Image source: The Home Depot.
POSTED ON 01-17-2019
A key takeaway of the holiday season was that the so-called “retail apocalypse” has been overstated, and consumers have embraced new ways of shopping. Physical stores are playing a key role in helping the industry thrive through the growing popularity of conveniences such as “buy online, pick up in store” (BOPIS) options, as well as advanced mobile integrations. Even showrooming – once seen as a potential threat – is helping drive online activity for consumers wanting to see and touch products before they buy.
For instance, shoppers broke online sales records on Thanksgiving and Black Friday, but many chose to collect products in store. BOPIS saw tremendous growth from Thursday to Friday at 73 percent, according to data from Adobe Analytics. This trend maintained in the other direction as well, with nearly 60 percent of millennials wanting to visit a store first to interact with products before buying them online later.
Moving forward, the key opportunity for retailers will be around becoming a leader in Customer Experience Management (CXM) – driving shoppers back into stores through digital experiences, while leveraging technology to enhance in-store shopping. The Home Depot, an Adobe Experience Cloud customer, is a prime example of an early mover in the space, where a strategic approach to interconnected retail has helped them keep pace with rapidly changing customer expectations for more than a decade.
The revitalization of physical stores
Physical stores continue to be a central hub for operations at The Home Depot, filled with contractors and DIYers finding the right products for their projects. While in-store traffic remains strong, Adobe Analytics data showed them that many shoppers were beginning their journey with The Home Depot online.
For instance, a customer trying to install a ceiling fan might go to HomeDepot.com to get product advice and a list of materials, and then add the tools to their shopping list. Once the customer is ready to purchase, The Home Depot offers the option to buy online and pick up in store, utilized by nearly 48 percent of online orders as of 2018. The company installed “order pick up” lockers at the front of the store, so customers could quickly pick up their purchase, while approximately 20 percent continue to make additional purchases during the same visit.
More online in offline
With in-store and online traffic growing at a healthy pace, the challenge became how The Home Depot could create an interconnected experience for their customers across the physical and digital world. The answer existed in the hands of nearly every customer: their smartphone. The Home Depot developed an award-winning mobile app that allows customers to easily locate the products they’re looking for in stores, read customer reviews and purchase items not currently available on the shelves. This “endless aisle” allows customers to not only shop from the 40,000 available products in store, but also access over 1.5 million products online.
Additionally, The Home Depot implemented features such as visual search, voice search, and wayfinding within their app to deliver faster, more accurate results. For example, take a customer who is looking to fix a broken door handle. The app can analyze a photo of the door handle and dig through an extensive product catalog to surface different replacement options. The app can also process natural language voice recognition and predictive search. The customer can then use the wayfinding feature to direct them to the exact aisle where the product is located, or they can get it shipped to their home if it is only available online.
Retail will continue to blur
While legacy retailers are aggressively investing in digital technologies, pure online brands of the Internet era have pursued a reverse strategy – looking for a physical footprint through acquisitions and pop-up installations. These two worlds are merging, and consumers will continue to embrace evolved ways of shopping. Retailers like The Home Depot are showing us how to drive real digital transformation through experiences that address the changing needs and behaviors of their customers.