Blog: Ron Bowers 

Ron Bowers (bio)
SVP, Business Development
Frank Mayer & Associates

Tuesday, 06 December 2011
Has Retail Confidence Turned the Corner?

"American consumers have been taking a deep breath and making a decision that it’s OK to go shopping again," NRF Vice President Ellen Davis has declared. If the results of Black Friday weekend through Cyber Monday are any indication, consumers have exhaled and given themselves permission.

Spurred by heavy promotion and earlier openings, retail sales during the Thanksgiving weekend rose 16.4%; shoppers spent 9.1% more per person than last year, and sales hit $52 billion compared to $45 billion last year, according to NRF. This is higher than the average increase for November and December over the past 10 years. If correct, this would indicate a continued retail recovery that began last year after holiday sales fell the previous two years. NRF has posted that the earlier store openings on Thanksgiving and Black Friday, while easy to condemn, were actually very well received by time-crunched consumers and retailers trying to stop the bleeding. Meanwhile, online shopping continues to win over millions of Americans this holiday season, with a record number hitting websites on Cyber Monday.

Retailers and brands are courting the consumer with discounts and offers, but what happens next? They will get a short-term return on their investment, but those focused on long-term engagement will be best positioned for the future. Retailers and brands that use the promise of self-service technology and social media to empower customers will create relationships that keep shoppers coming back when the holiday hype has modulated. Quite simply, the challenge of retail technology deployment goes beyond return on investment to include return on engagement.

At Customer Engagement Technology World (CETW) recently, I was honored to chair an insightful discussion centered on the importance of Return on Engagement vs. Return on Investment. It was led by three of the most respected and recognized B2C industry voices: Danna Vetter, vice president of consumer strategies for ARAMARK; Jennifer Nye, marketing and brand management strategist for Kohler Company; and Laura Davis-Taylor, SVP, managing director at ShopWork BBDO.

Danna Vetter  Jennifer Nye  Laura Davis-Taylor
Vetter              Nye                 Davis-Taylor

Looking beyond the economic metric of ROI to the behavioral metric of ROE, Laura Davis-Taylor focused our discussion by asking the questions:
  • How has technology altered the traditional shopping path?
  • How are smart retailers responding?
  • What brands are serving as inspirational examples for others to follow?
How do Self-Service Technology and Social Media Inform What Happens Next?

I think we can all agree there is no longer just a traditional shopping path but many paths to purchase facilitated by mobile and social technology. Mobile helps consumers shop across all channels. Social media gives shoppers context and community, enlisting friends virtually in discovery and purchase decisions. These technologies work hand in hand to facilitate the kind of engagement that can turn trial and purchase into loyalty and evangelism.

Consumers have been a beacon for retailers, rapidly adopting mobile and social platforms to empower their shopping. Smart retailers are those who aren’t afraid to experiment to find out what works for their customers across retail environments. The retailers that will best use social shopping in their marketing are not just talking at, but are listening to, consumers and adapting what they’re delivering based on consumer response and interactions. This is engagement, defined by Wikipedia as: "the repeated interactions that strengthen the emotional, psychological or physical investment a customer has in a brand."

How a customer experiences a retailer or brand is no longer just within her head or with those in the immediate vicinity. The consumer has become the reviewer, the broadcaster, and the brand advocate. Marketers can remain passive in this remodeled environment or they can facilitate behavior and try to harness its power. These could be the best of times or the worst of times for brands and retailers that don’t heed the consumer’s acceptance of the engagement shopping model. Brands like Starbucks, that understand the opportunity offered by the new Facebook model of streaming content and encourage social media sharing through their in-store merchandising and mobile applications, are leading the way on one end of the spectrum. Walmart is far ahead as it develops an application that facilitates social sharing through impromptu communities. Customers will ultimately be able to engage in-store via their phones with other shoppers, asking and answering questions, seeking and giving opinions on products and deals.

As discussed at CETW, the way we deliver customer interaction is evolving, and the only limit to what technology can do is our imagination and retail implementation. The focus should be on breaking down the bricks and mortar between customer and retailer and engaging in a two-way dialogue aided by emerging digital media and in-store self-service interactive solutions. We need to incorporate this new model into our planning and development. The challenge of a deployment should not be just return on investment, but return on engagement as well.
Posted by: Ron Bowers AT 08:53 am   |  Permalink   |  0 Comments  |  
Tuesday, 03 May 2011

The economic downturn has permanently changed the way consumers shop. More shopping trips begin online and at in-store kiosks, and price comparisons and coupon searches are even more common. Coupled with the social media explosion and breakthrough interest in mobile shopping, 2011 is poised to be the year e-commerce convergence moves from the sidelines to the heart of a retailer's strategic cross-channel-execution.

Retail technology solutions are at a major tipping point, paradigm shift or whatever game-changing catch phrase applies.

"The use of multi-touch technology allows the kiosk designer to make the system an extension of what people have with them every day," said Gene Halsey, director of Product Line for Touch Revolution, a projected capacitive touch-screen manufacturer. "By integrating the experience of Smartphones with the interface of multi-touch, kiosks now become as natural and easy to use as the fastest growing consumer products in recent memory."
There are a multitude of benefits to the multi-touch technology, many of which focus on the user experience. Taken together, these elements result in more-informed, more-efficient and more-engaging interaction.

Key elements to a multi-touch "gesture experience"

Familiar Interface
The familiar interaction of a smartphone touchscreen lends itself to redefining the user interface. If you know that the person walking up to the screen will know what to do when he touches the screen – you don't need to design large buttons or other "old" interface characteristics in the software. You can also place icons in such a way that people naturally think they are using their mobile devices. The kiosk then becomes an extension of what people have with them every day. This is a radically different way to think about kiosk design.

