Six Pixels of Separation - The Blog
February 9, 2012 6:39 PM

Endless Aisles

What has your shopping experiences been like lately?

I was recently in New York City giving a presentation at the National Retail Federation's Big Show 2012 event. I was part of the Shop.org First Look series and talked about the massive changes that retail will face as technology, Social Media and mobile collides at the retail level. We have more and more consumers who are connected with highly powerful smartphones at the store level and they're doing a lot more than just price comparison shopping. When you think of the potential and the opportunity to bring those different worlds together, the possibilities become endless (so long as you're not being a creepy brand).

Virtual shopping in a physical store.

During my time in New York City, I had the opportunity to drop into the Uniqlo store on 5th and 53rd. It truly is a sight to see if you're into retail, commerce, fashion and a unique in-store experience. I found two styles of jeans that I really liked, so I bought two pairs. The truth is that I would have bought a couple more, but they were out of my size.

What if?

What if there was a simple touchscreen that allowed me to buy those jeans right then and there? They could be sent to my home or hotel (depending on availability) or it could even let me know when I could come back to the store and pick them up. Seems simple enough in this day and age of e-commerce, doesn't it? Pushing that idea further, I should be able to do that exact same kind of transaction from my smartphone, right?

Hold your horses.

I realize that these types of simple integrations are few and far between when it comes to retailers (and other businesses), but the expectation as a consumer is pretty straight-forward - I can order online, so why can't I order online while I'm in the store? Attribution is one of those hotly debated topics when it comes to the world of retail meets digital and these types of converged interactions (doing e-commerce from the physical store). Think about how that type of transaction may help retailers better understand both consumers and the analytics behind who in the corporate food chain gets awarded the "sale".

It's much bigger than that.

Hadley Malcolm over at USA Today interviewed me about some of the future-trending retail issues for her article, Touch-screens create online shopping experiences at stores. The story, which was picked up by Reveries (titled, Endless Aisles - and yes, I liked Tim Manners' title so much that I stole it for this Blog post), prompted me to think differently about the value of digital signage and touchscreens at the retail level. While all of that has many advantages - from marketing to customization and beyond - the e-commerce integration is going to be a critical component. Not only will retailers have less people like me walking out of the store when I would have spend seventy-five percent more (had the retailer simply had the inventory), but this type of digital commerce will also reshape the entire inventory landscape. Every store is limited by their footprint and historical sales to drive inventory control. No more. If you think about this integration of e-commerce at the retail level (be it on a smartphone or a touchscreen installation), retailers may discover that a store in Peoria sells as much inventory on certain products (or maybe more) than a flagship store in Times Square.

Zero sum games.

Pundits think that e-commerce kills the retail experience. People still like to go out, wander the malls, touch and see what's new and exciting. It's not a zero sum game. The smarter retailers are going to wake-up and realize that e-commerce will no longer be a vertical within their retail experience... it's going to quickly become horizontal. The digitization and ability for consumers to hit the retail level, but have access to the full inventory (and maybe even more products... some of which can even be virtual goods) is going to be the true shopping experience of the soon-to-be-future for retail.

How do you see the future of retail?

By Mitch Joel


Comments Comments Feed
  • Posted by Joe Millward
    Mitch Joel

    This has been something I have been thinking about for a few years now, there are so many opportunities for retailers.

    Starbucks are probably one of the brands leading in this at present, but it was a gradual introduction and they still have a long way to go before the experience is simple, personal and full integrated to a customers shopping experience.

    I think we will eventually see something similar to the shopping scene in minority report (although hopefully less annoying).

    If retailers take the first step by adding some interface with their digital presence (even via iPads instore) , they will be ahead of most.

    Reply
    • I hope we don't see the Minority Report stuff... in the sense of blasting messaging like that. I'd love for that Minority Report stuff to happen if it's really about engagement as needed and driven by consumer.

      Reply
  • Posted by Karen
    Mitch Joel

    How do I see the future of retail? I'm sure it is very much like you do Mitch!
    I don't understand why retailers don't embrace technology to allow me to spend money.
    My latest "why can't they" happened few weeks ago when I wanted to buy a specific pair of jeans that are the house brand of a major retailer. I knew exactly what I wanted when I went to the store, but as it happened they didn't have my size. Their solution was to call other stores and if they found a pair, they could be held until the end of the day (which meant I would have to drive across the city). Instead - I left the store with my money still in my wallet. At the very least, they should be able to access inventory online and then have the product transferred to the store I was in. That's my minimum expectation right now. In the very near future I expect online and in-store to be one continuous experience. I want to see products on-line so I can browse there (if I want) and I want to be able to check inventory before I go to the store. If I leave the store but decide later I should have bought, I want to be able to do so online. There are a few retailers who are doing this well and they will survive and thrive. The ones who don't - not so sure.

