Five Ways Edge Retail is Reimagining Customer Engagement
Living on the edge carries a whole new meaning for today’s retailers, who are increasingly considering edge retail solutions to connect with consumers. This edgy model involves the ability for retailers to beckon would-be customers through digital means, stretching for that sale through smart, connected sales channels that are well-planned and targeted. It’s a burgeoning strategy rife with possibility—it’s unattended retail.
Visualize an automated boutique combined with a smart kiosk, and the omnichannel allure of edge retail becomes apparent. The convenience factor that can arise through such targeted outreach is no accident; thanks to the integration of hardware, software and cloud-based management, direct to consumer purchase decisions are made smarter than ever before. Giving consumers what they want when they want it is an age-old challenge and edge retail speaks to digital natives in their own language.
Convenience and actionable data gathering are a huge factor within edge retail, and the possibilities for fulfillment are intriguing. Imagine, for example, a machine stocked with jerseys placed outside a stadium that recognizes a fan’s favorite team and suggests merchandise accordingly. The automated kiosk that recommends different sunscreen SPF levels beachside based on whether the day is sunny or cloudy. A makeup pop-up kiosk placed precisely in a high traffic area, where targeted geofence marketing is in play.
Edge retail solutions are an interconnected hybrid that looms especially attractive for direct to consumer (DTC) brands. In the fall of 2021, Jabil and SIS International Research surveyed 201 executive-level omnichannel decision-makers from consumer brands about their sentiments and plans for edge retail. When asked to rate the concept's relevance to their business, 51% of respondents gave edge retail a 7 or 8 (indicating it drives day-to-day efficiencies), while 45% gave it a 9 or 10, meaning it supports strategic or analytical goals.
These solutions offer brands the ability to reach consumers where they are, when they’re willing to purchase. This shopping model is at once personalized and opportune, readily available and enticing. Adoption is growing, with 75% of survey participants already employing edge retail — proving there are many reasons to embrace it.
The Rise of DTC is Sparking the Proliferation of Edge Retail
DTC retail models are being adopted at a rapid pace. According to the DTC Purchase Index, 43% of Americans recognize DTC brands; and nearly 70% of those Americans have purchased at least one item from a DTC brand within the last year. This popularity negates the need for intermediaries, which in turn decreases distribution costs. That means improved profit margins, so profit can be spent on something else: like creating customizable experiences that inspire customer loyalty such as those provided by edge retail solutions.
With full control over data, DTC brands could tailor the in-person experience as never before. After all, their e-commerce data already reveals consumer patterns, needs and preferences. That means this physical shopping experience can be further personalized with data.
According to our survey, 71% of brands are investing equally in e-commerce and in-store technologies. So how can edge retail solutions help online DTC brands successfully expand into brick and mortar, and why is it fitting for other CPG or retail brands to perhaps adopt it as well? Two words: customer engagement. Below are five ways the strategy is reimagining that vital sales tactic.
1. With Edge Retail Solutions, Clicks Meet Bricks
Traditional malls still exist, yes, but expect automated boutique/smart kiosk hybrids to pop up more and more. Within edge retail capabilities are stores so interactive that they anticipate a consumer’s needs and wants. This tangible shopping experience is powered by data, which results in an enhancement of the direct-to-consumer relationship. A brand that once was rooted in e-commerce can come alive with edge retail solutions through a low-risk entry into brick and mortar, for example, vaulting from the Web to real-life, real-time applications.
Those who operate traditional retail stores can benefit as well. In our survey, 18% of respondents said the ability of edge retail to provide an opportunity to test new locations or markets to assess the feasibility of a permanent brick and mortar was the most important aspect of the concept. For more than half of respondents (57%), the ability to generate and analyze real-time data about traffic and sales or customers' response to new products was the factor they prioritized.
This merging of clicks and bricks takes customer engagement and nurtures that relationship, personalizing the shopping experience and providing a memorable experience.
