Exclusive NRF data shows how shoppers respond to and interact with in-store technology

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Creative use of technology in retail can inspire, excite and differentiate a brand. Even so, according to a new study from the National Retail Federation, the most thrilling applications are those that simply make the shopping journey easier.

NRF’s Summer 2019 Consumer View report explores how investment in technology is paying off, and in many ways has made “significant strides in transforming the retail experience.”

“The backdrop for this is that you hear so much about retail struggling, about the retail apocalypse, but as we know, none of that is true,” says Mark Mathews, NRF’s vice president of research development and industry analysis. “We also know retailers have been investing heavily in their businesses to improve their connection to customers, and make their customers’ lives easier by making the path to purchase more streamlined, and more enjoyable.”

DELIVERING ON THE BASICS

The basic fundamentals of retail haven’t changed for more than a century; it’s still about the right product, the right price and the creation of a positive experience. In recent years, however, a variety of new business models, disruptions and innovations have challenged retailers to keep up. The fruit of that labor appears to be rising to the surface as consumers notice.

“Everyone is so busy, and has so little time,” Mathews says. As a result, “They aren’t looking for complicated technology. Consumers find the most utility in innovations that make their lives easier and make the transaction process more seamless.”

NRF’s Consumer View tracks consumer behavior and shopping trends across stores, online channels, loyalty and technology. The summer study was conducted April 24 to May 17 among U.S. adults using Toluna Analytics.

“They aren’t looking for complicated technology. Consumers find the most utility in innovations that make their lives easier and make the transaction process more seamless.” — Mark Mathews, National Retail Federation

Among the most interesting findings was that 80 percent agreed that shopping technologies and innovations had improved their experience when shopping online; in-store, that number was 66 percent, and on mobile, 63 percent. Mathews admits it can be challenging for retailers to understand where to invest. But being able to see what’s meaningful to consumers is decidedly helpful.

“Roughly half of consumers are very interested in solutions that take the uncertainty out of shopping — whether that’s knowing that an item is in stock or getting accurate information on prices and reviews,” according to the NRF report. “And ability to address these needs is already shaping consumers’ decisions on the brands and retailers they shop. These more tactical needs currently outweigh the interest in more personalized or engaging experiences. That is not to say that personalization or retail-tainment is not a differentiating factor for shoppers, but retailers first have to deliver on the basics.”

Consumers want help, for example, knowing whether a product is available or in stock (55 percent), comparing prices or reviews (49 percent) and making it easier to find a product or location (47 percent). It didn’t seem that long ago that a brand or retailer being able to recommend items for purchase was an added benefit, but according to the study, only 25 percent of respondents are “very interested” in those solutions today.

Overall, there’s not that much difference in the percentage of respondents who are interested in technology or solutions related to the top challenges and the percentage who believe it is important that brands or retailers have these solutions and innovations in place. At some point in the not-too-distant future, then, it may be more of a differentiator when a retailer or brand doesn’t have these solutions in place, rather than when they do.

Interest remains in technologies such as virtual and augmented reality, though a relatively small number of people have been able to experience them firsthand. In addition, questions about practicality remain: It might be helpful to be able to see what a couch in a furniture store would look like in a room at home, but Mathews says other applications might not be so clear-cut.

“There are a lot of young companies doing really interesting things,” he says. “But it’s more interesting when it’s the bigger names. These are the harbor ships in terms of technology.”

Time will tell which of the emerging technologies takes root and which fade away. Mathews points to the 3D TVs of the not-too-distant past; the adoption curve simply didn’t match anticipated interest.


PRACTICAL APPLICATIONS

Easy, peasy! A number of brands and retailers have executed winning strategies for simplifying the shopping experience.

The Home Depot’s mobile app helps shoppers quickly and easily find what they need. The app has an image search that allows shoppers to take a photo of an item and receive recommendations for similar products. But that’s not all. There’s also a voice search, a barcode scan that provides additional information about products, help finding items in the precise aisle and bay with a store map and the ability to talk or chat with an online associate on demand. Back at home, shoppers can use the app’s augmented reality features to select an item and see what it would look like — and how it would fit — in that space.

