The rapid advancement of technology continues to radically change the way that we engage with the world, and one of the frontiers of the digital revolution is how we shop.
In the past, going shopping was an unavoidable part of life. However, armed with my smartphone and a credit card, I am able to buy groceries, order a new charging cable for my phone, send my mother flowers for her birthday, and have dinner delivered without leaving my desk.
Buying power is shifting to the millennial generation who, having grown up in a connected world, are very different to our parents. Traditional marketing strategies that have worked for decades are suddenly becoming irrelevant as the variables that inform consumer behaviour have shifted beyond the imaginations of even the best analysts in little over two decades. It has, therefore, never been more important for retailers, in both the digital and physical markets, to analyse their customers’ priorities and expectation, and tailor their marketing and products accordingly. While some might argue that online retailers hold all of the cards in our ever digitising world, advanced AV technology is proving to be a huge leveller for physical retailers the world over.
THE EXPERIENCE ECONOMY
In the early 2000s, some analysis grossly overestimated the impact that online shopping would have on the brick-and-mortar retail industry. While more and more people are turning to their browsers to find the products and services that they need, people still want to goshopping.
When predictions were made about an impending mass-migration from shopping malls to online stores, the unpredictable impact that social media would have on people’s buying behaviour could not be factored into the equation. According to KPMG’s Global Retail Trends Report 2019, new figures show consumers continue to spend less on buying things, and more on doing things – hence the rise of the experience economy.
Today, there are more than 2.56 billion social media users globally, and nearly every one of them is deeply invested in sharing their lived experiences online, be it the food that they are eating, the concert they are attending, or an amazing experience at a concept store. By creating a more immersive experience, retailers can drive people to their stores and ensure they leave not just with products but also memories.
Regional Director South Africa at Crestron EMEA, Rupert Denoon, shares a first-hand account of the impact that the experience economy is having on the retail sector in the US, and how South African retailers can use advanced AV technology to catch up. We then take a look at the concept store recently launched by a fine jewellery brand, James Allen, in the US, which takes maximum advantage of AV technology to create an unforgettable experience for visitors.
DEEP RETAIL
Every customer with a smartphone is a source of data, and the e-commerce market successfully uses this data to gain a competitive edge over traditional retailers. Deep retail is described by KPMG as “the use of profound learning about customers, to allow for retailers to develop personalised, tailored shopping experiences, products and services.” The use of deep retail in targeted marketing has resulted in online retailers knowing what their customers want, even before they know it themselves. The result is that today’s consumers expect an exceptionally personal level of service, and a highly tailored experience, and don’t want to have to wander aimlessly through a store searching for products.
Bruce Genricks, managing director at Electrosonic SA, shares his thoughts about how Smart Digital Signage in brick-and-mortar retail stores can level the playing fields, allowing traditional retailers to use facial recognition and data analytics software for target marketing in a physical location.
DISRUPTING THE DISRUPTORS
Traditional retailers are under increasing pressure to change the way that they engage with customers to fulfil their rapidly evolving needs. As pointed out by Brad Grimes, senior director of communications at AVIXA, “More than ever before, today’s’ retailers are leveraging immersive audiovisual and digital technology to infuse their brick-and-mortar stores with innovative design and cutting-edge functionality, which is fuelling a new growth-wave.” AV technology, including video walls, digital signage solutions, immersive sound, artificial intelligence, data-driven marketing enabled through smart signage, augmented and virtual reality, have proven to be the bricks that retailers need to build the experience-based offerings that today’s consumers crave. While South Africa remains behind the majority of developed economies in terms of e-commerce versus traditional retail sales, the pressure is on the physical retail market to adapt pre-emptively, before it loses its grip on the rapidly evolving South African consumer.
