The National Retail Federation host a conference each year called “The Big Show”, which, according to Retail Week, is “the most important look at retail technology anywhere in the world, and the international nature of the crowd shows how today’s technology evolution is a global one.” Earlier this year, approximately 33,000 people travelled to New York to attend this popular conference.
The event saw speakers from all over the world giving keynote speeches and even giving educational seminars, passing on their knowledge to others. Business owners from all backgrounds attended this event in order to gain more insight into the world of retail. However, there seemed to be one underlying aim from all those that attended – to understand how the dynamics of the retail world are changing due to the activity of online shoppers.
Data is key here and analysis and techniques were discussed at the conference in detail. Retailers were looking to understand how to meet online shoppers changing expectations, but at the same time, maintaining or even boosting the level of traffic into their stores. The data on this helped the retailers look further into the preferences of their customers and by investigating their behavior, to anticipate their needs. RetailWire were in attendance at the conference and said: “The ability to use data and predict patterns of behavior is advancing at a rapid rate and will go a long way in determining who wins the competition for consumer dollars.”
But the conference wasn’t just about the boring stats but was showcasing some exciting new things being seen in retail at the moment. Retailers got to see first hand, eBay’s new fancy technology that sees you in a smart dressing room. Nordstrom is currently trying out eBay’s technology in two of their stores; San Jose and Seattle. The dressing rooms have full-length mirrors that actually double up as some kind of interactive website. The idea is it takes away some of the annoyances of shopping, like when you realize you got the wrong size or if garment’s colour just isn’t right and you have to get dressed again just to get back out on the shop floor to fetch an alternative item. With these mirrors, you can request a sales assistant to get you alternative sizes/colours, or even finish off your outfit with a complementary pair of shoes! Nordstrom is not the only big department store to want to take strides in the technology department, but Bloomingdales have also started their own versions of smart fitting rooms. Whilst they have not implemented eBay’s technology, they have included interactive wall-mounted iPads in their fitting rooms in several of their stores.
PayPal also made some big announcements at the show; they will be breaking away from their partnership with eBay shortly and they discussed at the conference the trend in mobile payments. They expect that the stats will show that about 33.9% of all e-commerce sales will be from mobiles in 2015. However, their biggest announcement was the introduction of PayPal Credit; this will allow customers to purchase higher-priced items and then split their payments into easier and more manageable monthly payments. The idea is to give customers more control over their finances and make it easier for them to budget. PayPal says their aim is to: “collaborate with merchants and industry partners to create better and secure experiences for people online, in-store and on mobile devices.”
Another widely discussed topic at the conference was that of “shopping cart abandonment” – the process of when consumers browse online and add products to their basket, but never actually checkout and complete the transaction. RetailWire gave their two thoughts on this matter and said they believed that more and more consumers now do research online before they buy but then actually go in-store to make the purchase, based on what they have researched online. The goal of PayPal Credit is supposed to reduce the amount of shopping cart abandonment that is occurring as well as increasing the AOV (average order value), since more shoppers will be able to afford larger items if split into monthly payments.
Alison Paul, the vice chairman of Deloitte, voiced her opinion on the congruency between online and in-store shopping: “‘digital should no longer be a separate part of retail’ but also that customers should be measured ‘across the entire journey’ rather than with a particular emphasis on one part or another.” She believes that many retail outlets are approaching their strategies in the wrong way and that these retailers need to change their mindsets about the online and physical shopping world.
There has been a great deal of change in shopping habits over the years, whether it is online or in retail stores. Even something as simple as a store’s opening hours can change the way people shop. Customers’ behaviors and expectations must always be monitored if retailers want to continue to produce good results and meet their customers’ needs. Now more than ever, due to all the advancements of e-commerce and the popularity of mobile sites and mobile payments, the way we shop is evolving. The pressure is now on the retailers to adapt to these changes. If retailers want to continue to keep their customers coming back, they need to improve the buying experience and to meet customer expectations through a variety of channels.
Incidentally, it is the major retailers who will suffer the most from these changes; they have invested millions into the systems that they have in place already. If they are to make changes, then this will take a great deal of time and expense. However, for those smaller businesses, they have more flexibility and can implement changes with less organizational issues and expense. It is these small to medium-sized businesses that are at an advantage at these times.