News

Retailers want to make the customer experience 'more theatrical'

October 16, 2007

LONDON — A new report from Datamonitor shows that retailers are seeking to win back market share by making the customers' shopping experience more theatrical, with emphasis placed on the sensuous elements of an in-store shopping trip. "Shop X: where's the store heading?" reports that the next step in the battle to retain customers is to streamline the buying experience, bringing it more in line with Internet shopping in terms of ease and speed of transaction. The study examines the most pertinent technologies helping retailers achieve this, with advice to both retailers and technology vendors for development and application.

New technology will enable digital signage screens to determine the sex and approximate age range of viewers, as well as differentiate between individuals and groups. In the next stage of development, screens will be able to log when people point at a particular product on a shelf and then stream adverts relating to it to the nearest screens. As well as incorporating increasingly sophisticated display functions, proximity sensors enable the systems to determine when someone is nearby. When the system receives notification of a person within a certain parameter, the sound increases; when he leaves, the sound level is decreased. Furthermore, the technology can be incorporated with highly precise sound streams which target the message to a specific area of the store, thereby minimizing sound pollution and irritation levels for customers. Tests carried out on in-store digital signage systems showed them to be an effective method of advertising, leading to increased spend and elevated brand awareness. Although the cost of installing and maintaining a digital signage system is significant, authors of the report believe that the benefits which can accrue from deployment make it worth investing in for larger retailers.

Given the average person is targeted with approximately 3,000 commercials per day, retailers are seeking to differentiate products by means of a more engaging medium than static signposting and traditional TV. Digital signage offers retailers a means of doing just that. The report also shows that Near Field Communication (NFC) is another application of Radio Frequency Identification (RFID) technology, thereby avoiding the need for touch. In retailing, NFC technologies are used to facilitate ‘contactless' payments. Given that this form of payment requires neither signature nor PIN input, it is considerably faster than paying with cash or credit/debit cards. NFC means that the mobile phone is set to be an important tool for retailers due to its capability as a fast and relatively secure payment device. But retailers should realize that it can also become a means of direct marketing to consumers, via Bluetooth technology. If consumers are encouraged to use their mobile devices for NFC payments, retailers will also have the opportunity to establish more of a personal relationship with consumers if they use a consumer's mobile device to target focused advertising and promotions and interact with the consumer directly. According to the report, the Point Of Sale (POS) is an important arena for retailers, as a last chance to increase sales, advertise to what is effectively a captive audience and reinforce brand values. Within the POS industry, self check out is one of the technologies currently garnering most interest. The technology is popular due to its ability to cut checkout time with one attendant capable of overseeing up to six checkout terminals; it also appears to enjoy favor with consumers. In a study conducted in Woolworths Big W store's in France last year, 25 percent of customers chose the self-service option. Other grocery stores who have conducted tests are reporting between 20 and 50 percent of their daily transactions processed via the self-service check out.