Tag Archives: retail customers

AI-smartphones

Very Clever AI-Powered Smartphones Empower Customers

AI-powered smartphones is the latest attempt by phone manufactures to differentiate themselves from their competitors. They argue that customers will ultimately only buy the smartest phones. But how will the retail industry react to this new gadget?

AI-powered smartphones involves machine learning – the ability for a system to learn outside of its original programming. Furthermore encompasses AI-powered smartphones deep learning, which is a type of machine learning that tries to mimic the human brain with many layers of computation (David Nield, contributor to The Field Guide).

IT-Onlne reported research results by Gartner that identify 10 high-impact uses for AI-powered smartphones.

10 High-impact uses for AI-powered smartphones

  1. ‘Digital Me’ sitting on the device – smartphones will be an extension of the user, capable of recognizing them and predicting their next move. They will understand who you are, what you want, when you want it, how you want it done and execute tasks upon your authority.
  2. User authentication – security technology combined with machine learning, biometrics and user behaviour will improve usability and self-service capabilities.
  3. Emotion recognition – emotion sensing systems and affective computing allow smartphones to detect, analyse, process and respond to people’s emotional states and moods.
  4. Natural-language understanding – continuous training and deep learning on smartphones will improve the accuracy of speech recognition, while better understanding the user’s specific intentions.
  5. Augmented reality (AR) and AI vision – one example of how AR can be used is in apps that help to collect user data and detect illnesses such as skin cancer or pancreatic cancer.
  6. Device management – machine learning will improve device performance and standby time. For example, with many sensors, smartphones can better understand and learn user’s behaviour, such as when to use which app.
  7. Personal profiling – smartphones are able to collect data for behavioural and personal profiling. Users can receive protection and assistance dynamically, depending on the activity that is being carried out.
  8. Content censorship/detection – restricted content can be automatically detected. Objectionable images, videos or text can be flagged and various notification alarms can be enabled.
  9. Personal photographing – personal photographing includes smartphones that are able to automatically produce beautified photos based on a user’s individual aesthetic preferences.
  10. Audio analytic – the smartphone’s microphone is able to continuously listen to real-world sounds. AI capability on device is able to tell those sounds, and instruct users or trigger events.

What implications will AI-powered smartphones have for retailers?

Retail customers with AI-powered smartphones may now connect with AI-enabled stores and online eCommerce sites from anywhere. That may cause the already mobile customers to demand enhanced shopping experiences in every store they visit. Customers with these phones may change their buying behaviour towards retailers that are AI-enabled.

However, the high prices of AI-powered smartphones may see a gradual adoption of the technology and so give retailers enough time to adapt to the phenomenon.

Concluding

Some commentators has labelled 2018 as the year of Artificial Intelligence. So does this means the end of the small local retailer? I don’t think so. Indeed, it may provide an opportunity for smaller retailers to start a digital free retail niche. A niche where you still can use your own senses and decide for yourself when, what and why you want to buy something…

Read also: Webrooming and Showrooming – Buying Behaviors of Retail Customers in Virtual and Physical Environments 

Image:

maxpixel.freegreatpicture.com

 

My Avatar and Me – Coping in the Virtual World

I got it when I discovered the virtual world, my avatar. It’s like jumping into an uncomfortable spacesuit and then free-falling from the physical world into the digital world. This is a world full of zeros and ones, to which they answer only yes or no, which should be only right or wrong. How on earth can we ever comprehend this abstract environment? We need to digitize ourselves. Hence may avatar and me…

What is an avatar?

Your Dictionary defines an avatar as something visual used to represent non-visual concepts or ideas. Or it may be an image that is used to represent a person in the virtual world of the internet and computers. Peachey and Childs, (2011)1 suggest that taking on the form of an avatar within a virtual world is resembling a literacy of crossing down from the real into the digital. Consequently, many of us created our first avatars when we start playing games online.

