The Future Is Here.
Making the Store of the Future the Store of Today
The Future Is Here.
These are exciting times for brick-and-mortar stores, filled with challenges and opportunities. With the rise of e-commerce, the role of physical stores has undergone a dramatic transformation, one that is still evolving.
Consumers equipped with smart devices live their “real” lives seamlessly blended with digital experiences. According to the 2019 Mary Meeker Internet Trends report, 26% of U.S. adults say they are “almost constantly online.” This extends to shopping. Customers do not think about separate channels… they don’t think of their shopping experience in physical and digital channels. Instead, they want access to a single, unified experience that consistently travels with them across store, website, social media, and/or mobile app.
Traditionally, the physical store served as a static repository for products retailers select months in advance to push out to customers, with the merchandise assortment based on long-term seasonal demand trends. That is no longer the case — the physical store is now a lively hub of digitally-supported pull retailing activity.
Customers no longer think about separate channels.
Nothing disheartens a customer entering your store like the sight of long queues at the checkout stand. Even modern, sleek POS terminals can be slow and clunky, are subject to operator error, and occupy valuable front-of-store real estate. Self-service checkout kiosks are often confusing for customers, which can still mean long queues, and also pose the issue of taking up potential selling or customer service space.
Fortunately, in an era where most consumers enter a brick-and-mortar store carrying a smart device, the need for a dedicated POS terminal or self-service kiosk is greatly diminished. Mobile app development has reached the point where retailers can now enable brick-and-mortar shoppers to scan and pay for items using their own smartphones, without any need for associate interaction or a dedicated terminal. Consumer expectations are shifting as a result, with 96% of respondents to a recent Boston Retail Partners (BRP) survey stating they look for ease of in-store checkout and payment when selecting a brick-and-mortar store.
One of the most sophisticated examples of self-checkout is Amazon’s cashierless Amazon Go store model, which eliminates the need for human cashiers, or cash payments. Cameras equipped with computer vision and machine learning technology, as well as automatic sensors, keep track of the items customers take from shelves. When a shopper is ready to check out, they automatically pay with a registered credit or debit card inside the Amazon Go mobile app. (Customers can also pay with cash at select Amazon Go stores and will reportedly be able to do so at all locations in the future.)
The Amazon Go model perfectly illustrates how much physical infrastructure is actually required to support checkout without POS hardware. Stores should have networked cameras and sensors to both track real-time store inventory and provide security against shoplifting.
In addition, in-store WiFi networks need to be robust enough to provide connectivity and services, including payment processing, to all makes, models, and versions of consumer mobile devices. The “wireless store” requires quite a bit of wiring, even if it is out of view of the shopper!
Buy-online-pickup-in-store (BOPIS) and buy-online-return-in-store (BORIS) have become expected offerings for any retailer with a store and an e-commerce site. Customers expect to be able to pick up online purchases and make online returns in the brick-and-mortar store. BOPIS and BORIS have become firmly established fixtures in the omnichannel retail environment.
Like most things omnichannel, BOPIS and BORIS seem simple to the consumer, but are complex behind the scenes of the retailer. In the BOPIS/BORIS equation, the brick-and-mortar store becomes a hub connecting to the online distribution network, reverse logistics network, and e-commerce platform.
The role of the store associate also becomes much more complex as a result of BOPIS/BORIS. In addition to performing their traditional activities, such as stocking shelves and assisting customers, store associates must pick and pack online orders, manage online inventory, and fulfill e-commerce transactions.
Even store customers, who can benefit so much from the immediacy and convenience of BOPIS and BORIS, may need to deal with some extra complications. For example, a customer picking up or dropping off an online purchase may have to bring up a QR code on their phone for scanning via kiosk or employee device, produce a paper receipt with a scannable code, or display some type of confirmation text or email.
Younger consumers, in particular, are leveraging stores as fulfillment hubs for online purchases. According to a recent survey of Gen Z consumers age 18-25 from Package Concierge, nearly two-thirds used BOPIS within the last month and 60% say BOPIS plays a factor in retailer selection.
