Immersive experiences in retail

More and more retailers are investigating AV technology in-store to help modernise their brands in an online world. But there are a few factors which are limiting widespread adoption says Paul Milligan.

Technology, either in our pockets or on our desks, has become a central tenet in our lives.  And how we buy things is not immune to this change.  Online shopping has revolutionised the retail experience, and continues to evolve, with products delivered to us just hours after clicking ‘Buy Now’. 

So what has this done to the established way we previously bought our products, i.e. in malls, department stores or the high street? Retail is in a state of flux and looking for a way to re-connect with customers and a major way to do this is through technology. 

But it has some catching up to do, as Guy Phelps, head of retail sales for NEC Display Solutions explains: “What we, as AV professionals, have to remember is that ironically most retailers are behind their customers when it comes to technology.   Most customers have something far more sophisticated in their pocket when they enter the store than what has been installed in-stores.  When we talk to retailers about technology, the customer is often savvier than they are.”

At the moment there is a plethora of technologies being installed, with varying degrees of regularity and success it must be noted, in retail right now.   So what are they? Well currently the list looks something like (but not limited to) this; Digital signage, beacons, biometrics, touchscreen displays, videowalls, AR/VR, gesture recognition, 4K, holographic displays, and ‘magic’ mirrors.  

So which technologies work best in retail, and which ones don’t?  “The original idea was to use technology to drag people into the store, but now it’s being used to create an immersive experience once you are inside,” says Michael Bailly, product development and marketing director at Sharp Electronics Europe. 

Clas Dyrholm, founder and CEO of Realfiction, a Danish manufacturer of 3D holographic display systems, whose retail clients include Tag Heuer, Louis Vuitton and Coca-Cola, is another to adhere to that philosophy.   “We have found instantaneous communication works best.  It has to be something that does not require the consumer to go to lengths just to get an experience. VR headsets don’t work because there is no instantaneous effect, and it’s only for one user at a time.”  

Speaking to a variety of people across the technology supply chain, the consensus seems to be that the vast majority of systems going in to retail are still quite basic or simple.  Systems dubbed ‘lift-and-learn’ i.e. an iPad for the customer or sales adviser to gain more information, are commonplace.   That is not to say there aren’t ambitious projects being installed around EMEA, there clearly are, but it has to be rooted in reality.  “Sometimes the design agency comes up with an idea before knowing if it’s actually possible or not.  What we have to do is tell them maybe 75 per cent of that is achievable, the rest can be achieved but will cost half a million euros.”

TAO Sportswear retail image

Whatever systems are going in, it seems as though the message is getting through that professional systems are the best option, and if chosen correctly, can work smarter and harder for you once installed.   “Retailers are starting to realise using a cheap media player isn’t worth it, because six months later it’s gone wrong.  We are trying to push retailers into using systems which have some intelligence, so it can react to the environment that it’s in,” says Adam Wilson, director from Intevi, a digital media solutions provider, whose retail clients include Aldi, Bobbi Brown and KIA Motors.  “If you have some intelligence in the technology it can ensure that if the person in the store is picking up a particular product what is on the screen is relevant to that range.”  

Wilson is not alone in thinking this, as Phelps points out; “There is a lot of discussion now about intelligent signage, and how sensors can help give a better ROI.  I predict in 2016 and 2017 we’ll see a lot more sensor-based signage from high street brands.”

Videowalls are undoubtedly the biggest product in the AV world right now, and this is being reflected in retail too. A combination of falling prices and easier products to install has seen videowalls installed in more retail outlets all over EMEA, with a simple 2x2 configuration making up the lion’s share of projects.  It’s not particular ‘next-gen’ technology, and there are concerns about it being invasive in smaller retail spaces, but videowalls are certainly effective in this environment.

As mentioned above, space (or a lack of it) in retail can have a big effect on technology in retail, do the limitations on floorspace often dictate the technology? "It depends on the retailer, some rely on customers seeing as many products as possible.  In a boutique/luxury space, where they might not have a lot of product and it’s all about the look and feel and the experience so floorspace is less crucial,” says Phelps.  

Dyrholm agrees floorspace does play a part, but doesn’t feel it should restrict an integrator’s choice. “Of course there needs to be limitations, but retail environments should be about experiences.  I want to go to a shop and see something more than shelves of products.  I want to learn, I want to experience something.  When we talk about positive retail experiences it’s about touching or smelling the products, being given the chance to compare similar products, trying them on etc.”

In the past there has been reluctance from brands to invest in technology within retail, some have yet to be convinced of its worth, while others have had their fingers burnt on systems which made little impact.  This meant it was left to high-fashion/high-value brands to take a technological leap of faith, is this still the case? “In our experience it is,” says Wilson.  “They often come back to you with new ideas for projects, and they want to be brand leaders, and technology helps them do this.  The more basic, lower-end customers are simply happy with a standard digital poster to replace print.” says Wilson. 