    Reply
    • This is the convergence of the inventory control software speaking to the e-commerce platform and - this is where retailer's come in - allowing consumers to self-serve from there. It could well be the last mile for retail.

      Reply
  • Posted by Andrew Gomes
    Mitch Joel

    The first thing that comes to mind when I hear "Endless isles" is iTunes.

    Steve Jobs's direction with e-commerce through iTunes and the apple store experience is probably the best example of how that retail sector was cannibalized for the better.

    Although bricks and mortar Retailers will never disappear and they shouldn't. The ones who thrive will be the ones who cannibalize their own stores and re-design the way customer experience their brand in every channel.

    It will be interesting to see whether Retailers will lead the charge to win their customers over or whether savvy customers' dissatisfaction / demand for a better experience will be the effect that causes their reaction.

    Thanks Mitch!

    Reply
    • While it's nothing new, this is the concept of The Long Tail... no need to be limited by the physical space of a store (see Amazon, eBay and more). If it costs nothing to store and you can sell one of something and still be as profitable as when you're selling the same thing to many people.

      Reply
  • Posted by Philip Lassner
    Mitch Joel

    Mitch... I'm on the front lines trying to help retailers adopt new technologies to reduce/eliminate out of stocks and link the physical item to the virtual item both via RFID (UHF & NFC). They are eager, but slow! Lets keep the talk alive! I'm sure everyone has their stories of their size/color not being in stock, or the sales associate telling them, "i dont know why i cant find them.. my computer says we have two (2) of them on the store floor!"

    Reply
  • Mitch Joel

    Order online, pick-up in-store is definitely one of the trends of online retail. What ties this consumer flow together is "real-time availability." We all talk about "the cloud" and how we apps are going to change business, but what's prevented this O2O (offline to online) bridge is the inability for retailers to keep track of their inventory in "real-time."

    If I order something from a store online and want to go pick it up they need to:

    1) Make sure that they have it in stock
    2) Make sure that my reservation makes the appropriate deduction form the retailer's inventory the second I submit my request.

    This is one of the huge reasons you're starting to see retailers ditch their old POS systems in favor of tablet based virtual POS. Yes, through the cloud (and the innovations made possible by HTML5) these new virtual POS systems complete the circle. Now when a customer makes a purchase (or request) online it can instantly be received by a retailer's POS and the inventory (and the books = happy accountants) is processed in "real-time."

    One last point to retail innovation. Tablets are definitely going to replace the old "tech stations." Just look at Apple's store layout. One of the reasons this is made possible is the lack of register, checkout tech stations. Apple employees can help customers wherever they are on the floor, complete their purchase from their iPhone, and email you the receipt. Virtual POS, and continued innovations from companies like Square are going to revolutionize store layouts saving store owners tons of money on floor space by removing checkout lanes and tech stations.

    Reply
    • I'm a huge fan of Square. It's Jack Dorsey's new company that allows people to turn their iPhone into a device that can accept credit card payments. The vision statement for Square is: "a world without cash registers". The opportunity is that a lot of these newer POS platforms are cloud and tablet based and that they are cheaper and "lighter" to get moving with. The challenge is that the majority of retailers are stuck on very antiquated legacy systems.

      Reply
      • Mitch Joel

        Just as a follow-up to our previous exchange. It's exciting to the Square folks already attacking the iPad POS market:

        https://squareup.com/register

        I think Square - Register is going to bring about a slew of new technology companies into the retail space. Hopefully if they are smart, Square might open up their system to allow developers to build custom solutions to meet diverse merchant needs.

        Reply
  • Posted by Justin Emig
    Mitch Joel

    In the Northeast, Kohls does exactly this and it works perfectly. they have 42" touch screens that connect to their site. you can scan items in store, and check out online if you want (using paypal) or you can scan the item and find another size online....and ship it to your house for free. you can even pay for it at the register if you want. their cross platform connectivity is spot on. only thing they are missing is the mobile piece. but it is very well done.

    Reply
  • Posted by Jon Allen
    Mitch Joel

    Hey Mitch,

    I enjoyed reading your article as I feel that a lot of the points are very forward looking. I agree with you on that their are a lot of opportunities for retailers to carve out a niche by providing services that allow consumers to get more custom products quicker. Currently I am working for a Software company that allows retailers to do some of the things you are talking about (drop ship commerce, www.dropship.com). Retailers are constrained by inventory. Matching supply and demand can be difficult for that reason. I believe drop shipping plays a piece in allowing consumers to have the ultimate omni-channel retail experience. Would love to hear your feedback on the subject! I will also look forward to reading more posts on this subject.

    Reply
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