How Edge Retail Solutions Work
2. Digital Devices for Digital Natives
They number in the billions, those digital natives: consumers who cannot remember a day before digital devices. According to Citrix, 50% of workers identify as digital natives today; by 2025, that number will increase to 75%. These quick-clicking millennial and Generation Z digital adopters make up the prime audience for edge retail manifestations. After all, what is an automated retail location but another device to interact with?
For this segment of the population, edge retail innovations need little description to be understood. These digital natives are used to the convenience their devices offer. They are the online shoppers, the social media mavens, the ones who see no disconnect between clicking ‘buy now’ and having that same item on their porch later that day.
3. Making Connections Count and Growing Customer Relationships
The purchase used to be on the end-all. Now, companies aim to achieve customer stickiness through relationships – and whether those are nurtured through informational product tips or other such outreach, they must be personalized and targeted. Edge retail presents the opportunity to suggest add-ons, upgrades or more in real time when a customer visits a store, and it extends customer service afterward. It could also be a solution to what 19% of survey respondents said is the greatest technological challenge facing retail companies today — omnichannel marketing.
Brand messaging that stays consistent throughout the communication process makes that information useful and compelling. Data is a prime way to achieve that aim; digital brands that pay attention to buying patterns and specific needs of their customers stand to grow that relationship. This isn’t just ‘feel good’ marketing; it makes good business sense to engage the consumer and forge an ongoing connection.
4. Platforms Built for Customization
Edge retail is not just a smart vending machine strategy – retailers are seizing opportunities to customize hybrid physical and digital retail platforms. The toughest obstacle is building the proper platform to meet the brand’s aesthetic, customer engagement and business objectives. More than one-third (38%) of survey respondents said tailoring messages for a self-service kiosk is one of their top-three most important features when considering a new edge retail device.
Aside from being wrapped in an appealing format, the platform needs to embody compelling displays, user-friendly interfaces, computing and communications technologies, robotics and automation, advanced point-of-sales solutions, machine learning (ML) and artificial intelligence (AI). IoT connectivity to the cloud is necessary to provide safe and seamless interaction between digital and physical platforms while ensuring secure transmission of business-critical customer and sales data. For 61% of survey respondents, smart, intelligent technology like ML, AI and IoT connectivity is one of the most important features of an edge retail device.
As with any digital platform these days, compliance and security weigh heavily because no breach of customer data or confidence is acceptable. Moreover, retailers facing a post-pandemic future have heightened awareness of user interfaces supporting contactless and voice-activated operation.
5. A Data-Filled Pathway to Success
How do you gather the data needed from edge retail solutions? Through low barrier integration with digital retail platforms like Shopify. With various data points regarding acquisition and user behavior, you can fill in any existing data gaps in a hybrid edge retail solution.
Artificial intelligence is embedded in edge retail – and it’s a challenge, to be sure. Data on its own is not helpful; it’s what is done with that data that makes a difference. Even the most revealing data is not helpful to a brand if it is not used in a timely, efficient manner. Data can be used to quickly adjust prices, improve the user experience and even ‘abandon ship’ by replacing merchandise that does not gain traction as expected. Our survey found that data is particularly important for consumer brands selling non-perishable goods that consumers might think about or research more thoroughly before purchasing. Data generation and analysis was ranked highest in importance by apparel brands (39% selected it as a top consideration), followed by pet goods (17%) and cosmetics brands (16%).
Better informed business decisions are not only possible with edge retail, but they’re also imperative. Otherwise, why collect the data in the first place? Ideally, the edge retail strategy allows retailers to use data to place themselves exactly where they need to be -- wherever their ideal customers are.
A world full of device natives engaged with brands and able to make purchases in real time – that’s the hope of edge retail. It makes sense for DTC brands that wish to expand into brick and mortar locations. It can help CPG or retail brands expand theirs. And through a smart, connected sales channel, this ability to deliver products engages consumers as never before.