Design by Val Frixione.
Just because all retailers seem to have in-store WiFi, does that mean you should too? IT consultants are quick to extol the virtues of WiFi and how it is a necessity for all retailers. Looking at retailers that have implemented in the last 3 years (Target, Kohl’s, Saks, Macy’s, Nordstrom, just to name a few), we could conclude that it’s become a cost of entry in the digital world. In this post, we review the known benefits of WiFi, but more importantly, look at the 3 questions you must answer before considering implementation.
Benefits of In-Store WiFi
If you have a mobile app or use mobile technology to drive traffic, offering in-store WiFi certainly makes the customer experience seamless. The real win with app integration is in the ability to capture behavioural data: with a robust tracking software, retailers can identify where customers are shopping, how long they stay in an aisle, and what they are buying, or what they are looking at but not buying. What has eluded retailers to date is how to mine that data in order to send the most relevant and personalized offers to customers’ devices while in-store.
Opening WiFi is your pathway to delivering an omni-channel experience to consumers. While in-store, they can choose to have the product shipped to their home, they could select a size or colour online that is not available in the store, they can compare prices at other retailers, and they can look up product information or reviews.
Operationally, WiFi can help with line-busting, or the notion that the customer doesn’t need to line up to cash out, because employees can provide mobile checkout with iPads, or consumers can self-checkout via their mobile phones, for example. It can also support other WiFi-enabled devices in-store: if you have digital signage or information kiosks or screens, WiFi can ensure you serve up the most dynamic and fresh content.
3 Questions You Need to Answer About WiFi
1. Who Will Use It?
Will it be customers, employees or both? Be sure to engage a cross-functional team (Operations, Marketing, Merchandising, HR, Legal and IT) to answer this question and estimate traffic. This answer will impact the vendors and equipment that your IT departments select.
2. What Activities Will You Allow Them to Use It For?
Bandwith considerations will be largely determined by how WiFi access will be used in-store. Customers can use the retailer’s mobile app and check product reviews. Do you want to allow them to comparison shop or watch hi-definition video? Are there sites you need to limit? For example, employees can access WiFi for mobile checkout, check inventory at multiple locations, or look up product details. But they may also access Wi-Fi for personal use during breaks. It’s up to your HR to provide guidelines on appropriate Wi-Fi use.
3. What Are Your Data Capturing/Mining Objectives?
Without a doubt, this is the most important question retailers need to answer. Retailers must drill down to the most granular data, identify how you will use that data, and then prioritize all the data points in terms of how you can best leverage it. An equally important part of the process is determining data storage costs and capacity; without a sustainable budget, all the data you collect could go out the window.
What you capture and how you mine and use the data will ultimately help you quantify your return on invested capital by looking at sales and profitability of the transactions that occurred as a result of this. It is the true financial measure of WiFi implementation.
Arguably, JC Penney may not have taken the time to answer this question, after pulling in-store WiFi access in 2013 in order to save $7 million annually (the initial investment was a reported $12 million USD).
One More Thing…
A final and important note on WiFi implementation: Be transparent. Many customers accept Terms and Conditions of use without realizing that they include the right to be tracked while in-store. Coffee houses, airports and hotels offer WiFi as a pure convenience to build loyalty and this is what consumers are used to. The notion of being tracked via their devices while in a store is still relatively new and retailers must be up front about it or suffer repercussions.
When considering implementing WiFi in your store network, consider the benefits, but be sure to have clear answers to these three questions.