Retail Technology – Master or Servant?

Facetime-Video-Phone-1950sAs I approach 20 years as a high street retailer I think I may have reached that age when I look back through the Vaseline smeared lens of nostalgia to simpler times when summers were longer, life was sweeter, shops were called shops, rather than stores, and the only channels we talked about were the 4 we had on our 20 inch TVs.

In those barely remembered days, window shopping meant standing with your nose pressed to a plate glass shopfront rather than your Microsoft phone, Android was a morose character in the BBC version of The Hitchhiker’s Guide to the Galaxy and a web browser was someone who took rather than more than a healthy interest in arachnid architecture.

I’m not sure if it’s the change in the weather, the recent march of the souls of the undead on Halloween or simply the calm before the chaos of Christmas kicks in, but the last week or so has seen a marked increase in the proposal of ideas that will supposedly elevate the retail industry from these humble roots to previously undreamed of pantheons of technological supremacy.  Personally I’m not convinced.

Dynamic Pricing

Firstly we had Kingfisher’s Ian Cheshire and his predictions about dynamic pricing systems.  LCD shelf edge labels connected to a central computer will, he believes,  revolutionise the high street, allowing prices to be changed by the hour in response to demand, the presence of a particular customer demographic or even the proximity of a particular customer.

This was coincidentally backed up by a piece from Roy Horgan in the same edition of Retail Week Magazine, holding forth on pretty much the same hokum. I guess we can’t blame Roy, considering he works for a company that would likely be at the forefront of a roll-out of such technology, but as a retailer I’d have thought Ian Cheshire would have had more sense.

Comparing the day to day retail proposition with the pricing flexibility of an airline ticket or a hotel room is to miss the fundamental point by a nautical mile.  With the exception of some food uses, consumers are just as able to be flexible with their custom, so changing prices at particular times will only shift buying patterns.

To me this just sounds like the holy grail that RFID was held up to be some years ago.  Back then we were told that we’d have radio tags in everything from T-shirts to teabags but in didn’t happen.  Why?  Because ultimately the investment in the technology required didn’t justify the expense.  Sure, it would be great to be able to scan an entire shopping cart in one go, but if you need to ensure everything down to your last tin of beans has a tag on it that probably costs more than the contents, it’s never going to fly.

Click and Print Bling

Next we had the idea from Argos digital director Bertrand Bodson, that within 15 years we’d not have to worry about having our online purchases being shipped to us.  No more waiting for the delivery man or picking up that irritating ‘while you were out’ card.  No, according to Bodson we’ll all be furnishing ourselves with 3D printers where everything will appear like magic from within.

This was either a very transparent attempt at grabbing a few column inches during a slow news week, or Bertrand had been watching far too much Star Trek in his spare time.  He certainly didn’t seem to understand how 3D printing worked or what it’s limitations were.  The idea that anything other than the most simple products could be delivered in this way is plainly ludicrous.

handmade-jewelleryFor example, one of the products Argos will apparently be sending to us via this new channel will be jewellery.  As a jeweller myself I found this a heroically ill-conceived statement.  Presumably the idea is that we’ll all be sitting with a stack of gold or silver in our 3D printers, along with an equally dazzling collection of precious or semi-precious stones. Then, once we’ve ‘printed’ out all the components for the necklace of our dreams we’d only have to gain the knowledge of an experienced jeweller to polish them, finish them and then put the whole thing together.  That should take 2 or 3  years study on a good jewellery making course, plus the access to a small workshop, but that’s got to be better than waiting from the completed article to come through the letterbox right?

Why Fi?

Broadly this idea that technology will be the answer to all our problems seems to be taking hold across the industry.  A major plank of the recently published review by Bill Grimsey and his team suggested that one of the key innovations that will save the high street from ultimate demise is a wireless network that will apparently have customers prowling the streets with their noses pressed to mobile devices informing them of offers in the stores in the locality.  Presumably this will be a far better option than just raising their heads and looking in the shop windows.  I don’t dispute that Wi-Fi provision will play an important role in any future community area, but the idea of bombarding shoppers with local offers and adverts via a mobile device has been tried before without much success.  Perhaps it’s an idea who’s time will come, but the practical aspects of armies of people tapping palm pads rather than simply wandering about the shops seems to me at odds with what I understand as normal human behaviour.

