Analytics: Brick-and-Mortar Retailers’ Bridge Into the Digital World
It’s no secret that the number of people choosing to do their shopping online continues to grow. Convenience and competitive pricing keeps consumers coming back for more, especially to Amazon.com. Over 40 percent of all online sales in 2016 were transacted through Amazon, and its dominance in e-commerce continues to grow. Still, the lion’s share of retail sales continue to occur in brick-and-mortar stores that have a distinct value proposition with relevant and innovative offerings. All told, consumers spend an average of $1,700 per month in traditional stores, compared to $247 per month online, according to the International Council of Shopping Centers.
Shoppers say that physical stores offer the face-to-face interaction and hands-on instant gratification that drives their decision to opt for an in-store shopping experience. It’s likely why they also spend more time shopping in brick-and-mortar stores as compared to on a single retail website.
Online merchants such as Casper, Bonobos and Warby Parker are watching and listening. While they see their online sales growing at a steady pace, they’re also bridging the digital divide by opening physical stores or, in the case of Casper, partnering with West Elm to sell its mattresses in brick-and-mortar locations. These online startups want to offer the hands-on experience shoppers say — and their purchases prove — they covet.
As online retailers edge onto traditional retailers’ turf, it’s time for brick-and-mortars to exploit their opportunity in the digital world. Their bridge? One of online retailers’ best offensive plays: using analytics and technology to personalize and customize the way they connect with customers in person.
Through technology, online retailers regularly collect data from consumers and develop customer profiles that run deep and wide with demographic and shopping behavior data. It’s virtual gold that allows retailers to reach customers with personalized, in-the-moment advertisements, offers, product suggestions, and more
Using Technology to Stay Competitive
Brick-and-mortar retailers may have a leg up with consumers when it comes to offering the in-store experiences shoppers are looking for, but they’re going to have to up their analytics game if they want to continue to stay competitive and grow their comparable store sales. This means offering a 360-degree shopping experience that bridges the digital and physical shopping experience, including linking online profiles and shopping activity to in-store engagement, extending loyalty programs across all channels, and measuring the impact of digital and email marketing campaigns on in-store sales.
Fortunately, the technology to make that happen is easily accessible for retailers willing to use it. Most shoppers walk into stores carrying the tool that’s key to analytics today: a smartphone. Not only do almost 75 percent of Americans own smartphones, a survey by mobile loyalty company SessionM found that 90 percent of consumers said they use their phone while shopping in stores.
Traditional retailers hold another tool that leverages that burgeoning smartphone dependency while unlocking the opportunity to reward shoppers for their visit: in-store Wi-Fi. No longer considered a service upgrade, high-quality, free Wi-Fi is an assumption for shoppers, right up there with their expectation for well-stocked merchandise.
When a shopper logs into a store's Wi-Fi, the retailer can gather data that helps them keep pace with online retailers. By building shopper profiles and tapping into customer purchase history, brick-and-mortar retailers can get a better understanding of what shoppers are looking for. Engaging shoppers with relevant, in-the-moment offers based on prior transactions, online shopping activity, and frequency helps shoppers make the purchases they actually want — building brand loyalty and generating more in-store sales.
Taking Advantage of All Technology Has to Offer
When it comes to shopping experiences, consumers are more “me-focused” than ever. They want what they want, when they want it, and they’ve used technology in their favor to make it easier than ever to get it. When it comes being shoppers’ retailer of choice, brick-and-mortar retailers are already in the catbird seat. Studies show time and again that consumers are willing to share an email address or information about their shopping habits to yield an even better shopping experience. Add technology to the equation — smartphones, in-store Wi-Fi and analytics — and brick-and-mortars can hold on to their perch.
Allan Haims is the CEO of StepsAway, an online platform that enables mall-based retailers to create and deliver offers and promotions to smartphones.