There are long-standing challenges when it comes to optimizing sales per square feet in retail stores. When the size of the store shrinks, there is greater pressure to make the sales experience memorable. Retailers want to optimize each section within the outlet to maximize every sale opportunity.
This explains why there is a gradual shift towards more experiential shop domain. This gives them more flexibility and scale, especially when working in competitive domains. Every edge factor is critical when it comes to store sale maximization.
Here are five things to watch out for in 2019 to up the sales factor:
- Gamification of experience (AR, VR)
A great way to optimize sales in standalone stores is by introducing technology at its core. When you think from the customer’s perspective, few important points get highlighted. Customers want more options, better service and sales staff who can help them make their final decision. Retailers are adopting a technology-first approach that will encompass these aspects.
It would be cool to implement AR experiences, such as in-store exploration, catalogue venturing, and try-on features. They increase retention and the time spent per sq. ft. Customers are more involved in the store and can have deeper interaction with the brand, which can extend its story to its target audience.
VR is another technology that offers multiplying return on investment. Analysts believe that it is the connecting string between online and offline integration as it connects the physical and imaginary world for customers. It’s also offers a surprise factor to delights customers as they walk into the store.
“AR and VR have been tested in retail for a while but have only been implemented in a limited way so far. However, this is expected to change as major supermarkets, department stores, fashion retailers and DIY stores look to roll out them for various purposes, from in-store navigation and virtual apparel trials to product demonstrations, games and interaction with virtual shop assistants,” said Andreas Olah, Digital Retail Analyst of GlobalData.
- Introduction of AI in retail
While both AR and VR are set to grow by over 70% within five years, there is greater adoption of AI in the retail domain. To really maximize sales per sq ft it is imperative that AI is adopted as a core experiential tool. Sales staff can also use it to review customer desires and become better trained. This optimizes their time spent on the sales floor as well. It reduces the brand’s acquisition cost, while refining their approach better towards experiential shops.
AI is also introduced with automated welcoming systems that brands are working with. These systems work with the app and welcome customers into the store. AI can then process millions of data points to display a preferred sale on the screen of the welcome floor. Research suggests that 53% of Indian retailers will be working with AI extensively in enhance sales on the floor. This technology is also making it easier to process customer insights.
- Data management for floor-optimization
Having the right data is critical when it comes to floor optimization. As soon as the customer picks up their preferred item, Big Data can be leveraged to understand their spending habits. Retailers can check the loyalty system to explore new deals that may excite them on a different level. These personalized deals can be triggered when the customer’s name is entered into the system of their purchase is reviewed.
Retailers can also offer real-time deals by informing staff members about the customer’s previous purchases. This helps in developing a one-to-one relationship customers based on the understanding of their spending habits and what products delight them.
- Automation for servicing
While automation has become a key factor in the Indian retail logistics sector, it is time to bring it to the customer and service stage as well. Retailers can automate customer-interface, as well as the delivery method and use it to as a core value centre to make the best use of the square footage.
Automation is also used to make the check-out process easier. Indian retailer Watasale created a unique store experience where shoppers can walk-out without paying cash. Retailers have to appoint limited service staff since automation takes care of all payment needs automatically.
“We are only looking at Big Data to get analytics about the product information and inventory. Right now, we have kept it open (where customers can pay later). Going further, we will have wallets where the customer will store a certain amount of money, which will get auto-debited once he/she leaves the store,” explained Rajesh Malamal, CMO, Watasale Kochi.
- Customer add-on services
From free Wi-Fi to customized playlists, retailers can undertake simple things from a technology perspective to make customers feel comfortable in the store and add to their shopping delight. The longer time they spend in the store, the more the space is optimized per hour.
When customers can browse around the store comfortably and in a pleasurable environment, they feel like visiting it repeatedly. It creates a relationship-driven experience that is defined by service rather than price. Retailers can also design a unique acquisition journey for the shopper by introducing add-ons from the time they enter the store, which will make them feel like a part of the overall brand.