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Born Online, These Tech Innovations Drive In-store Engagement

Experiential retail attempts to rekindle the spark in brand-consumer relationships that has flickered out in the e-commerce age. And stores are finding that many of the same technical innovations that drive online shopping can be applied to in-store shopping trips, engaging consumers before, during and after an in-store visit.

In a panel session at the Shoptalk conference in Las Vegas, the minds behind technology initiatives at Macy’s, Walmart China and Panera Bread discussed the ways digital tools have revamped their businesses.

The use of in-store technology alongside user-friendly (and Instagram-ready) installations transforms Macy’s into what Nata Dvir, EVP and general business manager of Macy’s beauty, calls a beauty destination.

The physical space is really important in beauty,” Dvir said. In 2018, Macy’s upgraded its stores nationwide with improved lighting and more areas that encourage consumers to interact with their favorite products, or to experiment with new ones. Dvir likened the Macy’s beauty space to a playground where consumers feel encouraged to have fun with the goods on display.

In the pop-up Sweet Shop at Macy’s Herald Square location, for example, mini- and travel-sized products are stashed in candy jars. Vanities and selfie stands encourage lots of photography, and it seems customers are happy to take part: the hashtag #MacysBeauty has over 50,000 images.

Macy’s will also be launching a new partnership with interactive display company Perch in select stores this May. The department store consistently holds around 50 percent of the department store fragrance marketshare, so the Perch partnership is strategic. Dvir said Perch extends the traditional perfume counter experience with a digitally-driven interface. In-store displays will guide consumers to specific fragrances based on their scent family preferences, and when customers pick up the bottles, the digital screen will provide information about the fragrance and brand.

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Macy’s isn’t the only brand taking heed of customers’ online shopping habits to change the in-store shopping experience. Mark Berinato, vice president of experience design at Panera Bread, explained that the same tools that work online—predictive analytics, gentle “nudges” toward recommended products—can work in a restaurant setting.

“Tech use needs to be about elevating the experience,” Berinato said. “Will consumers come back more often? Will they pay more?” Yes, he said, provided retailers are willing to go all-in on their tech offerings.

When Panera Bread originally started integrating technology into its restaurants, they were small kiosks, well out of the way of the order and checkout lines, Berinato said. Customers had a hard time locating and using them. Rather than treating the digital order kiosks like an inconvenience, Panera embraced them, locating digital menus in central hubs so customers could see them and order as soon as they walked in the door. That didn’t mean they got rid of the “analog method,” said Berinato.

“Customers want everything. There’s no such thing as an average customer,” Berinato said, explaining that tech hasn’t changed the way many customers order. Panera Bread locations have a digitized “fast lane,” but also a traditional line and ordering system for consumers who want to slow down, or just need time to mull over their orders. That way, said Berinato, Panera improves the value proposition for customers who want a quick experience with full customization and a friendly user interface—but not at the cost of customers who love Panera Bread for its cafe decor, comfort foods and signature fireplaces.

Meanwhile, at Walmart stores overseas, a relaxing experience isn’t the focal point of the company’s tech deployment. Convenience and agility are the focus instead, said Ben Hassing, SVP of e-commerce and technology at Walmart China. “We have over 400 hyper-markets,” the multi-level counterpart to the U.S. “supercenter” concept, Hassing said. “Our customers don’t want to wait, and they don’t want to be missing items.” That can be a challenge, Hassing continued, because some of Walmart China’s three-level stores have 50,000 SKUs.

To keep operations light, and to keep customers engaged with the store’s mobile apps, Walmart builds its apps and updates within Wechat, the combined social platform/mobile wallet that’s ubiquitous in China. The entire code base for the apps is only four megabytes, so when it’s time to upgrade or update it, consumers don’t need to wait on a large download or enable special permissions. China’s super-svelte Walmart app does plenty, though: a QR-code based payment system, a scan-and-go checkout tool, personalized digital couponing, and a geo-navigation system for finding items in stores. The app has been warmly welcomed. Hassing said its “breakneck” adoption rate netted 24 million unique users in eight months.

Hassing hopes the advancements in Walmart’s Chinese stores will improve customer-centric innovation globally. “Our main business pain point was not knowing who our customer is,” Hassing said. “We now have a relationship before the store, at the store and after the store with that customer. That’s a very powerful thing.”