The future of retailing: is it really all about technology?

I recently viewed the following slide deck (PSFK Future of Retailing Report 2011) and was struck by how the introduction focusses upon the human, the social – shopping as a social experience as much as an economic one, and yet the rest of the report focusses almost exclusively on the wonders of technology and the difference it will make to the shopping experience.  I believe that the report implies that by putting an array of technologies into the retail stores less staff will be needed and possibly these staff need to have less product knowledge because they will be able to access that information through handheld devices connected to the right systems.  Let’s just take a look at these assumptions.

Do you find that life is more complicated or less complicated?  Do you find that you are more time or less time?  Would you prefer to spend your time doing research, talking with your social network, evaluating options, find the right products and then making the purchase?  Do you do that voluntarily or out of necessity because either you do not trust retailers or find their staff to lack the product knowledge?  Do you do that for all product categories and before every single purchase?   Do you look forward to serving yourself through the website, the IVR and FAQ’s never encountering another human being at the company your are doing business with?  Can you really imagine turning up to the retail store, scanning in the bar codes, reading the reviews, reading how the product was manufactured, getting your friends opinions…..?  How long will that take?  Do you have the time?  Can you do that standing up in the store with lots of other shoppers jostling around?

What would it be like if you trust the retailers?  Retailers that stock products that you can trust – the quality is sound, they are fit for purpose; the products are appropriately priced; there are plenty of welcoming, helpful and knowledgeable staff who can and do help you with making the right choice including selecting the right products.  What if these staff are also enthusiastic about the products that they are selling?  Do you think some of that enthusiasm will rub off on you?

Allow me to share a personal story with you because I believe that it illustrates another perspective on why and how we shop in the retail stores.

I was handed an iphone 4 and told that I needed to get a protective cover for it – sound advice given that it is an expensive advice.  Yet, I had never owned an iphone and so did not know what kind of protective cover to get.  So I started by observing and noticed that different people had different covers and so I wondered which one would be right for me.  I even asked a couple of people for recommendations yet the recommendations landed as lukewarm to me so I lacked confidence on those recommendations.  Then I turned to the internet and there were all kinds of covers and all kinds of reviews.  At the end of this process I simply felt that I had wasted my time – too much choice, too many opinions and fundamentally I could not touch/feel/use the cover to see what it added to the weight, bulk and use of the iphone.  So what did I do?

As the retail centre was only five minutes walk I went shopping.  Where did I go?  Carphone Warehouse.  Why?  Probably because I have a mental map that says ‘independent advice’, ‘friendly in the past’ and ‘stocks lots of accessories’.   I walked over to the accessories section and started looking.  That did not help me because the signposting was poor – I simply could not find the iphone4 covers.  So I turned to the three people on the counter and asked them for help.  One young man stepped forward with enthusiasm.  He showed me the iphone covers and there was considerable choice.  So he asked me what I was looking for and I explained.  He then made his recommendation with conviction and enthusiasm yet he did not stop there.  Without asking he opened up the packaging, took out the cover and snapped it into place and invited me to feel it and use the phone.  I did and the cover did the job perfectly and it was reasonably priced as well.  So I thanked him for his help and bought the cover – all of this took less than five minutes; I had wasted some 3o+ minutes shopping online.

Insights into the shopping experience

There are some categories of products that we simply have to see, touch, hear, feel and experience in order to know if a particular product is right for us.   And this is where offline retailers have an advantage over etailers.

Sometimes it is really hard to choose because we have no prior experience and there are so many products to choose from.  This is where knowledgeable, enthusiastic, helpful staff can make all the difference: right there and then they can learn what you want and let you experience their recommendations.

There are occasions when you simply cannot wait a day or more to get your hands on stuff that you need.  Again this is where offline retailers have a great advantage because we can turn up and walk out with the stuff that we want when we exit the store – clearly not so for all products e.g. fridges, washing machines etc.

Convenience matters.  The fact that I could easily pop into the shopping centre made it that much more likely that I would do so when I needed to buy something quickly – on that day.

I enjoyed the human interaction with the young man that sorted out my problem for me / helped me find the right cover.  He is no longer just another face he is a human being to me: I know that he has an iphone, that it is white, that he had considered buying the cover he recommended to me but did not do so because it did not go with the colour of his iphone…… Put differently I was enriched by the social encounter (in the real world) which simply would not have occurred in the online world. And this social encounter matters to many people – the challenge is to get it right by retailers investing in the right people and the right number of people.

Conclusion

The basics of good retailing have not changed: location, merchandising, knowledgeable staff, great service, value for money….  Some retailers are suffering because on the whole many retailers have forgotten these fundamentals especially the human and social aspects of the shopping experience. Despite the lure of technology what really matters in the offline retail world is the human to human encounter:  the people that we meet in the stores, how helpful they are and how they make us feel about ourselves, our fellow human beings and the world that we live in.  The proper role of technology is to add to this hi-touch not to detract from it or to replace it.   I can imagine that there is a consultant or IT vendor out there selling the fact that with the right technology in place the retailers can dispense with their human staff: the customers will simply turn up and serve themselves or maybe robots will do the work of the human beings. To be in love with this dream is to be fundamentally mistaken about human beings and shopping.

Author: Maz Iqbal

Experienced management consultant living/working in Switzerland. View all posts by Maz Iqbal