Google Glass

google-glass-the-jerkProponents of Google glass have similar aspirations, with digital commerce solutions provider Venda recently publishing a report entitled “Wearable Technology: The High Street’s Secret Weapon?”.  Again the idea seems to be that wearing a clunky bit of face furniture with it’s origins in the 1970s children’s TV show Joe 90, will give you far more insight into available offers and promotions than simply looking at a sign next to the product.

I can appreciate blue sky thinking as much as the next person.  I know many of these seemingly unworkable ideas need to be thrown into the ring to allow them to be torn into digestible pieces that at some point may help to construct the next must-have innovation.

I’m by no means a technophobe either.  I’ve been working with computers since 1973 when the processing power we now take for granted in a microwave oven would have needed two huge rooms to house it, along with team of technicians on 24 hour call to periodically hit things with hammers.

I’m an early adopter of most new tech.  My company has had a website since 1995, and I designed and programmed from scratch the EPOS system than has run our inventory control and customer interfaces for the past 20 years, after finding a dearth of such software in 1994.

The good old days?

greengrocers1945So this isn’t a lament for the ‘good old days’ when ruddy faced greengrocers weighed out veg by eye and knew every customer for a 5 mile radius (although that was a golden era I can almost remember).  No, I fully understand that as modern retailers we all need to get our heads round at least some of this newspeak.  But my fear is that as ever more of these technologies are heralded as the answer to engaging an increasingly jaded consumerate, are we not also in danger of confusing the humble shopper as much as ourselves with an overload of ineradicable data and jargon?

It seems like every day there’s another start-up company or new think-tank that re-invents the retail wheel with yet another concept or strategy.  From the plethora of competing payment methods to new ways of presenting products in store.  When in essence the people we’re all selling to haven’t really changed from those we served before all these clever bells and whistles started dazzling us with their white hot potential.  More often than not I think we’re witnessing the birth of technologies for their own sake.  Answers looking for a questions and solutions looking for a problem.

Blind Alley

In practical terms it’s likely the very people that will be embracing these technologies, the young, may be the very demographic that in the future will have much less disposable income with which to buy all the stuff we throw at them.  If that’s true, I’d say we’re in danger of disappearing up a very dark and potentially rather empty alley in the not too distant future.  At the end of it we may see nothing more than our own hubris blinking back at us.

So let’s not forget the basic tenets of retailing as we launch headlong into this technological Valhalla.  The old aphorisms of customer service and personal interaction are often trotted out at this point in these discussions, and I’m afraid I’m not going to be any more original than that.  But in the final analysis I still maintain that we should only use technology if it enhances those two most basic functions of the humble shopkeep rather than seeking to find replacements for them.

Air_Conditioned_Shoes_Crazy_Inventions-s650x595-337964-580New technologies do of course offer fantastic opportunities, but ultimately we still need to be good retailers with all the same skills and motivations that were needed by that greengrocer back in the 1960s.  New ideas are of course exciting and innovation is always needed to keep our industry moving forward.  But I think we need to be certain that we’re responding to customer aspirations rather than confusing them with unwanted information, interaction or propositions.

Technology has brought us as much pointless gimmickry as it has opportunity, and as someone much cleverer than me once said, just because we can do something doesn’t mean that we should.   We should driving innovation, rather than being driven by it.

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5 thoughts on “Retail Technology – Master or Servant?

  1. “With the exception of some food uses, consumers are just as able to be flexible with their custom, so changing prices at particular times will only shift buying patterns.”

    We sort of see some of this already in the patterns of people visiting supermarkets after 8pm in order to shop the discounted items.

    • Good point Leigh. Which really proves my point that customers are ready and able to shift their buying patterns just as easily as prices can be manipulated. I think investing in a dynamic pricing system that simply does end of day mark-downs on perishable products might be overkill for such a narrow application. I was thinking more of prices being moved upwards at times of high demand, such as lunch times at food and beverage vendors. That seems to me to be one of the only virtually immovable times of day when demand could be predicted and adapted to.

  2. Great article. I found my way to this after reading your post on a Telegraph article about business rates in which you summed up my thoughts better than I could! (We have two optical stores in London and one in Richmond). If you get a sec please drop me an email as wouldn’t mind a quick chin-wag about advertising and PR for independents – we’ve recently tried Yelp (total waste of time) and are midway through a well-planned PR campaign with a great PR, but nothing seems to work!

    P.S. Please keep up the great blogging!

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