The End of Tactile Retail?
Retail is about the tactile. The well-heeled lady wants to feel the string of pearls she admires as much as the young man wants to feel the touch of the leather jacket he so wants, or the child that craves to feel that latest game console in their hands. Of course, the other senses such as sight and smell also play their role in what sells. However, ultimately, when it comes down to it the retail experience is all about the feel, the touch.
At least that’s how it used to be. Digital platforms have changed the way people shop. It is well-understood that customers are increasingly willing to buy online without having to visit a bricks and mortar store. Going, going, gone is the tactile, it is assumed by many. Not quite. Nikki Baird made a salient point in her Forbes article “What Digital Transformation Actually Means For Retail” when she stated that, “retail, in the end, involves transferring possession of physical goods to a consumer.” To divest retail of its physical properties is to divest retail of its very essence.
But Baird also warned that retailers who did not adapt their businesses to offering their customers digital solutions would be left wanting. 2018 saw the demise of former retail giants like Toy ‘R’ Us and Sears, both once corporate behemoths in their respective retail niches. Analysts have pointed out that these companies primarily failed because of their unwillingness or inability to adapt to the digital sales age, amongst other strategic failures by them.
Online Rises, In-Store Declines
Stores are shutting down at an alarming rate. Cushman & Wakefield estimated that store closures would rise 33% in the United States in 2018, equating to more than 12,000 establishments shutting down. The traditional battle shoppers fought was ‘Demand vs Wallet’. Cost has always been a barrier to buying. Your heart really wants those boots but can your wallet afford it? Nowadays, shoppers think of time and effort as major costs. Who wants to leave their couch to go “all the way” to a store to buy something that’s a few taps away on you-know-where?
How can retailers build an in-store experience that can compete with the convenience of shopping online? Building a seamless in-store experience is a start but it’s tough for brick and mortar to compete with the online experience on convenience alone. Brick and mortar stores can deliver an experience that online shopping can’t. How? By using the same weapon that made online shopping possible in the first place: technology. Enter augmented reality (AR).
Tilly’s Uses Augmented Reality
AR was a term first coined by Boeing researcher Thomas Caudell in 1990 and refers to a real subject, captured on video or camera, to which the technology ‘augments’ or adds a real-world image with extra layers of digital information. It’s the lady who stands in front of a video console and can ‘test’ different shades of lipstick that are technologically superimposed over her lips on camera. This is in contrast to VR, which fully immerses you in an alternate ‘universe’. AR is simpler, less expensive and less invasive, which is why retailers should love this technology.
Tilly’s is an American retail clothing company that was founded in 1982 and is based out of Irvine, CA. The retailer sells an assortment of branded apparel, accessories and shoes, aimed primarily at the youth and young adult market. Competitors include the likes of American Eagle Outfitters, Forever 21 and Urban Outfitters. Tilly’s operates 222 stores across 31 states. The average Tilly’s store is 7,900 square feet. Increasing foot traffic is vitally important for the company.
In May 2017 the clothing retailer commissioned INDE, a Hungarian company that develops award-winning immersive and interactive products, to develop a standalone AR display system. Tilly’s piloted this AR store window, called VyuAR, at a Tilly’s store in Ontario, CA. The VyuAR window conjured dynamic 2-D and 3-D content developed to fit perfectly with the layout of that specific Tilly’s location. This content included a custom-made Vans skater, a dragon, a giant octopus and a floating shoe. On the practical side, items that were on sale and hot items were highlighted with pop-up information. The end result was every brands dream scenario: a perfectly Instagrammable moment.
An AR Success Story
The AR store window at the store at the Ontario Mills shopping mall was a resounding success for Tilly’s. According to Jon Kubo, the company’s chief digital officer, it was estimated that foot traffic at the pilot store was up by 30% in the month after the AR store window went active. Kubo also relayed that more consumers had downloaded the Tilly’s mobile app during this same period. After their successful AR store window experiment, Tilly built another AR success story.
AR Scavenger Hunt Yields ROI
Tilly’s also used AR as tool in their back-to-school shopping promotions in the form of an AR scavenger hunt. Social media personality Shaun McBride a.k.a “Shonduras”, was used as the celebrity for the promotion due to his popularity with the company’s primary demographic, i.e. tweens, teens and young adults. McBride encouraged contestants to search for three coins hidden in images around various stores. Shoppers who found three of these virtual coins received a 20% discount coupon on their phone.
According to Jon Kubo, the results of the ‘treasure hunt’ promotion were exceptional: it literally drove “tens of thousands” of entrants to stores, yielded an 80% coupon redemption rate, a 99.6% opt-in rate for push and location tracking via the app and a 23% hike in app downloads during the promotion’s span. These are the types of uptake stats that are any digital marketer’s dream come true.
The development and launch of the scavenger hunt promotion took about two months for Tilly’s. Project management time included two weeks for the rough concept, two weeks for the story boards and creative mock-ups, one week to develop a script and four days of filming with McBride and a green-screen setting. In terms of both time and cost, the ROI from this promotion was a smash hit.
Double Edged Sword
Technology is a powerful force, responsible for ushering in a massive wave of online shopping. Retailers can use AR, VR and other advances in retail technology to leverage that same force to draw shoppers from screens to stores.