State of Mobility in Retail Report

From ‘Bricks to Clicks’: Navigating the Retail Revolution

2State of Mobility in Retail Report

Personalization, customer service and attention to detail, driven by interactions with technology, are back on the agenda

Introduction 2 Global research methodology 3The state of mobility in retail report: Key findings 3Forging ahead in the digital race 4Consumer confidence in new technologies rising 5Mobile readiness is speeding up globally – will retailers sink or swim? 6Youthful enthusiasm serves as a digital catalyst 6Country conclusion: U.S. 7Country conclusion: UK 7Country conclusion: Germany 7Country conclusion: Sweden 7Investing in the 'new normal' 8

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Introduction

The idea that ‘the customer is king’ has never been more profound than it is today. In fact, this royal status has been upgraded in recent years as online and offline retail continues to merge, fostering levels of service and customer experience completely unlike what was seen even a decade ago.

Back then, the continuous rise of e-commerce looked like it had physical stores on the ropes, as a thirst for immediacy, efficiency and widespread shopping availability was being quenched. Since then, however, a revised – more traditional – retail appetite has come back into the fray. Personalization, customer service and attention to detail, driven by interactions with technology, are back on the agenda.

So, in this new climate where customers want the best of both worlds – the immediacy of online shopping with the personal touch of brick and mortar stores – a host of new mobility solutions have been given a welcome route to market, as a key enabler in the marriage of online/offline retail.

Looking through the modern lens of how mobile technology throughout the retail landscape can enable personalized experiences on an omnichannel basis, SOTI has carried out research among 4,000 consumers in the U.S., UK, Germany and Sweden, to gauge their opinions on these trends and the solutions driving them.

Self-service kiosks, voice-activated shopping, delivery drones, mobile shopping and more, were all explored to assess how ready consumers are in key markets worldwide. The State of Mobility in Retail Report also looked at how ready consumers are to engage with new technologies that satisfy their hybrid retail desires.

The State of Mobility in Retail Report highlights the key challenges that today’s retailers are experiencing as a consequence of this burgeoning – yet, already very present – demand, and why many are turning to innovative retail technology solutions such as the SOTI ONE Platform to take their business-critical mobility to new heights.

3State of Mobility in Retail Report

Globally, more than two-thirds (67.3%) of consumers perceive mobile technology as an effective strategy for delivering a faster shopping experience

Global research methodology

Preparedness is paramount and, in retail, instant results are critical. Optimizing both online and offline channels for consumers is the new normal as we move from ‘bricks and mortar’ to ‘clicks and mortar’. SOTI is seeing significant year-over-year revenue growth from this demand, as the need to effectively manage all inventory, scanners, sensors, and robots intensifies in the supply chain.

Inevitably, this not only impacts revenue streams, but also workers and the overall retail environment and customer experience. The only way to get ahead of the curve is to encourage personalization from the outset; to take in what consumers are calling for and respond to it now.

The research explored these notions; comprising online surveys with 4,000 adults in the U.S., UK, Germany and Sweden. All respondents were aged 18 to 65 years old. Research was conducted in November 2019 by independent research firm Arlington Research, with internationally representative quotas achieved for gender, age and country (+/- 2%).

The state of mobility in retail report: Key findings

For some time now, there has been intense pressure on retailers to have the right technology in place to ensure the customer experience – whether online or offline – looks and feels seamless.

