Experiential retail: The UK high street revolution

2nd December 2011

One of the latest to think ahead of the curve is online auction site eBay, with the unveiling of a physical outlet in the UK today with a ‘pop-up' shop, reports the Guardian. But there will be no tills. Shoppers will instead pay using their smartphones to scan a ‘quick response' code on the price tag. This directs the phone's browser to the payment section of the eBay website, with the pitch behind this technique being: ‘no queues, no bags, no stress'.

 

The need for change

Given the impact of the uncertain environment it is vital for brands to shift to new modes of shopping.

Commenting on the bleak situation for UK brands, a spokesman for asset manager Henderson says: "Travel firm Thomas Cook has been rescued by £200 million of new financing and we have seen profit warnings from many other consumer-facing businesses including Blacks Leisure, Carpetright, French Connection and Jacques Vert.

"In addition to this, we are starting to see signs that things are not so rosy at John Lewis, regarded by many as a high street bellwether. Finally, the squeezing of suppliers from the likes of Debenhams and Marks & Spencer, combined with the recent unseasonably warm weather, are more signs that retailers are starting to struggle – all pointing to a challenging Christmas trading period for UK retail."

 

New strategies

Big brands in particular are becoming increasingly creative in their techniques to lure shoppers. For example, Tesco and Ocado have trialled virtual shopping ‘walls' where shoppers can browse and order groceries using applications on their phones.

Tesco has even tested ‘augmented reality' in its stores. By holding a catalogue or a product key up to webcams in the supermarket's aisles, shoppers can generate life-size 3D projections of products and read their specifications before making a purchase.

 

The digital revolution

Digital innovations are creating user experiences that are interactive and personal, and part of our everyday life.

Time Techland says: "Welcome to the world of experiential retail, where in-store shopping is enhanced with interactive interfaces, augmented reality and social media integration to create a unique experience for each individual consumer. From virtual mirrors that allow users to try on makeup without actually putting it on their faces, to window and storefront displays projected in 3D (or even 4D, as was the case with Ralph Lauren in 2010), these technological trends have been popping up in stores around the world, and could soon be available in a mall near you – if they aren't already."

For example, for Adidas, Intel created the adiVERSE Footwear Wall, which allowed users to peruse more than 8,000 shoe styles in 3D on one of its multiple touchscreens.

But is this a passing trend? "Judging by the success of campaigns launched by high-end brands ranging from Disney and Puma to Burberry and Da Beers, it looks like we're going to be seeing more technologically advanced shopping options in the very near future. In fact, in Germany, a grocery store devoted to exploring these types of innovations – the Real Future Store – has been in operation since 2008 and enjoyed overwhelming success. Sales have reportedly increased by a solid 15% since the store's inception, but whether this is due to the technological offerings or the inherent need to buy groceries remains unknown," says Time Techland.

A BBC report on the Real Future Store, customers enjoyed the recipe kiosks and were enchanted by the ocean sounds that complemented the seafood department, but were less enthused about an option to identify themselves at the register using just a fingerprint.

 

So what does the future hold?

Rohit Talwar, CEO of Fast Future Research, specialises in advising retailers, shopping centres and airports on how emerging social trends, technology developments and new business models can transform the retail experience.

He says: "I think we'll see a growth in blended experiences combining digital advances with new service ideas. For example, New Look at Westfield has a body scanner that captures all your measurements and then personal shoppers use those measurements to help choose clothes that are right for you. Burberry took its catwalk show onto Twitter and Near field communications will enable retailers to identify the shopper and start delivering more personalised services.

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