Last week privately-held retailer Forever 21 filed for bankruptcy. Once a beloved and well trafficked store for the teenage set, the chain is the latest retailer to fall victim to consumers’ changing shopping habits, even as spending remains strong. According to the U.S. Census, retail sales hit a record of $6 trillion in 2018. But shifts in consumer behavior, including an increasing reliance on technology and greater focus being put on convenience, has left retailers on shaky ground.
Shifting Shoppers: Why Savvy Retailers are Driving Customer In-store
While shoppers will never wholly abandon brick and mortar stores, they expect retailers to offer an online/remote alternative. After all, with the convenience of online shopping at the click of a button, it takes a lot to convince customers to make the trek to a retailer to pick out their merchandise. Savvy retailers are investing in self-service models that provide a more convenient and personalized experience alternative to today’s shoppers.
One solution is the introduction of the “buy online, pick-up in store” (BOPUS) channel. A consumer orders online like normal and then, many times, gets free shipping and/or a quicker turnaround picking it up from the storefront. When the consumer comes into the store, they either interact with a self-service kiosk, like the huge Bell & Howell tower at Walmart, or with a store associate. Similarly, this is exploding in the grocery vertical with Kroger and Walmart both being heavy players.
Retail Fraud is on the Rise
Wading into these new offerings with eCommerce highlights a need for identity verification. In the US, fraud attempts have doubled year over year (from 2018) and have tripled since 2017, according to LexisNexis True Cost of Fraud study. Increased mobile transactions, sophisticated synthetic identity fraud, and more digital goods and services sold are driving this fraud increase. Retailers continue to struggle with verifying customer identity.
Specifically, retailers are seeing high losses in “return fraud.” Bad actors are finding or stealing receipts, coming into the store, taking the item off the shelves, and going to the return area to do a fake return. Folks like Home Depot and Walmart are prime targets because their stores are physically so big fraudsters can’t be monitored closely by store associates.
Balancing Shopper Experience with Security
Privacy, security and improved customer service can co-exist in the digital economy with digital identities. Improved customer service can be enabled by technology. There are certain, low risk functions (for example offering kiosks or applications to help shoppers find or purchase items) that can and should be completely automated. This enables employees more free time to be more attentive and provide personal attention to high priority shoppers and tasks. The level of assurance needs to match the level of risk.
Acuant’s Trusted Identity Platform speeds up, simplifies and strengthens processes for in store or digital transactions via cloud, mobile/apps, kiosk & desktop scanners. Retailers can catch fraud and verify age for regulated services and products via instant ID verification and facial recognition, all in seconds.
Want more information on how retailers can prevent fraud and create happy customers ahead of holiday shopping season? Visit us here to learn more.