To succeed, electronic gadgetry must meet shoppers' needs

Discount Store News, Dec 8, 1986 by Thomas R. Rauh

To Succeed, Electronic Gadgetry Must Meet Shoppers' Needs

Any consideration of electronic shopping must include a look at leading edge technology. A number of new technologies have been experimented with for shopping, including laser video discs, smart cards and expert systems.

But the emphasis on technology appears out of perspective. Electronic shopping, like retailing and consumer marketing, involves some old-fashioned marketing concepts like customer service, convenience, information and shopping ideas, consumer entertainment and advice and savings. Technology will facilitate the development of new services, but the services, nonetheless, must address these basic needs of the consumer to be successful.

Electronic shopping has been meeting consumer needs in at least seven areas: product selection advice, product demonstrations, shopping ideas, personal consultation services, access to information, access to merchandise and, finally, the bundling of services.

Product Selection Advice

One of the most interesting categories in the market is product selection advice. Systems elicit information from consumers about their habits, desires and interests and recommend purchases. The Intermark Group, for example, has worked with low-cost interactive, free-standing terminals incorporated into point-of-purchase displays sponsored by manufacturers. One system developed for Clairol is a countertop terminal that plugs into a electrical outlet, includes a couple of circuit boards and costs less than $1,000. The terminal asks questions about the color and texture of a customer's hair and how often she washes it. Based on the answers the system recommends a number of Clairol products. Significant sales increases have resulted from using this terminal. Where many customers would walk past a display in the store, they are intrigued by the terminal. Once they use it, instead of buying a single product, they may buy two or three products for a complete hair care program.

American Videotex Services pioneered a product it called "Shopper Aide." This system is designed for consumer products that have a degree of complexity in features and functions, such as cameras or telephones. Customers specify information about the characteristics they seek in the product. The system uses a sort-and-extract program to search through a data base of products and make a recommendation. That recommendation may be in the form of a digitized image of the product, supplemented with a computer graphic. Technology provides advice the way a sales person would, based on information elicited from the consumer. The system is low cost and has made a sales impact.

Product Demonstration

Instead of a $500 cardboard or wooden display for H & B A and cosmetics in the store, you might find a $1,500 partially electronic display that provides higher returns.

Another area that traditionally has used a lot of in-store demonstration and audiovisual displays is the do-it-yourself industry. For example, a home center in southern California has joined with manufacturers to provide presentations on a laser disc of more complex or new products. They show the benefits of these products and how to use them.

Again, this is a self-service system. Often it's video disc-based, because the laser disc is needed to present what's going on with a particular product. This kind of presentation is justified by the complexity and the prices of the products. The return that can be offered when comparing an automated demonstration to that of a wage-earning employee is attractive.

Shopping Ideas

Technology is also being used to provide shopping ideas. Today fewer and fewer people go into retail stores to get ideas. They are in a hurry, trying to complete a transaction in a store and get out. The ideas are coming from other sources, such as catalogues and magazines. One of the more interesting efforts to put shopping ideas back into the retail store is found in Manhattan at Fizzazz, a store owned by Murjani and selling sportswear bearing the Coca-Cola logo. The store has incorporated touch-screen technology and video projection units to create a merchandise presentation that's integrated with the store concept. Touch-screen monitors near the entrances control video projectors hanging from the ceiling, providing continuous video displays of store merchandise.

What's going on here is an example of integrating technology with the merchandising and store concept. In this way, the technology plays a role in the process of suggesting ideas, introducing the merchandise to the customer and helping the customer to narrow selection. It's theater in the store. These systems are characterized by large screen displays, incorporating both stills and full motion. Most are interactive. There are very few department stores in this country without a bank of TV sets someplace. Many of those early looped video-taped programs are not interactive, and they are sponsored by the manufacturer, rather than the retailer.