The future of contactless shopping
The transformation process in the retail sector has accelerated dramatically as a result of COVID-19. This time of change is raising new questions: What is the best long-term response to changing customer needs? What technical aspects need to be considered? And what do specific application and business cases look like?
Insight in brief
- The emotional experience in the store cannot be ignored as a factor in influencing shopping behaviour
- The integration of technology in brick-and-mortar retail will be a key competitive advantage in the future
- Evaluating which is the right technology is hugely important
These questions were examined in a Zühlke-sponsored study by the Institute of Retail Management at the University of St. Gallen. A summary of the results can be read in the report Retail store of the future | The future of contactless shopping.
As part of the study, various scenarios for contactless shopping were explored in terms of their technological feasibility.
- Scenario 1 – Automated purchasing system
- Scenario 2 – Pick station
- Scenario 3 – Virtual store
- Scenario 4 – Self-service store
Conclusion about the shopping methods
Interestingly, the people surveyed were most amenable to the implementation of the self-service store. This scenario involves scanning a QR code in an app, for example, when entering and leaving the store. The selected products in the physical shopping basket are then automatically paid for on leaving.
Despite receptiveness to the use of new technologies in retail, the brick-and-mortar shopping experience remains the most popular. The emotional experience in the store cannot be ignored as a factor in influencing shopping behaviour. These findings show that brick-and-mortar retailers need to fundamentally rethink the shopping experience. The objective should be to merge new technological options with existing sales channels.
New shopping experience as a result of networked technology
Imagine you visit a DIY store to look for paint. To begin with, you wander happily along the huge aisles and attempt to find your own way through the maze of products. You gradually lose patience, so you look for help, but without success. You have now spent more than five minutes searching in the huge building and are clearly annoyed. As well as needing help with the paint, you also need information about the right roller and about what protective covers you need. Eventually, you find a member of staff and you look for the items together. Unfortunately, the member of staff still can’t give you all the information you need, so you have to find it on the internet for yourself. You now know what you need, but unfortunately not all the products are in stock. This means, whether you like it or not, you will have to come back to the DIY store again another day.
How could technological options help to provide a better shopping experience in this situation? Imagine that you enter the DIY store and immediately open the store’s app on your mobile phone. Prior to this, at home, you had entered ‘paint’ in the search field, so you already know which shelf you will find it on. You head there purposefully, and in the space of a few minutes, the tin of paint is in your trolley. The app immediately gave you suggestions for other equipment you might need, such as rollers, cover sheets, and even painting designs. With just a few clicks, it shows you the shelf numbers. You are also given fascinating tips and tricks and tutorial videos on painting techniques. Thanks to the indoor navigation system, the retailer also knows that you have been standing in front of a shelf for five minutes, perhaps feeling confused, and sends along with a store assistant. As you leave the store, your shopping basket is scanned automatically and the goods are paid for in the app. Now, thanks to technical assistance and human advice, you are ideally prepared to go and paint your home.
Specific examples of implementation are needed
The example given above can also be applied in other sectors. The technological integration would be gradual, as these implementations show:
- Department store: Initially, just the top 100 sales products in the brick-and-mortar store could be offered within a loyalty scheme app, based on the principle indicated above. Payment would be made via the stored payment method.
- Supermarkets: In supermarkets, the best-selling lunch products could be used as the main selection criteria. These could be offered in a cordoned-off area of the store. Given the tight amount of time customers have for lunch, this efficient and targeted shopping experience would be seen as a positive.
- Specialist stores: By having bestsellers within an app, this kind of self-service store could also provide a personalised shopping experience. When choosing a pair of trousers in the store, the matching top, belt, or shoes would also be displayed in the app and the location of these products shown on the integrated map.
- Kiosk: Products that are most popular in the mornings and evenings could also be offered in a separate area. The more efficient the shopping experience is felt to be, the more frequently customers will buy, including just before getting on public transport.
Integration in an existing ecosystem
The ideas described are innovative, but what are some initial achievable steps? When there is a lot of information, focus and clear organisation are key. The selection of products and the target groups are one element. The integration of new technologies and merging them with existing systems are additional key components; evaluating which is the right technology is hugely important here. In addition to an app, innovative solutions can also be adaptations of existing websites, loyalty programs, or scanning functions.
Better emotional experience through the use of networked technology
The integration of technology in brick-and-mortar retail will be a key competitive advantage in the future. It will result in stronger customer loyalty, not just in times of crisis like COVID-19, but also in the long term. Used in the right way, networked technology does not make shopping less of an emotional experience – it just means that the contactless shopping experience is redesigned in a targeted way.