An unsung hero and often missed "glue of retail" might just be PayPal
Amazon certainly gets the lion share of headlines in terms of online retailing. But, the new normal in retail is more likely to be some sort of multichannel convergence. Innovative retailers are in fact experimenting with how to integrate store displays with online product presentation and purchase. PayPal is a pioneering partner in an interesting experiment with a "Q Route" with the shops of De 9 Straatjes in the Netherlands. For struggling bricks and mortar retailers, much can be learned from watching PayPal … and the Amsterdam retailers who are creating opportunities to shop multichannel seamlessly.
Retail will change dramatically … because of you the consumer!
When you boil it all down, retail is simply about meeting the needs of consumers. In the previous decades, and one could argue previous centuries, retailing was about products and location. Merchants brought together compelling collections of products into a convenient location (stores) in order for consumers to find what they want and make a purchase.
What has changed is the empowerment of consumers. Online access to products and the ability to purchase via smartphones has given the consumer the ability to shop anywhere, any time that they chose. This creates opportunities for innovative retailers and companies like PayPal (which is in fact owned by eBay the largest online retailer in the world). John Donahue, eBay CEO, has said:
The way that consumers shop and pay in the next 3 years will change more than in the last 20 years. In the Netherlands, we see that prediction already coming true. The next wave will be a dramatic blurring of the lines between e-Commerce, m-Commerce and high street retail.
Of course eBay sees many opportunities for PayPal to be the "retail glue" binding these channels … and the transaction mechanism for consumers regardless of how they shop.
What omni-channel means for the new normal of retail
Innovative retailers are starting to recognize the changes in consumer behavior. In countries with high smart phone penetration, young adults would rather leave home without their wallet than their smartphone. Indeed, many of them would prefer to pay for products with their smartphone. And of course PayPal would like to be a preferred payment option whether that purchase is made in store or online.
Innovative retailers are no longer just looking at online versus stores as separate channels. In fact, it is not about optimizing channels at all. The best are in fact looking for ways to reach consumers where they are and make their lives easier. Omni-channel is becoming the new normal where retailers will use technology to enable consumers to:
- Pre-shop to evaluate styles, color and selection
- Determine if a specific store has the product on hand
- Offer best consumers specific targeted promos by phone
- Location based shopping assistance, targeted displays
- Pay for the purchase in multiple ways … including by smartphone
- Skip the lines at the cash register and purchase in the aisle
- Purchase remotely and pick up in store
- Profile based "loyalty" and opt-in services and incentives
Interesting Amsterdam case study from the PayPal blog
Who knew that PayPal had a blog? I certainly didn't! I picked up the Amsterdam case study post by Eelco van Wijk from one of the smart briefs I was reading. While the technology utilized is certainly not breakthrough, it is an interesting case study from the standpoint of multiple retailers collaborating to create seamless 24/7 shopping experience.
Why Amsterdam? Amsterdam is known worldwide for its iconic items of cheese, windmills, and canals lined with 17th Century step-gabled houses. It is also known for "window shopping" in the famous red light district … but that's different kind of retailing entirely. Suffice it to say that Amsterdam is a city with a high density of consumers shopping at all hours. It is also in a country with a very high smartphone penetration (44%). With mobile phone replacement cycles, smartphones could easily reach 75+% in a couple of years.
How Q Route works in the historic De 9 Strattjes shopping district
De 9 Straatjes is the Dutch name for "The Nine Streets". It is a shopping area in the historic area of Amsterdam with a collection of high end retail shops and restaurants. What makes this case study interesting is how 30+ individual retailers banded together to create a district mobile shopping experience with a special 9straatjesonline mobile app. In fact, smaller retailers and even retail malls could learn a great deal from the highly integrated online site that these retailers have put together for their district: De 9 Straatjes (The Nine Streets).
As mentioned previously, the technology is not new. Essentially the retailers put QR codes in their window displays encouraging consumers to click and go online to explore more colors, styles, and to make a purchase … with PayPal of course. Who would want to carry packages around all evening as you stroll the canals and explore restaurants? On the "Q Route" in The Nine Streets purchases made by your smart phone are delivered in great gift boxes to home addresses.
A picture is worth a 1000 words, and a video is even better. Click the link below to see the 24/7 mobiel shoppen in acton.
They say that a journey begins with first steps. The Amsterdam experiment is but a step in integrating mobility as part of omni-channel. However, it is a particularly interesting case study of collaboration among multiple retailers to create an omni-channel shopping district with PayPal serving as a partner
and the “glue”.
- The PayPal Blog: Window shopping 2.0 in Amsterdam; 11.14.12