Part 2: The Changing Face and Reality of Digital Stores

Vivek Agrawal

Vivek Agrawal, Vice President of Digital Stores, Skava

In the second part of the in-store series, Vivek Agrawal explains what the future of in-store holds from a Skava perspective and what retailers must do in order to digitize their brick and mortar store.

Q: There are many retailers right now following the dressing room concept with interactive mirrors such as Rebecca Minkoff’s boutique store in San Francisco. What’s your vision for dressing room?

A: Dressing room is something that is becoming mainstream now, but it’s been a concept for 3-4 years. In my prior life with Marks and Spencer, we had done a dressing room concept for them. This time when I went to London, I visited a couple of stores like Burberry and one more with magic mirrors and dressing rooms. I think they are concepts that have been in flagship stores. I don’t think it will become mainstream for multiple reasons:

  1. It needs a lot of space. For transponders to work correctly, camera recognition to work correctly, whatever technology you’re using, it’s going to take a lot of space.
  2. The second constraint is that there are dressing rooms stacked right next to each other. While you need space, you also need confined space from a radio frequency perspective, or airwaves perspective. Again, there are technologies that work already that will solve those challenges and have already started to, but the reality is that these technologies right now work about 50-60% of of the time at most. There are some forms of digital that are going to exist, but before it starts to become mainstream, it’ll take a few years.

Q: What is Skava’s view of the future for in-store in the next 4-5 years?

A: I think the biggest movement from my perspective in the next 4-5 years is going to be around personalization, beacons and RFIDs (radio frequency ID) and all of these will mature and be able to provide the next generation of experiences. And to enable consumer devices in-store for every consumer.

I think brands will continue to invest in-store because that’s what defines your brand today, whether or not you’ve moved to the next level or not. In order to identify with those brands, you will have to go digital. Slowly, but surely, I think in the next 4-5 years, it’s going to certainly mature. Every store is going to have a better payment method, better traction on security, operations and infrastructure. Those three things are going to mature.

It’s almost like the Internet, but now it’s a given. In the next 4-5 years, all these experiences will be a given.

Q: How are retailers feeling about their in-store strategy right now ?

A: It’s all over the map. Retailers like Nordstrom and Marks and Spencer are already creating or defining the next generation of experiences and where the market is going to next. And then there are retailers that embarked on the journey and invested in the last couple of years so they’re working toward maturity of their kiosks, digital displays, and focusing a lot on marketing coupons to their customers.

Then, there are retailers who are so confused by all of this that they don’t know what to do. I’m surprised, but even in today’s day and age, I do find retailers struggling, trying to figure out what to do because they know they’re too late into the market, so they don’t want to go with a “me too” strategy. There is still a large segment of the market that truly needs help in digitizing their journey.

Q: If a retailer decides they want to digitize their brick and mortar store, how should they approach the strategy if they don’t know what to do?

A: I think they need to truly look at and analyze the data. Figure out what your consumers are looking for and what does your digital consumer journey look like. So if you have a dot com, do you have an effective mobile site?

The reality is that around 90% of US sales are happening in brick and mortar stores.

How well you execute your marketing campaigns across multiple channels determines how well you drive foot traffic to your stores. Once you’ve optimized on that end, then how do you provide continuity, in the experience in-store, and how to use the digital devices or experiences?  So, that’s one lens of it, which is the user journey.

For some retailers, it might not even make sense to invest in, depending on how far behind you are. They might leap into mobile phone as an in-store device.

Then, put a lens on technology and ask, how much can my technology support?

And then from an operational standpoint, how ready am I? Am I staffed enough to bring it in? I think the focus on these two or three challenges will help you decide what should you be doing. Majority of retailers are already going through re-platforming for this very reason, or soon will be doing it if not so already.

If you want to learn more about digitizing your brick and mortar and providing stellar in-store experiences, schedule a strategy meeting with us.

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