CREJ - Retail Properties Quarterly - February 2016
The year 2015 marked when technology closed the gap between in-store and online shopping for retailers. Customers now are able to combine the convenience of connecting to a retailer’s website or application for additional information with the benefit of being in the store, where they have the added ability to physically inspect the products. “Fifty percent of retailers have an online store, up from 23 percent,” according to a report by Lightspeed POS. “Nineteen percent currently implement a mobile POS [point of sale] for checking out customers anywhere in the store, and 22 percent use a mobile POS for inventory lookups on the store floor.” By building new retail space or upgrading existing space with the following five technology trends, building owners can provide a product that tenants are looking for in order to keep their customers engaged, which means less turnover for property managers. It also benefits brokers to have a top-tier product for their clients. 1. Digital signage. Leveraging digital signage can create an interactive shopping experience using visual communication. From changing prices on the fly to creating targeted advertisements, retailers can manage digital signage content – whether that content is at a single store or at stores across the nation – from a single, central location. Owners, managers and brokers can keep existing and potential tenants informed using digital signage by displaying interactive content to advertise their listing, to provide a property directory or to add revenue by selling advertisements. A current example can be seen on the 16th Street Mall with the digital retail directories placed in various locations. One tip: Although property owners can save money on the interactive displays by purchasing hardware from an over-the-counter retailer, it is worth considering commercial-grade displays for their longer life spans when they are powered on for long retail hours. 2. In-store Wi-Fi. Using fully managed Wi-Fi connectivity throughout your retail space provides multiple options for interacting with customers. From POS to customized apps, or even tablets in dressing rooms to facilitate assistance, in-store Wi-Fi provides additional touch-points to engage with customers. Retail property owners should consider offering wireless access points across multiple spaces for an additional value-add to tenants. It is worth noting that customers complain that they would rather have no Wi-Fi versus poor Wi-Fi. Therefore it is important to work with an experienced technology consultant to provide enough bandwidth and coverage to enhance a customer’s experience. 3. Mobile payments. By the end of 2016, 25 percent of all retail e-commerce sales in the United States will take place via mobile devices, according to eMarketer. Mobile point of sale allows retailers to use tablets and phones to process payments on the floor as well as check inventory at other stores. In order to accommodate the use of mobile point of sale, it is important to understand the need for adequate Internet connectivity. Retailers should plan on a minimum of 10 megabits per second download and 5 mbps upload for even a small (500- to 1,000-square-foot) retail space. 4. Resurgence of beacons. According to Business Insider, beacons will directly influence over $4 billion in U.S. retail sales this year and climb to 10 times that number next year. Beacons are used for short-range Bluetooth connectivity to personal devices and can provide in-store coupons, POS and data analytics showing how much time users spend in a particular area. One beacon is relatively inexpensive and can accommodate coverage of approximately 5,000 sf of store space. As a broker, when showing properties, understand the possible layout of a space and where a beacon can be located to help tenants visualize the space and how their customers can engage with their products. 5. Network and device management. With all of the technology that can be placed in a retail space, use a trusted technology adviser for network and device management. Your adviser can manage everything, including the Wi-Fi, POS and tablets used by employees. Although retailers can handle one location fairly effectively, managing multiple stores across a nationwide company quickly can add up in terms of headcount and costs. Using third-party advisers can assist with the return on investment for technology changes. Understanding retail requirements and the technology available will help ensure the right fit for retailer and customer satisfaction. However, poor or mistaken information can lead to a poor customer experience. By partnering with a trusted technology adviser, you position your retail space to showcase its in-store and online convergence and meet your clients’ business needs. Ease of use must be a priority when implementing, and training is an important step to include. Leverage your third-party partnerships to accommodate both.