themselves – travel further, select what they want, unpack and repack at the till and then take it home. Now, even the checkout is done by the shopper in many cases. Small-format, local stores were squeezed and became “convenience” stores, narrowed down to impulse and emergency purchases.

However, something else was happening, too – shoppers were adopting technology. They were becoming better informed and issue-aware; mobile and inter-connected with likeminded people.

Channels and formats proliferated. Media fragmented and so did shopping habits. “Loyalty” schemes with the lure of rewards as a means to gather data have become so common. Who doesn’t have a wallet or purse full of plastic or a pile of loyalty cards now left at home?

The iPod taught us we could “unbundle” what others had “packaged” (e.g. individual tracks from an album). Starbucks gave us the illusion of ultimate customisation (e.g. skinny, grande latte with an extra shot and a dash of syrup). On-line commerce like Amazon showed us personalised and engaging experiences. Smartphones put us at the centre of our own world .

I expect that most, if not all, reading this article know all this.

There are an endless number of disruptive technologies available in the retail industry like iBeacons, mobile apps, digital coupons, Wi-Fi, digital displays, on-line orders/click&collect, QR codes, video analytics, ANPR cameras, e-loyalty, social media, big data, NFC, RFID, biometrics, self-scanning, ESL, mobile commerce, and light tracking to name a few.

But the biggest disruptor in retail today is not technology – it’s the shopper.

Shoppers are coming back increasingly to small-format, local stores as destinations providing compelling propositions – freshly prepared food, great coffee, support for local community and food producers, sensitive to restricted budgets, ethical issues and dietary needs. At the recent SLR awards, one could not fail to be impressed by the initiatives of not only the winners but all the nominees.

So I prefer to avoid the term “convenience store” and instead I want to talk about community, local, accessible and trusted. They happen to also be convenient.

That begs the question then: “Who needs data and technology?” in this market sector.

The answer is any retailer that wants to remain competitive and continue to meet and exceed the expectations and needs of today’s shoppers. The big players don’t stand still – deploying propositions and technology, trying to gather more and more data and crunching it like crazy to get shoppers into their store, not yours, getting them to spend more when they are there (which means less for you) and giving them reasons to come back.

But local retailers have advantages that can be exploited – they have agility, community and trust.

Technology can help continuously and consistently engage shoppers pre-store, in-store and post-store using their preferred method of communication – email, SMS, social, mobile app messaging – proactively or reactively, as they wish, when they wish. But the technology itself is not the answer.

Installing multiple “vertical” or siloed solutions can deliver some benefit but end up creating fragmented views of shopper behaviour, limit ability to action and worse still can end up confusing the shopper. This creates complexity for them and for the retailer.

We must put the shopper at the centre of what we do, understand what they want, how and when they want it and recognise that their behaviour will evolve and vary based upon many factors – time of day, immediate needs, events, ethical values, life changes – and will evolve and change.

By integrating the right technologies and solutions, we can simplify complexity with a single view of the shopper to provide personalised and relevant experiences for them at all stages of their journey.

Picture a “cook from scratch” shopper during a limited lunch break versus on Friday evening while thinking about the dinner for friends the next day; a busy “professional” with a considered health kick shopping without a time crunch versus rushing in at 10 pm on Wednesday for essentials like toothpaste and milk; a “family feeder” with a gluten intolerant child looking for new ideas to provide an interesting meal for tonight.

And how do we know what they want? Ask them. They will tell you if they feel there is “fair value exchange” and trust. This is the strong domain of local retailers. Add to this the data of what they actually do and a picture emerges that, with their permission (opt-in), we can use to  better serve them.

Retailers can use technology to customise the ambience, “look and feel” and even advertising or information on display to make the store seem more personalised and relevant. Free Wi-fi can help make the store a destination for surfing or checking emails while drinking coffee and, based on their preferences, to engage with them every time they connect to provide something they value while learning more about them.

Retailers can provide access to one or more mobile apps, suited to different demographics to enhance the experience, but must also ensure that non-smartphone users can be included through pre-store engagement and in-store self-serve tablets — or even talking to a real member of staff.

Every interaction is a learning. This is why a single view of the shopper is so important and can only be achieved with an integrated, real-time approach centred on the shopper with actionable insights that are easy to understand and implement, consistently.

So I leave you with what I think are three key steps for retail success:

  • Simplify complexity – integrate relevant technologies and solutions centred on the shopper journey.
  • Engage shoppers pre-store, in-store, post-store to understand their preferences and behaviours.
  • Personalise the experience with relevance – more shoppers, spending more, more often.