PredictSpring are optimistic about what lies ahead for our industry and have strong feelings about the strategies retailers and brands must employ to stay engaged with their customers. This is why we want to summarize the five technologies that retailers should really be focusing on this year.
Today there is no reason for customers to wait in line. Brands and retailers must realize that the inefficiencies associated with legacy point of sale (POS) systems are costing them billions of dollars and are resulting in poor customer and store associate experiences. Nowadays, it’s actually quite simple and inexpensive to simply add on to an existing POS system in order to address line busting and to offer a host of other services that significantly enhance the shopping experience.
Retailers should look to a new modern, cloud-based modern POS system to solve for common retail use cases like clienteling, endless aisle, and BOPIS, but it should importantly also allow the retailer to fully function in the case of network outages. A modern, mobile POS with offline mode ensures sales associates are able to complete common workflows, such as processing sales, returns, applying discounts and special store promotions and signing up customers to loyalty programs, even during busy periods with limited or no connectivity.
Amazon (NASDAQ: AMZN) was the pioneer in the “scan and go” concept of retail. Walk into any of the retailer’s 9 Amazon Go concept stores, grab what you need and walk out. There’s no need for cashiers as the company’s sophisticated image recognition and AI technologies detect what you’ve taken and seamlessly bill the credit card connected to your Amazon account.
We are beginning to see more and more of this seamless in-store, fully connected retail experience. Nike (NYSE: NKE) has jumped on the bandwagon by designing a 68,000 square foot “retail experience” in New York City that provides its customers with similar jaw-dropping capabilities.
The dynamic and interactive Nike shopping experience connects the digital experience with the in-store experience better than any other retailer I’ve seen.
Nike customers can check local product popularity data to help inform in-store purchase decisions. Members of the NikePlus super fan app can reserve products in the app and have them held in an in-store locker for pick up at a later time. App users can make appointments with specialists in-store to design custom footwear. The Scan to Try feature allows customers to scan a barcode on a product that will then be personally delivered to a fitting room. Or scan a mannequin and the entire look will be brought to the fitting room. And importantly, Nike Instant Checkout allows customers to pay using the Nike app, thus avoiding long checkout lines.
This trend of seamlessly connecting the digital world with the physical world – and particularly as it relates to payments - is a trend that retailers should pay close attention to as it provides a unique experience and an important convenience to shoppers.
There has been a recent uptick in the number of direct-to-consumer, subscription-based styling services. After answering several style and preference questions, these brands send customers a well-curated selection of clothing, beauty products and accessories. Consumers love the personalization and convenience of brands such as Stitch Fix.
Retailers are beginning to take note of this model and have begun to emulate a version both online and in store. Using chat capabilities on the brands’ native apps, store associates can communicate directly with customers to curate individual looks or entire wardrobes. These suggestions can be shared via the app or set up in dressing rooms in-store. Nordstrom (NYSE: JWN) currently offers its customers free personal stylists, beauty stylists, wedding stylists, onsite alterations, style boards (hand-picked recommendations sent to your mobile phone) and gifting services.
These add-on services allow retailers to differentiate themselves from the pack and create lucrative upselling opportunities. Consumers enjoy an elevated customer experience, which creates brand affinity and loyalty.
We are seeing a new trend toward “under the radar” superfan apps – apps that are available only to a brand’s most loyal customers. These apps serve several important functions. First, they reward loyalty by offering a select group of customers early access to products, special content, games, offers, and events. Adidas’ Tango, Target’s (NYSE: TGT) Studio Connect and NikePlus are great examples.
And aside from the benefits to the consumer, these secret super fan apps provide important benefits to the brand as well. Target’s Studio Connect allows users to try out and vote on yet-to-be-released products. In other words, Target has created a free focus group to inform future product development. NikePlus offers free music, guided meditation, and fitness classes to users in exchange for information regarding users’ personal interests.
These super fan apps create a sense of exclusivity, help drive engagement, convert customers into brand ambassadors and, importantly, increase sales and CLTV. Research by consulting firm Capgemini suggests that a dedicated super fan app can increase annual revenues by five percent.
Personalizing the retail experience is no longer simply about targeting a particular customer based on his or her preferences. Rather, brands and retailers should focus on “hyper-personalization,” using sophisticated data collection methods to gain important insights about customers, products, and trends.
In fact, collecting and using data effectively is so important to retailers today that many companies are now building out Data Find Teams. These teams do nothing but design data collection methods, collect and analyze information – effectively spilling over customer data to get a better understanding of customers, their buying habits, and preferences.
One method of data collection that we are seeing more frequently is the style quiz. In-app quizzes, like the one found on Michael Kors’ (NYSE:CPRI) KorsVIP app, asks users about their style goals, color preferences, purchase habits, body type, size, style preferences, and other personal information. Customers are happy to gain personalized style advice and brands gain invaluable information to inform new product development and assist with marketing campaigns.
One thing is very clear - the power pendulum continues to swing in favor of the consumer. Consumers wield an inordinate amount of influence and brands and retailers need to innovate to offer consumers the elevated shopping experience they now demand. Tech-driven solutions that elevate the shopping experience for customers do exist. Brands and retailers should make finding and implementing these solutions a priority.
Find out more about our POS for apparel and footwear here.
While we will go through a shift in consumer behavior, some temporary and some long-lasting, eventually we will be back to normal or, as everyone is calling it, new normal. But first, we will have to go through the “new” new normal.
PredictSpring is excited to announce that Steve Madden LTD. (Nasdaq: SHOO), has selected the Modern POS to create a seamless shopping experience for consumers no matter where or when they engage with the brand.