“The big brands won’t hesitate to use technology,” says Bailly.   “Compared to advertising on TV it’s quite a good ROI.”  Christian Jeske, the marketing director for Pyramid Computer, a German manufacturer of products for the retail sector, feels the general retail market is now investing in technology, but there are geographical differences; “One to three years ago people were scared, they were waiting to see how things developed.  Now US and UK brands are looking to innovate.  In German-speaking markets we are still locked in discussions, they don’t feel ready for those types of technology, they are concerned the public doesn’t know how to use it, and it may not be accepted by older customers.” 

While those elite brands like to use technology to separate themselves from the pack, the everyday reality of technology in retail is a lot more sobering says Phelps. “I’ve lots count of the amount of times I’ve gone to meetings with clients and talked about our facial analytic software and about combining that with sensor-based technology and self-calibrating videowalls and it’s ended up six months later with a deal for a bunch of 42-in screens and nothing else.  That’s the reality.”

One major stumbling block to technology in retail in the past was an insistence on proving ROI.  New intelligent systems have made proving a case for technology easier than before, so is it still a make-or-break issue? “Signage in retail is always a question of return,” says Bailly.  


Jeske agrees; “Outside of the UK and USA the first question is about the price, in the UK and USA the first question is about the innovation of the project – what is new about it? What can I offer my clients?” This situation is not helped by a reluctance by some clients to release (potentially sensitive) ROI information says Phelps. 

“Clients aren’t keen to tell you what the ROI has been on projects, so you can’t use that to promote it to the next client, but clearly they are getting it or they wouldn’t keep expanding.”  Again, ROI is back to what an integrator can get the technology to do for the client. “Retailers are always asking ‘how can I get my screens to do more, and to work harder for me?’ They want data back from the screen, how many people have viewed it, how many people have picked up that product etc,” says Wilson. “The more the systems can give back to them, the higher the chance the rollout will be bigger.”

One of the biggest trends right now in retail in omnichannel, which is where a brand or retailer gives customers a seamless experience across all channels, online or offline.  It is going to be one of the biggest drivers of retail technology spend over the next five years.

According to Retail Week magazine, retailers are now spending the equivalent of three per cent of annual turnover on omnichannel alone. These facts haven’t escaped the AV world.  “Omnichannel is key.  You have to have one brand online and in-store, the customer doesn’t want to think about the channel, it just knows the brand it wants to buy from.  It doesn’t want to worry about where to get the best price – online or in-store. The key to success is having a really good omnichannel strategy, so that whatever the customer wants to buy you have the right channel for them.”

The same thinking, of one seamless presence, is also being felt within retail teams says Phelps; “Increasingly we are seeing a joined up approach and the marketing, web, and AV teams are becoming increasingly centralised.”

Biometrics and beacons are two technologies that live outside the AV world, but have the potential to join many of these technologies together, and also provide a wealth of valuable data to retailers.  Biometrics, which uses technologies like fingerprint systems and facial recognition is being used by retailers to improve targeted marketing efforts. 

The global biometrics market has rising from $7bn to 15b in just three years, and technology consulting firm Frost & Sullivan has forecast that nearly a half-billion people will be using a smartphone equipped with biometric technology by 2017.   But concerns around privacy are slowing its adoption, or making providers, such as NEC, modify its offerings. “Our proposition is deliberately anonymous.  It takes the place of someone standing there with a pen and a clipboard.  When you start storing images of people’s faces you move into a CCTV legality situation. A retailer’s ultimate goal is to get you through the door and find out what you do, but they don’t want to pay for the software and ongoing legal issues that goes with that, in my experience,” says Phelps.  

Beacons are a similar technology, which use Bluetooth low energy (BLE 4.0) for communicating with beacon enabled devices found in many smartphones.  According to a report by Business Insider beacons directly influenced over $4bn in US retail sales in 2014. Again, there are advantages; you can grab the data of everyone who walks through your store. 

But there are concerns too, as Jeske points out: “Germany has strong data laws, so it’s difficult for beacon installs to take place.  Also there are cultural differences in how people react to it.  In the US customers don’t seem to mind an electronic greeting when they enter a store, ‘Hello Mr Smith’, in Germany they would be afraid and ask ‘How did they get my data?’”

In-store technology has huge advantages for the retail sector, but the technology has to fit, both in a physical and ideological sense.  Technology installed years ago, just for the sake of it, which subsequently proved a costly failure, has damaged the perception for many in positions of power in the retail world. 

The key point to remember about all these new technologies is that they will only work if customers want to use them, and it adds something to the brand, as Dyrholm points out: “We have to use some of the space to install something that adds value to the product story, that adds an ability to dive into the product, the way it has been manufactured, its unique selling points etc.  If you give consumers something different, and appealing, they will spend the time.”