Episode 16

This is a truly fantastic episode. For this discussion about in-store experience and retail efficiency, we invited both sides of the same coin to share their insights. The results are a packed session of how to effectively mesh together empathy and efficiency, sensory and experiential, authenticity and speed. 

Retail consultant, Ian Scott, joined Boran Cakir, retail optimization expert to unpack this hot topic. 

You will find so much more on the full episode (watch above or Spotify link below) but here is the summary: 

Q: How do sensory experiences provided by physical stores compared to those offered through digital channels? 

Ian: The store has three unique advantages that none of the digital channels do. The ability to touch and feel products, which is particularly beneficial in certain categories like being able to try on clothes, so I know that online returns is a real issue within the fashion sector. Food is probably one of the lowest engaged categories for digital sales. That ability to pick your own fresh fruit, for example. There's a lot of that when it comes to purchasing a product and checking it before, but then you do have that interaction opportunity as well.  

Beyond just that, you have human to human interaction. You can talk to a member of staff directly. I think particularly post COVID, we appreciated it more because we were denied it.  

The final thing is peripheral vision. If you go on a website or an app and you go to say the Nike store to look at the Air Max sneaker, there may be a few others recommended at the bottom, but you see that one thing. It's a very linear binary process.  

That's where the physical store has its unique advantages as compared to the digital channels. 

Boran: I'm a big believer in tech and operations in particular, but the physical operation of the omnichannel experience for customers is so important. The key thing that digital experiences bring is personalization. Which at the moment, physical stores need to improve on significantly.   

Ian: I often see that things like AI and other processes are brilliant for logistics back office, stock checking and things like that. I was in a decathlon store in Singapore last week and they have a robot that just goes around and scans all the shelves and just stop counting at the end of every day. This is great use of functional technology. 

At that face -to -face contact point there's some wonderful things that technology can do to help. Data gathering and personalization. You can recognize someone coming in a store, tailor messages based on previous buying history, which is really hard to do in an analog way.  

Boran: The other key element is the community building. There are a lot of retailers now that are trying to create better in -store experiences. Gymshark being a great example. There's a lot more now to offer in the store experience and the community building as well. It's not just in terms of the products that are on the shelf, but also that sense of community and really connecting with the brand, which the online side combined with the in -store side can really create a good sense of that. 

Ian: Gymshark is a great example of how they've evolved. They learnt very quickly about the uniqueness of the physical space, having understood digital so well and they built community there. I love how that store has evolved. I was quite critical when it first opened, but every time I visit, the interaction, the sense of community and the build-up is a great example of a brand that's really understanding what they're doing. They've created a physical touch point for something that has evolved online for years and been very successful. 

Boran: I think Amazon is a great example, right? And then moving into the physical space, how important actually is as part of the Omnichannel strategy. You can't just have a digital experience on its own. 

Ian: I find Amazon fascinating. They perfected convenience and availability online. They were the ones that upset delivery and we've now got people running around trying to deliver in 10 minutes, 15 minutes because they started doing next day delivery and that prompted people to try and outdo them.  

Their forays into physical stores are really quite interesting. They are very, still very binary and data driven in the way they do things. I think their most successful one is the fresh, just walk out technology, where it sort of exemplifies their convenience and availability offer.   

Q: How does the integration of omnichannel strategy create a more seamless and convenient shopping journey for customers? 

Boran: The key thing is about unifying the customer experience, right? Customers still to this day, regardless of the generation, want to have that tactile experience, feel and engage with the products. But now, ever than before, particularly with COVID as well, really accelerating the need for customers to go online, be able to see products, and then also then want to go into store. So there needs to be a better unification of how that works together.  

For example, having flexible options, you can buy online and then pick you up in store. You can have same day delivery for, for these customers, or you can go into the store and have an extension of the inventory, which I think retailers actually need to be much better at. It's not just everything that you see on the shelf, but the customer service representatives actually offering the customer even more so what they have in their catalog, which is, you know, going above and beyond.  