Walmart’s grocery pickup is expected to be available in 3,100 stores by the end of the year, in addition to same-day grocery delivery from 1,600 stores. But Walmart announced in June it was ready to go the extra mile: With Walmart InHome Delivery, shoppers can place an order and have an associate deliver the goods right to their kitchen or garage fridge. The associates will use smart entry technology and a proprietary, wearable camera to access the customer’s home, “allowing customers to control access into their homes and giving them the ability to watch the deliveries remotely,” the company says. “These associates, whose jobs are focused on this service, will also go through an extensive training program which prepares them to enter customers’ homes with the same care and respect with which they would treat a friend’s or family’s home — not to mention how to select the freshest grocery items and organize the most efficient refrigerator.” InHome debuts this fall for more than 1 million customers in Kansas City, Mo.; Pittsburgh, Penn.; and Vero Beach, Fla.

The Nike House of Innovation 000, the brand’s New York flagship that opened in 2018, is a playground of digital advances. Shoppers who use the brand’s mobile app, for example, can enjoy instant checkout as well as the ability to “shop the look.” Store mannequins include QR codes. Once scanned, the app provides information on the products, when they can be delivered to a fitting room or brought out by an employee. There’s also an entire floor exclusive to members of the NikePlus digital program, who can receive free courier delivery, one-on-one appointments with experts and special offers and opportunities called “unlocks.” The flagship earned Forbes’ Best Retail Experience of 2018 honor.


TACKLING PAIN POINTS

For the more practical opportunities, NRF is not alone in its views about using technology to increase ease and seamless experiences for shoppers.

In its January 2019 report, “Winning in An Era of Unprecedented Disruption: A Perspective on U.S. Retail,” McKinsey & Company named the need to “reimagine the store” as one of five imperatives for companies that “aim to be tomorrow’s retail winners.”

From the report: “Since established brand names mean much less to consumers than they used to, the basis of retail competition is shifting from price and product superiority to privileged insights and customer experience. In light of this shift, there’s no doubt that physical stores can still be highly effective consumer touchpoints, but retailers need to think hard about the role of the store. Stores must be tightly integrated with the online channel, enabling online sales while simultaneously offering experiential features and cutting-edge technology that sets the store apart.”

McKinsey highlights food retailer Ahold Delhaize’s no-checkout “tap-to-go” technology, retailer Everlane’s “shop walletless” in-store option for those who have registered on its website and the ability for shoppers in New York and San Francisco Reformation stores to select items for trying on through digital screens.

Each of these advances tackles unique pain points — and pain points still exist in all channels, including online.

With the NRF study, 37 percent of respondents reported they were most frustrated at the beginning of the shopping journey, when they’re first researching features and reviews; almost half say they’re most interested in tech solutions for this stage.

Roughly a quarter are most frustrated right before a purchase, when checking prices or availability, with the same amount most frustrated after the purchase, when leaving a review or processing a return. Interestingly, 25 percent of consumers are most interested in tech solutions right before the purchase, and only 12 percent after.

On the other end of the spectrum, roughly two-thirds of respondents who had tried selfcheckout, buy online, pick up in store and mobile payment were satisfied with those experiences.

Challenges remain, however, in getting word across that these technologies are available: Just 56 percent of respondents were aware of buy online, pick up in store options; 59 percent of mobile payment; and 62 percent of self-checkout.

FUTURE PLANS

So, what about the future? The study showed that more than eight in 10 respondents had tried — and were interested in trying again — advances such as in-app store navigation (89 percent), virtual reality (82 percent), virtual fit (83 percent), augmented reality (86 percent), visual search (86 percent) and smart dressing rooms (88 percent). Just 64 percent of those who had tried a voice assistant such as Alexa, Google Home or Siri were interested in doing so again. Social shopping fared just a little better, at 78 percent.

More than half of respondents had not yet experienced — but would like to try — emerging technologies such as in-app store navigation (56 percent), visual search (60 percent), virtual reality (54 percent), augmented reality (54 percent), virtual fit (54 percent) or smart dressing rooms (57 percent).

Mathews says NRF doesn’t typically put itself in the position of advising retailers about how to do what they already do best. As such, he won’t offer specific recommendations regarding the data. He will say, however, that consumers are “enjoying certain technology more than others, and looking for their pain points to be solved by retailers. All retailers do need to get on board with this, because this is the future.”

Of course, there are still retailers that do just fine without a strong ecommerce game.

“There are many different ways to connect with the consumer,” Mathews says.

No matter what those ways are, it’s essential that they simplify rather than complicate the relationship.

Fiona Soltes, a freelancer based near Nashville, Tenn., loves a good bargain almost as much as she loves a good story.

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