To this end, stand-out stats from the report provide a strong starting point for their focus, contributing to a 360-degree consumer view of retail that includes highlights such as:

• More than two-thirds (67.3%) of all respondents believe that retailers who utilize mobile technology provide a faster shopping experience for customers, with 78% of U.S. consumers believing the same

• Self-checkout devices are not only perceived to be beneficial to the shopping experience (40%), but actually improve the shopping experience (47.1%)

• Fewer than a quarter (24%) of people across the entire study would prefer a solely traditional in-store experience void of any technology

• Despite a general demand for technology to influence the shopping experience, consumers are unwilling to sacrifice personal data security (32.6%) to improve their in-store experience

• Respondents in the U.S. (48.1%) and Sweden (37.5%) are most excited about retail innovations like facial recognition and beacon technology, versus Germany (32.1%) and the UK (31.7%)

• An overwhelming 50.7% of Swedish respondents believe that scan-as-you-shop technology improves their in-store shopping experience

• Respondents in the U.S. (19.4%) and Sweden (20.2%) demonstrate surprisingly similar levels of comfort with the concept of delivery drivers entering their home via smart locks to leave purchases inside

• Globally, more than two-thirds (67.3%) of consumers perceive mobile technology to be an effective strategy for delivering a faster shopping experience

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Forging ahead in the digital race

When it comes to enhancing the overall retail experience, it’s not simply a case of analyzing whether consumers are in favour of digital assistance or intervention, rather, it is to what extent, and through which means.

It’s here that the trends found in the report are better explored as specific regions, where nuances can be found. From there, additional factors can be dissected across parameters, especially age.

In the UK and Germany, statistics around the types of self-service technologies consumers would be willing to utilize, and think would improve the shopping experience, are similar. For tools such as digital kiosks, digital signage and scan-as-you-shop, around one in five (21%) of those surveyed reported back favorably in each case. In both countries, and also within the U.S., the only technology to set itself apart as an already trusted option was self-checkouts (42.6% in Germany, 51.6% in the UK) – the option that has been entrenched in retail establishments for the longest time.

The only notable difference between the two nations, when exploring the perceived ‘benefit’ of each self-service technology, was Germany’s slight leaning towards digital signage for navigation. Even though this remains an emerging trend at 13.9%, it does allude to a positive trajectory for the country as its digital journey continues.

Comparatively, in Sweden, there are clear signs that the journey is further along. When asked what is most important to Swedes with regards to their ideal in-store experience, around 20% of Swedish respondents veered towards personalized shopping experiences, personal data security, and even in-store delivery and collection. Not a vast increase on the UK and Germany, but still enough to suggest advanced readiness on the digital front.

When asked about the specific technologies they’d perceive as beneficial or as an improvement to the shopping experience, the contrast was more telling. In addition to the trend of self-checkouts (42.4%), there is also a huge leaning towards scan-as-you-shop systems in Sweden (50.7%); far higher than what was reported back from the other surveyed nations.

When looking at improving the shopping experience, digital signage was also above 20% favourability, and the statistics are even more significant when exploring the age range of those willing to embrace digitization in retail. In Sweden, net positivity for technologies improving the shopping experience among the oldest age range (55 to 65) came out on top at 71.2%; ahead of the UK (58.6%) and Germany (57.2%).

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Consumer confidence in new technologies risingWhen it comes to meeting consumer demand in the current climate, retailers have a tough task. Blending the speed and convenience of digital, with the personal touch of more traditional human-based interactions, is no small feat, especially given the understandable resistance among shoppers to indulge in brand new digital tools right away.

This trend and characteristic was brought to light in different ways throughout the findings. Overall, the general theme suggests that personalization is key – if personal information is kept secure. While more than three-quarters (76%) of consumers want personalized in-store experiences from mobile devices, one-third (32.6%) are unwilling to sacrifice personal data security to improve their in-store experience.

The notion of ‘warming up’ to newer solutions certainly echoes throughout the State of Mobility in Retail Report. As epitomized by the adoption of self-checkouts, ahead of technologies such as scan-as-you-shop or digital kiosks, getting used to new technologies is reflected when respondents were asked about delivery and transaction options.

Almost 90% of respondents across the board were happy with at least one or more delivery options outside of traditional in-store transactions. From more familiar options such as home deliveries and in-store collections, which teetered around the 50% mark, to up-and-coming technologies including autonomous vehicle delivery (26.9%) and delivery drones (31.4%), ‘delivering on expectations’ seems to now represent delivery outside of the traditional.

