Walmart announced last month that it will be testing shelf-scanning robots in 50 stores across the country. The robots are designed to ensure products are priced correctly and always in stock. My guess is it won’t take long before Walmart’s artificial intelligence (AI) plan extends to additional customer-facing bots as digital transformation continues to change not just tech landscapes, but physical ones, as well.
Indeed, the past year has not been a great one for physical brick-and-mortar retailers. As of September 2017, more than 6,400 store closures had already been announced for well-known retailers like Macy’s, Payless, and Sears. As online shopping continues to boom, offline shopping continues to bust—and retailers are realizing they need to add some excitement to their physical shopping experiences if they want to stay in the game. The following are a few ways some brick-and-mortar stores are digitizing their physical shopping environments to survive the modern marketplace.
If You Build It, They Will Come
Yes, robots like the one Walmart is introducing can save time and money. But most physical stores today are also concerned about foot traffic—getting more shoppers out of their living rooms and onto their sales floors. One of the best ways to do this is through simple wow factor. Adding tech enhancements like virtual reality, smart mirrors, and smart fitting rooms can get customers interested enough to venture out into the physical world of shopping—and research shows it’s working. By introducing a Japanese-designed robot called Pepper to a retail store in Palo Alto, for instance, the retailer increased foot traffic by 70 percent. Another store, the Ave, saw a 300 percent increase in revenue after bringing Pepper aboard. Clearly, if physical stores want to stay in business, they need to think of novel ways to use technology to their benefit. This could be anything from virtual showrooms and other unique in-store virtual reality experiences to robotic fitting room assistants—anything that creates buzz and adds value for the customer.
On Chatbots and Digital Assistants
I still remember when self-checkout and price-check stations were introduced at my local grocery store. It felt so empowering to shop and check out without needing a store associate to help me. Such will continue to be the case as new, more advanced tech is added to physical retail locations. AI, chatbots, and digital assistants can help shoppers find exactly what they need in no time. They can recite prices, item locations, available sizing, and inventory—all without error. And, if used alongside machine learning capabilities, they can also recommend items customers are most likely to want or buy. It’s no wonder Panera now offers free cookies to entice people to order from digital kiosks. There is tremendous potential to upsell, cross-promote, and incentivize purchases, all with one click.
Data and Analytics
Clearly, robots and digital assistants aren’t the end-game for most retailers. When used alongside the Internet of Things (IoT), companies will be able to gather valuable insights from their customers right as they shop—offering coupons, suggesting products, and sending incredibly targeted messages to increase the chance of sale. Even better: that information has an extensive shelf-life. It goes toward generating more complete customer profiles that can further improve customer experience (CX)—a CX that increasingly gravitates toward virtual experience and digital interaction, rather than human ones.
As we move forward in digital transformation, it’s clear that traditionally “human” sectors like retail and dining will need to begin merging with digital experience to stay relevant and profitable. Clearly, “big box” legacy-era stores will have the hardest time adapting, as they come with much more space—and physical baggage—to shepherd in to the new digital era. Walmart has already stepped up to the challenge. And as one of the largest retailers in the country, I’m guessing it will likely inspire others to follow. The only question now is whether cool technology will be enough to get shoppers out of their homes and into the physical marketplace—or if they’ve become so accustomed to online everythingthat it’s impossible to reverse the tide. Only time will tell for sure.
This article was first published on Futurum Research.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. From Big Data to IoT to Cloud Computing, Newman makes the connections between business, people and tech that are required for companies to benefit most from their technology projects, which leads to his ideas regularly being cited in CIO.Com, CIO Review and hundreds of other sites across the world. A 5x Best Selling Author including his most recent “Building Dragons: Digital Transformation in the Experience Economy,” Daniel is also a Forbes, Entrepreneur and Huffington Post Contributor. MBA and Graduate Adjunct Professor, Daniel Newman is a Chicago Native and his speaking takes him around the world each year as he shares his vision of the role technology will play in our future.