Retailers Are Finally Bringing Digital Shopping Into Physical Stores

During the early 2000s, while the retail industry was getting battered by e-commerce, grocery stores were seemingly safe. Twenty years — and a pandemic — later, much has changed; e-commerce and delivery services have transformed grocery retail. Today, when consumers visit a store, they enter with much higher expectations. A convenient and smooth, seamless shopping experience, similar to what they would get online, is required. If the retailer fails, other grocery stores that have embraced customer-facing technology will happily welcome their business — or the consumer will turn to online delivery.

Source: Oriient

With smartphones, multifaceted shopping experiences are now the new norm. In fact, in a report by the ROBO Economy (Research Online Buy Offline), 82 percent of shoppers consulted their phones before making in-store purchases.

Taking In-Store Technology to the Next Level

Grocery retailers’ bread-and-butter is still in-store sales, and many are expanding their multichannel experience to be more flexible for today’s shoppers. Target has added Disney microshops, including photo stations and interactive displays. Kroger is using shelf-based digital displays for pricing, nutritional and dietary information, as well as promotions.

Some stores are using technology to offer faster checkouts. Albertsons' “smart” shopping carts enable customers to ring up items as they shop and pay without going through checkout. Amazon Just Walk Out technology lets shoppers sign in via their Amazon.com account when entering the store, select their items, and leave, automatically paying via their accounts when they exit. Not only does scan-and-go technology reduce time wasted, but it allows retailers to streamline operations and reassign employees to areas in which they can provide more personal service; or retailers can lower labor costs by reducing headcount.

The original goal of store design was to ensure customers made more impulse purchases. However, that's being overtaken by the need to make the shopping experience speedy and convenient, allowing customers to find what they need quickly. Walmart renovated 1,000 stores with a new design focused on navigation and wayfinding.

Nielsen Shopper research indicates a clear need for direct geolocation; 40 percent of shoppers failed to find at least one item on their list every time they shop, causing a 3 percent to 5 percent loss in revenue.

Grocers are also enhancing the personalized features available within their apps. With personalization, for example, return on investment of online advertising is much easier to track. Did the consumer add the item into their shopping basket after seeing the ad earlier in the day, yesterday, or the week before? Retailers are sitting on massive volumes of data they can use to understand individual consumers’ buying patterns. Simultaneously, customers can use grocery retailers’ apps in physical stores to learn more about products and view weekly specials.

In-Store Location is Key

Integrating indoor GPS into grocery apps for search and real-time navigation makes it easier for shoppers to find the items they’re looking for. Not only does it improve the shopping experience and show the customer their time is valued, but it also increases basket size by reducing the amount of unfound items.

Mapping the Customer Journey for Profit

Enabling in-store location services within a retailer’s mobile app also provides full visibility into the customer journey. Using knowledge about the path to purchase, grocery retailers can offer an optimized, digitized and customized in-person shopping experience while making marketing more effective. Combining customers’ online shopping activities and purchase histories with their physical location within the store, grocery retailers can target and market in real time. For example, if a customer navigates to the beer aisle, they can also receive an ad for potato chips and pretzels. The same location data can be used to provide recipe suggestions when a customer is in front of a specific ingredient, helping to further drive sales.

Knowing WHAT the user is doing in physical stores means knowing WHERE the shopper is throughout the journey. With this visibility comes insights about optimizing the in-store experience — e.g., maximizing the store layout for better shopper flow, improving display and product placement to boost sales, and seeing the best places to create digital touchpoints. Properly applied data improves operational efficiency by ensuring more popular areas are well stocked with items customers seek most.

The grocery industry faces more challenges than traditional retailers, as they're selling commodities in a highly competitive environment. With the right technology, grocers can increase their bottom lines while streamlining the path to purchase, satisfying their shareholders and customers alike.

Or Shin is chief business officer at Oriient, an indoor navigation technology provider that offers highly accurate indoor positioning using the earth's magnetic field and built-in smartphone sensors.