Technology is key to giving consumers a richer shopping experience
The consumer wants a richer shopping experience. Technology is the answer. - In the palm of almost every consumer is a smart phone and with that we can add to the shopping experience in a way that we never could before, says Dr. Paul Marsden - a psychologist based in London who has specialized in consumer behavior, shopping trends and in-store technology.
- By: Karsten Bengtsson interviews
- Published: 11-04-2014
Dr. Paul Marsden is a consumer psychologist, writer and researcher with a deep interest in branding, trends and technology. He is also a former bodybuilder.
But these days he is mostly wrestling with the question of how to “reinvent retail for the connected customer” - the subtitle for a white paper he just wrote. He also writes two blogs on related subjects: ”Viralculture : Content Marketing for the Mind” and ”The Digital Intelligent Today”.
Do use see the need for the retail industry to ad more technology to their stores in order to compete with the online world?
- I think that the only way the in-store retail industry will be able to compete is by using the new model of omni store commerce. That the consumer goes to the store to get an experience and then buy online. The industries that will be successful in the future will be those who offer an integrated experience across multiple channels.
So if you are not able to sell online, I think you will have a really tough life ahead of you because if the product you sell has a universal product code - if it can be bought elsewhere - then Amazon will kill you. It is just that simple. They got the scale, they got the logistics - you just can’t compete against Amazon. You need to either sell something exclusive and unique that can’t be bought online or you need to sell your products online and use your store as a place for experience and servicing.
But don’t you run into the showroom-problem - where the consumer browse in the store, but buy from someone else online?
- I think that Apple has shown that it does not have to be that way. That you don’t have to go to the lowest price. Apple’s stores are the most successful retail on the planet. They sell more per square meter than any other store in the world. More than the jewelry store Tiffany, which comes in at number two. And Tiffany sells about half of what Apple does.
So even though Apple’s competitors in the US don’t pay sales taxes online, Apple is still able to sell its product in their physical stores because they offer an amazing customer experience. Steve Jobs once said: “I want every Apple store to look like a modern museum with the right material, the right light and so on, so the consumers can have an insanely great experience when they come into our stores.” People go to the Apple store for entertainment. Its retail-tainment. You go in and woo! And you always come out with something, right? Apple has shown that with good service and excellent experience, people will not necessarily use the store just for showrooming. They will buy as well. Apple invites the costumer to use his or her phone app, so they can scan themselves out - they don’t have to talk to a human being. Or you can scan the product code and buy your iPhone elsewhere. Apple has such a belief in their brand and in their service. The costumers know that they can come back for more information and service if anything goes wrong. People will pay premium for that kind of service.
People want to go to stores
Do you see self-service kiosks as part of the in-store experience in the future?
- It is already happening. Here in the UK, the department store Mark & Spencer have self-service walls in some of their smaller branches so if the costumer can’t find what they are looking for in the store they can buy it online and have it delivered to their home.
Will we get a hybrid world, where part of the online world will move into physical stores?
- Yes, instead of separate silos, we will see stores that try to fulfill the consumers demand for finding what they want here and now. With new smart phone technology we will see consumers shopping in all kinds of ways - sitting on their coach doing research, ordering online, picking up in stores. And if the product is not good, return it in another store, get service by phone. It is an omni channel world.
But people still want to go to stores. When Google tried to sell its first mobile Android phone only online, it was a complete disaster because people wanted to touch and feel it. Few people will spend 500 dollars on something that you can’t touch. That is why, in the US and the UK, you see a whole trend of small pop-up retail stores, temporary stores that are used only when you launch a new product or around a particular event.
We have seen a lot of tricks from the online world moving into real stores - like taking pictures of your shopping experience and posting them on Pinterest or showing Facebook-likes on products in physical stores. Is that a good idea?
- I think it can be done in a way that makes sense. What eBay did around Christmas was a good idea. They created a virtual store in Covent Garden here in London, it was a pop-up store where all the products were projected onto virtual shelves and then you could scan those virtual products and buy them right on your phone and get them delivered by eBay to your home. It ranked the most popular Christmas-items on the screen so shoppers could get ideas - what to buy for their grandmother or give to their kids.
And we have seen how C & A in Latin America is showing the number of Facebook-likes on hangers of popular clothes in their physical stores. We have seen physical stores that show costumer reviews of products. You simply scan the bar code and product reviews will come up on your mobile phone. And that is useful. If you see why people shop online - the answer is that you can find almost perfect information there. Apple Retail has copied the review idea as well. And the fitness chain RunnersNeed will find the cheapest price online and offer you that price in the store. If you want to buy a pair of Nike running shoes, they will find the cheapest price for you. And you don’t even have to ask them. They will just do it. So we are seeing that stores are learning tricks from the online world and experimenting with them in the physical store.
So you think you can fight online technology with even more technology - now in stores?
- There might be some people that are looking for a sort of non-technology experience when they go into a physical shore. They might want to talk to a real person. But I still think you can give these consumers a better experience with technology. You can see what Burberry has done. The sales person here has a tablet so he or she can see the costumer’s purchase history, what they like and don’t like online. This will make that human interaction richer and gives the costumer a better experience in the store. Also, you can use technology to check yourself out like in the Apple Store. People don’t want to stand in line just to check their stuff out. But you have to use technology to enhance what is good about shopping in a store - experience, service etc.
A richer shopping experience
And also use new forms of technology to pay in the stores?
- Well, there is a whole new range of technologies that can do that. PayPal has its Virtual Beacon; Apple has its own version - iBeacon - and so on. All these kind of Bluetooth technologies. With those, customers can go to a shelf and get a whole range of information about a product and also pay for it right away. So I think there is a place for a lot of these technologies. Retailers will have more knowledge on who is stopping where in the store; who is looking where and so on. It enables shops to give a more rich shopping experience. If you are in front of the yogurt shelf, you can download recipes via Bluetooth technology. So I think there is a place for these new Beacon technologies - special the PayPal Beacon where the consumer can pay for the product right at the shelf.
Isn’t the real advantage for physical stores that they can provide shopping that truly is a social experience - something that the online world can’t do?
- Well, yes and no. Sometimes I think shopping in a store can be rather anti-social - or just a bad experience. But yes, it can be social too. I just came back from China where there is a social trend called tuangou - which is a kind of team shopping, where shoppers organize themselves online, or via sms, to go to a store together at the same time and demand a group discount. So 20 people will go to an electronic store and buy 20 TV-sets - but only if the sales person is willing to give them 20 pct. rebate. So right there you are using the power of the crowd to negotiate a better prize. In this case technology can actually make shopping even more social.
The example from China is like using the Groupon-idea in real stores?
- Yes, but in many ways I think Groupon and other online coupon-sellers are missing the social aspect of crowd shopping. I actually think we will see a more consumer-driven crowd shopping, like in China, instead of the retail-driven practice that we see online today. It is, after all, the consumers who have the power.
Dr. Paul Marsden