With online gaming, virtual worlds are three dimensional environments in which you can interact with others and create objects as part of that interaction. How do you do that? You appear as an avatar in the virtual world: an avatar is a virtual representation of you (a ‘virtual ego’) which can take on any shape or form as you so wish (Virtual Reality Society). Just like my avatar and me…

My avatar and me going shopping

Now we move from gaming to shopping. How will my avatar help me shopping in the virtual world? It can be done with the help of your online retailer… According to De Mesa, (2009) 2 brands can, by being three-dimensional and interactive, move past the ‘show me’ paradigm of other media and get into the ’touch me’ world of true interaction.

Take for example shopping online for clothing. From the start this was a potential minefield. “The issue of getting the correct size remains a serious drawback for buying clothing and footwear online. Sizes vary from brand to brand, and since you can’t try out the products before buying them, selecting the size is always a gamble”, says Tarun Mittal, YourStory.com.

However, the industry is pouring millions of dollars into developing and trying technological solutions. Augmented reality, avatars and algorithms that approximate your size based on measurements you provide are already in the marketplace (CBC News).

So, my avatar (and me) can now click on an app to select my body shape and click on a piece of clothing I want to try. My avatar will appear in a 3D image wearing the item in the comfort of my own home. That’s really cool, isn’t it!

How can using avatars help retailers?

Just as we are using avatars to ease into the virtual world, so retailers use avatars to target their audience better. They call these avatars personas. Retailers, for example, create personas to help them understand their customers better. “It’s not who comes to your website that is important it is how they behave when they get there that is key to your success”, say Jackson (2009) 3.

Jackson (2009) 3 also suggests when designing personas, retailers should look at a number of different sources of data to define how to get to their role models. These are:

  1. Demographic data – age, gender, geography (data acquired from customer surveys, CRM data or other sources).
  2. Customer psychographics – what the customer does in the pre-purchase phase found by looking at a number of different sources in addition to the demographic data, such as web analytics keyword data.
  3. Market data – such as how the branding and market place effects the decisions of the persona. Web analytics keyword data, Google Trends and data from doing a competitor analyses are good sources of information.

Once a retailer has all the data about her customers, she can create an avatar or persona for customers that are interested in a specific product or product line. Below is an example of a completed buyer persona.

Concluding

The advent of the internet and technological advances thereafter have plunged us all in a new world. It’s a new world with a new economy and new rules – for most an exciting though scary space. By creating avatars and personas, machines and humans can meet on common ground – each wearing a spacesuit to make sense of one another.

Notes:

1Peachey, A. and Childs, M. 2011. Virtual worlds and identity, In: Reinventing ourselves: contemporary concepts of identity in virtual Worlds, 1-12, Springer London.

2De Mesa, A. 2009. Brand Avatar: Translating virtual world branding into real world success, Springer.

3Jackson, S. 2009. Chapter 6: Developing and Measuring Motivational and Behavioural Personas, In: Cult of Analytics: Driving online marketing strategies using web analytics, Routledge.

Images:

  1. slidesharecdn.com
  2. Pixabay

Read also: Chatbots in Retailing – a Fact or a Fad?

Augmented Reality in Retail – a Useful Customer Experience

Not so long from now. There is an eerie quietness in the retail store.  Almost all the customers are wearing identical glasses and head sets, slowly walking through the aisles like humanoid robots. No, it’s not a new episode of Star Trek in the making – this is Augmented Reality (AR) in action.   Retailers are now experimenting with AR to get customers back in the stores.

What is Augmented Reality?

Augmented reality is the practice of augmenting a real-time direct or indirect view of the physical world with virtual information 1. Scholz and Smith (2016) describe the practice of AR as: “Marketers layering digital information (e.g., text, pictures, and videos) over objects and spaces in the physical world (e.g., product packaging, advertisements, or street scenes). And consumers experiencing these hybridized realities via digital screens (e.g., smart phones or video installations) or projections (e.g., holograms)”.

AR can also be explained as the co-existence of virtual and real in the same space, as well as the interactive alignment and mutual registration of computer generated sources with physical reality 2.

