Personalised instant alerts triggered by virtual boundaries and sent directly to consumers’ smartphones are the new weapon being investigated by retailers to gain a competitive edge.
The latest solution from Geographic Information System (GIS) technology giant Esri Australia will enable retailers to place an invisible perimeter – known as a geo-fence – around a storefront, triggering push notifications to customers’ phones when they cross the boundary.
Personalised special offers – promotions, time-sensitive discounts or loyalty bonuses – will be delivered directly to the customer to attract them into the sender’s store.
Esri Australia Principal Consultant Gary Johnson said the geo-triggered messages allowed retailers to start a tailored conversation with consumers at crucial moments during their shopping experience.
“Retailers place a high price on personally engaging customers as they walk through a shopping centre or district,” Mr Johnson said.
“Unlike SMS or email campaigns, the technology doesn’t bombard shoppers with random promotional material at an inappropriate time or place.
“Instead – by taking advantage of smartphone GPS features – GIS technology can provide retailers with precise details of customers’ movements in and around their business.
“This insight can be used to deliver targeted messages as part of a strategy to improve personal service to customers or as a value-add for a complementary business.
“For example, a shoe retailer could reach out to customers leaving a clothing store with a notification that reminds them to purchase footwear to match the new clothes they’ve just bought.
“Conversely, a retailer could establish a geo-fence in the vicinity of a competitor’s store which would trigger a time-sensitive special offer to tempt customers back.
“The technology will enable businesses to provide a greatly improved retail experience to shoppers while taking ground back from competitors.”
Mr Johnson’s comments follow a recent report by commercial property firm Colliers International which revealed 28 international retailers such as H&M, Sephora, Next, Gap and Zara are looking to establish 235 new stores in Australia within the next five years.
The report also expressed concerns that the international retailers’ global reach would enable them to bring products to Australia at greatly reduced prices and undercut smaller, local retailers.
Mr Johnson said introducing geo-trigger technology now would give local businesses time to consolidate customer loyalty ahead of the expected international competition.
“Early adoption of the solution will give established local businesses an edge over incoming retail juggernauts by enabling them to provide superior, personalised customer service,” Mr Johnson said.
“A major convenience store in the US has already seen a 10 per cent rise in sales nationwide using this technology.”
Mr Johnson said – as with many of the standing loyalty schemes – participation would be voluntary, with consumers needing to ‘opt-in’ before their personal data and location are shared.
“It is an equal exchange, the customer is prepared to provide some personal information, for example, their location and shopping habits, in return for special offers or higher quality service,” Mr Johnson said.