It has been a volatile year for the British high street. 2016 saw, at the beginning of June and in the wake of Brexit, footfall down 3.7 per cent on the year and one in ten stores lying empty. Over the past few weeks, however, brick and mortar stores have made a surprising comeback.
Defying expectations of a 5 per cent fall in shoppers, footfall in fact rose over 2 per cent on Black Friday, while online growth failed to meet expectations. Much of this is chalked up to the fact that savvy consumers are today looking to turn their shopping trip into an “experience”, relegating online shopping to the more functional, targeted items.
The act of entering a shop is something of a ritual. The physicality of a store cannot be replicated online, and it’s a key area where the brick and mortar retains an advantage over the digital. Being able to walk through a physical space, taking in a multi-sensory experience, is what makes shopping on the high street unique and important. New technologies will be the key to continue differentiating high-street and online shopping.
Studies have shown that 54 per cent of retailers worldwide with above-average sales understand that the use of the Internet of Things (IoT) is set to have a dramatic change on the way companies will operate and do business over the next three years. A third of businesses in the UK believe it is already having a major impact upon their business. Those IoT technologies – and the big-data analytics that work alongside them – can benefit retailers in a number of ways.
We have already begun to see retailers using video sensors to detect and count the number of people in a space, which can then feed this back to employees in real-time – even pushing alerts straight to their mobiles. Such technology can alert staff working in the back to the number of customers in a queue, or alert management to a customer who has strayed into an off-limits area.
Further to this, visual merchandising and store atmospherics have long been known to have a direct impact upon the customer and how much they spend. Chain Store Age set some hard facts on this topic back in 2004, stating that 63 per cent of consumers remember occasions when the store atmosphere caused them to buy more while almost half also spent money and more time in a store with the right atmosphere. However, despite this, the ability to track customer responses in the physical space has proved tricky.
Growth in areas such as facial tracking and machine learning mean that video technology can now automatically track a customer’s reaction to certain visual cues. Questions on which displays are holding people’s sight for the longest, which are eliciting a sigh versus a smile, and which get people picking up products can be answered with quantifiable, results-based metrics – and without a sales assistant lurking with a clipboard! The ability to respond to these messages is key to making the high-street a personalised experience worth leaving home for.
The IoT and the smart video space is developing at a rapid pace, but so are consumer habits. To understand these habits retailers must embrace the analytics now becoming available. The vast well of customer information previously thought unattainable is finally in reach, and all that is left is embracing the tools that will help incentivise consumers to leave their laptop at home and step onto the high street.
By Scott Brothers, Vice President of Corporate Development at Oncam
Read the original blog post on Think Big, Grow Fast’s website here.