Advanced in-store technologies, like virtual and augmented reality, have been nothing more than a pipe dream for many retailers over the years. Only now are we starting to see these exciting trends go mainstream. The Covid-19 pandemic has driven home the need for more convenient, more exciting experiences, with less touch of course. And retailers have taken note. Many of the big players are moving at pace to meet the needs of the changed shopper, but even smaller shifts towards digit
digital are making a big difference to the customer experience. Contactless experiences Contactless payments have quickly become the norm, as many consumers ditch cash in favour of convenience and better hygiene. ATM withdrawals in April were down 30 per cent from the month before and over 40 per cent lower than twelve months earlier, Michele Bullock, assistant governor – financial system, RBA reported in June. While some retailers have been fearful of abolishing cash completely, having the option of digital payments is now a necessity. Last week, Woolworths announced that it was expanding a trial of its cashless Metro stores, with three additional stores across Victoria and NSW to adopt contactless payments. “As more and more customers choose to pay with cards, we’re trialling all electronic payments in a small selection of Metro stores which currently see very few cash transactions,” a Woolworths spokesperson told Inside Retail. Phil Pomford, general manager, global e-commerce, APAC, Worldpay from FIS, told Inside Retail concerns around safety and hygiene have accelerated the contactless payment trend. “We’re seeing a massive shift towards the use of digital and mobile payment methods, known colloquially as the “Pays”, such as Apple Pay and Google Pay, with over one billion shoppers expected to make a digital or mobile wallet payment this year,” Pomford said. With biometric technology, such as face recognition and fingerprint scanning, meaning better security and more convenience, digital and mobile wallets will drive nearly 70 per cent of e-commerce and 45 per cent of point of sale purchases in APAC alone, by 2023, according to the 2020 Worldpay from FIS Global Payments report. “It is therefore no surprise to see major retailers like Woolworths making a concerted effort towards digital-first or entirely digital payment solutions. It is simply a non-negotiable for retailers if they wish to remain competitive and continue to attract an increasingly digital-savvy customer,” Pomford added. For those in the business of online, contactless pick-up has also become an important part of the in-store offer. Ikea, Woolworth Supermarkets, Dan Murphy’s, Big W and KMart are all now offering contactless Click & Collect. QR codes are also gaining traction as a contactless payment method but many retailers are using them to do so much more. At Burberry’s social retail store in Shenzhen, China, all product tags are labelled with QR codes that connect to digital screens in-store and allow customers to access more information, product storytelling and exclusive items. ASOS’ first circular fashion collection, launched last week, also features a QR code on each garment tag to tell customers more about the company’s circular design principles and how the product was made. Experiential retail Retailers have realised that customers are looking for more exciting in-store retail experiences to make their trip to the shops worthwhile. One such retailer is Levi Strauss, which has just brought its Next Gen store concept to North America. Personalised shopping experiences are a key selling point at the Next Gen stores which allow customers to find and customise new looks in collaboration with in-store stylists. A Tailor Shop is the heart of the store complete with smaller format direct-to-garment printer and an interactive app. “These stores aren’t just about transactions, they are about an experience,” the jeans company said of the launch. The Next Gen stores also offer services such as Buy Online, Pick-up In Store and curbside pick-up for better convenience. Saskia Fairfull, founder and community manager of Independent Fashion Advisory Board (IFAB) told Inside Retail, “Experiential retail is no longer an in the future concept.” “It’s become front and centre now because of Covid-19 impacting retail in such a significant way. The only option for retailers is to create a more relevant shopping experience and that means focusing on experience, personalisation, convenience and connectivity.” Virtual reality Virtual try-ons are also ramping up, particularly in the area of beauty where traditional testers have been stripped out of stores globally as the pandemic heightened fears of cross contamination. MAC is among the beauty giants leading the way in virtual, with its new Innovation Lab in Queens, NY, inviting customers to virtually test makeup shades using an augmented reality (AR) mirror. They can even try on complete beauty looks created by MAC makeup artists. The experiential retail offer doesn’t end there. Customers can also customise their own palettes and personalise product packaging. Harrods’ new beauty concept H beauty is another prime example of Covid-19 pushing traditional retailers to do things differently. An interactive beauty Playtable allows customers to experiment with makeup, a Skincare Station offers mini facials and masterclasses, and an in-house Champagne bar tops off the Instagram-worthy experience. Fairfull said experiential retail works best in categories where shoppers are ready to be delighted and surprised. “This retail model adds something special to the purchase that people remember and choose to buy from again. You don’t expect all the bells and whistles from a grocery shopping experience, just that it is reliable, convenient and you can find what you’re looking for in the shortest time possible,” she said. Brand stories Brand storytelling is another rising trend in bricks and mortar stores, and something that Twinings has done well in its revamped London store. Twinings’ Moments of Curiosity provide interactive experiences where customers can learn more about the heritage of the brand, its tea growers, sustainability practices and values around health and wellbeing. “Being able to convey a brand’s ethos, supply chain, creative vision, values and mission statement outside a website is providing huge value in developing trust and advocacy with shoppers,” Fairfull said. “This effort to communicate paired with new technology solutions enables shoppers to make an educated decision about buying products and aligning with brands. From the physical space to digital platforms, creating branded environments through multiple touchpoints is critical in building lasting relationships with shoppers.” While global brands are leading the way, Fairfull is expecting much more exciting developments closer to home in the near future. “There is no better time than the present to start crafting what experiential retail looks like for Australian brands. I’ll be keeping a close eye on a few of our local stars in the coming months such as Mecca, Adore Beauty, Accent Group and The Iconic,” she said.