Syncing The Digital With Reality The game is no longer e-commerce vs. brick and mortar; it is store vs. store.

By Nitin Kaushal

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When e-commerce platforms like Flipkart and Amazon hit the Indian market, brick and mortar companies started to wipe cold sweat. Online shopping was starting out with a mean purpose, and it looked like it wasn't going to go anywhere. Malls shut down, bookstores suffered, while all online stores saw business booming.

But fast track a few years into the retail revolution, and it became clear that the repercussions weren't as apocalyptic as we'd initially assumed them to be. Shopping, after all, is an experience online stores simply cannot offer. There is a convenience in walking down to a nearby supermarket to get groceries for the cake you need to bake in the next hour. There is leisure in strolling around with your cart looking for new products you can try, there is simplicity in reading through the fine print behind a box, before buying it all on a lazy Sunday with your family. Online shopping can get you suggestions and reviews, but they can never give out the retail therapy that brick and mortar stores deliver. E-commerce platforms are certainly booming individually, but as retail channels, they don't hold a candle to the excess of consumers who prefer to just drive to the nearest mall and buy what they see.

As polarized as digital platforms and brick and mortar stores were, retailers soon realized that technology didn't have to be their enemy. Muttering "Amazon" in a Landmark store while grunting at the inconvenience of searching for books will certainly get you looks from the dark side, but it won't exactly make you wrong. As brick and mortar retailers, the convenience of digital platforms is not something they should overlook, and the rumbles of customers impatiently searching for products is not an experience they should endorse. Harnessing the power of technology, as clichéd as it sounds, can always make the physical retail experience far more accessible, leading of course to wider possibilities of sales growth, repeat customers, and popularity.

For physical retailers, digital data collection and analysis can open entirely new doors, and ensure the best results in the form of customer satisfaction, loyalty, and relationships. Instead of relying on more traditional methods of marketing, retailers can keep digital signatures of their customers, analyze their behavior and feedback to base all their products and marketing pitches on calculated data and actionable insights.

One of the more exciting possibilities today is to accurately analyze foot movement and customer traffic across the store to measure conversion ratio, sales and marketing effectiveness, while strategically creating in-store heat maps, ensuring maximum visibility of the product. Artificial intelligence (AI) makes this possible at a fraction of what it used to cost to gather such data. Accurate footfall analysis allows offline functions of brands to take a more informed and strategic approach to selling. By correlating the data to optimize their stores, whether it's in terms of staff or products, allows for smarter marketing, and consequently would lead to better store conversion ratios. In-store AIs are advantageous, as their proactive actions and didactic learning ensure realtime data collection and analysis, as well as their recommendations and suggestions which are directly accessible to both retailers and customers. Not only do these strategies enable additional sales, but well used and analyzed data can drastically improve the satisfaction of customers, who are getting exactly what they demand in the form of highly personalized experiences.

Related: Follow The Leader: Patrick Chalhoub, Co-CEO, Chalhoub Group

AI is particularly useful for curating an experience, the possibilities of which are almost endless: beacon features used by physical retailers such as Amazon Go are incredible examples, and interactive kiosks, virtual and augmented reality, as well as locationbased services, are only some of the innovative experiences that a tech-enhanced reality can offer. Technology can creatively wipe off some of the frustrating aspects of brick and mortar retail, such as the unavailability of the exact aspects of the product, the time spent hunting for the right product and the decision-making process that is often limited or impaired by lack of time or resource.

The offline Chinese grocery market, for example, was almost completely devoid of innovative customer service. But Alibaba's grocery retail venture Hema created a game-changing paradigm shift with its blend of online and offline experiences. Across its 25 supermarkets, each Hema has an online catalog for its in-store meat products for customers to use to check the product's history, nutritional value, and sourcing. They can use the stamped barcode to check out their items through the store, while online customers can expect a delivery of same to their homes in 30 minutes.

It is becoming increasingly clear that the competing ecommerce and brick and mortar retail work far better when they are in sync. Not only can technology profile the average customer requirements for more inclusive store stocks; retailers such as Abercrombie and Fitch actually use it to let customers view and buy online or offline products while at the store. Customers almost always arrive with a notion of having multiple choices and chains to buy from and ensuring a smooth selection and buying process is vital to the store. Chains like Abercrombie and Fitch have accomplished this by presenting the customer with an "endless aisle" of products, cataloged online, and without the restraints of space, but available at the customers notice in an offline channel. For intelligent technology in physical retail, the sky's the limit.

The fusion of e-commerce and in-store platforms means a heavier load on the brick and mortar system. While the gains from higher sales are certainly tempting, it's also necessary to remember that it comes at an excessive cost, mostly based on managing the orders coming through various channels. None of the advantages resulting from an online inclusive experience would be possible without high end and advanced methods of order management. Creating such systems are vital to the success of brick and mortar ventures into the digital realm, as they enable easier inventory organization as well. The end results in a smooth, seamless experience that is a blend of digital retail in a very physical experience– limitless in its possibilities and stalled only by the imagination. The synchronization of e-commerce platforms and brick and mortar retailers only works when they aren't disjointed rival stores. Technology belongs to everyone in the new field, and it has leveled out the competition grounds between the polarized channel's stores. E-commerce stores scramble for exclusive deals to attract more customers, while brick and mortar stores run on loyalty, intelligent market pitches and a personalized customer experience. The entrance of interactive digital technology has given retail stores the stepping ground to come to blows with their online competitors. The game is no longer e-commerce vs. brick and mortar; it is store vs. store, and that depends completely on which one utilizes its unique force the best.

Related: Redefining Retail: Elabelz Founder And CEO Nooruldeen Agha On His Latest Venture, ST-YL

Wavy Line
Nitin Kaushal

President and General Manager at EMEA at Capillary Technologies

Nitin Kaushal is President and General Manager – EMEA at Capillary Technologies.

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