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The Rise (and Fall) of QR Codes in Retail: Is it Time for a Comeback?

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In the ever-changing retail landscape, QR codes (or quick response codes) have become something of a permanent fixture. These square-shaped black-and-white displays are found on a dizzying array of product labels. A QR code is actually a matrix-style bar code that can cram more data in a smaller space than a conventional linear barcode. When scanned, QR codes provide factual or marketing information that might spur consumers to buy the product.

Although every smartphone-equipped shopper can read products’ QR codes, the codes haven’t exactly caught on as a retail tool.

This post will shed light on the challenges that retailers face in using QR codes to promote and grow their businesses. At the same time, it will also show potential opportunities that could turn the tides in QR codes’ favor.

 

QR Codes in Retail: A Brief History Lesson

QR codes in retail have a fairly long history. In 1994, Toyota subsidiary Denso Wave developed the two-dimensional displays to track the Japanese auto maker’s car parts.

Fast forward to 2002, when numerous Japanese service businesses banded together to brainstorm uses for camera-equipped smartphones. Their favorite concept: use the phones to scan varied retail products’ QR codes, ideally convincing customers to buy the products. Over time, the technology gradually made its way to the United States, where it was adopted by various retailers.

 

Companies Embracing QR Code Technology

There are a number of major retail chains that have jumped on board with regards to QR codes. Mega-retailers Walmart and Target were among the early brick-and-mortar businesses to launch fast QR-friendly cashless payment systems.

Meanwhile, longtime fashion and lifestyle retailer Macy’s unveiled its “Backstage Pass” that featured the iconic Macy’s star with an embedded QR code. When a shopper scans the star with their smartphone, they’re rewarded with information on Macy’s fashion trends, shopping discounts, and store-specific information.

Other players have also incorporated QR codes into their mobile payment platforms. Walmart Pay, for example, requires customers to scan a QR code at checkout to pay with their smartphone. The “buy now pay later” solution Klarna also uses QR codes to power its in-store payments.

 

4 Obstacles QR Codes Face in Retail

Many retailers have integrated QR codes into mobile payment applications and marketing strategies. So, why haven’t more consumers scanned the codes to gather information about a product or service that might interest them? Here are four reasons for consumers’ hesitation to make QR codes scans a part of their daily routine.

 

1. Search Engines Are Faster and Easier

When you want to learn about a new product, you’d probably whip out your smartphone and Google the item. Contrast that with having to find a poster or ad for the product, with an invitation to scan the QR code. The former approach is quick, easy, and intuitive while the later is just the opposite.

Why would customers rely on yet another “thing” (like brochure, poster, or business card) when they can get the info they need using just their smartphone?

 

2. Consumers Are Unclear on the Concept

QR codes’ somewhat ambiguous nature has probably confused many consumers. Are QR codes a marketing tool? Are they used for payments? Do shoppers need a special app? Because the implementation of QR codes are so fragmented, there’s no one compelling reason to fully adopt them.

 

3. Smartphones Didn’t Used to Have Built-In QR Code Readers

Apple and Android smartphones previously didn’t include a QR code reader as a native feature. So, people had to download an app, which likely led some tech-challenged users to simply give up.

Fortunately, this changed in 2017 when Apple posted an iOS11 update that enables users to scan QR codes through the phone’s camera app. The Android platform wasn’t far behind. Today, both phone manufacturers include native QR code readers on their products.

 

4. Technologies Like AR and VR are Challenging QR codes

QR codes are also facing competition from other, potentially “cooler” technologies. Augmented reality (AR), for example, elevates the retail experience by bringing virtual components into the real world, essentially allowing physical and digital realms to co-exist in the same space. Think: Pokemon Go, digital makeup application, and Snapchat filters.

Like QR codes, AR initiatives require people to whip out their smartphones to access the technology. But unlike QR codes, which typically take people to a static webpage, AR offers a much richer and cooler experience.

Virtual reality (VR) is also challenging QR codes. While VR needs more sophisticated hardware (headsets are typically required), the technology can provide an immersive experience that QR codes will never be able to match.

In many ways, these technologies do a better job of showcasing a product’s features or telling a brand’s story than QR codes.

 

QR Codes in Retail: A Smart “Reboot” Might Be Underway

All is not lost, though. In 2020, retailers are pulling out all the stops to attract consumers who want to level up their shopping experiences. And for some, doing that means using a variety of tools and technologies — including QR codes.

Many business owners and marketers are making QR codes a solid part of their strategies. Consider the following:

 

Baking It into the In-Store Experience

Clever retailers are finding ways to incorporate QR codes into the shopping experience.

New York City’s Nike flagship store House of Innovation 000 is using QR codes to drive app downloads, loyalty, and product browsing.

While customers browse through the Nike venue, they’re invited to scan wall-mounted QR codes to receive even more rewards. If customers don’t have the Nike mobile app, they can easily download it from the QR code.

The store’s popular “Scan To Try” feature invites customers to scan Nike-outfitted mannequins. When the customers do that, store assistants bring those apparel articles’ correct sizes and colors to the fitting rooms.

 

Marketers Get Valuable Data via QR Scans

In certain cases, QR codes can give retailers valuable intel. The growth of digital marketing enables marketers to better track their campaign results. For example, marketers can count the number of QR scans for a specific campaign. After combining this data with other relevant statistics, they can gain insights into the performance of their campaigns.

 

Colorful QR Codes Can Grab Customers’ Attention

The era of drab black-and-white QR codes in retail is over. In recent years, QR codes gained the ability to be more customizable. Companies can add their brand logos, display eye-catching colors, and incorporate unconventional shapes.

When QR codes are well-designed, they could potentially increase consumers’ interest and lead to more click-throughs to the brand website, marketing campaign, or other desired destination.

 

QR Codes Promote Hygienic Customer Experiences

QR codes also saw a resurgence in 2020 when the COVID-19 pandemic hit. To promote safer customer experiences, businesses started incorporating these codes into their physical distancing initiatives.

Numerous restaurants, for example, started adding QR codes to tabletops. Customers would then scan these codes to view the restaurant’s offerings on their phones, eliminating the need for hand-held menus.

Meanwhile, retailers like CVS teamed up with PayPal to use the payment company’s QR codes as a touch-free payment option for in-store shoppers.

 

Proper Implementation is Key — Regardless of the Technology You’re Using

Whether you’re a fan of QR codes or they’re dead to you and you’re trying other things, always remember that proper implementation is key. No matter what initiatives you’re running in-store, ensure that they’re on-point by monitoring and auditing your initiatives.

CB4 can arm you with the tools you need to ensure that all your retail programs are working and are compliant to your brand’s standards.

Request a demo today to learn how CB4 can help you elevate the retail experience.

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