Ever been stuck in a self-service checkout loop from hell? With items that refuse to scan and endless buttons to press before paying by card? Technology has found its way into every part of the retail customer experience. Innovation in this space is rapid and relentless, and not every innovation is actually improving customer experience.
Retailers are eager to create efficiency and design more streamlined customer experiences through retail innovation, and particularly through AI. However, it’s important to keep a firm grasp of what really works, and what’s just hype. By working with CX strategy teams who can effectively measure the impact of technology, retailers can be certain their tech investments are creating real value, avoiding the smoke and mirrors.
Competition in the retail sector is fierce, and consumer habits are ever-evolving. In the coming years, retailers face some tough choices about where their budgets should be spent. One thing’s for sure, most will prioritise investment in retail innovation intended to drive value.
While retailers mull over retail innovation investment, customer experience is suffering. The latest figures from FM Outsource found that 42% of UK consumers felt that customer service was no longer a priority for businesses. Shoppers are still turning their backs on the High Street in favour of ecommerce, and over 13,000 retail units closed down for good in 2024, up by 23% on 2023.
Consumers regularly report frustrations about overly complex technology interrupting their customer experience. From clumsy self-checkout systems that ask too many questions, to chatbots that pop up persistently when online shoppers are browsing. Clunky, complicated and unwelcome technology simply gets in the way of the process, without enhancing the experience or adding value for the retailer.
Hidden tech gems that quietly boost CX and ROI
Interestingly, it’s often low-profile technology that brings the most meaningful changes to CX and the best ROI for retailers. Beyond the fads, the best retail innovations enhance customer service, rather than replace it. We’re talking about the tools that blend seamlessly and support staff to provide excellent customer care. Or the tech that frees up the staff to have more meaningful interactions with customers.
Real-world examples from UK retailers
RFID Technology
RFID can prevent staff from having to monitor for shoplifting and errors when working on self-checkout stations (SCOs). Random bag checks or customer service staff lurking behind shoppers using SCOs is off-putting. RFID tagging means that any unpaid-for items are alarmed and picked up as shoppers exit the store, freeing up staff to focus on more positive service-based interactions.
Marks & Spencer have launched a ‘Scan & Shop’ mobile app that allows users to scan the items they wish to buy while moving around stores. They can check out without queuing and pay for their goods via their mobile phones.
M&S staff are also using RFID technology to locate items for customers and the checkouts are also more efficient as items are scanned and identified quickly. Other retailers, including Sainsbury’s, Waitrose and Decathlon, have their own versions of this self-scan tool available, enabled by RFID technology.
Smart fitting rooms
Trying on clothes in-store has become increasingly frustrating for customers since e-commerce has become widespread. Shoppers are used to having access to sizes and styles at the touch of a button, often ordering several options and trying them on at home. When in-store, the CX is poor. Often, there’s only one or two garments in each style and size on the rack, and shoppers are forced to leave the fitting room to hunt out alternatives if the clothes don’t fit. This reduces the likelihood of a purchase and damages brand loyalty.
Equipping fitting room staff with tablets that enable them to check stock levels and find alternative sizes and styles is being rolled out across a number UK retail stores. John Lewis is an early adopter and customers are reaping the benefits. Staff are on hand to bring alternative sizes and style to shoppers and there’s no need to leave the fitting room.
AI camera shelf-monitoring
Around 44% of shoppers enjoy visiting supermarkets to do their food shop in person, according to PYMNTS Consumer Report. Most shoppers point to convenience as the main factor driving their decisions, so finding empty shelves in the supermarket would be seen as highly inconvenient, pushing them further towards e-commerce and delivery options.
Tesco is fighting back, using AI cameras to monitor stock levels on their shelves. The technology keeps staff informed if shelves become messy or begin to run low. This supports them in providing an efficient and pleasant in-store shopping experience.
AI-driven personalisation
Several large UK retailers are using AI in their customer experience design to provide a more personalised version of customer service. For example, Marks & Spencer has launched its new ‘Style Finder’ tool on its mobile site. Users can upload an image of a style they like and the AI technology will find and recommend similar garments available in M&S stores or on their ecommerce site.
Boots is also using AI in their in-store CX strategy, rolling out its No7 skin care analysis tools in stores. These devices analyse shoppers’ skin type and recommend makeup and skincare from the data gathered.
These AI retail innovations are transforming customer service, delivering a level of personalisation that simply isn't possible with human staff alone. By enhancing every step of the shopping journey, AI is making a powerful, tangible impact on the in-store experience.
It’s clear retailers need to strike a balance between convenience and intrusiveness when investing in retail innovation. Technology should be invisible - enhancing, not interrupting, the customer’s journey. However, to make these investments sustainable, retailers need to make sure their technology investments are creating value and, ultimately, giving them a competitive advantage.
During the decision-making process, retailers must prioritise results from metrics that measure actual ROI. Starting with conversion rates and customer satisfaction levels over vanity metrics like social media followers, footfall and app downloads is recommended.
For retailers, technology offers value when it creates efficiencies for end-to-end processes. When considering retail innovations, businesses can start by identifying the end-to-end processes that drive the most value, then reimagining these processes involving AI.
Often, retailers buy AI tools off the shelf. Sometimes they customise these solutions using their own data, which can enhance return on investment. Better still, if a retailer identifies an opportunity that is strategic enough to offer a competitive advantage, building their own solution can offer something unique to the customer experience.
To truly thrive in today’s competitive landscape, retailers must focus on technology that complements, not complicates, the customer experience. Retailers can generate healthy ROI when they invest in smart, seamless solutions that empower staff, delight customers, and deliver measurable value. When retail innovation is grounded in real insight and ROI, it stops being hype and starts driving meaningful results.
Ready to transform your customer experience and build customer loyalty? Get in touch, our CX experts would love to talk.