Digital integration in physical retailing. How shoppers augment their own instore experience with a smartphone

For physical retailers, it is strategically limiting to consider digital innovation, as much literature suggests, solely in terms of integrating online features within store. There is potential competitive advantage in leveraging customer-led technology adoption, specifically smartphones to augment the physical experience over the virtual in more novel ways. In this paper three aspects are identified as having potential for digital transformations because they are unique to offline retailing. The first is retail socialisation. An extensive literature examines the role of new technologies in mediating or replacing social exchanges in the customer retailer relationship. But this is to overlook the fact that shopping with companions can be a hedonic leisure activity, motivated by cultural factors, which smartphone use is shared amongst each other. The second is the omni-sensory shopper experience – despite unconstrained choice, the online shopper experience is still limited to just two senses, sight and sound. Physical retailing has no such constraint providing an increased engaged experience which shoppers share via the use of their smartphones. The third is total shopper gratification – unlike the online experience, most physical service encounters involving a tangible product will demonstrate that product and its alternatives can be fulfilled without delay.

Opportunities for customer-led tech adoption in each aspect are discussed through literature review then evaluated in competitive context. Any strategic advantage from digital innovation within a physical category is likely to be competed away quickly but will leave spill over effects between physical and virtual offers. Strategic implications for marketing theory and retailers are discussed.