Digital Technologies: Testing, Implementation and Failure

Digital Technologies:  Testing, Implementation and Failure

19-04-2019

Retailers implement different technologies at their stores: from regular displays for quick orders to checkout equipment, which automatically charges customer’s card when they leave a store. But are all innovations profitable? And most importantly, do customers like them? Ustor team made a list of technologies implemented at smart stores and collected customers’ opinions on innovations.

Technology Flop or Top – Who Decides

Nowadays competition on the market increases rapidly: the number of trading platforms has doubled in the past decade. It’s getting harder to attract customers in stores, and that’s when innovations come in. How can one determine that a particular technology will work out and increase customers’ loyalty? Each innovation goes through a series of tests. Only after the assessment experts decide whether to implement a new technology or not.

How technologies are tested:

  • experts analyze the cost of innovation implementation;
  • they integrate technology into company’s structure and observe customers’ reaction;
  • innovation is being implemented in several stores and experts monitor the ways it affects sales rates, number of customers and expenses for 3 to 6 months;
  • after that stage, the technology is being implemented in the rest of the stores.

Smart Store Technologies

Imagine you get to visit a so-called smart store and to explore all its cool features:

  • There is a face recognition camera installed at the entrance. This technology helps to make an individual offer for each customer [if he or she is in the customer loyalty program].

  • The store is equipped with a multifunctional terminal, which can show individual discount offers, print out a list of ingredients for a particular recipe or estimate a shopping basket based on customer’s monthly budget.
  • There is also a system for individual offers consisting of a camera and a display. The camera recognizes customer’s age and gender and shows special offers for him or her on the display. However, this technology is not yet perfect: algorithms cannot work properly if a person is too far away from the camera.
  • Shelves are fitted with digital price labels. This way employees save up to 10% of their time: instead of replacing old labels with new ones, the system updates information automatically. Moreover, interactive labels could be completed with      QR codes and NFC. A customer points the camera of the smartphone on a label and receives full information about a product.

  • Cameras in all zones of the store help to keep all processes under control without facing customers. Employees can tell about the freshness of a product by a slightest change in its color, check price labels or layout etc. Cameras at the checkout area are necessary for indicating long queues so an employee can immediately open up one more checkout lane.
  • Smart price-checker on a wall will come in handy when you need to check price of any product, e.g. coffee, and find chocolate to go along with it.

  • Self-checkout is a self-service checkout system: a customer can scan purchases using the phone and escape long queues at the checkout lane. Store owners are concerned about this technology: the number of thefts might go up while there would be much less communication between staff and customers.
  • Mobile self-checkout works like a self-service checkout system, but a customer needs to download and install a special app. Therefore, only a few retailers abroad use this technology.
  • Smart terminals in checkout area show special offers and additional suggestions taking into account customer’s purchase history and discount card.

CO2 detectors monitor levels of carbon dioxide in the room and tracks down ventilation issues. If your customers are barely moving and constantly yawning, then it might be due to poor ventilation. In some cases, improvement of air quality can stimulate sales rates.

A Few Words About Customers’ Dislikes

Displays with lots of flashing advertisements irritate customers. But screens with personalized offers help them to choose the right product. Everything in a store should implicitly or explicitly demonstrate commitment to customers.

Facial recognition technology is one of the examples, when customers are not okay with innovations. This might be due to a sensitive legal aspect: a regular hash cannot yet be considered personal data, but using a 3D model of a person’s face and their name already feels unethical.

According to research, large number of cameras in a store can scare away customers. Yes, this might help a retailer to monitor availability and quality of products, but a person, who doesn’t know that, will meet this innovation with caution.

In 1995 a Nintendo VR console utterly failed, but nowadays this technology gains in popularity. Customers can use VR technology to buy things without having to leave their houses or choose furniture without placing it in their flats. However, customers dislike bulky VR headset. It’s easier to visit a store than to wear heavy equipment for hours. Another disadvantage is that a customer cannot touch a product. And sometimes that is the main reason we choose to go to an offline store. Nevertheless, developers improve VR technologies and make them more and more accessible. That’s why we will be able to see these technologies with a much broader set of functions in our stores in the nearest feature.

Conclusions

According to Deloitte data, sales rates in stores, which use innovations, has increased from 49% to 56%. Customers are still treating new technologies with caution but in a decade target audience will change. People, who were surrounded with technology since birth, will be the main customers and all these cameras, digital labels and smart terminals will be something casual to them. Choose new technologies for your store by analyzing current data, but also always try to look forward into the future.