How to transform retail customer experience using AI, digital signage, self-service

How to transform retail customer experience using AI, digital signage, self-service

We reached out to Greg Jones, CEO at tutch, to learn how retailers are leveraging digital signage, self-service, and AI for powerful customer experiences.

Greg Jones is CEO at tutch. Photo: Greg Jones/tutch.

Every now and then, you still see doomsday predictions about the “end of retail” due to various headlines or innovations. Whether it was the rise of e-commerce, the impact of pandemic and supply chain issues, or a host of other challenges, it’s always been fashionable to predict the end of brick-and-mortar shopping experiences.

However, in-person, live experiences are stronger than ever, from retail to entertainment and beyond — from Howie Mandel making surprise airport appearances via Proto hologram to entertain and interact with airport travelers to the digital signage-fueled resurgence of the American shopping mall.

But how can retailers take advantage of the right technology and strategies to create a digitally-infused in-person shopping experience — while avoiding costly pitfalls along the way? We reached out to Greg Jones, CEO at tutch, a retail technology firm, via email interview to learn more.

Q&A with Greg Jones

Q:Despite years of e-Commerce and the impact of the pandemic, people are still shopping in stores. Is in-person retail shopping back?

A: I’m tempted to say that in-person retail shopping and the essence of retail never left, but clearly there were many months during the pandemic where it was forced to a halt. And despite the rise in adoption of e-commerce, something like 87% of all consumer purchases still take place in-person. What I will say though is that while physical stores were temporarily shuttered, more shoppers than ever adopted online shopping. And because of that, we’re seeing that their expectations of what should happen in stores has drastically changed.

E-commerce platforms offer autonomy, convenience and ease. Shoppers can access retailers’ entire product inventory when and where they want. They can easily get product information, without having to hunt someone down to ask a question. And they can discover new, relevant products they might not have otherwise thought to consider.

For all of e-commerce’s convenience, however, it lacks the immediate gratification that customers get after making an in-store purchase and walking out the door with it minutes later. Online, they can’t touch, feel, try on or test the products they’re considering. They don’t get the social aspects of a shopping trip – whether the salesperson giving them personalized tips or simply being around other shoppers. And the discovery element feels more mechanical than whimsical and thoughtfully merchandised items that create a holistic experience in stores.

Shoppers are seeking new and novel experiences, and physical retailers are in a great position to implement aspects of ecommerce into their in-store shopping models to bring together the best of both worlds for a more digital-savvy shopper.

Q: How should brands think about their physical CX versus their online CX – are they one and the same thing? How can they be unified and streamlined?

A:Customer experiences online and in stores need to cater to a shared set of shopping habits and desires, while also contributing to retailers’ profitability, but these experiences should be tailored to meet the channel at hand. You can’t, for instance, just drop a website into a store and expect it to meet the needs of more digitally inclined customers.

The first thing physical retailers should consider is how customers’ approach to shopping has changed in recent years. For instance, online platforms have trained many shoppers today to research and compare products well before they even enter a store. In fact, many times, entering a brick-and-mortar shop is the final step for them, rather than the first. For these shoppers, product discovery is less immediately important than being able to quickly find the product they came for.

For the retailer, this means not only catering to shoppers who want speed and efficiency, but also those who are looking to be inspired. And beyond that, figuring out how to increase the engagement and the basket sizes of shoppers who only intended to buy one thing by quickly exposing them to complementary items – within the flow of their intended experience. The in-store digital engagement not only improves the shopping experience, it also provides retailers with valuable customer behavior data they weren’t previously collecting.

Key to achieving all of this is making the in-store experience an extension of the online journey, not a replacement of it.

One way stores are tackling this is by incorporating familiar digital experiences into stores, such as self-service screens that enable customers to either continue the shopping experience they already started online or to simply navigate the retailers’ product assortment autonomously, similar to what they would do online.

Once initiated, these interactive screens can also act as virtual sales assistants, freeing up associate time, and letting shoppers know all variants of the product they’re looking for – whether in store or not – and then using AI to analyze their preferences to begin surfacing personalized recommendations based on what they’re looking at. All of this happens within the in-store experience, where customers are benefiting from a differentiated and curated shopping experience, and physical points of engagement. Digital simply augments this experience by catering to customers’ increased need for autonomy and retailers’ need to increase profitability, streamline the customer journey and bridge the gap between online and offline so they can stay connected to their customers over time.

Q: With so much hype about AI, how can brands decipher the truly profitable technologies and habits to surprise and delight customers?

A: Right now, we’re seeing a number of emerging in-store technologies that are focused on futuristic offerings, such as holographic staffing or speaking signage. Sometimes when retailers think about AI, they think of these types of ultra-high tech and novel use cases, as well as the challenge of implementing AI and needing to address more practical applications that solve everyday business problems and create value.

But shoppers aren’t looking for gimmicks. For retailers, the key to using AI, or any technology for that matter, lies in enhancing the good parts of the experience while increasing efficiencies in processes and operations that make their stores run.

One very important use case retailers should be considering when thinking about AI is how they can increase profitability by inspiring every single shopper who walks in their door to spend more. Online, retailers have mastered the art of increasing cart sizes by tailoring shopping experiences to meet the individual preferences and behaviors of each person on their site. Anything that a shopper searches, clicks on and buys online further informs that retailers’ understanding of them so they can automatically serve up recommendations based on their current and past shopping activities, size, styles and tastes-all in effort to increase the order value right then and there.

