Opinion

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Why retail technology is big business

4 Mins

Figures from the A.R.E.’s ‘2015 Purchasing Forecast‘ show that in-store technology and fixtures are the retail areas most likely to see a significant budget increase next year. The report shows that providers of technologically innovative solutions will be the big winners, securing contracts from all sizes of retail chains. With 46 per cent of retailers saying they would be increasing spend on in-store technology, it certainly makes happy reading for those in the business.

Technology has undoubtedly become a crucial part of the customer journey and overall in-store experience, but the big question is why.

The overarching reason is actually quite a simple one – shoppers’ behaviour has changed. They have become desensitised to traditional selling tactics and way-finding designed to guide them to high profit areas of a store. So, for retailers, the pressure is on and they are constantly looking for new and innovative ways to influence and gain an insight into consumer behaviour.

For traditional ‘bricks and mortar’ store retailers, there’s added pressure from online rivals. In fact, our own survey has shown that 63 per cent of consumers prefer to shop online and 83 per cent of shoppers believe more stores will close their doors unless they significantly up their game. And, it seems technology is the way many retailers are choosing to make the required improvement.

I strongly believe it’s about taking the ease and convenience that shoppers love about the online experience and using technology to achieve this in-store. This blurring of lines between the online and offline experience is definitely a retail trend that we’ll see exemplified in the years ahead.

As an industry, we have to sit up and pay attention. This was abundantly obvious at a recent visit to GITEX Technology Week in Dubai where solutions for retail were most certainly mobile focussed, again blending the real life store experience with online convenience.

Of course, technology should never be used for technology’s sake. There always needs to be a reason behind it that ultimately provides a benefit for both the retailer and the consumer. For retailers, it helps improve operational efficiently as well as offering invaluable insight into shopper behaviour and purchasing patterns and, for shoppers, their experience becomes more engaging and enjoyable.

I still think there’s a lot of work to be done when it comes to making technology work for both parties. A classic example is the much-hyped iBeacon.

I would personally like to see iBeacons integrated with retailers’ reward schemes. Ask yourself how many times you’ve received money-off coupons from a store based on your previous purchase and then ask yourself how many times you’ve actually used them.

As the iBeacon tracks a shopper’s route around a particular store, money off coupons could be sent directly to the consumer’s phone when they’re actually in the relevant product area. In my mind, you couldn’t get a much more direct and personal form of retail marketing than that.

Ultimately, there’s no one size fits all solution when it comes to technology in the retail sector and that’s actually what makes it so engaging. Retailers know how important customer loyalty is and they want to be flexible to achieve it. At the moment, it’s all about ‘intelligent shopping’ for both consumer and retailer and in the months and years ahead, technology-based solutions will continue to be at the top of everyone’s shopping list.

Alan McPherson is CEO of Tensator Group.

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