Retailers Go Digital to Enhance In-Store Experience

While digital technology has revolutionized how we use the Internet, television and cell phones, it is increasingly playing an important role in the way retailers attract customers to their stores.

Last month we reported on two interesting developments in Japan — DeBeers' 3D store windows and Minority Report-style two-way billboards being tested in Tokyo — but that's just the tip of the digital iceberg.

Retailers are incorporating a wide range of digital interactive technologies into the store experience, believing that consumers are looking for engaging experiences that resemble what they can achieve online. Some of these technologies, such as the virtual mirror (above) being tested by L'Oreal, are beginning to pay off the promise of virtual reality.

The Wall Street Journal reports that Interpublic, the advertising holding company, is testing retail enhancements including interactive dressing room mirrors, shopping carts and scanners that offer personalized discounts, and kiosks that offer assistance from virtual service specialists.

The company's Media Lab has studied more than 10,000 North American shoppers and found that satisfaction with retail stores is declining as much as 15% annually. As a result, Interpublic and other marketing companies are looking at ways "for marketers to connect with customers as part of an effort to better understand what makes consumers buy and to encourage companies to rethink their approaches to the role of the retail store."

Retailers are taking a lesson from online shopping, which brings interactivity and ease of ordering, along with a vast amount of information about products, to a shopper's computer or smartphone. More and more, the retail store needs to compete more effectively with the online world.

That's why J.C. Penney has introduced a 52-inch touch screen at select stores called "Find More." The smart fixture allows shoppers to see additional merchandise, scan a bar code to get product details, access recommendations, or email data about an item of interest to themselves or friends.

L'Oreal's "virtual mirror" kiosk (created by IBM and EZFace) in the UK uses augmented reality. It takes a picture of a shopper and then allows her to "apply" makeup, taking into consideration such things as skin tone, facial features, and product color. The mirror can make recommendations and allow the consumer to share a virtual makeover image with friends via an Internet connection.

The Limited is evaluating interactive mirrors for select stores within the next six months. The mirrors would advise shoppers on what pieces of clothing go together, show them the item in different colors, and transmit images to the shopper's Facebook profile to solicit friends' opinions.

Unilever's "Share Happy" interactive ice cream machine engages consumers with visual trickery: it asks them to smile, and rewards them with a free ice cream.

Location-based services like Foursquare, Gowalla, and Facebook's new Places app make it possible for consumers to "check in" with friends from stores and to receive special offers when they visit local establishments. Emerging mobile applications like Shopkick allow retailers to know when a customer physically enters a particular store, not only when they make a purchase.

Brand marketers and retailers are cooperating to test and implement forward-thinking technologies because they want to keep consumers coming back to the stores. "Faced with increasing fragmentation in traditional media," says the Journal, "marketers hope to connect with consumers when they are in a place where they can make a purchase immediately."

So get ready for the store of tomorrow — one in which digitally-assisted shopping will be commonplace. If retailers have their way, just such a store could be right around the corner.