How technology is helping retailers bridge the gap between online and in-store

Despite predictions about the “death of the department store” and the “retail apocalypse,” in-person shopping hasn’t disappeared. It is, however, evolving to be a lot more tech-savvy.

At Sam’s Club, shoppers can scan QR codes to request help from an employee, who can then chat with the digital assistant “Ask Sam” to find specific product information. At H&M’s COS stores, smart mirrors can scan RFID tags on the clothes then suggest matching items or request different sizes/colors without the customer leaving the fitting room. At Sephora’s “store of the future” in Shanghai, an in-store tablet can scan a customer’s face to deliver ultra-personalized AI-generated recommendations for skincare and makeup.

This fusion of personalization, convenience, and experiential elements represents the new cutting-edge retail landscape, which blends online and in-store shopping into one experience that offers the best of both worlds. Retailers know it as “omnichannel retail,” a tech-driven shift that was emerging before the pandemic and has accelerated rapidly. Data from McKinsey shows omnichannel customers shop more and spend more than single-channel shoppers.

 “Most of the brands that are doing well have brought both of these approaches together in a unified way,” says Simon Ogle, CEO at retail design agency iSi Global.

As consumers meander from shopping on their PCs to their smartphones to physical stores, they expect brands and retailers to keep pace.

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Stores as an experiential destination

During the early days of the pandemic, ecommerce grew to 19% of retail sales. By 2022, that’s dropped to 15%, which is still higher than pre-pandemic, according to the National Retail Federation. The takeaway for retailers: When customers shop in person, it’s for a reason.

“Customers shop online because it’s convenient,” says Bianca Cristescu, head of marketing at iSi Global. “They go to stores to have those memorable immersive experiences and connect in a genuine and authentic way with the brand.”

Last year in Berlin, iSi Global built HP Lighthouse, a retail space designed to show what stores of the future could look and feel like. HP devices and digital displays throughout the space educate consumers on its latest products. Other technology, like QR codes or NFC tags — both scannable labels that let people learn more about a product — gather data such as which items customers click on, informing business decisions on marketing strategy and personalization.

 iSi Global also collaborated with a local artist who created a graffiti wall inspired by both Berlin’s unique culture and HP’s sustainability efforts. The installation features a QR code that shoppers can scan to view the artwork in an animated, digital format. Cristescu says these experiential elements are essential in creating a more engaging and connected shopping journey.

“It’s about being a destination,” she says. 

Creating shopping experiences gives retailers opportunities to engage with customers more deeply, which increasingly requires bridging online behavior with in-store communication via customers’ mobile devices. The HP Engage Go lineup of in-store devices “untethers” store employees from behind the checkout with a mobile device that enables them to check inventory on the fly, assist customers with purchase decisions by showing them products option on-screen, zooming in on style details, offering side-by-side comparisons, or for furniture items, discussing room layouts and decor. They can also process the sale on the spot away from the check out queue.

Store- or brand-specific apps offer information, discounts, or other promotions, while retailers are able to track what content shoppers are looking at both in-store and after they leave. They can then use that information to tailor each consumer’s experience based on location and shopping patterns. According to Epsilon research, 80% of customers say they’re more likely to make a purchase when offered a personalized experience, such as product recommendations or even a discount related to their recent browsing. 

“Phones are the most important communication tool,” says Brian Hammett, the CEO of StratosMedia, a company that builds physical-to-digital experiences for retailers. “It’s what people have come to expect, and retailers have to work with this.”

Artificial intelligence behind the scenes

Online shoppers used to finding whatever they want, when they want it, will also have those expectations when they walk into stores. Retail forecasting to meet consumer demand used to be hit-or-miss. Now, with vast amounts of data and advanced machine learning algorithms, retailers can create highly accurate forecasts optimized by science rather than speculation.

Running those algorithms, however, can be both time consuming and expensive without the proper hardware. So companies like retail IT service provider VINX are turning to the HP Z8 G4 Data Science Workstation, which, when paired with NVIDIA GPUs, can quickly run sophisticated models that get those insights. The system is also small enough for most IT departments to manage and powerful enough to work locally, without sending data to the cloud. 

AI is also at work in physical locations. For example, the retail tech company Vispera uses computer vision technology and AI-powered image recognition to help retailers optimize their brick-and-mortar stores and keep product displays fully stocked and looking their best. Using discreetly placed shelf-facing cameras or employee-held mobile devices, Vispera’s technology scans shelves and detects when products are out of stock or priced  or displayed incorrectly, generating reports and alerts for store employees.

“When a customer shops in a store, they need to find the right products on the right shelf with the right price in the right aisle,” says Ece Uluş, global strategic alliances manager at Vispera. “What we help the retailers do is have those products where they are expected and increase their sales in the process.”

Last year, HP Tech Ventures, the investment arm of HP, invested in a funding round for Santa Clara, California-based startup AiFi, which makes AI-powered checkout technology. Using computer vision and cameras, AiFi enables “frictionless” shopping in so-called autonomous stores without cashiers, so shoppers can anonymously purchase items in-store without having to stop to scan or wait in line to checkout and pay.

Seamless self-checkout

While some shoppers enjoy the in-store browsing experience, plenty enter a store ready to pick up exactly what they need. 

“Customers have changed,” StratosMedia’s Hammett says. “They tend to do a lot of research these days before they go in and buy the product.”

Almost 90% of consumers report that they are happy to see retailers making self-checkout options available in stores, but the self-checkout systems in many stores haven’t kept up with expectations. Older kiosks often aren’t durable enough to hold up to heavy use, are often perceived as “dirty” because so many people touch them, and can wear down even more quickly with frequent disinfection. They can also be unreliable, suddenly going offline because something failed on the unit, the security was breached, or the operating system and software were not properly managed.

“Older self-checkout technology was designed for cost savings and labor reduction,” says David Gosman, global industry strategist for retail and hospitality at HP. “They not only look bad, it can degrade the customer experience,”

HP’s new kiosk and retailer platform, HP Engage Express, overcomes these problems with the help of premium materials, high-resolution touch display, and industry-leading security tools. Their sleek design is similar to smartphones with bright screens and high-resolution touch displays, a familiar interface to most shoppers, and one that better fits the aesthetics of today’s stores. They’re built to be “retail-hardened” — an industry term that means they’ve undergone a multitude of tests to help ensure durability and that they can continue to operate under extreme conditions. And, the kiosks are also built to be disinfectable, which means employees can wipe them down throughout the day without damaging the equipment. 

“The design is stylish and attractive, meaning it won’t stick out like an ugly, sore thumb within today’s beautified store environments,” Gosman says.

As technology continues to transform and improve the in-store shopping experience, Cristescu at iSi notes that it won’t likely replace retailers’ most effective in-store assets: their employees. Instead, it will give them new ways to connect with customers and make in-store shopping worth the trip.

“With an online purchase, you’re basically talking to a robot,” Cristescu says. “In-person, you get the opportunity to talk to a real person, and you can ask real questions and that person will be there to support you. After the pandemic, people are yearning for that human touch.”

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