The modern retail landscape is undergoing a significant transformation. With factors such as the cost-of-living crisis, the rise of ecommerce, and evolving customer expectations, it's clear that the retail world is adapting to cater to the modern consumer. Still, one element remains unchanged - the human desire for experience.
As a future-focused partner for the consumer industry, we’re constantly navigating the intersection of consumer behaviour shifts and emerging technology. That’s why we partnered with TheIndustry.fashion to host an event centred around the topic of ‘The Connected Store’, bringing together key decision-makers from brands and retailers to gain practical advice on how to deliver a true, seamless omnichannel retail experience. We chaired a panel on ‘Elevating Retail: Advancing Connected Stores through Collaboration and Technology’ with insights from Andrew Redman, Head of Store Ops at Marks and Spencer (M&S), Cameron Worth, Founder and CEO of SharpEnd, and Liam Buswell, Innovation Director at True. Below are the key elements to consider when thinking about your connected store strategy.
The Rise of the Connected Store
Today’s consumers are looking for an elevated retail experience, whether they’re shopping online or offline, through third-party partners or social media. Retail and consumer brands need to consider all channels together – making them feel like an extension of one another, whilst enticing customers with personalised experiences, on demand delivery, and flexible payment options. At the heart of this strategy is the store – a vibrant hub where service meets storytelling, where digital interweaves with tangible, creating hyper-relevant consumer connections.
M&S is one of several retail businesses that are navigating their way through the connected store journey – hoping to better connect customers via its various channels. Redman explains, "When I think about connected store, I think about connected customer. At M&S, we want customers to navigate our offer seamlessly across all channels. We hope to achieve this by creating a successful omnichannel experience, allowing customers to shop via any channel without noticing a difference."
Redman continues by offering an intriguing perspective on the connected store. For him, a connected store is not just about integrating technology. It's about ensuring that both the customer and the store colleagues play pivotal roles in the shopping journey. By training staff adequately and equipping them with the right technology, retailers can enhance the performance of in-store tech.
Worth, who founded SharpEnd in 2015, highlights the importance of driving customer engagement, even in unconventional settings. He emphasises the necessity for retailers to offer engaging experiences that capitalise on the time customers spend in a particular place. Worth said, “Rather than using all the latest tech, harness the tech that people know about and use it to your benefit”, giving the example of Clinique’s NFC-enabled experience in which Clinique married its well-known brand identity with a fresh take on connected packaging and technology.
The Undying Value of In-Person Shopping
While many have heralded the "death of the high street", such declarations may be premature. Contrary to the belief that brick-and-mortar stores are becoming obsolete, consumers still crave the in-person experience. But to compete with the convenience and accessibility of online shopping, physical retail needs to offer something fundamentally different.
Factors like the Covid-19 pandemic, macroeconomic shifts, and emerging technologies have altered consumer behaviours and expectations. Today's shoppers seek a blend of omnichannel convenience, experiential shopping, community, and personalisation.
Innovations and Opportunities
M&S has witnessed a surge in customer loyalty and sales through the introduction of connected experiences. In terms of technology, M&S is harnessing the power of tools like RFID for stock management and machine vision to analyse customer footpaths and habits within the store.
While M&S continues to appreciate the technological tools they've relied on for nearly two decades, Redman emphasises the significance of establishing apt platforms and embracing open systems to explore new possibilities. He explains that "to truly build a thriving connected store and an effective omnichannel approach, it's essential to champion innovation and A/B test. Yet, it's equally vital to leverage transparent data to gauge the efficacy of any initiative."
Worth emphasises the significance of collaborations between retailers and technology startups. By merging retail insights with technological innovation, the industry can continue to push boundaries and redefine the shopping experience.
Challenges, Risks, and The Way Forward
Legacy retailers face the dual challenges of integrating modern technology and overcoming an aversion to change. The balance between technology and experience is crucial. Retailers need to prioritise customer experience over technology, ensuring that any tech integration genuinely enhances the shopping journey. Redman highlighted the importance of navigating the tech vs experience conundrum and emphasised the need to understand what you’re trying to achieve first and then implement the tech once your basics are covered. This requires innovation, experimentation, and the ability to learn quickly.
Data privacy is another crucial aspect of modern retail. Redman shared that when it comes to data privacy, the approach from M&S is to be customer centric – really questioning whether it is adding value to the customer. With increased digitisation, retailers must strike a balance between personalisation and privacy, ensuring that they use customer data responsibly and transparently.
As part of the event, we conducted a poll delving into what stages retailers and brands were at in their connected store journey. 45% stated they were at beginning stages and hadn’t thought about connected store innovation yet, citing they were unsure where to start. 45% stated they felt competent and were starting to test new tech, while only 10% said they were at a professional stage and had run tests, using those learnings to inform future retail strategy. This highlights the opportunity that exists for retailers and brands to elevate their customer experiences and start testing new ways to bring their brands to life.
The retail industry is in a state of flux, driven by evolving technologies and changing consumer behaviours. By focusing on the human experience, weaving online and in-store experiences, leveraging the right technologies, and prioritising transparency and trust, retailers can successfully navigate the implementation of ‘the connected store’ and offer a seamless and enriched shopping experience.