The Endless Aisle
Tapping into additional revenue potential
By Ralf Kluth, NCR Solutions Sales Specialist Retail
In preparation for exhibiting at KIOSK EUROPE EXPO 2012, NCR's Ralf Kluth explains how retailers can tap into additional revenue potential with endless-aisle solutions.
When consumers gather additional information online before purchasing in-store or take a look at products in-store before purchasing online, a solution is needed that gives retailers the opportunity to connect both channels to maintain customer loyalty and secure revenue. Kiosks that extend the aisle endlessly and accompany customers through to the checkout give retailers a powerful, sales-promoting productive system.
Consumers like to be well informed before they make a purchase and combine the different channels like in-store, online, and mobile at will during their decision-making process. For example, an in-store purchase is usually preceded by online research and, before purchasing an item online, consumers will often inspect the product in-store. According to a study carried out by the E-Commerce Center (ECC) for Retail at the Institute for Retail Research (ECC Handel am Institut für Handelsforschung), consumers conduct Internet research prior to 60 percent of all in-store purchases they make. In turn, over a quarter (27 percent) of purchases made online are preceded by research in the store – this corresponds to almost 30 percent of all online sales. The reasons for a consumer to switch from the in-store to the online channel could be the unavailability of the desired product or a particularly attractive e-commerce offer. However, one thing is certain: If retailers limit themselves to the range of goods available in their store, a whole part of revenue and customer retention potential is left untapped: Studies estimate that the retail industry "loses" approximately 70 billion euros every year* because items are not available.
Retailers are faced with the challenge of extending their range of in-store goods and combine their channels in order to accompany customers seamlessly from the beginning to the end on their preferred channels – during the research phase and the decision-making process through to the moment they actually purchase the goods. If retailers do not offer this seamless shopping experience, they run the risk that consumers will also switch retailers when switching channels. First of all, it is important that retailers offer their customers a consistent shopping experience across all channels. NCR c-tailing solutions, a range of software and services, ensure just that. Furthermore, a well-positioned self-service kiosk system can transfer e-commerce processes to the store, giving customers access to all goods including those not available on location and beyond the store's own stock.
Alongside discount coupons and repeat purchases, kiosk systems are one of the three most important factors for in-store purchasing. In a study conducted by the US market research company NPD Group in Germany , 45 percent of those asked indicated that they value the ability to obtain information and prices in advance of a purchase using an in-store kiosk system. In addition, almost one-fifth of consumers questioned in Germany would like to order the product directly at the kiosk. Almost half of those questioned intend to use kiosk systems more extensively in the future.
Productive Sales Assistant
Today, kiosk systems can accompany customers throughout their purchase and offer them an improved shopping experience, provide price and product information and, in particular, build the interface to an extended range of goods available online. Consistency as well as binding price and availability information are key. Connecting the systems to the stock and the enterprise resource planning (ERP) of the retailer therefore plays a decisive role.
Retailers can make the self-service channel in the store more appealing by integrating customer loyalty programs, giving consumers access to their personal data and offering additional added value at the kiosk: For example creating personalized gift lists, managing wish lists, looking up the location of items in the store, and making purchases. In addition, offering to manage and print out discount coupons improves customer retention. Retailers can also use the contact with the customer at the kiosk to advertise cross-selling offers or take pre-orders for fresh produce.
Kiosks are no longer an "information stand”; they act more like additional productive sales assistants that inform and advise customers, process measurable transactions, and generate sales. They also improve the retailer's image as consumers favor companies that offer them multiple channels for interaction.
A Question of Flexibility
Kiosks can be integrated in a number of ways in a retailer’s sales strategy. It is crucial that they are also supported from a technical point of view. Using a Web-based self-service kiosk platform such as NCR Netkey that can be programmed flexibly helps retailers create, distribute, run and monitor multimedia content centrally. The platform easily connects to the POS, payment transactions, and the ERP system. And it leaves retailers the option whether to use the development environment to create applications themselves or to assign this task to a partner.
Kiosks with a powerful platform enable retailers not only to successfully combine different channels with one another and offer their customers an enhanced shopping experience; they also provide key components for an "endless" range of goods, increased goods availability, and attractive additional business. The better retailers understand how to design customer interaction at the kiosk and give consumers more personal preferences, the more successful they will be and will differentiate themselves from the competition.
Monday, May 14, 2012