Apart from that, the integrated inventory is super important. A lot of times the issues faced is the inventory online and in store, the online members may not know exactly what's online and vice versa. You can't find online exactly what inventory levels are in store. The best businesses that can really have real inventory updates is super critical as well. And I think the last thing is the cross-channel personalization as well.  

Ian: The customer doesn't think in channels, but the problem is most businesses do. So, you'll have separate departments with their own spreadsheets and KPIs and budgets. You need simple things like same tone of voice, same product availability and same price. There may be the odd unique situation if a store is open and a competitor opens over literally opposite and they may need to be price sensitive to combat. 

But beyond that, a customer may get up on a Saturday morning and go, right, I'm going to go into town and go shopping and get out the app to check the price before they drive into town. Then they turn up and find it's 20 pounds more expensive in the store.  

One of the most important and beneficial parts of understanding the whole ecosystem of your availability and delivery, because the customer will keep buying from you. That's the most important thing. 

Q: In the race to optimize operations, are retailers compromising the authenticity and warmth of human interactions, do you feel? 

Boran: I still think in the early stages of adoption of JNI, AI in the retail space. It's still too early to say if retailers are compromising the authenticity and interactions. But if you ask me what the impact would be of the adoption for a field, if business were purely focused on bottom line improvements, then for sure, there's a great potential for compromise. For example, utilizing chatbots, automations as well can really make things for the customer feel like there's a lack of emotion, intelligence, and empathy as well, which is super important. In particular, from a store side and physical side of things. Then you've got a lesson in satisfying customer experience.   

There's only so much that a trained model can deliver. There's going to be these edge cases that arrive from time to time. However, bringing in such optimization though has its benefits. There's always seen from some businesses quicker and more accurate responses, which obviously leads to better customer experiences as well. You don't want to be waiting in a chat line for 10, 15 minutes if that question can be resolved much quicker. 

But the models need to be fine-tuned. It's not a one size fits all. Where at the moment, what you see like in Gen I landscape, especially for retail, is that solutions have been sold that may not be retail specific, but try to be adopted to retail as well. The key thing is balancing the efficiency and warmth. You need to have both. It's not a case where, you know, you completely ignore gen AI and don't focus on optimization in your operations. However, that human interaction also needs to be there as well.  

Ian: I find it really reassuring that someone who's launched a technology focused company is talking about that emotional intelligence and recognizing because my experience with chatbots has been eminently frustrating. When you simulate a human, you better be bloody good at it. The technology in human digital interaction with humans needs to support and enhance the human interaction with humans.   

Boran: There's been some use cases, right, where the AI starts to hallucinate and then give recommendations, actually, it's not even company policy as well, which then you can put yourself into legal issues, hence why it's good to test internally first of all and also like utilize it for your workforce because there's less risk in that sense. It's a case of training the model, it will get there, it's just a case of still very early on. The impact of AI and that you start to embrace it and the opportunities it will provide.   

Ian: I had a really interesting experience in Chicago a couple of weeks ago in the Sephora, the beauty store, and they have skin scanning technology where they place this sort of handheld unit on your skin. It does a deep scan of your skin, which is quite an enlightening process when you see the results. But it will then rate your skin. Is it dry? Is it oily and things like that? But then it will start recommending products. But they are very importantly then have very well -trained staff that then talk to you.  

That's where I would like to see a lot of the customer facing technology, where you're going, right, where do we need to apply the technology? Where do we need to apply the humans? And understanding that the two work together because that technology didn't replace staff.   

Boran: I had the same experience when I went to Dream not so long ago to test out some mattresses and they had this camera essentially laying the mattress and it tell you exactly what type of mattress you need. But obviously that was a great interaction for me from a technical side, but then thereafter, then you had the assistant on the shop floor telling you more detail and giving you that insight, walking you around, which combined together was actually just embrace a great cool technology.  

You train a staff to how to use the tools, but you're not expecting them to know every single knowledge detail out there. Then they utilize the tools in those interactions and conversations that they have similar to your experiences for it. That was a great example of how tech and human interaction combines really well. 

To hear more of what Ian and Boran have to say about retail going forward, you can: 

Watch the full chat above 

Listen on Spotify here 

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