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5 Ways Retailers Are Using Technology to Rethink In-Store Shopping

Aug. 23, 2016
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Many brick-and-mortar stores are watching their profits slowly crumble to the ground, thanks to the internet. With the ease of online shopping and fast, free shipping from subscription services like Amazon Prime and Wal-Mart’s ShippingPass, some consumers are shying away from physical retail locations.

Shoppers prefer stores to the web for now, but online shopping is growing at a fast pace. E-commerce sales jumped 15.5% in the first quarter of 2016 compared with a year earlier, while total retail sales increased by only 2.2% during that time, according to the U.S. Department of Commerce. Some companies are shutting down branches due to lack of profit. Kmart and Sears are in the process of closing 78 locations, and Macy’s recently announced plans to close about 100 stores.

But retailers are finding creative ways to make in-store shopping more enticing and prevent it from becoming obsolete.

“There’s no store customer or e-commerce customer, there’s just customers, and customers shop increasingly as they want,” says Dan Evans Jr., Nordstrom’s business public relations director. “For us to grow and evolve as a company, we need to have a real sense of urgency around staying relevant.”

Retailers know that relevance revolves around technology these days. That’s why many have taken steps to become more up-to-date. Here’s a look at some of their tactics, how they work to your advantage and where they fall short.

1. Interactive kiosks

Retailers are attempting to turn stores into more engaging spaces by incorporating elements of the online shopping experience, including screens that mimic smartphones and computers.

Macy’s has tested kiosks in some of its top-performing department stores, including those at Easton Town Center in Columbus, Ohio, and New York’s Herald Square. These touch-screen centers perform a range of duties, from completing in-store pickups to providing tourism information. Kiosks can be helpful if you can’t find a sales associate or if you’d rather shop solo.

The benefits: You can browse through merchandise and information and potentially complete transactions by yourself. And there’ll likely be no line, so you can get in and out of the store quickly.

The drawbacks: In many ways, this experience is no better than shopping online — except, of course, you don’t get to sit on the couch in your pajamas.

2. Creating a cell phone haven

Companies hope that if mobile users’ needs are met, they’ll spend more time — and money — in stores. Gap, Old Navy and Banana Republic offer free Wi-Fi to shoppers. So do the Apple Store and Target.

But Wi-Fi is no good unless your mobile device is charged enough to use it. Some businesses have you covered there, too. Through its partnership with ChargeItSpot, Neiman Marcus has installed phone-charging stations in a majority of its stores; customers can lock up their phones and charge them while they shop.

The benefits: With a full battery and access to Wi-Fi, you can compare prices, browse your favorite websites and check your social media feed without eating up your data.

The drawbacks: Retailers don’t always have the fastest internet connection. Plus, privacy is a concern. Is the network secure? Is the store collecting your data? Check the terms of use before you connect.

3. Apps and web tools

Almost every retailer now has its own free app that shoppers can use at home and in stores. American Eagle Outfitters, Nordstrom, J.C. Penney and Victoria’s Secret are just a few examples.

Apps can keep track of your coupons and rewards points at specific stores. With some, you can get reviews and more information about a product by scanning its bar code with your phone’s camera. If you’re in the store and an item is out of stock, these apps can tell you whether it’s available at other nearby locations.

Macy’s is taking mobile use a step further. At 10 locations, the department store is rolling out a browser web tool dubbed Macy’s On Call, which uses IBM’s artificial-intelligence platform Watson as an in-store guide for shoppers. Customers can ask for directions to a certain product or department, and they’ll get an answer on their phone.

The benefits: You’ll have all the resources you need at your fingertips. These tools make applying discounts and navigating the store more convenient.

The drawbacks: Apps take up storage space on your phone, so they might not be worth downloading if you’re an infrequent shopper. And whether you use an app or your browser, retailers can track your shopping behavior for marketing purposes.

4. Smart fitting rooms

At some stores, you’ll even find technology in the fitting rooms.

For example, some have mirrors that let you create a virtual catalog of sorts, featuring yourself as the model. High-end retailer Neiman Marcus has installed full-length “memory mirrors” at select locations, including San Francisco’s Union Square. You just need to enter your email address and create a PIN to use them. These mirrors are more like screens that use cameras to capture pictures and shoot 360-degree videos, so shoppers can get a complete view of the outfits they try on. Customers can also scroll through inventory and send the images to their email addresses or share them with friends for a second opinion.

Other places, like Bloomingdale’s, have tablets in their dressing rooms. These let customers find an item in another size or color or request help from an associate.

The benefits: Smart mirrors let you compare ensembles side by side, and because they “remember” the images, you won’t have to try on the same outfit multiple times. Tablets are a little less high-tech but still offer convenience.

The drawbacks: Again, security might be an issue. Stores have measures in place to protect your privacy, but they could be gathering data, and breaches do happen occasionally.

5. Mobile POS

It’s become commonplace for staff to get in on the digital action as well. Chains across the nation, including Lowe’s and Nordstrom, have staff members equipped with mobile point-of-sale devices such as iPhones or tablets. Using these, they can search for inventory, scan price tags, place orders or swipe your credit card when you’re ready to check out.

“Our hope is that we can use technology in a way that makes the experience a customer chooses as seamless as possible” says Evans, the Nordstrom public relations official.

The benefits: The mobile POS enables fast, one-on-one customer service. It’s almost like having a personal shopper; associates can help you find what you’re looking for online if the store is out of stock or bring the register to you so you don’t have to wait in line.

The drawbacks: You may feel pressured to transact, and the speedy checkout process means you’ll have less time to rethink your purchase.

Why shop in stores?

There’s no doubt that online shopping is convenient and efficient, but there are advantages to shopping in the physical world. Thanks to technological advances, you can shop smarter and more independently in stores than ever before, plus you still have the option to consult an employee if you need assistance. And you’ll get a truer sense of how an item looks, feels or fits in person than you will from a website.

As long as shops feel e-commerce sales breathing down their necks, you can expect that they’ll work harder to improve your experience.

Lauren Schwahn is a staff writer at NerdWallet, a personal finance website. Email: [email protected]. Twitter: @lauren_schwahn.