Scholz and Smith (2016) have identified the five ingredients of AR:

  1. AR content – is virtual information that is often perceived by consumers through digital devices (e.g., smart phones, large-screen AR installations);
  2. Users – are the people who directly experience an AR layer. Users can share the same physical space. For example, if a screen displays an augmented view of the street behind a bus stop (e.g., bogus window paradigm). Or they may view the same AR layer while dispersed across different locations – for example, when readers of a magazine access the AR content of an active print;
  3. Bystanders – are people who do not experience an augmentation themselves but instead observe a user’s actions either directly – by sharing the same physical space – or indirectly – by viewing content (e.g., images) that a user has generated during his or her augmented experience. Bystanders can affect users’ willingness to engage in AR experiences because they form the social context of the experience;
  4. Targets – are entities in the physical world that are augmented with digital information. In many cases, targets are objects; for example, a marketer might digitally overlay a brand narrative or ingredient information on product packing. Targets may also be people – for example magic mirrors in fitting rooms that superimpose digital images of their merchandise over live images of customers;
  5. Background – those objects and ambient conditions that share the same physical space as the target, but that are not augmented in this particular AR layer.

AR has the potential to be a life-changing technology application. In a recent interview by Bloomberg, CEO Tim Cook of Apple said: “We’ll all have AR experiences every day, almost like eating three meals a day. It will become that much a part of you.” What is the value of AR for the retailer?

Augmented Reality in retail

AR can help Bricks and Mortar retailers to let their customers enjoy their shopping experience and come back for more. Shauna Heller writing in Media Leaders propose that retailers offer headsets for people to wear while in their stores, to guide people through the store with pop-up characters, animations, or even a virtual assistant right through the visor popping up as people walk around. According to Augment.com, AR helps in the following ways to stop buyer uncertainty:

  • Proximity, presence, and interaction – a customer who is shopping for home furnishings can launch models of a bed or lamp to see how the item would actually look and fit (to scale), rather than playing a guessing game. AR advocates for purchases with more certainty and satisfaction.
  • Modify or customize selections – Augmented Reality makes it easy for consumers to explore their options and make personalized modifications.
  • Visualize or understand products and features – a customer must be able to understand and visualize how a product works and functions. AR augment sophisticated demonstrations that make it easier for customers to visualize and understand the intricate features of a product before they purchase.

AR marketing campaigns open new possibilities for brands to engage and interact with consumers, especially those from social media generations. Yaoyuneyong 3, et al found that AR is “immersive, persuasive and powerful” and the two benefits of AR marketing that they’d identified are:

  1. Enhancing communication by engaging and increasing consumers’ level of immersion and
  2. Improving sales strategy and sales processes.

Also, augmented reality can make a difference to the shopping experience for both online and offline retail customers.

Concluding

After all, it took a game like Pokémon GO and millions of people with smartphones a couple of years ago to bring Augmented Reality under the spotlight. However, the real value of AR is not just for the entertainment of its users, but also as a dynamic marketing tool for retailers.

Remember Pokémon GO?

Further reading

  1. How successful are Retailers in the Omnichannel?
  2. Bricks and Clicks Retail – Shopping Experience makes the Difference

Notes

1 Scholz, J. and Smith, A.N. 2016. Augmented reality: Designing immersive experiences that maximize consumer engagement, Business Horizons, 59(2):149-161.

2 Javornik, A. 2016. Augmented reality: Research agenda for studying the impact of its media characteristics on consumer behaviour, Journal of Retailing and Consumer Services, 30:252-261.

3 Yaoyuneyong, G., Foster, J., Johnson, E. and Johnson, D. 2016. Augmented Reality Marketing: Consumer Preferences and Attitudes Toward Hypermedia Print Ads, Journal of Interactive Advertising, 16(1):16-30.

Image and video

  1. shortfilmwindow.com
  2. Pokémon GO

Know Your Clever, Less Distinctive Customers – Generation X

Generation X, which refers to those born from the mid-sixties to late seventies is one of the most highly educated generations in history and is characterized by technological and media savvy, skepticism and pragmatism 1. Above all, these shrewd customers usually make informed purchasing decisions and often search the internet for the best deals. So what makes Generation X different from other generational cohorts?

