No clicks, but online ease brought to stores

JULY 10, 2014
THE AUSTRALIAN

US start-up Hointer blends the best elements of online retailing and traditional bricks-and-mortar shoppingSource: Supplied
IF Hointer.com is the future of the retail, then humans need not apply.
So says Ferrier Hodgson retail expert James Stewart of the hot US start-up that blends the best elements of online retailing and traditional bricks-and-mortar shopping, all without the “burden” of human interaction.
“Hointer is at the pointy edge of the wedge and it’s not for everyone, but it offers a really interesting retail experience,” says Stewart, who visited a Hointer outlet and met the company’s founder, Nadia Shouraboura, on Westfield’s recent global retailing study tour.
Once you understand the Hointer system, it won’t come as any surprise that Shouraboura has an Amazon.com pedigree, having joined Jeff Bezos’s tech giant in 2004 and running its global supply chain and fulfilment.
Hointer owes its name to the word hunter, and its mission is to deliver a utilitarian shopping experience — no queues, no delays, no clutter, and no overbearing, sales-driven staff.
It works like this. Shoppers going into a Hointer store can download an app and choose from about 150 styles of jeans, each of them with QR codes on tags that can be scanned with a standard QR-code reader on their smartphones or tablets. The app keeps a list of all selected items in a virtual shopping cart, and directs shoppers to a numbered dressing room when they tap “try on”.
Simultaneously, a message is sent to the store’s automated stockroom, where a robotic system delivers the requested items to the designated dressing room.
Up until this point, the whole process has taken 30 seconds.
From there, unwanted items can be dropped in a chute, triggering an automatic deletion from the shopping cart, or shoppers can ask for different sizes by again tapping the app.
Once a final purchasing decision is made, payment can be made by tapping the number of the dressing room on a touchscreen terminal, and swiping a credit card or digital wallet.
Shoppers who return to Hointer get an even more seamless experience. If they’re pressed for time, they can exit the store without paying at all, leaving it to the app to bill them for the items they left with.
“We want a zero-action purchase,” said Shouraboura, who is to visit Australia in a few weeks. “It’s not ‘click and you’re done’. We want no clicks.”
The Hointer founder describes her business as a “micro-warehouse, controlled by customers’ mobile phones and our algorithms”.
But what the company really hopes to do is use technology to enhance the defences of traditional retailing against their online rivals, and perhaps even start turning the tables.
Shouraboura is effectively revolutionising in-store shopping by offering the convenience of online, while at the same time underscoring the big drawback of the online experience — the inability to try on garments before you buy them.
The natural cost advantage enjoyed by online is also minimised. An automated stockroom means fewer sales staff, with salaries accounting for 14-18 per cent of a retailer’s sales.
Less space is also required for displaying merchandise.
Stewart says Hointer’s prospects of success have been enhanced by a number of recent trends.
“For the first time, consumers in the US are going to blogs for digital reviews ahead of the recommendations of family and friends for their decision-making,” he says.
“Surveys are also showing that store staff are having much less influence on transactions — as little as 15 per cent of consumers say their behaviour is influenced by in-store sales people.”
He cautions, though, that the retail landscape is far from settled.
One school of thought says that store staff become even more important in the digital world, although their role changes to facilitators because most consumers are not early adaptors of technology. Apple is the classic example, with the tech giant’s stores awash with staff.
However, their role is mostly service-oriented, albeit with an ability to transact with shoppers.
It would be overstating to say that Amazon was the inspiration for Hointer, but it would also be remiss to ignore the parallels.
Hointer is powered by Amazon-like algorithms, with robots set in motion at the touch of an app. But it’s also the opposite of Amazon, because everything is in-store.
“We are a software start-up. Period,” the founder said recently.
Hointer licenses its technology to other retailers, should they want it.
Shouraboura has said she’s been negotiating with unnamed but well-known retail businesses.
There has also been idle speculation about a Hointer-Amazon collaboration, perhaps more based on the fact that her partner is Amazon web services vice-president Charlie Bell.
But Shouraboura says a Google partnership is more likely, noting that she has been invited to the search giant’s Silicon Valley headquarters to discuss Hointer.
“Amazon is very much an online retailer,” she said.
“I love Amazon. I shop for everything on Amazon, with the exception of apparel, jewellery and other things you need to try on.”