The projected capacitive technology also provides the ability to add multi-touch to the interface. Now adding familiar gestures to the interface is possible when designing content. It is natural to "swipe a finger" across the screen to flip the page. It's natural to "draw a circle" with a finger to scroll through options or "pinch a picture" to make the image larger. This frees the user from next-page icons, scroll bars and zoom buttons. The result is an opportunity to create content that is dynamic and fun to use.

"Today, the rules have changed and the power has shifted," said Brian Ardinger, senior vice president and chief marketing officer at Nanonation. "Luckily, today's technologies like digital signage, kiosks and mobile will be key factors in engaging customers and differentiating offerings. These technologies will create the in-store experiences that resonate with today's consumer."

Clean, industrial design
Removing the front bezel from the monitor allows multiple design and installation alternatives. A multi-touch monitor can be embedded into the wall or other flat surface. Imagine creating a kiosk in a countertop. When visiting home improvement stores, customers can use interactive content within the kitchen design center layout — not at a stand-alone kiosk — but actually embedded in the kitchen product display.

Without the bezel on the monitor, it is possible to create interactive-video spaces within traditional retail environments. Monitors can be tiled together to create content that is bigger than a single monitor — without a concern about the interruption to the visual continuity caused by the bezel.

Multi-user options
The natural extension of multi-touch screens is the ability for multiple users to touch the same screen. This accommodates a system design with four different screen regions built around different information. Each of those regions can now be active at the same time —in essence creating four kiosks out of one screen. Systems become playful — one person can flick images across the screen to another. Another interesting option is to design games for multiple people to play in amusement situations. Imagine an amusement park with way-finding stations that can switch to a game station that the whole family can use. The traditional amusement kiosk game "one-trick" pony can now be a multi-function device that can do things that weren't possible only a couple of years ago.

When the entire surface of the touch monitor is glass, the kiosk cleanliness factor improves significantly. No longer are there dust collectors and crevices all around the surface of the touch area that need to be constantly cleaned. Customers and employees don't have to worry about the grease that has visibly collected around the bezel when you put the self-service ordering kiosk in the fast food restaurant. It is very difficult to keep dirt and grease out of old bezels. Take away the bezel — take away the place for that junk to collect.

A projected capacitive monitor can be put in a range of places that weren't practical for touch input in the past. Even with surface damage, the projected-capacitive screen continues to work. Even at the extreme case of breaking the cover glass, the screen can continue to work. It becomes a different definition of uptime for the machine operator. It reduces concern about machines going down as often. Many people have dropped iPhones in the past and continued to use them for days, weeks or even months before getting sensors replaced. The same can now be true for the public-use interactive kiosks.

Focus on the user experience
According to Forrester Research, the public now spends as much time on the Internet as watching television. This behavior is facilitated, in part, by the use of mobile phones. Adults are just as likely to have a mobile phone as a computer.

Price Waterhouse Coopers studied post recession shoppers In "The New Consumer Behavior Paradigm: Permanent or Fleeting" and found that retailers must leverage their marketing, merchandising and positioning to push their offerings that are "need to haves" and build a case for the "must haves." Although most people rely on cell phones in their everyday lives, this is a tall order in the context of a 2-inch screen. This goal is attainable when elements are integrated and retailers employ a variety of digital media, kiosks and in-store merchandising.

This brings us to the real success at retail — collaboration across channels. Consumers post The Great Recession are looking for trust relationships with retailers. They are guarding their resources and have changed their shopping paradigm to a direction that is more selective and targeted. It is generally THE BRAND that has brought consumers back to the shopping environment. It is THE EXPERIENCE at retail that builds loyalty and will keep them coming back.

Consumers are expecting that all contacts with the brand, across channels, on-line, in-store or in-hand will be consistent and coordinated. They are expecting their needs and brand access to be met without limitations on a particular channel. The "BRAND" means more today than it did as little as just three years ago, and it encompasses all the interactions — digital and physical — that consumers have with retailers. Consumers have finally embraced the true success of the retail shopping experience, The EXPERIENCE is the BRAND!

A strong retail kiosk merchandising company can successfully marry the key elements of brand marketing, customer interaction, design, engineering and technology. The product of collaboration and experience in all of these areas is far more important than the features or price of an individual piece of technology. Paco Underhill, in "Why We Buy: The Science of Shopping," warns not to "get lost in the technology." It isn't the individual ingredients but the strategy of the whole that produces a winning solution.

In analyzing the results of their study, The Customer Centric Store 2010, RSR found that the No. 1 opportunity in the current market is to refine the customer's in-store experience. And the No. 1use of in-store technology, identified by 76 percent of retailers was to "maintain and/or improve the customer experience."

Interactive merchandising, whether delivered by a kiosk, an iPad app or digital signage, is no longer an add-on option for the early adapter. It is a crucial differentiator in the retail setting.

All retailers and brands have access to the same marketing, merchandising and technology resources. It is the savvy and experience with which they employ these means to create awareness, satisfy and delight consumers, and convert shoppers into loyal buyers that will translate to success.

Critical Takeaway Tips

  • The kiosk is an extension of the consumer's experience in the retailer's store. The design of the kiosk needs to reflect the "brand" that is the retailer and offer a "call to action," an engagement, that is consistent with the retailer's marketing and merchandising strategy. The EXPERIENCE is the BRAND!
  • The software interface must be designed for the multi-touch experience and leverage all the potential intuitive tendencies of the consumer's interaction. If the software is not engaging the gesture interface intuitiveness and flexibility, why use the multi-touch screen?
  • Projective capacitive multi-touch is the logical choice for retail or any consumer interactive self-service deployment. Cost, flexibility and longevity can deliver a generous ROI.
Posted by: Ron Bowers AT 08:37 am   |  Permalink   |  
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