There is enormous change happening in-store. Endless aisles, mobile POS, pop-up branding, interactive store windows, web-connected kiosks, virtual try-on, flash sales, augmented packaging. Add consumer invention into the mix, and we see almost daily acts of spontaneous experience innovation – show-rooming, social shopping, buy anywhere/ship anywhere. But where many retailers are missing the mark is when they try to apply on-line strategies to the in-store environment. The two experiences are entirely different.

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CONNECTED RetailTHE FUTURE OF THE IN-STORE EXPERIENCE
Charles Sayers
Experience Innovation
SapientNitro
csayers@sapient.com

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There’s a blurring of the lines happening between
The physical and the virtual

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IN-STORE RETAIL USED TO BE
SIMPLE
BuyBuyAwareness Familiarity Consideration Preference Loyalty
BUYING WAS A LINEAR EXPERIENCE

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IT USED TO BE
CLEAR
THE ROLE OF A STORE WAS TO PUT PRODUCT
INTO THE HANDS OF THE CUSTOMER

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IT USED TO BE
EASY
DRIVE STORE TRAFFIC.
STOCK THE SHELVES. ACCEPT PAYMENT.
! + +

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E-COMMERCE IS GROWING AT 20% PER YEAR
TRADITIONAL RETAIL IS GROWING AT ABOUT 3%

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$16 Billion $210 Billion $29 Billion $298 Billion
SOURCE: Forrester Research Online Retail Forecast, 2012 to 2016 (US)
FOUR YEARS FROM NOW, IN-STORE WILL STILL COMPRISE MORE THAN
90% OF ALL RETAIL SALES

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TO MEET THE EVOLVING EXPECTATIONS OF THE OMNICHANNELING CUSTOMER
RETAILERS HAVE BEGUN
FIGHTING TO RETAIN RELEVANCE
Replacing print signage
with digital displays
Installing self-service
check-out
Adding price
and coupon scanners
Offering touch-screen
way-finding and registry

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RETAILERS ARE IMPLEMENTING
INNOVATIVE TECHNOLOGY
IN TRADITIONAL WAYS

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THEY’RE FOCUSING THEIR APPROACHES ON THE WRONG
CONSUMER DRIVER
acquisition
ONLINE
interaction
IN-STORE
VS.

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IN-STORE
IS NOT
AN ONLINE EXPERIENCE

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CONNECTED RETAIL
OFFERS RETAILERS THE OPPORTUNITY TO DIGITALLY – ENHANCE
THE STORE’S FOUNDATIONAL STRENGTHS
► Immediacy
► Convenience
► Control
► Collaboration
► Sensory Interaction
► Guidance

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CONNECTED RETAIL
IN-STORE
EXPERIENCEVIRTUAL PHYSICAL
Fully integrated, digitally enhanced, in-
store experiences that engage customers
at the intersection of the virtual and
physical world.

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IN-STORE
EXPERIENCE
ENVIRONMENT
CUSTOMER
PRODUCT ASSOCIATE
BREAKTHROUGH INNOVATIONS
WILL EXPLOIT THE UNIQUE ADVANTAGES OF THE PHYSICAL STORE
ENVIRONMENTS
that inspire, adapt, curate
and evolve in real time
PRODUCTS
that do more than simply
sit on a shelf, but feature
augmented packaging and
digitally enhanced
merchandising that can be
activated and viewed
through consumer-
controlled devices
ASSOCIATES
who are brand experts,
equipped with mobile-based,
collaborative tools and access
to consumer and inventory
information
CUSTOMERS
who are given free reign to
connect to virtual and in-store
data that can be mashed,
customized and socially shared
while still shopping in-store

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TRENDING EXAMPLES

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APPLE HAS A FULLY INTEGRATED
CONNECTED ECOSYSTEM
Apple orchestrates every aspect of the end-to-end ‘Apple experience’
across every touch point to become the world’s leading retailer (driving
sales per square foot over $6,000)

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LENS CRAFTERS LEVERAGES
CONNECTED PRODUCTS
LensCrafters has deployed a “Magic Mirror” that allows customers to
scan physical products and see what they might look like on their
reflection in the mirror – perfect for customers who can’t see without
their original glasses on.

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NORDSTROMS WAS SURPRISED BY
CONNECTED SHOWROOMING
Nordstrom introduced an app in the fall that executives expected people
would mostly use remotely to order items while they were watching TV
or waiting for a train. But in addition, customers use the app while
shopping at Nordstrom rather than approach the sales staff.

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ADIDAS HAS CREATED A
CONNECTED ENVIRONMENT
Adidas recently launched digital product displays that are tightly
integrated with physical product displays. This allows on-line only
inventory to have a visible place within the store environment.