Because of this, shoppers have come to expect this sort of personalized experience everywhere they shop – even in stores.

For a retailer that has already installed self-service screens throughout its store, AI can step in to replicate this type of experience in much the same way, based on what the shopper is doing right then and there – and even in conjunction with knowledge of what the shopper has done online. And it can do it at scale, meaning it remembers each shopper that interacts with the platform, each subsequent time they use it, and tailors its recommendations to account for all new information it gathers.

This approach lets retailers go from having no digital experience in stores, to having an AI-enabled self-service tool that feels familiar to shoppers, and which marries the ease of online shopping with the tangible advantage of being able to see different products in person at physical stores.

Q: Can you share some specific examples of stores that have used AI, self-service, and digital signage to reach their customers in new ways?

A:A great example of a retailer leveraging this combination is Australian specialty store chain Between the Flags. During their busiest week of the year, long lines and overwhelmed staff had threatened to limit sales. Between the Flags addressed this by replacing a traditional point of sale (POS) station with three self-service digital platforms from tutch. This didn’t just give them a digital way to checkout; it let customers take control of their shopping journey, from start to finish – all the while making product recommendations, sharing any product information they needed, and giving them real-time stock levels. As a result, the store increased customer basket sizes by 14% with overall YoY revenue for that week up 60-70% compared to the year prior.

Between the Flags also uses tutch’s Endless Aisle functionality to sell a line of Australian Sheepskin Boots. The boots are a hot item, but they also take up a lot of floorspace, making it impossible to showcase the entire collection at once. Rather than having to pick and choose what styles it wanted to sell, Between the Flags installed tutch’s digital platforms near the collection, occupying less than 6 feet of wall space, so shoppers could touch and feel the boot quality, while also choosing from the entire range of over 45 boot styles. The result was a 28% reduction in physical stock, and a more than 100% increase in sales of the boots.

As more shoppers use these types of platforms, they begin gathering information about what shoppers across the board are looking for in each store location and where there is demand – or not – for different products. AI can then synthesize this data to optimize inventory management, predict what products and variants sizes should be featured in each store, and which would be best reserved for online or other sales channels. It can also tell retailers which products are the most popular and which are commonly considered or purchased together. All of this can inform exponentially more lucrative merchandising decisions going forward.

Q: Can you share some “cautionary tales” of what brands should avoid doing?

A: When it comes to AI, it’s tempting for retailers to “sit this one out” like they did the first wave of digital.

Of the retailers who have seen their models threatened by digital technologies, the threat was never the technology – it was their unwillingness to consider it.

Rather than risking a deeper disconnect with shoppers, I would advise retailers to consider some very practical digital and AI use cases that can be easily put to work in their stores to increase profitability.

The other important factor to keep at the forefront is customer satisfaction. Customers want a positive and personalized experience, and retailers should avoid neglecting the journeys designed to provide that to them. They can’t treat customers like transactions, ignore the way they want to shop or fail to address their questions and concerns promptly.

Retailers need to be actively listening to feedback, quickly addressing pain points, and providing personalized interactions. With staffing shortages and other challenges, this is hard to do in a physical store environment, but AI can do it at scale.

When customers feel heard and understood, they’re more receptive to suggestions that enhance their shopping experience, such as upsell and cross-sell opportunities, leading to increased satisfaction and in turn, basket sizes.

The combination of digital platforms and effective human store staff can create environments where technology accentuates the care of store staff to create a shopping experience that delights and surpasses anything they can find online while enabling retailers to be nimble enough to adapt to evolving needs on the fly. Losing the focus on the customer will always lead retailers astray.

Q:How do you balance personalization and upselling with consumer demands for security and privacy around things like AI and digital tech?

A:While AI allows retailers to anticipate needs and curate personalized experiences – a clear benefit for shoppers – it also requires increasingly more data to become more proactive. This is where the line between personalization and privacy can seem to blur. Transparency is key to balancing personalization with data security and privacy concerns.

Retailers can build trust and ease customer concerns by being upfront about data collection practices. This means clearly outlining what data is collected, how it’s used, and how long it’s retained. Customers should be given clear opt-in and opt-out choices to feel more secure, and retailers need to emphasize the use of anonymized data for AI personalization, which can alleviate anxieties about individual profiling. This focus on transparency builds stronger customer relationships and ensures that they don’t instinctively write off the perks that AI-powered shopping efforts provide.

Q:As an expert in this field, what are the biggest trends we need to watch in the coming year?

A:A key trend for the coming year is the rise of scenario-based search and shopping, which leverages customers’ use of AI to go beyond a basic product search to recommendations and suggest complementary items based on their broader needs.

For example, a customer wanting to prepare for a beach trip might traditionally search for items separately, like “sunglasses,” “sunscreen,” or “hat.” This piecemeal approach can be time-consuming and lead them to miss essential items. With scenario-based search powered by AI, the approach changes. The customer can simply search for “things to bring to the beach” and get a curated list of essentials – towels, sunscreen, umbrella, maybe even a frisbee – everything they need.

A platform in the store can direct them to every aisle or shelf where these pieces are located. The retailer can also develop their own marketplace of sorts by partnering with other stores that perhaps offer some complementary items that they themselves don’t carry, sharing in the revenue generated by new sales opportunities that otherwise would be impossible.

By adapting to this trend, brands can position themselves to meet the evolving needs of modern shoppers, using the in-store digital platforms as a path for retail media and offering a more convenient, holistic, and satisfying shopping experience.

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