The term retail apocalypse was coined by a US journalist referring to mass closure brick and mortar stores in the country. Since then global media focused on retail has highlighted couple of major shutdowns in the Europe and other parts of the world. Connecting the dots they started to question the foggy future of brick and mortar stores.Considering the amount of prime real estate they occupy in any civilization – the brick and mortar category has been going through its share of touch times. For those who understand the process of evolution (the biological reference), know that the new doesn’t kill the old, rather in the process of making its own space, it changes the way the entire ecosystem works.
In the retail context, E-Commerce changed the way we used to shop. Infact, by making the shopper ready to give their credit card online, they opened up much more avenues beyond shopping. The Indian internet revolution to a great extend has been driven by e-commerce. Technology along with evolving consumer has resulted in a major shift in the entire retail landscape. The brick and mortar retailers have been slow to adapt – the physical and digital divide is narrowing and the industry needs tools to support.
Indian startup ecosystem seems to the backbone of the government. Put together the entire startup landscape you could see how those group of people are working toward making the economy / mankind future ready. Based on the nature, I put startups into 2 broad buckets – new path breaking technology startups and a business use case startup. A business use case startup typically solves and operational problem using existing technology.
Checkout this comprehensive list of over 150 startups which are transforming brick & mortar retail. Right from in-store shelf monitoring solution to virtual trial rooms, upto location analytics & proximity marketing. Slowly but gradually brands are working on identify what works for their set of problems. As the market is flooded with solutions, it’s important for the retailers to clearly define their business, shopper expectations and build solutions to be future ready. The future I refer to has already arrived.
I re-iterate this at the cost of sounding repetitive – it’s not online v/s offline. These 2 channels may have cannibalization from an organization sales function point of view, but they don’t compete each other. A good thorough analysis of the evolved consumer landscape, establishes that these 2 channels embrace each other. The omni-channel world has made it possible to capture shopper preferences online while browsing the massive window shop catalogue and geo-fencing ensures contextual communication.
The brick & mortar stores continue to be the place where most significant value is created. Right from touch & feel, visual merchandising, brand experience the brick & mortar stores play a very important role. To all those who believe that the future doesn’t have space for brick and mortar – consider this AT Kearney report that highlights over 95% of online sales last year was registered by retailers with brick & mortar stores.
The digital to physical gap has narrowed –the consumer expectations have evolved – now we need tools to follow.The entire retail landscape needs technology touches – and thankfully many players are working on building solutions. We at Shopholix have been working on enabling brick and mortar stores with tool to manage the huge base of internet users / online shoppers. Leading brands in the country do not have this ability to execute an offline campaign with seamless digital execution. The current CRM at most of the leading retailers show you beautiful graphs of the reactive data behind the POS. But there is no real shopper actionable, behavioral and location analytics available – something which helps you be proactive.
Once the shopper-to-store experience is digitized, it’s of utmost importance to digitize the in-store experience as well. The current in-store experience is primarily people driven which has to evolve. Many in-store merchandising and trial room technologies have enabled amazing engagement and experiential tactics – which can deliver the third dimension of the experience.
I give a huge emphasis on pre-property research – improving decision on choosing the right location for your new stores, expected business potential, catchment consumer profile, is a must for retailers and malls. With high cost and low efficacy retailers are unable to use the traditional research process. Data & Technology has automated location based consumer research,enabling high efficacy decision making. There has been much spoken about beacons and physical devices which seemed to be a perceived answer to the online to offline category.
The solution providers (various startups) have a great opportunity ahead – with the entire ecosystem evolving together backed by venture capital is ensuring availability of resources to make this happen. Guest wifi, POP up and kiosks, in-store music, inventorymanagement, smart receipt & ratings, omni-channel analytics, work force tools, augmented reality, along with many other ways the retailers can use technology to enhance in-store experience and capture omni-channel analytics.
The challenge for a technology service / solution provider, startups focused on this category, is the clutter createdby the number of solutions available in this fragmented industry. The key to success would be in productizing a solution and moving at a god speed to ensure marketplace leadership.
On the other hand the retailer has a problem of many. Many perceived solution to the problem. It’s going to take a while for the retailers to understand their entire technology and consumer landscape. I can see various retail businesses experimenting with various solutions right now. In time the retail businesses would stitch their entire Omni-channel strategy for a consistently growing future.
The future is exciting; technology is and would continue to enhance every single human touch point. Businesses have to react and adapt very swiftly to this continuous evolution, and stay relevant in the newer landscape.
The article has been penned down by Chinmay Bhatt, Chief Marketing Officer, Shopholix