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WAL-MART HAS INTRODUCED A DYNAMICALLY CONTROLLED
CONNECTED AISLES
Wal-mart has embedded CMS-driven messaging through its in-aisle
experiences, which is generating a viewership of 120 to 130 million per month.
That’s the fifth highest video viewership behind NBC, ABC, CBS and Fox.

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LEGOS LET’S CUSTOMERS SEE THE FINISHED FUN WITH
CONNECTED PACKAGING
Legos shows kids and parents what the final Lego product in the box they are holding will
look like when built. No code required, the system uses image recognition to create a 3D
animation around the top of the box that, with gesture recognition, let’s customers carry
the model in their hands.

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MARKS & SPENCER HAS CREATED
CONNECTED EXPERIENCES
Marks & Spencer has recently launched a magic mirror fitting room that comes to life
when RFID-enabled products are tried on. The fitting room blends digital content and
sales associate tools with the physical product and fitting room environment to create a
fully-enabled connected experience.

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A CONNECTED EXPERIENCE FULFILLS TWO
ORGANIZING OBJECTIVES
AT THE POINT OF ENGAGEMENT
BUSINESS OBJECTIVE
What is the business problem we’re
trying to solve or the opportunity we’re
trying to take advantage of?
SHOPPER DESIRE
What will motivate shoppers to engage the
experience in-store?
ENVIRONMENT
ASSOCIATE PRODUCT
SHOPPER
IN-STORE
EXPERIENCE

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A CONNECTED EXPERIENCE
CREATES A REASON
TO ENGAGE IN-STORE
ENVIRONMENT
What will draw the
shopper’s attention to the
experience within 3
seconds of crossing the
threshold?
How should it relate to the
rest of the in-store
environment?
How will it remain dynamic
and fresh to avoid
desensitization?
ASSOCIATE
What will the role of the
Associate be in the
experience?
What is the experience
for the Associate ?
PRODUCT
How will we enable product
interaction?
How will shoppers interact with
products in-context?
How will in-experience products
relate to in-store inventory?
Where/when will transactions
take place?
SHOPPER
What is the singular action
we want shoppers to take
at the end of their
experience?
What elements of the
experience can they retain
and share using their
personal technology?
What will make the
experience relevant and
memorable after they
leave the store?
ENVIRONMENT
ASSOCIATE PRODUCT
SHOPPER
IN-STORE
EXPERIENCE

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IN-STORE
EXPERIENCE
A CONNECTED EXPERIENCE IS
LOCALLY CONNECTED
WITHIN THE STORE
local
ENVIRONMENT
How will local messaging
be introduced and
maintained?
ASSOCIATE
How will Associates
access information
about extended SKUs?
How will the experience
adapt to localized
inventory?
PRODUCT
How will products reflect in-
store exclusivity, pricing or
shipping options?
SHOPPER
How will the experience adapt
to preferences expressed
within other channels?
How will shoppers be enabled
to share their experience at
the point of impulse?
How will shoppers be
rewarded within the
experience?
ENVIRONMENT
ASSOCIATE PRODUCT
SHOPPER
IN-STORE
EXPERIENCE

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A CONNECTED EXPERIENCE CAN BE
ACCESSED AND SHARED
BEYOND THE STORE
ENVIRONMENT
What elements of the
experience will be
standardized across
locations?
ASSOCIATE
How will Associates be
supported with a “single
view” of the shopper?
PRODUCT
How will consistency of
product information be
maintained?
SHOPPER
How will loyalty be
rewarded across all
Beyond experiences?
How will shoppers be
alerted to enhancement
and/or changes to the
experience?
ENVIRONMENT
ASSOCIATE PRODUCT
SHOPPER
IN-STORE
EXPERIENCE
localglobal

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THERE MUST BE A
CONNECTING POINT
AT THE CENTER OF EVERY IN-STORE EXPERIENCE
localglobal
account
information
product
information
service
information
promotional
messaging
social
sharing
account
history
local
community
localized
messaging
market
segmentation
registries
personal
preferences
local
inventory
extended
aisles
universal
SKUs
local
promotions
behavioral
targeting
loyalty
rewards
mobile apps ENVIRONMENT
ASSOCIATE PRODUCT
SHOPPER
IN-STORE
EXPERIENCE

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► Fundamental consumer behavior hasn’t changed;
its just become more enabled
► Expectations are being defined and reshaped by
every moment of interaction
► In-store engagement must connect customers to
richer, omni directional experiences – that
leverage the store’s unique strengths
► Connected Retail is the opportunity to connect
consumers to more at the point of virtual and
physical engagement
CONNECTED RETAIL
SOME FINAL THOUGHTS

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THANK YOU!