On the transaction side, greater variation was found on levels of ‘trust’ when it comes to digital intervention. Across the U.S., the UK and Sweden, cash transactions are still in the back of people’s minds, but there is a general shift towards chip and pin, or contactless payments (42% of respondents prefer this method over others). Considering that financial transactions are understandably a prime concern for consumers being urged to put faith in technology, this positive trajectory towards digital adoption and trust is a positive sign of retail’s general mobile transformation.

In Sweden in particular, the concept of trust when it comes to fulfilling demand on deliveries was taken a step further, with one-fifth (20.2%) – including a concerted percentage of the older generation – saying they’d be comfortable with a delivery driver entering their home via a smart lock to leave purchases inside.

76%

32.6%

Three-quarters of consumers want

personalized in-store experiences from mobile devices

One-third are unwilling to sacrifice personal data security to improve their

in-store experience

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Mobile readiness is speeding up globally – will retailers sink or swim?At face value, consumers seem to understand the benefits of mobile and IoT technologies in the retail space, but – as is often the case – they remain more favourable to those that have been established in the public domain.

This leaning was echoed when respondents were asked what types of mobile devices they would like sales associates to use to provide a better in-store experience.

Presented with options including handheld or cart-mounted devices to check inventory availability and pricing, mobile devices that allow purchases away from traditional cash registers, or handheld devices to enable communication with backroom associates, generate primarily positive feedback. More than three-quarters (76%) of respondents would be in favour of at least one of these solutions when shopping.

Not only does this reflect the idea of openness to mobile technology in retail, but it also brings in elements of ‘control’ over such technologies, and more personalization of the shopping experience. When it came to financial transactions, or even the shopping experience itself, those surveyed showed immediate receptiveness to solutions that were either already commonplace, or those that they could oversee themselves (such as self-service or scan-as-you-shop), while displaying more long-term optimism over more IoT-driven solutions that are in their infancy.

As evidence of this overall leaning towards mobile transformation, regardless of the stage of its adoption levels, more than two-thirds (67.3%) of those surveyed across the board concede that retailers who utilize more mobile technology (both self-service and used by sales associates) enable a faster shopping experience for their customers.

In the U.S., these readiness levels are even higher, with 78.2% perceiving mobile technologies as an effective strategy for retailers to enable faster shopping experiences; and only 8.2% suggesting that their checkout times haven’t sped up.

Youthful enthusiasm serves as a digital catalystTo compound the idea of forward-thinking optimism, respondents were asked about their perceptions of even more advanced, forthcoming innovations. These included functions such as facial recognition and beacon technology as a sign of things to come in the retail sector.

Across all countries, more than one-third (37.4%) expressed excitement when it came to such innovations, with the U.S. and Sweden (48.1%) taking this enthusiasm even further.

Across the entire group, this excitement was ramped-up even further among males (44%) and the 18 to 34 age range; the latter a quarter (25%) more likely to get excited about new technologies on the horizon, than the 35 to 65 age range.

This suggests mass positivity towards upcoming trends and the solutions driving them and, closing in on the findings even more, other interesting trends have emerged along similar lines. Especially among younger males, where the idea of voice-activated shopping, or delivery drones for purchases, are both viable and exciting opportunities.

Considering the younger demographic's contribution to the retail sector, this is indeed a positive sign; not just for the industry at large, but more specifically for brick and mortar stores. In its battle with e-commerce, brick and mortar seems to be unearthing digital solutions to bridge the gap between the two.

For the prospect of delivery drones, even the UK and Germany (countries that were a bit more cautious in other areas of the survey) are above 25% when gauging comfort levels.

The important phase now is to convert this positivity and excitement into tangible adoption. It’s understandable that genuine levels of trust only occur once a solution has been widely available and tested for a period of time, but that trust can only settle in among consumers if retailers capitalize on the evident enthusiasm and encourage faster rates of adoption, now.

