For online retailers, the majority of profit comes during the holiday season, which makes selling – and selling well – all the more important. But Christmas is changing. The retail sector is undergoing huge shifts in the digital realm, which makes the end-of-year rush an excellent litmus test for determining which companies are doing things right – and identifying those that are falling behind.

For most, the preparation for Christmas begins as early as July or August. But for the savvy digital business, getting ready for the end of the year isn’t just a rush job; it’s something they should have baked into their business plan. Savvy businesses should be considering the following trends when making their next move.

1. Automated stores

The future of the store is one with fewer offline sites, but more experienced staff. Retail is increasingly adopting an automated model in which customers are serviced by stores with minimal staff disruption. So what’s taking their place? Technology. The typical example here is the Seattle-based fashion store, Hointer. The concept is unique – customers pick which pair of jeans they want to try, and automated mechanical systems takes the clothing to a dressing room.

While in there, the customer can even request another size and have them automatically delivered – saving the awkward redressing and going in search of the right size. Stores are experiences – allowing customers to do as much as they can themselves will only empower them.

2. In-store technology

Retailers are increasingly using tablets and other touch-input tech to allow customers to find more products themselves. Local retailers such as Country Road have been developing this tech on their own, while David Jones and online retailer Shoes of Prey have teamed up to allow customers to use tablets in a dedicated space. No doubt facilities such as these will be popular tools come the Christmas rush, to avoid standing in queues and the endless aisle trek.

3. Interactive buying opportunities

Beyond stores, many retailers are taking every opportunity they can to get in front of customers –  including merchandising through videos. There have been some experiments in this area, including a music video produced by Canadian retailer SSSense last year, which through interactive hotspot technology, ensured that every item featured in the video could be purchased by the viewer right then and there.

The use of these in-built annotations tool to point viewers to products consistently will become much more common as businesses work on capitalising on these types of multimedia.

Sssense is capitalising on the popularity of video and music, by bringing it together with e-commerce.

4. Stores are downsizing

Retail has been downsizing for the past several years now, with the collapse of large-scale businesses in the fashion and book industries underlining the perilousness of holding on to massive floor space. But it’s not just about cutting down – businesses are actively designing their offerings around a smaller footprint. Pop-up shops are some of the most popular businesses around. The modern retail trend isn’t about simply cutting square footage – it’s about designing the store to maximise the available space and cater to the customer. The notion of the popup store is also evolving beyond the physical to the digital realm, where curation is a customer’s dream. Kicked off by daily deals and group buying sites, the demand for sites such as Fab.com and to be launched Australian site Lodie is ever-increasing.

5. The digital staff member

While more common in the fashion industry, this trend has seen businesses install different types of tech to empower the customer. The most common use is the installation of interactive screens in the store for customers to help themselves. Already in Australia companies such as Sportsgirl have experimented with this type of interface, allowing customers to share a picture of themselves in a new outfit on social media. Apart from being a useful tool, this technology allows businesses to get their own brand on social networks – a must for the Christmas period.

6. Target marketing

While the value of email marketing is constantly debated, research including studies from the Australian Media and Communications Authority show it to be the most popular digital marketing method. However most businesses still aren’t using it right.

The increasing popularisation of ‘big data’ means businesses are drilling down into email marketing demographics. By changing up offers and even minute details such as subject lines based on customer purchase history and browsing patterns, can guarantee a better return through this channel.

The target is getting that open rate up. During the 2012 American presidential race, the Barack Obama campaign achieved huge success in targeting specific users with even superficial changes in email subject lines – there’s no reason the same can’t be achieved in a retail environment.

 

Contributor

John Riccio

John is PwC Australia’s Design & Deploy, Experience Consulting partner.

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