11:58 am - Sunday April 20, 2014

Trends in Retail Pointing to Innovations in Services

One of the areas in which rampant innovation is beginning to point toward fundamental shifts in the norms of social behavior is the retail space. Long the domain of the intersection between desire and the physical display and response to that desire, retail is being transformed by the application of technology at all levels. The deployment of technology is transforming the retail experience and decoupling it from the physical world—primarily because the physical is being is being made tangible in the digital world.

Here are ten trends in retail identified by PSFK  in their 2010 and 2011 reports, that are being facilitated by technology, that are transforming the retail service experience.

World as retail experience
Increased access to the mobile web is causing the boundaries of the retail experience to extend into the everyday. With overlay technology, potential customers traveling through a mall or down a city street can see tailored offerings and deals in adjacent establishments. The reach of the retailer is now beyond the walls of her store which serves as a transition between e-commerce and physical retail experiences.

Pre-view shopping

The ability to visualize changes to environments and physical attributes via technology brings new meaning to the term “try before you buy.” Customers and now experience the new chair in a visual presentation of their own living room online. Or a shopper can try on a new suit before he decides to venture into a store for an actual fitting. Previous incarnations deploying generic environments and universal body types are giving way to actual, consumer-centric representations. This also means that the retail environment may also be experienced in advance of stepping a foot into the store.

Handheld enabled services

Lindsay Stevens from C.Wonder has said, “I believe that in a few years time, you won’t see a sales associate without a mobile device.” The timeframe of a few years is actually perhaps too long. With the use of tablets and smaller mobile devices, and with the additional of payment platforms like Square, the retail experience is well on its way to eliminating the checkout counter. The experience for the customer becomes much more personal—having been met on their terms in the retail environment—and much more exclusive.

Selling the ideal

Technology enables the retailer to design a complete customer experience from initial contact while web surfing at home all the way through to the receipt of purchase and beyond. The ability to tailor and customize that experience means that the customer can receive focused attention before, during and after the purchase that is unique to them. Not only does this create a richer experience it also has the capacity to create a deeper relationship between the retailer and their customer thereby extending the customer lifetime value.

Every store as flagship

Rather than being passive retail experiences where a customer is left to their own devices, retailers will begin transforming their stores in ways that are thematically, seasonally, and community-related. The passive experience will be supplanted by ever-changing and delighting experiences that are previewed online and via mobile devices. Expect overlays of game mechanics, feedback tools and participatory design as customers interact with and “own” their favorite stores.

Complementary curation

The concept of providing sets of products is not a new one in the fashion space. High end clothing stores have long combined outfits with displays of accessories to drive impulse purchases, and increase the bottom line given the increased margins on those accessories. What is going to transform this approach is the complimentary offers that exist beyond the retail environment. Retailers will seek to understand customer tastes and can offer pointers to additional purchases (perhaps even outside their own establishment) that will enhance the customer goodwill (consider the impact of Kris Kringle directing parents to stores other than Macy’s in the movie “Miracle on 34th Street.”)

Transforming decors

Alex Calderwood, the founder of ACE Hotels, has noted that, “In my mind, the ideal store would be designed like a stage set. It could change on a frequent basis.” This concept is also not a new one. Seasonal display changes are commonplace. But what if, using 3D technology you, the customer, could interactively design a space that transforms not every three months but every three weeks, or three days, or three hours, or three minutes?! For retailers pattern analysis of customer movement can reveal new insights into changing the retail environment, perhaps even as the customer moves through the space. I imagine entering an IKEA and not leaving after a week as their trademark maze design shifts around me!
Taking the store to the customer

The rise of the food truck culture in cities like New York and Austin, Texas are emblematic of this approach. Big box retailers are taking this concept on the road, too. Proctor Gamble has created a laundry on wheels that has traveled the USA in recent years and even been deployed to environmentally devastated regions like Tuscalossa, Alabama after they were hit by a tornado this year.

Instant show tell

The “unboxing” movement has given rise to a whole retail subculture around the anticipatory and revelatory nature of shopping. YouTube has become filled with videos of people unveiling their technology purchases. Some retailers have responded by making opening their packaging a more theatrical experience. They have designed a degree of intricacy and detail that lead to surprise and delight. Beyond that is the ability to share the direct retail experience. Levi’s is using social media platforms to enable customers to share potential purchases with friends and determine purchases based on their “Likes.” Expect retailers to bring that experience into their environments be creating “boxing” moments as previews for unboxing at home.

Group clout

The power of group purchasing has truly come into its own in the last year with the rise of Groupon, LivingSocial and other group-based deal platforms. Beyond this are funding platforms like, Kiva, DonorsChoose and Kickstarter all of which enable the soliciting and pooling of funds to reach specific goals with defined rewards. Retailers are beginning to recognize the value of that community spirit by using geolocation technology to attract and retain communities of consumers rather than individual customers.

Beyond these trends lies a whole world of retail and service innovations to be explored.

How has your shopping experience been transformed by technology?

This article was originally posted by Drew Marshall on: http://collaborativeinnovation.org/2011/12/trends-in-retail-innovations-in-services/



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Drew Marshall

About the Author: Drew Marshall

Drew is the Principal of Primed Associates, LLC. His primary focus is on helping his clients’ innovation, product development and project management teams get unstuck so they can deliver value to their customers as quickly as possible. In working on the creation of an innovation-capable culture in his client Drew helps them rapidly improve the return on their innovation investment. Drew has had consulting and management experience in strategy formulation, process consulting, project management, rational thinking practices, and product development methodologies; and he also possesses broad industry experience in software, retail, service, manufacturing, public sector and education. With a Bachelor of Arts degree and a Graduate Diploma of Education from the University of Western Sydney in Sydney Australia, and a Master of Arts in Whole Systems Design from Antioch University in Seattle, Washington, Drew is also a certified Project Management Professional. He was the past Chair of the PMI Consulting SIG and has presented widely on project management, human resources management and innovation issues. Drew serves on the Board of Trustees for Princeton Nursery School.

Filed in: CEO, CIO, Collaborative Innovation, COO, Management, Retail, Technology