Blog: Stuart Armstrong 

Stuart Armstrong (bio)
President Americas
ComQi

Tuesday, 27 November 2012
For as long as I can remember, the Holy Grail in retail is to increase purchase conversion rates by gaining a better understanding of the way shoppers actually shop a store.
  • What is the path of their shopping journey?
  • Where do they dwell in the store?
  • What merchandising techniques are most successful in moving shoppers to traverse more of the store?
To approximate an answer, a variety of methods, ranging from simple people counters to video cameras and physical shop-alongs still remain common fare for retail researchers. Yet the results from these methods don’t adequately satisfy the marketer’s desire to do what is ultimately intended; enhance the shopping experience while driving increased conversion.

For a moment, let’s move from bricks to clicks and examine the web for some answers.

Analogous to a physical store, an e-commerce site captures the virtual shopping journey. It knows how you travel the site, how long you are there and how promotions and product messaging can link you to travel more of the site. Analytics, both individual and aggregate, come out of this process and can trigger content changes based on patterns in the data. These data-triggered content changes create relevancy. The more relevant and timely the content, the more likely it is to generate desired behavior changes. In short, sales will increase.

One case in point: Williams-Sonoma has launched a new e-commerce site featuring personalized gifts and accessories while also adopting a new targeted marketing model that incorporates shopper behavior. This is being seen as an important contributor to their online sales increasing 16.7%, while total store sales grew 8.9%.

Ironically, the virtual shopping experience has become more personal than a store visit. Good news: there are proven marketing technologies, that have been evolving for over a decade, that afford brick-and mortar merchants the same advantages that smart e-tailers have.

It starts with in-store digital signage but not your everyday “run-through-a-pre-scheduled-playlist” signage, but instead smarter data-triggered digital signage. I am well aware of examples where digital signage is designed to deliver maximum results by being contextually aware and picking up digital cues from its surroundings: 
  • Digital signage at a quick serve restaurant “listening” to the weather and promoting hot soup the minute temperatures slip below 60 degrees
  • Signs inside department stores listening to car traffic on the highway, promoting lunch at their café while there’s a traffic jam outside that will not clear for an hour
  • A sporting goods retailer listening to the PGA leader board and promoting Callaway apparel as Phil Mickelson battles for a win; also listening to the inventory data to promote only those products that are in stock at that store
  • And, a consumer electronics retailer listening to the ePOS system to promote the latest featured price for a product their shoppers are interacting with on their mobile smart phones (showing promotional videos and loyalty benefits)
This is today’s merchandising: using signage with relevant, interactive, just-in-time content that alters shopping behavior and drives same-store sales increases. But, how do these examples bring us any closer to emulating web-based eCommerce for a store environment? The last example that involves the personalization of content triggered by a shopper’s smart phone brings us closer to web shopping.

One UK shopper analytics company, Path Intelligence, is doing this brilliantly, and answers many of the questions we posed at the beginning. They do that by collecting shopper pathing data continuously, passively and anonymously through the unique pings of every shopper’s mobile phone (regardless of model). For privacy purposes, those pings do not contain the user’s name or phone numbers. However if the user wants to opt in, then individual permission-based data can be captured, typically in exchange for shopper incentives. Check out this video on for a visual description of this robust technology.

ComQi and Path Intelligence are bringing together smart digital signage and real-time shopper pathing data, by department or section. This will allow retailers to gain sharper insights into the effectiveness of content, and subsequently use those insights to make instantaneous changes to their content.

For example, let’s say a major department store is running a holiday promotion on children’s apparel. Located in the department is a digital sign promoting great deals on the clothing and cross promoting their toy assortment. The digital sign is continuously listening to the ePOS and inventory system to make sure that the items promoted are in-stock and the promotional price is up-to-date. Additionally it allows the shopper to opt in through their smartphone using a QR code or NFC (near-field communications) to receive a wayfinding map to the toy section as well as a 20% coupon intended for same day use. The Path Intelligence platform (from their “FootPath” solution) provides amazingly valuable data. 
  • How are shoppers moving through the kidswear department and how long are they there?
  • How many shoppers remain within viewing proximity of the digital sign, and for how long?
  • What percentage of shoppers has opted in?
  • What combination of content and incentives drives the most traffic to the toy department?
Based on the Path Intelligence insights, content can be optimized to display the most effective promotions on an individual store basis without any human intervention by the retailer. The Path Intelligence system can get even more granular by anticipating what, where, and when (down to the day of the week and hour of the day) the content should be shown. Without the high cost of additional staff, the combination of digital signage and smart phone technology takes on the role of a personal shopping assistant.  

It is often said that “content is king”, but content does not tell the whole story. Content that is relevant and timely is what makes this King powerful.  So if you are implementing digital signage, or advising on how it should be used, first consider a system that has an astute sense of its surroundings and can trigger content intelligently. When you do that, your system will deliver a sizable return on investment, starting with a measured increase in purchase conversion.
Posted by: Stuart Armstrong AT 03:54 pm   |  Permalink   |  2 Comments  |  Email
Comments:
Very interesting case studies and vision for the opportunities that digital signage might deliver, based on where people are, what they're doing, and what's going on around them. Add to this the potential engagement via WiFi and smartphones (and older Bluetooth-only cellphones) with proximity advertising, and a complete picture of the pissibilities emerges. Companies like Media2Go (www.media-2go.net) can enable digital signage to take advantage of the consumers that are also NEAR the point of purchase and serve to direct them to either the signage, aisle, product, or store. I would be interested in hearing from the signage gurus about the value of integration of these technologies. And, of course, supporting the delivery.
Posted by Paul Baron on 11/28/2012 - 12:45 PM
Good stuff from Stu at ComQi and Path Intelligence! Stu's statement says it all: "Content that is relevant and timely is what makes this King powerful". Why are retailers not using this talent and tech more? Stay tuned.
Posted by Ian Collins on 11/28/2012 - 01:12 PM

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