Having a robust underlying store network is absolutely critical for any retailer engaging in BOPIS and/or BORIS activities. The store’s Internet communications infrastructure must be strong enough to simultaneously engage in real-time data exchange with multiple distribution, inventory and order management networks, potentially including systems operated by third-party partners.
In addition, store associates need to rapidly track, collect and distribute multiple streams of data with mobile devices, and kiosks and customer mobile devices may also play a part in the BOPIS/BORIS technology environment. Without a solid network foundation, BOPIS and BORIS efforts will crumble.
Trying on apparel and cosmetics is a routine part of the brick-and-mortar shopping experience, but an often frustrating and time-consuming one. Customers may have to try on numerous iterations of a garment to find the one that looks best, and applying cosmetics products can be messy and even irritating to the skin.
3. Virtual Try-On
However, more stores are now offering interactive tablets, kiosks, and screens in dressing rooms or on the store floor to enable shoppers to view digital representations of themselves and see how different products would look on them. These virtual self-service technologies enable shoppers to quickly try on large numbers of products, and then select the items they like best for more time-consuming physical try-on.
To offer virtual try-on in their stores, retailers must provide an underlying network that can support complex augmented reality/virtual reality (AR/VR) systems. AR and VR solutions also need to be connected in real time to back-end product information management (PIM) systems to pull the appropriate images of items customers want to try on, as well as to device screens that display them.
Also, the in-store physical network may also need to either support in-store digital cameras or connect with customer devices, so that shoppers can submit photos of themselves.
For many consumers, the smartphone has become a tool that brings digital capabilities to the physical world. Increasingly popular mobile shopping list apps are a perfect example of how the smartphone serves as a crucial omnichannel touchpoint for brick-and-mortar retailers.
Leveraging a shopping list app, consumers can create a digital shopping list on their mobile device before visiting a brick-and-mortar store. Depending on the app, this may be accomplished by scanning product barcodes, selecting items from a digital list, and/or checking off goods purchased during previous store trips.
4. Shopping List
Once customers arrive at their destination store, mobile wayfinding can be used to direct their shopping in a manner that minimizes trip length and the amount of time chilled and frozen foods and perishables are exposed in a shopping cart. Retailers can also send customers real-time, personalized mobile offers and suggestions based on the items on their list, as well as products in proximity to their current in-store location.
Supporting this type of guided in-store mobile navigation involves a substantial amount of physical infrastructure. Wayfinding requires that retailers install some type of beacons, smart shelf labels, RFID tags, or other interactive transmitters that can communicate with customer devices. Wayfinding assets also need to interact with an in-store geolocation system to ensure customers are directed to the proper products in the correct spots.
And of course, in-store WiFi networks must be capable of supporting large numbers of customer devices continually exchanging data with interactive transmitters. In addition, store associates will need to be able to interact with smart labels or tags to keep real-time track of shelf inventory levels, as out-of-stocks can seriously disrupt a mobile shopping list program.
Creating the ‘Store of the Future’ ...Today.
The physical store is not obsolete, but its operating model is evolving to meet the needs of modern, constantly connected customers. Emerging technologies such as self-checkout, BOPIS/BORIS, virtual try-on, and digital shopping lists enable retailers to offer a futuristic store environment to today’s customers.
Of course, these leading-edge store solutions do not operate in a vacuum. Retailers must ensure their brick-and-mortar stores are equipped with the most effective and advanced network technology to support future store offerings.
Lumen is the second largest U.S. communications provider to global enterprise customers. Headquartered in Monroe, LA, Lumen is an S&P 500 company and is included among the Fortune 500 list of America’s largest corporations. Lumen provides services to 7 of the 10 largest retailers in the world, helping them provide their customers with an outstanding retail experience. Lumen delivers innovative private and public networking and managed services for global businesses on virtual, dedicated and colocation platforms. It is a global leader in data and voice networks, cloud infrastructure and hosted IT solutions for enterprise business customers.
Leveraging Lumen’s technology, services and know-how, today’s retailers can confidently create a robust and scalable platform capable of enabling a “Store of the Future” shopping environment for their customers, today as well as tomorrow.