Across the retail sector a lot of effort is going into finding creative ways of using technology to create new customer experiences.
The question is, will that investment trickle down into a return for the business, or is it just window dressing?
Marc Jacobs recently revealed that it plans to open a pop-up shop during New York Fashion Week where Twitter and Instagram posts will be accepted instead of money.
With each transaction, consumers will be able to use the hashtag #MJDaisyChain as a form of ‘social currency’. The most creative posts will be entered to win larger-ticket fashion and accessory items.
Burberry is another example: the luxury brand used digital interaction to tempt its customers by incorporating special high-tech tags on stock. When scanned with a mobile device, the tags trigger a short film on the customer’s smartphone or tablet that shows how each item is carefully made by hand.
In addition, the mirrors on the walls in Burberry’s flagship store in London’s Regent Street turn into screens that play digital content triggered by the clothes that shoppers are trying on.
Clever innovations such as these are a direct result of retailers adapting their methods to fit consumers’ changing habits. Many have now mastered the first step of providing a good online service for customers, but the focus is now on experimenting with ways to wow customers with the latest technology.
As a result, the line between technology and retail continues to blur, with many retailers now looking to develop the consumer experience through greater innovation.
However, in order to ensure that there is a link between the latest retail technology and return on investment, it’s essential that retailers focus their efforts on the high-tech experiments that that will actually put money in the till.
The campaigns organised by Marc Jacobs and Burberry may be able to achieve this goal as a result of the publicity that these experiments invariably generate.
Plus, in Marc Jacobs’ case, using social media can also be extremely effective at driving brand awareness amongst consumers at a very low cost.
Where it will be crucial to understand the potential return on investment is for more costly innovations. For example, what about Amazon’s vision to deliver products using drones?
Will it be possible to balance the mammoth cost of implementing such a futuristic service with the extra revenue that it creates for the business?
The retail industry has clearly gone through a massive change over the past few years and retailers definitely need to adapt their strategy in order to survive.
At the moment, the industry is in an experimental phase, where retailers are still testing the technological waters.
However, businesses will need to measure the successes – and failures – of their retail innovations in order to make the best decisions on where to invest next.
Only then will retailers be able to turn technology into a real return on their investment.
- Dan Coen, director, Zolfo Cooper