The Changing Customer Experience, Part 2: New Trends in Retail

wallet in pocket


[Estimated read time: 7 minutes]

Shoppers are fickle, demanding, contradictory, and confusing, but you wouldn’t be in the retail biz if you didn’t love a challenge! There’s never a shortage of new advances and ideas for how to win the hearts and wallets of consumers, but do you know which ones are a good fit and which will leave you with buyer’s remorse?

Here are five trends in the retail customer experience you can’t afford to ignore:

1. The line between online and in-store is disappearing

When online shopping first became a real presence in the retail landscape, many feared it would be the death of the brick-and-mortar store. Instead, e-commerce is now being leveraged to improve the in-store experience, resulting in growth for both channels. Forrester predicts that cross-channel retail sales in the U.S. will reach $1.8 trillion by 2017.

As retailers increasingly embrace this new perspective, it’s becoming more difficult to distinguish between online and offline sales. So much so that the experts at Strategy& believe attributing revenue to online vs. in-store sales will soon become pointless: “Before long, that number may be of interest only to the accounting department, not to the retailer’s buyers, senior executives, and stockholders.”Click to Tweet

Continuing to make a clear distinction between online and in-store experiences is frustrating to customers, who want a seamless shopping journey, regardless of channel. At a minimum, consumers expect to be able to purchase an item online and pick it up or return it in the store. But they’re also starting to expect the same pricing and inventory on your website and in your store, and consistent answers from store associates and customer service agents.  

Macy’s, for example, allows customers to browse their local store’s inventory online. They can see what’s in stock, and purchase a product for immediate pick-up or same-day delivery. And with the store’s mobile app, customers can scan in-store product barcodes to access online reviews, promotions, and more.

2. Top pure-players are moving to a “click-and-mortar” model

Despite the always-growing popularity of e-commerce, it can never completely replace the in-store experience. Shoppers want the ability to see, touch, and try on merchandise. That’s why leading pure-play retailers – including Warby Parker, Birchbox, and ModCloth – have started opening physical stores.

And their experiments have been very successful: eyewear retailer Warby Parker has reported $3,000 in annual store sales per square foot, which is on par with Tiffany & Co.’s $2,953 and second only to Apple’s $4,568.

These evolved brands also discovered that opening a brick-and-mortar store gave their websites a boost in organic search traffic. In the first six months after opening its first store, Warby Parker saw a spike from 100,000 to almost 350,000, and it continues to grow.

3. Cutting-edge technology is enhancing the in-store experience

Eight out of 10 consumers use a computer, smartphone, or tablet while shopping, and odds are that technology is light-years ahead of what your employees are using. But that’s changing, as retailers are not just updating old POS systems, but shifting their priorities. With traditional registers, employees have been stuck behind the counter. Now, mobile devices put them on the floor where they can interact with customers, answer questions, and take payments on the spot.

That’s just the beginning, though. Retailers have started getting creative with these latest tech advances:


The MemoryMirror is a giant video screen and camera that allows customers to see themselves wearing an outfit from 360 degrees. The mirror remembers what customers have already tried on, so they can compare outfits side-by-side. Finally, they can record eight-second videos to share outfits with friends and family. Of importance to retailers is the opportunity to collect data about customer behaviors and preferences.

A couple years ago, Footlocker introduced a kiosk that allows shoppers to completely customize a pair of New Balance shoes (and they mean completely – all told, it offers 48 quadrillion possible combinations!). Now The Loop, a retail technology testing center, has version 2.0: its kiosk displays a hologram of a shoe that shoppers can customize using their smartphones.

Experts warn, though, that these augmented reality devices could backfire. As “The Retail Doctor” Bob Phibbs puts it, “The future of retail has to go further than just passing out iPads to save a clerk from checking the stockroom. It has to start with the customer. They left their home because they were craving a human-to-human experience, not a virtual reality experience.”

The big draw of physical stores is the ability to physically experience merchandise and get in-person advice – areas not usually associated with VR. Successful stores are using the technology to create a more personalized, social shopping experience, not automate tasks and reduce staffing costs.



Retailers are also turning to the Internet of Things (IoT) to up their game. With the ability to combine shoppers’ precise locations with data like purchase history and recent online product views, the IoT is having a huge effect on retail stores’ use of technology. A McKinsey study found that using IoT in retail could have an annual economic impact of $410 billion-$1.2 trillion by 2025.Click to Tweet

Today, Hugo Boss uses a network of heat sensors to record the traffic in each area of its store and decide where to place premium products. Other stores scan faces to determine age and gender, and track wifi signals from customers’ smartphones (even when they’re not in use) to monitor location and identify high-value shoppers.

4. On-demand purchasing is removing friction

Consumers want to take action now, before their attention is pulled somewhere else. They want instant gratification for minimal effort. And the retail industry is giving it to them.

Amazon Dash is a great example of this. Washing clothes and notice you’re almost out of detergent? You can literally hit a button and the detergent will show up on your doorstep in, at most, two business days. No more remembering for the five minutes before your shopping list is in front of you – in fact, no more shopping lists at all!

Social media, which excels at finding ways to keep the attention of the constantly-distracted public, is in the game now too. With Twitter’s “Buy Now” and Instagram’s “Shop Now” buttons, Facebook’s mobile storefront, and Pinterest’s buyable pins, consumers don’t have to leave the immersive world of social to purchase an advertised product.

CX Trends in Retail like this woman shopping over the phone

One company, Soldsie, has taken even more friction out of the process by allowing consumers to purchase items on Instagram and Facebook simply by commenting “Sold” on the post. They then get an email with an invoice for the item, which they have 24 hours to pay. Brands are seeing a 70% conversion rate, and 60% of the invoices are paid within a half hour. Instead of saving the item, making a note, sending themselves a text, or any of the other numerous ways shoppers try to keep track of items they want to purchase, they just have to type four letters and move on, leaving the remembering to someone else.

5. Fraud management is getting smarter

Preventing fraud in a omni-channel environment is an uphill battle. An action that seems harmless on one channel raises red flags when viewed in the context of multiple channels.

A lot of retailers are struggling with that reality. Only 46% have consolidated fraud management solutions across channels. Almost two-thirds say they don’t have the tools to effectively manage omni-channel fraud, while 54% don’t have the skilled staff. And fraud prevention continues to get more expensive.

Legacy fraud management techniques and tools can’t keep up in today’s world of fast-streaming, real-time data from an ever-growing number of sources. They weren’t created to understand the complexity of mobile commerce, and they require highly trained staff to maintain.

Companies are starting to turn to smart technology like machine learning, which makes decisions and intervenes in real-time, requires much less training and maintenance, and uses data and human feedback to improve its accuracy over time. In the long term, fraud prevention tools that incorporate machine learning cost 30-50% less to operate.

How Astute Can Help

Astute Solutions can assess your needs and design a customer experience that will have shoppers lining up at your doors. We’d love to hear from you to learn about your business and find out how we can help you succeed.