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To make the right retail tech investments, look at consumer comfort

Leigh Bryant Profile picture for user Leigh Bryant November 29, 2022
Technologies on the cusp of mainstream adoption could be the key to taking your customer experiences to the next level, writes Orium's Leigh Bryant.

ecommerce online selling monitors concept © Mediamodifier - Pixabay
(© Mediamodifier - Pixabay)

Customers have certain expectations and preferences for how, when, and where they want to be served. Brands that can meet those ideals secure customer loyalty and carve out a distinct market advantage, but predicting where those expectations are headed next can be challenging. The rate of change in retail technology is so rapid that knowing where to place your bets for the next must-have digital commerce experience can be one of the most high-risk, high-reward decisions an ambitious retailer may make.

That’s why it’s important to look at not just quantitative data around adoption rates or market penetration of the latest technology, but also at qualitative data around consumer comfort towards new and emerging technologies. Customers are ready to offer their loyalty to brands that strike the right balance between what they want now and what they can get excited about for the future, and studies like Compelling Commerce can help retailers be ready to create the experiences that strike that balance.

What is Compelling Commerce?

Compelling Commerce is the first longitudinal study of its kind to provide a data-informed look at consumer comfort towards 75 technologies. The report helps ambitious commerce leaders make sound investment decisions today, with a ranking of all the technologies surveyed and a Green/Yellow/Red framework to make it easy to evaluate them at a high-level. Looking at changes in consumer comfort over the years, the report also reveals trends and insights that make it easier to place the right bets for the future.

The report also includes a variety of technologies across other industries, like health, travel, and transportation, allowing us to understand some of the deeper forces at play. By surveying the broader technology landscape, it’s easier to see how certain core technologies (eg artificial intelligence, altered reality, smart technology, etc) are perceived differently by customers depending on the context.

At one end of the spectrum are 'Green Zone' technologies, which customers expect brands to use, like self-checkout kiosks and mobile apps. Not every brand will make use of every Green Zone technology, but they give us a good sense of what consumers consider table stakes, and can help brands identify where they may be lagging in the market already.

At the other end are 'Red Zone' technologies, which consumers aren’t yet ready for in a wider retail environment, like drones and in-store facial recognition. Brands contemplating these technologies should view them predominantly as a chance to explore new concepts and to learn information that can help chart a course for the future. These technologies should typically only be tried on a limited scale, to mitigate the risk of damaging the brand.

'Yellow Zone' technologies are arguably the most telling for retailers, as they exist at a tipping point. Technologies in this category, like self-scan shopping carts and customer service chatbots, are poised to become fast movers if consumer comfort and adoption maintain their upward trend. But if implemented carelessly or before the technology has reached maturity, they could be sharply rejected before they gain a firm foothold in the market and may languish on the sidelines far longer than they should while consumer trust is regained (think: electric vehicles 20 years ago).

'Yellow Zone' technologies – ready to break out

Assuming you aren’t scrambling to catch up with Green Zone implementations, the Yellow Zone offers the best insights into what will supercharge growth in the next few years. 

AR shopping tools

AR shopping comes in at #36 on the survey — a sizeable jump from #43 where it used to sit, just ahead of the halfway mark on the survey, and right in the heart of the yellow zone. With related technologies like digital clothing measurement at #37 and AR smartphone apps at #28, AR enhanced shopping is an area brands should be starting to seriously consider. The successes of early adopters like Sephora and IKEA means very soon, customers will start to expect some form of AR enhancement in all of their commerce experiences.

The increased exposure and familiarity AR shopping apps have had in the past few years — especially during the pandemic — have taken AR from an interesting idea to a digital experience with the potential to significantly impact business outcomes. By allowing users to virtually interact with products in a pseudo in-store experience, AR could provide a high degree of personalization for customers, helping them find the right products at the right time with less risk and higher rates of satisfaction. Plus, AR can make the shopping experience much more accessible. It grants shoppers the ability to try things out in their own homes, and lets someone shop 'locally' from anywhere in the world.

That said, they’re still in the yellow zone for a reason. Given that these technologies are fairly new, and their exposure to a wider audience is still relatively low, brands should look for ways to integrate them into their existing customer experience as an optional feature while refining exactly where and how they can enhance the shopping journey.

Autonomous purchasing

Autonomous purchasing involves the interplay of different technologies, like artificial intelligence, scanning software, and mobile tech. It also ranges in complexity, from the familiar self-checkout to the more advanced cashierless automated grocery being pioneered by tech giants like Amazon.

With autonomous purchasing, it’s primarily about two things: ease of use and overall utility. Self-checkout offers a great example of this. When it first rolled out, people struggled with it and for a time, the tech looked likely to fail. The utility was fairly obvious — a chance to speed through checkout for low-item purchasers with shorter lines and no chit-chat — but the experience was just hard enough to use that it was often outweighed by the effort. By placing a cashier close at hand to support the self-checkout interactions while users were getting the hang of the machines, retailers made the experience easier to use and therefore easier to adopt. It’s now at #3 in our overall rankings.

Smart shopping carts at #32 and cashierless checkout at #26 are both in a position to see the same growth. The convenience afforded by cashierless tech, in particular, will likely bring it to wider use in the coming years — especially as its dependent technologies mature in parallel. One particularly interesting use case is the ability for autonomous purchasing to facilitate alternative store formats, like popup stores and store-within-a-store. In the case of the former, retailers could easily introduce a new product line or test a new market without having to worry as much about staffing or POS, since most operations would be automated, allowing for lower-risk experimentation.

Automated customer service

Customer service chatbots, which come in at #33 in the rankings, have seen a drastic evolution since their early e-commerce days. With the rise of omnichannel retail, chatbots are being utilized in increasingly complex customer journeys that span platforms and touchpoints, like buying online and returning in store. However, these technologies aren’t likely to replace their human counterparts any time soon — and brands should be wary of their use in potentially highly-charged moments.

Brands risk alienating their customers in some of their most vulnerable brand moments by relying on chatbots to tackle nuanced, complicated interactions. Where chatbots excel is in their potential to automate data-driven and menial tasks, like rescuing abandoned shopping carts or facilitating low-stakes purchases. They offer a move toward greater omnichannel capabilities, especially when supplied with a complete customer profile through APIs, and an opportunity to integrate machine learning and AI as part of providing a more relevant customer experience. By relegating these data-rich tasks to chatbots, customer support agents and store associates can focus on providing the personal and empathetic experiences that make them so valuable, winning customers over in the moments where it matters most and building loyalty that can last a lifetime.

My take

Customer loyalty is a precious commodity that must be earned. When you show that you know your customers — from their wants and needs to their dreams and doubts — you’re already on the right track. But when you make the right investments that differentiate your brand and impress your customers, you’re ahead of the game. Investing in technologies that are safe will help you create an experience that customers expect; investing in technologies that are on the bleeding edge will make you a changemaker in your space.

Check out the full Compelling Commerce report to learn more.

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