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COVER: 5 applications you should be using but aren't

Want to improve the customer experience, drive revenue and cut costs? The cool innovations can help

February 12, 2009

In retail, as in business in general, there are always more available options and ideas than there are resources to pursue them. This is doubly true for technology investment, which can eat up a budget quickly if left unchecked. Even so, there are a handful of such applications that today's savvy retailer may be ignoring at his own peril. Here are five tools and technologies your stores should be using — today.

Thoroughly integrated multichannel

Perhaps more than anything else, today's retailer needs to present a unified front across all channels. But saying that is a bit like saying you should always eat right and exercise — considerably easier said than done.

"Adoption of cross-channel solutions has been slow, largely due to previous lack of foresight on the part of retailers with regard to e-commerce," said Irwin Kramer, CEO of iCongo, which manufactures a handheld device that helps retailers manage their supply chain. "Originally, many retailers developed their online storefronts with little consideration for future inventory integration and channel interaction." Proper multichannel integration is tough, and it can be expensive since it touches so many different parts of the enterprise and so many different data sets.

"There are some retailers that still have a way to go, and this is something that is becoming so critical," said IBM business line executive Norma Wolcott. "The lines are really coming down between physical stores, mobile devices — whether it be a BlackBerry or a cell phone or an employee handheld device — and then, of course, the Web at home," she said. "It isn't three different experiences. It is one experience where I happen to be using a different touchpoint. Retailers really have to begin to view that as the entire retail experience — not a store experience, not a Web experience."

Mobile retailing

Dovetailing with a proper multichannel approach is the ability to touch consumers at the mobile level. That interaction can take any number of forms, from mobile couponing to product information, from e-commerce in the store to mobile marketing.

"There are some retailers that sitll have a way to go, and this is something that is becomng so critical." — Norma Wolcott, IBM

"Mobile-based retail technologies are an excellent example of a technology that is available, but (that) retailers in the U.S. haven't yet adopted," said Valerie Christensen, B2B marketing communications rep with loyalty and affinity marketing firm Access Development. "As I see it, merchants will need to — and many already want to — leverage the mobile medium to reach people who are more on-the-go than ever before." Mobile marketing agency Sponge recently announced research showing that only one in five retailers has a microsite aimed at mobile browsers. That leaves the overwhelming majority of merchants with no user-friendly Web presence for mobile phones.

Beyond the Web, mobile devices are ideal for receiving marketing messages such as "m-coupons." Given the amount of data that can easily be collected from a mobile browser, those coupons can be targeted with pinpoint accuracy based on demographics, browsing or purchase history and previously collected survey data.

Video product tours

With multichannel becoming more important by the day, retailers need to understand that the store Web site often will be the point of first contact for a new customer. That not only places the onus on the designers to make the site as engaging and immersive as possible, but it also means that the product merchandising that takes place online needs to be just as dynamic and attention-grabbing as its in-store counterpart.

"Retailers are often overlooking one of the most compelling technologies to help them close the sale —

video product tours," said Rebecca Scanlan with SellPoint, a company that develops video tours for brands such

"Bricks-and-mortar retailers increasingly have to compete with the shopping experience that online players can deliver. This means experimenting with bringing more media, especially digital media, into their stores." — Christohper Vollmer, author of "Always On: Advertising, Marketing and Media in an Era of Consumer Control

as Panasonic, Dell and Sanyo. "They're particularly useful for complex products like electronics and toys." For shoppers, the video tour experience is often a seamless one, so much so that they don't separate it from the rest of the buying process. Many Amazon product pages, for instance, contain embedded video tours that allow the shopper to zoom in and out on the product and rotate it for a complete view — all within the Amazon page.

Interactive media at the end-cap

End-cap marketing and merchandising is a discipline as old as retail itself, but the dawn of digital media turns it on its ear. With so many purchase decisions made in the store — and with the changing consumer perception of the customer experience — the interactive, digital end-cap is becoming a force to be reckoned with.

"Retailers are not leveraging in-store media enough, especially where in-store

media can be tied in to on-shelf promotions and end-caps," said Christopher Vollmer, author of "Always On: Advertising, Marketing and Media in an Era of Consumer Control".

"Bricks-and-mortar retailers increasingly have to compete with the shopping experience that online players can

Cabela's was able to increase its SKU availability fivefold using product-recommendation kiosks.

deliver. This means experimenting with bringing more media, especially digital media, into their stores." Digital signage provider The Media Tile Co. has installed 200 brand-sponsored interactive end-caps into major sporting-goods retailers. The retailers have a reported 30-percent uplift in sales, sustained over a year since installation. Perhaps more impressive is the level of inventory extension — since these are "destination retailers" that hobbyists typically travel to visit once or twice a year, the brand uses the displays to push products from its entire multiseason product line, resulting in much larger per-visit sales.

Product-recommendation kiosks

Self-service in the aisles is an established concept that shoppers have wholeheartedly embraced, but much more can be done with the technology, specifically in the area of upselling and cross-promotion.

"While many retailers understand the need to provide personalized product recommendations to their customers' online shopping experience, only a few have taken steps to present them to consumers on in-store kiosks," said Lori Trahan, executive director of marketing and corporate communications for ChoiceStream. "Many retailers use in-store kiosks but haven't leveraged product recommendations to drive cross-sells and upsells to those profitable in-market shoppers." One retailer that has leveraged the technology is Borders, which separated from Amazon in early 2008 and launched a new Web presence of its own.

Concurrently, it launched an in-store kiosk program that brings the online experience into the store — and generates a massive database of customer information to boot. The program not only improves customer satisfaction, but it also allows Borders to chase the "long tail" of customers looking for very specific titles that might not be on the shelves.

Cabela's also has benefited from the technology. Using kiosks from KIOSK Information Systems, the specialty retailer is able to extend its SKU availability fivefold.

The kiosks contain video content for many items, including big-ticket items such as hunting rifles. Sales associates, which the company dubs Outfitters, use the devices to walk customers through products and features.

"Combining the Outfitters' expertise with interactive media delivered on the kiosk has been a very effective way for Cabela's to increase in-store sales with existing and distribution center inventory," said Cheryl Madeson of KIOSK.