Innovative retailers balance the best of digital and physical worlds

How digital technologies like cloud, AI and mobile enhance the customer experience in brick-and-mortar stores

By | 3 minute read | February 3, 2020

In-person shopping in physical retail locations has dwindled in recent years, largely due to the convenient experience available through online shopping options. While many retailers have already incorporated online shopping into their strategies, there’s still the question of what to do with existing brick-and-mortar stores. Rather than replace physical shops altogether, innovative retailers are embracing the opportunity to update their physical locations with digital technologies such as cloud, AI and mobile capabilities. By harnessing the best of the digital world, retailers can enhance the physical shopping experience and even increase in-store traffic.

Leverage technology to create more meaningful in-store experiences

Savvy customers who like to do their shopping in person still prefer to research prices and product information before they even enter a physical store. Florida home-furnishings retailer City Furniture saw this as an opportunity to shift its selling-floor strategy and update showrooms to make the in-store experience as informative, easy and engaging as it is online. Thanks to a trio of mobile apps, City Furniture has increased its average order volume by 13 percent and reduced average discounts by almost 60 percent.

Naranja is Argentina’s largest credit card company, with a 30+ year history, more than 10 million cards issued and 260,000 active merchants. Over the past few years, Naranja has been working to build the “branch of the future,” where the customer experience is efficient, effective and enjoyable thanks to fully cloud-enabled solutions.

“We want to make life easier for people,” said Naranja Commercial Director Aida Ferraira. “We seek to bring the best of the digital world to the physical world, where we really deliver an omnichannel experience that promotes, above all, self-management.” With a strong focus on customer experience, that total transformation included digitizing the customer journey, working with artificial intelligence to facilitate a more consistent experience, and promoting customer self-management. “We were able to reduce the average wait times from 10 to 15 minutes to three minutes,” said Ferraira. “And our customer efforts, which were 75% positive, jumped to 90% positive.”

Provide consistent customer experience across multiple touch points

A customer’s ability to interact with retail in their preferred way — whether that’s finding an item online and having it shipped to their home, buying online and picking up in a store, or returning an online purchase in a physical store — can mean the difference between a sale and a missed opportunity. But for that to work, the company must have complete control over complex inventory-management processes behind the scenes. “Our customers might not see a difference between buying a product from our e-commerce site and buying that same product from one of our stores,” said Kent Heimes, Retail Solution Architect at Fossil. “But in the past, we used separate systems to manage those processes.” Fossil seized the opportunity to implement IBM Order Management to enable centralized visibility and orchestration of its inventory across channels, making omnichannel retail a reality.

Reduce customer decision fatigue

Behr is widely known for its expansive paint selection, with more than 30,000 colors to choose from. However, when faced with an overwhelming number of options, many consumers struggle to make a decision — which is why, over the past 10 years, DIY paint projects have been on the decline. Behr wanted to cut through this decision fatigue and find new, innovative ways to reach DIYers with personalized recommendations based on their needs and what they’re trying to accomplish.

Behr harnessed the power of AI to develop its Color Discovery tool, which uses a series of questions and a chatbot format to narrow down a customer’s choice to a set of three colors based on their needs. “Once someone has used our tool, they generally go into a Home Depot store to get either a paint chip or a sample,” said Behr Vice President of Digital Marketing Tanuja Singeetham. “For the first time, we can measure whether using the tool actually leads people to a store visit. And, in fact, we’ve seen an 8.5 percent incremental lift driving footsteps into the store.”

Like any industry, retail is always changing. As customers’ needs and expectations evolve, so must the way retail businesses reach and interact with those customers. Today, AI, mobile capabilities and cloud solutions are great tools to help retailers widen their reach, increase agility and make the most of the infrastructure they already have.