Article

Embracing big data, technology and omni-channel operations to enhance the customer experience

The retail world today is epitomized by near-global access to the Internet and speedy adoption rates of smartphones.

August 19, 2014

By Steve Jones, Managing Director, Project and Development Services, JLL

Mandated by the tireless pursuit of "enhancing the customer experience," the retail industry is changing rapidly — perhaps more so in the last several years than at any other time.

The retail world today is epitomized by near-global access to the Internet and speedy adoption rates of smartphones. It is forcing savvy retailers to create a brick-and-mortar shopping experience that rivals the convenience and immediacy of the Internet, but delivers an experience that cannot be matched online.

Enhancing the retail customer experience requires change — a changed mindset, a changed direction and, more often than not, a changed or renovated physical environment. Shaping how retailers devise and execute such a plan, and ultimately succeed or fail, are how they embrace the roles of big data and technology, and their ability to create an omni-channel platform.

The role of data

Consider the following: more than 95 percent of purchases continue to be made in stores (in spite of a rapidly growing Internet commerce industry). Further, according to a survey by IPSOS, almost 60 percent of people prefer to make their purchases in stores.

At face value, these statistics bode well for retailers whose revenues are primarily derived from bricks and mortar stores. At the same time, however, savvy retailers understand that purchasing trends and buying habits can turn on a dime. As a result, it has never been more important for retailers to focus on enhancing the customer experience. The ultimate objective is to keep customers, and their wallets, coming back by providing them something that simply cannot come from the internet.

Retailers must leverage big data — standard demographic and shopping data — to better understand the marketplace and their customers. Increasingly, retailers are learning that truly personalized experiences can only occur when customer information about behavior, history and whereabouts is gathered.

Collecting actionable data — through customer loyalty programs, point of sale data and online shopping behavior — enables retailers to implement dynamic browsing, customized displays, personalized recommendations and shopper-specific discounts. This data will result in greater alignment between a retailer’s brick and mortar locations and their customers.

Food Lion collected data that revealed that the grocer’s customers were increasingly focused on produce. Based on that finding, and understanding of the loyalty that could be further established with its customers, Food Lion wasted no time renovating its stores to better position its produce offerings and, in the process, enhance its customer experience.

For retailers, collecting, interpreting and better understanding big data can enhance the customer experience and ultimately maximize return on investment of store renovations with modified layouts, in-store kiosks, virtual walls, virtual dressing rooms, augmented reality and new product offerings.

Using the right technology

For many customers, using technology in retail stores is exciting and captivating. Retailers are fighting to gain and keep consumers’ attention, but interactive experiences rooted in technology can help combat disengagement. Tablets and smartphones, for example, can be used to promote convenience (taking customer payments rather than making them wait in line), demonstrate product features, offer more item options and encourage social sharing. Additionally, the use of large displays purposefully engross customers, making it easy to forget they’re inside a store.

Creating an omni-channel experience

Building an omni-channel experience typically means merging or integrating at-home, in-store and mobile commerce into one seamless experience. Customers want the continuity and the convenience that it provides.

AMC, the national chain of more than 350 movie theaters, took their customer experience to a new level by embracing the omni-channel experience. As part of their overall strategy, AMC implemented programs where guests could purchase tickets and even reserve seats online.

This worked hand-in-hand with AMC’s strategy to bring movie-goers back to the theater, particularly in locations that needed to be refreshed. AMC installed home theater seats and updated food and beverage services. The omni-channel experience of buying tickets online translates to a brick-and-mortar customer experience unrivaled in the entertainment industry. In fact, AMC sells more tickets with fewer seats — to sold-out audiences.

Customer experience is individual to each retailer and the clients they target. It’s crucial for retailers to ask the right questions and understand the role big data, technology and the omni-channel experience play in their overarching strategy so the appropriate renovations programs can be developed to enhance that experience.

Steve Jones is Managing Director and Lead of JLL’s Project and Development Services Multi-Site group. He can be reached at steve.jones@am.jll.com. (Photo by Paul Swansen.)