Large-format stores — also known as big-box stores — are known for their no-frills nature. Often housed in simple warehouse-style premises, they’re not fancy, but shoppers don’t mind since they know this will translate to spending less at the cash register. But as technology pervades our everyday lives, retailers are increasingly being impacted by advances in this area, and big-box retailers are being thrown into the mix. So do we need smarter tech-enhanced big-box stores, or will that g
that go against the very nature of what these retailers set out to offer?
I’d argue that it depends on the technology.
Have you ever wandered the aisles of a big-box store searching for a product you can’t find? I know I have, and technology could certainly help that. The US grocery chain Kroger is piloting a sophisticated smart shelf system that allows shoppers to create a shopping list on the Kroger app. In-store, the app synchronises with smart shelves to guide shoppers around the store.
Closer to home, last year, Bunnings introduced an app that helps shoppers locate what they are looking for, which has the dual purpose of making the store more accessible and reducing the requirement for so many staff on the floor.
Another common challenge for big-box stores and their customers is displaying every available product. This is where ‘endless aisle’ kiosks can come in handy.
Customers can use digital in-store kiosks to browse and order out-of-stock items. They’re shown detailed product information and promotional videos and are pointed in the direction of nearby stores with stock.
Elsewhere in the retail landscape, we’ve seen the introduction of location-based shopper engagement with wi-fi or Bluetooth systems that can sense when a shopper walks past a display or area in the store. Shoppers then get special offers for that part of the store. We’re also seeing geolocation technologies that involve cameras recording where shoppers pause in front of products and then present relevant promotional messages on digital displays in the direct line of sight.
Do big-box stores need that kind of technology as part of the shopping experience? I’d argue it’s more of a nice-to-have than a necessity.
Of course, the big headline-grabber for retail tech is virtual or augmented reality. Some say it’s a fad, but the technology can genuinely enhance the shopping experience when used properly.
The vast majority of applications to date help shoppers visualise items in their own homes. US brands such as Home Depot, Target, Wayfair and Anthropologie all offer smartphone AR apps for this purpose, and Ikea has rolled out one globally.
According to eMarketer, nearly all (98 per cent) of Australian retailers believe that AR will increase store foot traffic, so it’s surprising more retailers are yet to adopt it.
At a more basic level, advanced technology at the point of purchase is slowly becoming a hygiene factor for retailers, and big-box brands will need to follow suit.
It’s interesting to note that Australia is one of the world’s leading adopters of contactless transactions, with the Reserve Bank of Australia recently reporting more than half of all transactions (not just retail) are made via contactless payment devices, and a further five per cent on smart devices such as smartphones and watches — something we’re all now familiar with.
And off the back of the pandemic, contactless payments have become an expectation with the extension to click-and-collect. To reduce physical contact, many large retailers have implemented systems that allow shoppers to notify the store when they have arrived to pick up their purchases. There’s nothing better than walking into Dan Murphy’s and being handed your order the second you enter the store.
I’m of the opinion that big-box stores could do with a tech upgrade, so long as it’s not tech for tech’s sake.