Mall of the Future
Feb 2, 2010 3:16 PM, By Elaine Misonzhnik
What a shopping trip might look like a decade from now.
...SMS messaging—to drive consumers’ purchasing decisions, says Michael Becker, vice president of strategy with iLoop Mobile Inc., a San Jose, Calif.-based mobile marketing and content distribution firm.
Today, a retailer’s typical text messaging campaign might be a blanket strategy that offers a 20 percent discount to every subscriber in its mobile alerts program. But the text messages of today will eventually be replaced by more sophisticated campaigns geared toward individual shoppers, says Eric Holmen, president of SmartReply, an Irvine, Calif.-based mobile marketing provider. In the future, as retailers gather more sophisticated data and analytics on customers’ past purchases, they will target their sales strategies. Think of online services like Amazon.com and Netflix. Amazon generates lists of recommendations based on items previously browsed, purchased or placed on a user’s wish list. In addition, users can specify that certain items were for someone else, so those purchases can be excluded from the process that generates new recommendations. Similarly, Netflix allows users to rate the movies they’ve seen and then comes up with suggested rentals based on what users with similar reviews also liked.
A key step will be getting shoppers to enroll in retailer- or center-specific loyalty programs. Then, using these more sophisticated analytics, retailers will be able to offer discounts based on products a customer has tended to buy in the past, with savings dictated by the customer’s loyalty to the retailer in question, Holmen notes. Moreover, retail property owners could be part of this equation as well. Think of the same data crunched center-wide. If an owner could take data about all of a consumer’s purchases at a center, it could create bundles of offers geared to specific shoppers.
Holmen, for instance, typically buys a new pair of shoes at department store Nordstrom every 18 months. Because Nordstrom is a place he likes to shop, Holmen says he would opt to participate in its promotions program. As it stands, Holmen only buys shoes when the need strikes him. In a scenario where he’s part of a retailer or mall loyalty program, either Nordstrom or the center might be able to estimate when Holmen’s shoes are wearing down and send a reminder, enticing him with discounts on his favorite brand. Holmen might then have the choice of either completing the transaction online through his mobile device, or locating a nearby retail center with a Nordstrom that carries his preferred brand of shoes in his size.
In a more interactive campaign, if sensor-embedded advertisements detected Holmen’s mobile device at the mall, Nordstrom could text him while he was on site. Moreover, if associates at a Nordstrom store know that Holmen is coming by for shoes, they can gear their sales strategy based on Holmen’s purchase record. He sometimes buys a belt or two with his pair of shoes, he explains, so that would be the kind of product that might turn into an impulse purchase. The salespeople might then be able to further narrow down the list of items to tempt Holmen with by checking the amount of store credit on his account and the average price of belts he’s bought in the past.
In addition, the center hosting the Nordstrom might be able to utilize smartphone apps to help Holmen plan his shopping route in advance and make the shopping experience as hassle-free as possible.
Thinking ahead
The management at the Mall of America, the nation’s largest retail and entertainment complex in Bloomington, Minn., envisions a day when shoppers could use mobile devices to get customer service in a matter of seconds. They will gain access to real-time parking information, have the ability to draw a direct route through all the stores they’d like to visit, buy tickets for the mall’s amusement rides in advance and send immediate notification to the center’s staff in case of emergency—for example, if they lost track of their child and need help, says Dan Gasper, director of public relations with the Mall of America.
During the 2009 holiday season, the Mall of America was already using its Twitter account to send shoppers regular updates about the parking situation, including the best ramps to park at and which roads to take to avoid traffic. The service proved so successful that going forward, Mall of America will provide Twitter parking updates on Saturdays and holiday weekends year-round.
Click for larger image
Mall of America’s marketing team also hopes that eventually smartphone apps will help them drive traffic to their stores. For example, when customers focus their smartphone camera on a poster in the mall’s common area announcing the arrival of a new tenant, it will immediately take them to the retailer’s Web site, so they gain a sense of what that store is all about, says Bridget Jewell, a public relations coordinator with the Mall of America. Mall of America is already in discussions with several smartphone application developers about ways to improve customer service.
“It could change the whole shopping experience by making it more coordinated with who I am,” says Holmen. “You can have a shopping route planned out and find the best values for you before you even get out of the car.”
Some smartphone-oriented personalized sales techniques are already in the early stages of development. For example, in November, Swedish furniture seller IKEA launched an augmented reality application for its PS furniture collection that allows shoppers to take photos of various pieces of furniture within the collection with their smartphones and superimpose them on photos of their rooms at home to see how well the items fit in.
Meanwhile, a recent iPhone application contest organized by mobile ad exchange network Mobclix and apparel retailer Gap Inc. yielded Gap4Me, an application that allows shoppers to browse through Gap’s current merchandise selection and superimpose the clothes on a photo of themselves to get a sense of how they would look and whether various items would create a cohesive outfit. The application, which helps shoppers cut the amount of time they spend browsing in the store, won the People’s Choice Award. The grand prize went to Gap app, developed by IntuApps, a New York-based technology and marketing firm. That application helps shoppers locate nearby Gap stores and browse the merchandise on iPhones, giving them the option of forwarding photos of items they like to their friends and even providing a selection of background music to simulate a real-life Gap shopping experience.
In the future, augmented reality applications will likely go a step or two further, to the point where customers might be able to perfect fits without ever needing to visit actual dressing rooms. This fall, interactive marketing agency Zugara rolled-out Fashionista, an application that allows shoppers to upload images of themselves using a Webcam, then superimpose different clothes on their digital bodies. They can share the images with their friends on Facebook or with other shoppers on the Zugara site, to get outside opinions on the outfits before they click the “Buy” button. At some point in the future, “I wouldn’t be surprised to see virtual sizing rooms, and then you have that product delivered to you,” says Lisy.
Click for larger image
In fact, this might solve retailers’ current woes in ordering merchandise—stores lose money when they fail to sell all of their stock at the list price, but keeping inventory levels too low can drive away shoppers. The ability to size customers virtually and then make customized merchandise orders once they’ve paid for their purchase would solve that problem. It would also limit the amount of inventory each store would have to carry, turning many retail spaces into showrooms, some experts predict. Customers will come in to touch and feel the merchandise, get sized if necessary, then place orders through the retailer’s online or mobile channel.
“The role of brick and mortar stores might [change to] function as an old-fashioned showroom,” says Underhill. “When you look at the Sears catalog showroom of the 1960’s, you’d go visit the showroom, but then call-in the order.”
New configurations
All this would have deep implications for store sizes and layouts. Retailers will need less storage and display space with streamlined supplies of merchandise carried on hand. There are already some retailers who operate based on the showroom model, including consumer electronics seller Apple. Apple’s wildly successful stores allow customers to test-drive its products before they make a purchase. They also keep a trained army of store associates and “Geniuses” to dole out technical advice. Inventory clutter in the sales area is kept to a minimum.
Retailers should also eventually be able to use face recognition technology to market products to every shopper directly, notes Holmen. In the not so distant future it might be possible for retailers to install LCD screens in their storefronts that will recognize customers through a signal on their mobile device and beam a digital image of that customer wearing items from the Gap’s latest line. It will be much like a scene in...Continue reading on next page
Next page
Acceptable Use Policy blog comments powered by Disqus