Gen X grew up with both parents in the workforce, or in a divorced household, causing many of this generation to become independent at a young age 2. This generation is described as experiencing social insecurity, rapidly changing surroundings, and a lack of solid traditions. Members of this cohort are said to have the following characteristics 3:

  • Value autonomy and independence
  • Thrive to open communication
  • View work from an action-oriented perspective
  • Do not believe in “paying dues”
  • Seek to acquire skills and expertise
  • Do not have long term loyalty to a company (but are loyal to individuals)
  • Believe in balancing work-life objectives
  • Are reluctant to take on leadership roles

“Like their namesake suggests, Gen Xers are less distinctive than other generations. And they know it!” says Paul Taylor, executive vice president for special projects at the Pew Research Center. Therefore retailers should  know how Generation Xers behave when shopping…

The shopping behavior of Generation X

Generally, generation X shoppers can be categorized by their keen understanding of marketing and media. Indeed, research is crucial for these individuals – they use the web to reinforce their existing opinions on brands and products, rather than to form them to begin with (RetailPro). Nelson Baber 4  did a study  on how marketing practices should be adapted to today’s technology-driven culture. He found that Generation X spend half their time watching television – more than they spend on the Internet.  However, Gen X will respond to television advertising as well as research information on the Internet. Therefore, Barber suggests products targeted toward Generation X should have informative advertisements on both venues that contain detailed advertising copy.

Generation X shopping online

Generation Xers are known to be shrewd online shoppers that spend nearly 40 hours per week shopping online. Therefore retailers with internet shopping sites should avoid too many pictures or advertisement copy that would cause skepticism among this group. Barber 4 suggests that advertisers present product information in a straightforward manner and allow users to share the site or product-specific selection with friends through e‑mail links or connections to social media. The table below lists some of the facts regarding internet use by Generation X.

Facts on Internet Usage among Generation X (Statista, 2013)

Internet Profile
Internet users in the USA 58.2 million
Mobile internet penetration (worldwide) 66%
Social Media
Facebook account ownership (worldwide) 81%
Number of social network sites in the US 44 million
Median number of Facebook friends (US) 200
Online Shopping and Spending
Average online spending in the US $561
Share of making purchases worldwide 68%
Books are the most purchased item 38%

 

The data as shown in the table indicate that Generation X loves the internet, social media and online shopping. Importantly, online – and Bricks and Mortar retailers targeting Gen Xers should take their behavior and outlook on life into account to achieve their lasting patronage.

Concluding

The last say about the shopping behavior of Generation X is best summarized by Lissitsa 1 and Kol, 2016. “Gen X is highly sophisticated in its buying behavior and is turned off by slick and generalized promotions. They still makes purchases based on traditional search and decision-making methods. They want to hear the features of the product as well as an explanation of why these features are necessary. Moreover, Gen X have an attitude of risk avoidance and a low capacity for risk. Lastly, as consumers, Gen X looks for customer convenience, community relations, and branding. They have a reputation of being incredibly disloyal to brands and companies.”

Read also:

  1. Selling to the Young Ones, Generation Z
  2. Shopping Behavior of The Baby Boomers
  3. Demographic Segmentation – Dividing the Market by Generations

Notes:

1 Lissitsa, S. and Kol, O. 2016. Generation X vs. Generation Y–A decade of online shopping. Journal of Retailing and Consumer Services, 31:304-312.

2 Acar, A.B. 2014. Do intrinsic and extrinsic motivation factors differ for Generation X and Generation Y. International Journal of Business and Social Science, 5(5):12-20.

3 Ordun, G. 2015. Millennial (Gen Y) consumer behavior their shopping preferences and perceptual maps associated with brand loyalty. Canadian Social Science, 11(4):40-55.

4 Barber, N.A. 2013. Investigating the potential influence of the internet as a new socialization agent in context with other traditional socialization agents. Journal of Marketing Theory and Practice, 21(2):179-194.

Images:

Wikimedia.org

Pexels.com