How AI Is Helping Brick-And-Mortar Retail Businesses Stay Competitive

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Date
6 Sep 2018

It’s difficult to skim through any business or technology-related article about retail and not feel one of two sensations: excitement for the future or a bout of doom and gloom. Fear of deviation from the way retail businesses historically operated has trickled down from top-level management to the day-to-day staff. And while warranted in some cases, disruption is now a necessary staple of successful retail companies. However, I believe those who recognize the full extent to which technology can positively impact businesses see the future of commercial operations as an optimistic challenge.

Among retailers, brick-and-mortar stores face an uphill battle in garnering the attention of customers and keeping their interest in buying in-person. This is of course evidenced by the rapid influx of e-commerce giants willing to grab as much market share as they can. Consumers have more options, more tools for price comparison and more convenience -- and retailers are feeling the pinch. According to a Moody’s Investors Service report, many stores are scaling back operations and closing physical locations to divert their energy, resources and capital to the online shopping experience.

But the brick-and-mortar model of business is far from dying off. Instead, companies with large-scale physical locations are turning their attention toward an experiential-based model of business in order to remain competitive and develop a completely new buying experience for the consumer.

Three Ways Artificial Intelligence (AI) Can Help You Improve The Customer Experience

For retailers to embrace this level of change, it’s imperative they focus on what brick-and-mortar stores offer that online shopping never will: customer experience. Above all else, it’s the customer experience that keeps consumers coming in the door. Instead of the conventional focus on less output of time and money, businesses recognize the true value proposition is in customer experience and ultimately, customer retention. A redirected focus on a reliable, efficient customer experience is often easier said than done, but in my experience, robotics and AI technologies can lend a necessary hand in its delivery.

Here are several areas where AI is already making an impact:

1. Delivering On Expected Standards

Two areas that are often overlooked but have room for significant improvement in the retailer space are cleaning and inventory management/restocking. These tasks are oftentimes done out of sight of the customer, but they are influential nonetheless.

For example, at Brain Corp, we work on technology that makes robotic floorcare available to retailers, mitigating the need to pull in a staff member to ensure the floors are spotless each night, as well as any concerns over missed areas due to stocking or other closed-hours activities. It offers flexibility in scheduling to ensure cleaning is done right and on time, based on business needs. Other companies working on this include Intellibot, Nilfisk and Avidbots.

Similarly, the challenge of inventory stocking is a task robotics companies are taking on to improve the customer experience. Solving the issue of customers not being able to find or purchase desired products, there are a number of early-stage companies developing relevant solutions. Made possible through sophisticated AI and imaging technology, these robots automatically let retail teams know what needs to be restocked and when -- ensuring that buyers are always able to access what they want when they want it.

2. The In-Store Experience

Robotics and AI applications don’t just happen behind the scenes. Some elements of this new, heightened customer experience are very much interactive. Pepper, developed by SoftBank Robotics (full disclosure: SoftBank Robotics is related to the SoftBank Vision Fund, an investor of Brain Corp) is a humanoid robot that interacts directly with customers as a concierge and sales associate. The product has experienced success in the retail space, creating interest and engagement among customers while offering a higher level of efficiency for the overall shopping experience.

Another example of robotics and AI in retail practice is Bo, a customer service robot designed by BotsandUs. The technology behind Bo helps optimize the customer journey by recommending products based on customer needs, as well as assisting customers in finding the product they are searching for in-store. Through AI, the robot can lead the customers directly to their specific item or hand them off to a store associate for more in-depth help. This provides an enjoyable experience for customers and takes away the need for employees to use their time managing simple tasks.

3. Front-Of-House Applications

Large retailers are also looking at front of the house applications, such as cashier-less checkout, drone navigation assistance, and high-tech pickup kiosks. Not only do customers remember their experience when these elements are at the forefront, they are also more likely to return for a similar interaction in the future. In considering these new technologies, business development executives representing these innovative products should be very conscious of the return on investment paradigm shift. Gone are the days of simply talking “time and money saved” when considering a new product. Customer satisfaction, retention and the overall customer experience are also key elements when considering the quantitative and qualitative perspective throughout the sales process.

Making these forms of AI and robotics technologies successful in retail requires some forward thinking and buy-in from the start. In many cases, an onsite technology advocate is necessary to help with the transition toward the future of retail environments and enhanced customer experience. Those organizations willing to modernize the approach of delivering on customer expectations, the in-store experience, and front-of-house operations have the potential to see a valuable return on investment over time.

Moving toward an experiential-based model takes strategic thinking and innovation. As more consumers embrace the convenience of e-commerce, brick-and-mortar retail businesses must consider their value proposition through customer experience improvements to remain competitive and relevant. The use of AI and robotics is one emerging method to achieve greater efficiency while tackling the challenge of the customer experience in a consistent, meaningful way.

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