The retail CIO’s role in improving consumers’ in-store experiences

Gary GodfreyBy Gary R. Godfrey, Principal, Advisory Services, Ernst & Young LLP.

Even in this age of e-commerce, it is the store that is the hub of retail activity: still today the majority of sales happen through retail stores, also because many consumers are ordering online and picking up their goods in a physical location.

Traditionally, elements such as service, marketing and product presentation were the differentiations and integral part of customer experience. Today, however, elements such as information and insights are part of this mix too. These days, customers’ smartphones often have more information about products in stock than the sales associate at the store has.
So, how can retailers enhance the in-store experience of their information-rich consumers? The answer could mostly be technology. Certain in-store technologies are gaining momentum:

  • Near-field communication (NFC): Using NFC technology, stores can push information — including offers, product information and ratings — to the consumers’ phones when they are in the vicinity.
  • Barcodes: Two-dimensional bar codes on products, when scanned, provide consumers with relevant product information. Bar codes on groceries can even provide information on where the product was grown and how. In other words, a simple bar code can provide consumers information about the overall supply chain.
  • Tablets: Untethering the manager from a desktop in the back office of a store is key. Putting key management data about labor, sales, inventory, etc., in the hands of a manager on a tablet allows them to be more up-to-date on what is happening in their department or store in a more real-time fashion while still being on the floor. Salespeople can use tablets for product lookup to share information with the consumer on the floor, inventory lookup, order and ship to home and line-busting or for mobile checkout.
  • Augmented reality: Digital mirrors, for example, use augmented reality to show you how different clothes and accessories look on you without you having to actually try them. Furniture retailers use this technology to show customers how a piece of furniture would look in a home – before buying.
  • Virtual reality: Using interactive displays and walls, products can be displayed in an interactive fashion virtually. The virtual nature of this lets retailers promote a product anywhere and let the purchase happen at the store later.
  • Smart shelves: Weight-driven sensors on smart shelves keep track of inventory, letting the store know which product is being taken off the shelf when – live. This gives retailers unprecedented insights on customer behavior and also drastically reduces the time it usually takes to replenish out-of-stock inventory.
  • Digital shelf label: This is taking off as a way for retailers to update pricing more easily and dynamically. These labels can be used to present information such as product data, reviews, promotions, etc. This can also be used to support a “pick to light” capability in the store for store fulfillment of orders.
  • Digital signage: Retailers are moving to digital menus, price boards and signage in the store. Lower cost to update and maintain, more accurate and updated information, more dynamic interface from a customer engagement perspective are all driving increased adoption.

Opportunities for the CIO

To enhance the retail consumers experience by employing technology, CIOs can look at the investment in technology from different angles, working closely with other business functions. They can be putting the necessary processes in place and supporting agility to try out and rapidly implement different technologies.

In-store devices can provide stores and CIOs with vast amounts of consumer metadata. Using this data to increase ROI is something the CIO, and the chief customer officer or the chief strategy officer, can be working out together.

CIOs can also assess legacy infrastructure to make it more responsive, deciding where and how to invest in emerging technologies. Rolling out a consistent experience across all stores of the retail chain can also pose challenges.

Retailers are generally open to adopting technology where there is a clear value proposition. The millennial, tech-savvy consumers are changing our ideas of what consumer expectations are. And that, in turn, is fundamentally changing the role of the store. This change in consumer preference isn’t only a challenge. If you look at it more closely, it is also an opportunity. It is an opportunity for retailers to interact with clients in ways that have only been imagined until now.


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