Forward thinking retailers: E-commerce doesn't diminish kiosks' role
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With e-commerce weighing heavily on retailers' minds today, is in-store interactive technology, such as self-serve kiosks, taking a back seat?
No one questions the importance of e-commerce to a retailer's success. Adobe Research predicts that online sales will reach $107.4 billion this holiday season, an increase of 13.8 percent, while in-store retail is expected to grow 10 percent less.
But while e-commerce is growing, interviews with two forward-thinking retailers reveal they are not dumping in-store technology.
Neiman Marcus and Nebraska Furniture Mart executives indicate e-commerce is actually driving a greater role for interactive technology.
"What we're talking about is digital interactive screens in the store that deliver some kind of value to the customer, whether it's being able to look at items that are online only or happen to not be in that particular store," said Scott Emmons, head of the Neiman Marcus Innovation Lab.
"I'm looking for kiosks to kind of tie together the customer's journey through the store," said Emmons. "They continue to be important."
Experiences beyond e-commerce
That's because kiosks provide unique experiences beyond traditional in-store customer interaction, Emmons said.
One example is Nieman Marcus' "memory" mirror, a fashion mirror outside of dressing rooms that offers a 360-degree view of what the customer is wearing which enables them to share the video in real time with friends for feedback before making a purchase.
"If you think about what we did with memory mirror, that's at the far end of doing something interesting with basically the same kind of hardware that you would deliver a traditional kiosk experience with," he said.
David Bash, Grandscape marketing and technology director at Nebraska Furniture Mart, said the retailer has no intention of taking its eye off the in-store experience as it invests in e-commerce.
"Retailers must focus on the whole experience," said Bash. "E-commerce is a sales channel that you must invest and commit to for success. However, the in-store experience is equally important. Retailers must focus on how to improve the engagement with their customers in-store. That includes kiosks and gamification."
Retailers also have a bevy of other technologies to consider. While Emmons and Bash are committed to self-serve kiosks, they hold somewhat different views about embracing biometrics and artificial intelligence.
Emmons takes a cautionary view about these emerging tools.
"I would say that you have to be super careful with those technologies because of the privacy issues, whether real or perceived, by the customers," he said. He said a retailer must be upfront with customers about technologies that can be seen as invasive.
The retailer must also be prepared to offer an alternative experience if they feel that a particular technology, such as biometrics, is too invasive.
Neiman Marcus hasn't done a lot with in-store beacons yet, Emmons said. Nor is the company ready to embrace mobile ordering just yet.
"It (mobile ordering) hasn't matured enough where it's seamless and it works every time," he said. He said connectivity can be an issue.
"When you can connect the customer's device to your in-store digital experience, I'm always looking at ways to do that," he said. He compares it to the connectivity challenges with early Wi-Fi.
Bash is more optimistic than Emmons regarding biometrics, in-store beacons and mobile apps, all of which he sees interacting with in-store kiosks.
What about ROI?
The big reason for Emmons' caution is the simple fact that every technology effort requires investment and a determination of return on investment.
Investing even in proven technology poses a challenge.
"They're still trying to figure out how they can fund those projects," Emmons said of retailers in general. "All of a sudden in the last few years, retailers have realized that they have to be very technology savvy, that technology is a part of doing business in a physical store."
Emmons said retailers must resist the tendency to measure the investment against short-term sales change. This type of assessment requires knowing which customer interacted with the device, which is not always easy.
In evaluating an investment in technology, Emmons thinks about the broader customer experience.
"A lot of things we want to be more frictionless and more casual," he said. "Sometimes that's hard to measure."
Main Street is watching
To be sure, Neiman Marcus and Nebraska Furniture Mart are not run-of-the-mill retailers. A walk through an average strip mall, especially in secondary markets, typically will feature less sensory engagement.
Nevertheless, Main Street America is paying attention.
"Digital technology has grown incrementally in our marketing strategy," said Joe Bell, director of corporate communications for The Cafaro Company, an owner and operator of shopping centers in Niles, Ohio with more than 50 properties in 10 states. "It will no doubt continue to grow as a part of the overall shopping experience for our guests."
"We, like so many other shopping center developers, have invested more and more over the past few years in marketing that relies heavily on social media platforms (Instagram, Facebook, Twitter, etc.)," Bell said. "Technically, it's not the same as an interactive kiosk, but it moves us in that direction."
Companies: Neiman Marcus
Elliot Maras Elliot Maras is the editor of KioskMarketplace.com and FoodTruckOperator.com.