Thank Technology for These 6 Trends in Experiential Retail
by Ten-X, Ten-X is the nation’s leading online real estate transaction marketplace and the parent to Ten-X Homes, Ten-X Commercial and Auction.com.
One of the reasons that malls and shopping centers have taken a hit is because of technology. With online shopping an easy, efficient, and often cheaper way for people to get what they need, shopping at department stores is becoming something that only people who urgently need or demand instant gratification do.
This has led to an increase in experiential retail: the concept of paying for an experience as part of buying goods and services. Ironically, the same technology that has reduced the market share that malls and big box stores hold has helped experiential retail. Here’s how:
1. Using social media to understand customers
Social media has long been used as a successful marketing tool that businesses use to get their message out. These days, companies aren’t turning to Facebook, Twitter, and Instagram to speak, but rather to listen. Conducting surveys and having discussions with customers via social media platforms has been revolutionary in helping businesses determine wwhich experiences customers want when they enter the store.
2. Creating customized products
Advancements in technology have changed the way that businesses service their customers’ needs, and a good example of this is Asics foot mapping service. Customers are able to visit a participating Asics store and have their feet and gait analyzed as they run on a treadmill. A computer then analyzes the data and determines which shoe is optimal for the runner’s feet.
In another example, Adidas and Intel partnered up to create the adiVERSE, an in-store touchscreen wall that let customers mix and match styles and browse through more than 8,000 different types of shows.
Virtual reality has been valuable in helping customers make informed decisions before they decide whether or not to buy a product. Companies like Tommy Hilfiger, Lowe’s, and The North Face have all had success using virtual reality in their stores. Equipped with Samsung GearVR headsets, customers are able to get a 360-degree view of their product – or in a clothing store, people wearing the product. This is especially great for home improvement and furniture stores since these kiosks allow the customer to see what a product or renovation looks like inside a home.
The amount of virtual reality technology used by retailers is expected to increase in 2017, especially as more big-name companies like Sony, Google, HTC, and Facebook jump into the virtual reality market.
4. Providing superior customer service
Nobody has been as successful at combining technology and experiential retail than Best Buy. When it comes to anything IoT (Internet of Things) related, Best Buy’s Geek Squad is there to help. Not only does their superior knowledge of technology help customers make better purchasing decisions, Geek Squad members also make routine house calls to install and set-up smart products.
One of the reasons that the Geek Squad has been so successful is because not everyone understands how IoT hardware works, especially baby boomers. The company was able to capitalize off this lack of technological knowledge by creating a group of customer service reps who help customers get used to their new devices. Options like this are why nearly 60% of consumers find brick-and-mortar stores to have much better service than online shopping.
5. Giving customers internet access
These days, having access to WiFi at a public place is something that a lot of us have grown to expect, and we have Starbucks to thank for that. Their strategy was to create a space that didn’t only serve coffee and snacks, but also gave customers a place to relax and connect to the internet. After a while, other businesses saw how customers reacted favorably to free WiFi and began offering it as well.
Avalon, a mixed-use community a few minutes north of Atlanta, is a perfect example of how technology can improve experiential retail. Along with single and multifamily homes and office space, this 86-acre community offers a cinema and 365,000 square feet of retail shops. One of the primary reasons why Avalon’s retail sector has been so successful is because of the free high-speed fiber optic WiFi offered. While your general customer has no use for internet 100 times faster than your average broadband services, the fact that it’s available and free is enticing.
6. Integrating augmented reality
Augmented reality (AR) often gets lumped into the same basket a virtual reality, but they’re actually completely different concepts. While virtual reality creates an entire new world for the user, AR uses a simple smart device to modify our reality; think Pokémon GO.
There have been talks of rolling out AR kiosks where customers can see how jewelry and accessories look on them, but the biggest advantage of AR has been in iOS and Android apps.
Furniture retailer Wayfair recently unveiled their WayfairView app that uses your smartphone’s camera to allow you to see how furniture sets look in the rooms of your house.
Another successful use of AR to help improve experiential retail is the Sampler app from Converse. Here, users can cycle through a number of different shoes and see how they look on their feet. Considered revolutionary when it was released, other retailers have since copped on to how valuable AR can be in helping pursue customers to purchase their products.
Ultimately, there will always be a need for brick-and-mortar shops. As advanced as AI is becoming, it’s unlikely that a computer will be able to provide the same level of customer service assistance as a human. In addition, some people prefer to visit stores where they can pick up, touch, and inspect objects before they buy them.
The fate of malls and big box stores has been extensively researched by top analysts in the field. There’s no denying that retail centers are going to continue to lose their hold on the market as online shopping becomes increasingly popular. However, it’s unlikely that malls and department stores will be rendered obsolete; instead, they’ll be expected to make changes and adapt to a modern market.
Ten-X is the nation’s leading online real estate transaction marketplace and the parent to Ten-X Homes, Ten-X Commercial and Auction.com. To date, the company has sold 275,000+ residential and commercial properties totaling almost $46 billion. Leveraging desktop and mobile technology, Ten-X allows people to safely and easily complete real estate transactions online. Ten-X is headquartered in Irvine and Silicon Valley, Calif., and has offices in key markets nationwide. Investors in the company include CapitalG (formerly Google Capital) and Stone Point Capital. For more information, visit Ten-X.com.