As more retailers strive to improve the in-store shopping experience, many are embracing advanced technologies to better meet their customers’ needs. These include replacing traditional POS devices with iPads, providing interactive and more engaging mobile apps, a focus on community feedback for product development, and much more. Retailers discussed their latest customer-focused technology plans and challenges at the National Retail Federation (NRF) annual NRFtech summit, held August 12-14 in San Diego.
On opening day, Vicki Cantrell, SVP of Communities and Shop.org Executive Director for NRF, highlighted two key challenges facing every CIO today: access to influence and talent.
“Around the world, the retail industry has come closer to achieving true omnipresence as the long-awaited convergence of in-store, online and mobile shopping finally has become a reality,” Cantrell said. “With these changes come challenges for CIOs. As technology becomes more important to every aspect of the retail business, and your departments serve as the bridge between the in-store, online and mobile channels, you have found yourselves battling for something I call IT for short ― influence and talent.”
Elaborating, Cantrell explained that budgets impact this influence. “We often hear that CIOs have fallen behind the times and that CMOs have seized the reins of innovation,” she said. “As resources get redirected to other parts of a company, CIOs find themselves facing more demands and responsibilities, but with fewer resources, and are being squeezed like never before.”
On the talent side, CIOs are struggling to recruit the personnel they need, according to Cantrell. “With more technology comes a greater need for skilled workers ― people who can use data to improve customer service while also protecting customer privacy.”
Data-Driven Fashion Industry
During NRFtech, Eric Koger, CEO and Co-Founder of ModCloth, a community-centric fashion retailer, explained how his company protects and leverages customer data to assess and improve on its community’s preferences. He revealed that ModCloth has invested in a scoring system to calculate feedback, comments and votes from its consumers. In response to this information, said Koger, the retailer created a series of “Be the Buyer” products, which allows online shoppers to vote on style samples for future ModCloth merchandise. “Be the Buyer” items, he said, now sell 2.5 times better than other products on its e-Commerce site.
ModCloth focuses on community, one of its core values, to help strengthen its brand in several ways. “Our community concept wins on three fronts,” explained Koger. “It helps differentiate the brand; its social validation component helps drive conversion; and the sense of belonging to a community fosters loyalty.”
Build-A-Bear To Augment In-Store Technology
Build-A-Bear Workshop Founder and CEO Maxine Clark, and CIO Dave Finnegan shared insights with NRFtech attendees about the retailer’s new in-store technology, to include touchscreens and gesture technology, and its plans to build on existing approaches to enhancing the customer experience.
Finnegan highlighted the importance of looking beyond retail technology itself to its role in the corporate strategy. Although the latest technical developments from Build-A-Bear play a crucial role in gaining customer engagement, “they’re really about creating a personal, magical connection with our consumers,” he said.
For example, because building good customer relationships is so essential, Finnegan challenged his team to “go back to the launch of Build-A-Bear, before much of today’s technology existed, to truly understand why the concept of Build-A-Bear Workshop works so well.” This initial concept included relying on the ideas that add to the brand and experience, then working backwards to engineer it.
Mobile POS A Win-Win For URBN
Anthropologie, BHLDN (Anthropolgie’s bridal store), Free People, Terrain and Urban Outfitters all are early adopters of mobile POS technology. At NRFtech, Calvin Hollinger, Chief Information and Logistics Officer for URBN, the stores’ parent company, said the adoption of mobile POS has been “a win-win, both operationally and financially.”
Hollinger said his goal is to have a mobile device in the hands of every store associate by 2014 or sooner, and plans to remove all registers and replace them with iPads mounted to Bluetooth-enabled cash drawers.
He provided an example of how URBN offers real value to customers through mobile: “Since music is important to Urban Outfitters customers, and they love the music played in stores, we made music the go-to feature of a new mobile app for this chain,” said Hollinger. “The app tells a customer what song is playing in the store at the moment and what was played recently. This approach provides a unique and engaging experience, rather than simply optimizing the Urban Outfitters web offerings in app form.”
Mobile apps are helping URBN store associates, too. Hollinger shared that though e-Commerce generates 25% of URBN revenues, roughly 20% of that merchandise is returned to stores. To help combat this trend and its operational challenges, URBN created several internal mobile apps that assist associates with processing returns, printing new merchandise tickets, restocking and more.
NRF VP Shares Insights On Mobile
Tom Litchford, NRF’s new VP of Retail Technologies, was on hand to speak with retailers at NRFtech. In a recent NRF blog, Litchford talked about the most pressing challenges and promising opportunities facing CIOs today. “Mobile, mobile, and mobile,” he stated. “Throw in a little Big Data and social, and you pretty much have the technology landscape.”
He said that similar to Bill Gates’ early vision of a computer on every desk and in every home, today there is a computer in the hands of every shopper, a development having “profound effects on the industry.”
As a result, Litchford noted, today’s consumers have a great amount of knowledge about retailers and their competitors. “[Consumers] control the shopping journey, and the retailer must be ready and able to engage with them on their terms,” including when and where they want information, and on what device they want it, he said. “The challenge for CIOs today ― aside from traditional IT principles around data privacy and security, system deployment and manageability ― is to rapidly build new core competencies in customer-facing solution development as well as mine volumes of external unstructured data to gain insight into their customers’ preferences.”
Join Retail TouchPoints at the 2012 NRF Shop.org Annual Summit in September. Click here to view the agenda.