State of Mobility in Retail Report

Country conclusion U.S. enthusiasm extends to the most forward-thinking of trends

It’s fair to say the U.S. was the most extreme in terms of favourability towards the solutions presented in the survey. A lot of this seems to come through the notion of convenience.

When it comes to payment options, the differences between cash and card payments didn’t differ all too much from those trends seen in Europe. However, there was much more enthusiasm for delivery options, with more than 90% open to options that divert away from traditional in-store experiences. This included comparatively high levels of excitement towards the possibility of delivery drones (37.5%), autonomous vehicles (29.7%) and even delivery drivers entering homes via smart locks to deliver goods inside (19.4%).

Country conclusion The UK may still prefer the high street, but that doesn’t mean an aversion to digitalIn the UK, there is optimism for technology and its role in improving the retail arena, even if they’d like these new solutions to complement more traditional systems rather than completely overhaul them.

As many as 32.8% still state that they prefer a traditional in-store experience while shopping, quite a lot higher than any of the other three countries, but this doesn’t necessarily signal a resistance to digital. Rather it’s a symbol of hope for the traditional British ‘high street’ to remain relevant and prosperous in the face of e-commerce’s perceived monopoly – and that’s only if they embed more innovative solutions quickly.

Country conclusion Sweden’s demographic balance opens the door to widespread adoptionUnlike its European counterparts, Sweden presented a much more balanced perspective towards the idea of digitization and mobile in retail, expanding even into the older age demographics.

You can almost see the evolution of readiness from Germany and Sweden through the transaction segment of the survey, with the latter overwhelmingly in preference of chip and pin (60.4%), notably ahead of the former’s preference for cash, but not yet at a contactless stage when it comes to their favoured method.

Perhaps most notable for Sweden isn’t its overall comparison to the UK and Germany, but the much more balanced representation across males and females, and indeed age ranges, when it comes to mobile and IoT favourability. The figures very rarely differed for males and females for any of the questions presented, unlike other countries surveyed.

Inevitably, Sweden’s openness to innovative technologies presents huge opportunities for retailers in the country to tap into a wider demographic than any of the other three nations.

Country conclusion Germans call for control as they continue their digital journeys

Germany is cut from a similar cloth to the UK in its desire for digital strategies to enhance existing state of affairs in retail. For Germany specifically, this notion is intensified when elements of personal control are brought into play during the delivery and transaction processes.

Regarding mobile devices being used in-store, almost three-quarters (74.1%) subscribed to the idea of at least one device enriching the sales process, which shows that the concept of technology in retail is very much favourable. The onus is once again on retail chains to introduce them now so that consumer trust levels can improve more speedily.

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Investing in the ‘new normal’

As consumers become more accustomed to new mobile and IoT technologies in retail, trust levels are rising. This is a potentially unsurprising result, however the more promising and revealing statistics revolve around enthusiasm for solutions either still in their infancy, or just on the horizon.

The trajectory of innovations that are commonplace in society, but perhaps new to retail (such as voice-activated solutions or wearable technologies), are positive and present a valuable opportunity for retailers to leverage more concertedly in order to build consumer trust even further.

Today, even more exciting territory such as drone deliveries, or facial recognition technology are yielding enthusiasm ahead of their mainstream adoption. This alludes to an overall leaning towards digital disruption among younger generations in particular, who realize that such innovations are leading the way to the shopping experience of the future.

This isn’t just good news for the technology landscape

In positive news for brick and mortar stores, this ‘new normal’ is being perceived as an inevitability in many cases. For those responsible for implementing these solutions, they need to ensure that user functionality also satisfies consumer demand.

The time for retailers to invest in mobility is now. The take-up of this technology is inevitable. They must be prepared to calm any customer concerns and turn enthusiasm into sustainable trust among the consumers of tomorrow.

SOTI is a proven innovator and industry leader for mobility and IoT management. Globally, over 17,000 companies depend on SOTI to transform their business by taking mobility to endless possibilities.

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