How to Supercharge the Retail Customer Experience with RFID

How can retailers maintain or even thrive in an environment in which brick and mortar sales and profits have been severely challenged? According to a PwC study, 78% of consumers say sales associates with deep knowledge of a product are important to the shopping experience. And a study by McKinsey and Company notes that retailers that can improve the customer experience by 10% can grow revenue up to 10%.

That may sound straightforward, but the problem has been that consumers expect the same shopping experience they get online inside a store – but retailers aren’t yet delivering it. In fact, it remains difficult for them to get product information and recommendations, find items, get assistance in dressing rooms and remember merchandise for later purchases.

Today, with customer experience and engagement in the spotlight, retail stores realize the increased need to engage customers and improve their experience, service and satisfaction levels. Customers today have an infinite number of channels to spend their disposable income, making retention difficult.

Why Is Customer Engagement So Important?

The bottom line is that customer experience equals loyalty, which directly correlates to increased revenue. The probability of selling to an existing customer is 14 times higher than selling to a new customer, according to Market Metrics. When satisfied by a shopping experience, 73% of consumers will recommend a brand to others and 46% say they will trust that brand’s products and services above others, according to SDL Global CX Wakeup Call.

Some 97% of global customer say that customer service is “very” or “somewhat” important to their choices, according to Microsoft. And 62% of global customers have stopped doing business with a brand or organization due to a poor customer service experience, according to that same Microsoft research. Finally, once a customer leaves after a poor experience, 80% say they will never come back and, if they do, 59% say they will be less loyal, according to SDL Global CX Wakeup Call.

Recommendations Increase Sales

Recommendations is one area where online retailers have struck gold because it significantly enhances revenue. Several studies indicate that recommendations in online stores have increased revenue in general from 5-15%. For Amazon, that number is more like 35%.

The same holds true in the brick-and-mortar world. In-store recommendations increase sales. Consider the use of mannequins, which have proven a simple way to boost sales since their introduction in the 1800s. They provide a better shopping experience, they recommend products, they guide shoppers to product locations, they are inexpensive and they fill voided shopping areas.

Improving on the Mannequin

Now consider putting RFID to work to create an electronic version of that mannequin, providing all those benefits in a digital environment. Data collected from RFID-tagged merchandise provides customers with recommendations and additional product information. They can sense when an RFID tag approaches and notify shoppers about other sizes and colors available in the store via touchscreens. Apparel stores can use them as an extension of mannequins.

Interactive mirrors can show shoppers what an item of clothing will look like on them, as well as different combinations, and guide them to product locations or call an associate. If internet-enabled, shoppers can post their selections on social media or email themselves a wish list. Consider the benefit whether used on the sales floor, in fitting rooms or via smaller devices mounted on display tables. Associates could better serve customers by delivering more product information.

Early feedback on these systems has found that visual images of product recommendations increases upsell and can boost retail sales between 10% and 30%.

It’s clear that retailers need to change up the store experience to meet evolving customer needs, a recipe for not only survival but success in a challenging environment. Interactive shopping is a unique way to use RFID data to engage customers, improve satisfaction and boost sales.

Alan Tamny is Director of Global Product Management at Checkpoint Systems

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