High-tech multimedia delivery systems are enabling retailers and mall owners to court consumers as never before. The latest innovations promise to boost sales, tighten marketing messages, create new sources of advertising revenue and bring point-of-purchase materials to life.
Top multimedia firms articulate differing visions of the future. But all agree that smarter, more advanced technologies will lead to significant changes in the way retail environments look, feel and sound.
"The trend is to be able to specifically market to a finer-tuned demographic," says Walter Balfour, director of sales and marketing for Orchard Lake, Mich.-based American Music Environments (AME). "You can actually say, 'The crowd inside the store between the hours of 11 a.m. and 12:30 p.m. matches this demographic. I'll be able to play music and video selections that match that.' If there is a different customer demographic later in the day, then you can have messages and ads tailored toward that."
Says Craig Williamson, president of Seattle-based AEI Music: "Where we see the future going is the melding of music, video and imaging technology delivered via a single source. By that I don't necessarily mean video and real-time, but lifestyle-driven visual images that are flowing through the space in slow motion or still frame. This imagery will be coordinated with audio to drive a particular brand image and store environment."
Craig McManis, marketing director for Long Beach, Calif.-based Pioneer New Media Technologies, notes that a powerful new science is evolving in which television, print, Internet, and mall-based media are rolled into one.
"We're seeing more and more companies that are trying to link together all of their media promotions," he explains. "For example, some are interested in extending their web applications to malls by using interactive kiosks. The kiosks allow consumers to explore various sources of information, print out web coupons, or even put their credit cards in and make purchases at the kiosk. The goods would either be delivered to their homes or picked up at the mall."
Managing the message With the rise of Internet access, some consumers actually are better informed than salespeople. Brian Edwards, president of El Segundo, Calif.-based Edwards Technologies, believes retailers must act quickly to restore the balance.
"In your store, you've got to make sure that there is some authority," Edwards says. "The salesperson should be able to go over and say to the customer, 'Here it is - I've got everything you ever wanted to know about not only this product, but everything else in its range.' "
Edwards Technologies focuses on telling clients' stories and promoting their brands. "I think you need to rely more on technology nowadays to do that," Edwards explains. "It could involve just getting children to interact with a touch screen or buttons. For example, we recently finished Disney's first interactive store in Chicago. The idea was to engage customers through entertainment and interactivity. When you throw in the Internet and the ability to deliver media using these digital connections, you have a way to really get a message to your customers. You've got a powerful, cutting-edge communications tool."
Edwards Technologies is now working on a high-tech initiative with Arlington, Va.-based Mills Corp. for Opry Mills in Nashville, Tenn. "I'm hoping that this project raises the bar for multimedia in malls," Edwards says. "We're using digital streaming video, the Internet - all the tools that everybody has been talking about - by putting together shows that will be broadcast on video screens at the mall. A digital server will be connected to the Internet, along with an updated playlist. The streaming video will include information about charities and concerts, or trivia about the city, its people and its music. We want to make people do a double-take, to touch them, to plug them into their community."
Satellites and CDs In the past, retailers have had to choose from two basic multimedia options. One was to use a direct satellite feed, which had the advantage of being simple and hands-free but wasn't easily customized; the other was to employ a more complicated customized approach.
"With a satellite feed, you ended up taking one channel and the retailer next door may have had the exact same channel," explains Williamson of AEI. "With a custom approach, you typically had a tape machine or CD player in the store and you constantly had to tinker around with it. You had serious limitations on what you could do."
AEI's ProFusion system - which supports audio, conventional video and more sophisticated imaging technology - provides the simplicity of a satellite feed with the power of custom on-site multimedia. It's basically a computer with content stored on the hard drive or downloaded via the Internet. AEI, which offers the ProFusion platform for as little as $60 a month, specializes in creating a wide array of demographic-specific multimedia content.
Williamson notes that innovative technology is enabling retailers to vary in-store multimedia quickly and easily. "For example, many of our customers are beginning to change their music throughout the day," he says. "A retailer may have a morning feel, pick up the pace in the afternoon, then do something different in the evening."
Jazzing up the mall Retailers and some mall owners are taking an increasingly interactive and high-tech approach to marketing their messages. Advance Auto Parts, for example, is installing its own proprietary, multi-channel, in-store satellite TV system, with monitors located behind parts counters or hanging above sales floors.
The network, hosted by ESPN anchor Doug Dunbar, offers programming from CNN/Sports Illustrated and ESPN, TNN and other channels. Putting the digitally-driven satellite network in place makes sense for AAP, despite the $10 million-plus price tag. Research shows that fully 60% of the chain's 200 million annual customers make purchase decisions at the point of sale. Keeping them in stores longer helps beef up the average purchase.
Mall owners such as Indianapolis-based Simon Property Group, which has partnered with CNN and others for its in-mall network, and Mills Corp. are taking a similar approach. Mills now offers MillsTV, a mall-wide video programming system that targets shoppers at the point of purchase. Each of the newly wired Mills malls contains a full-blown studio complete with playback, editing, filming and processing capabilities.
The network is a combination of video walls, parlor screens and overhead suspended monitors, supported by on-site staff. MillsTV advertisers have included America Online, Coca-Cola, Discover Card, Phillip Morris, Geico and Mazda.
"Mills TV has the same kind of capacity you would find in any production studio anywhere in the country," says Kent Digby, Mills Corp.'s executive vice president of management and marketing.
If you operate a retail store in a mall, Digby says, less than 3% of that mall's total customers will enter your store. As a result, your marketing messages fail to reach up to 97% of walk-around traffic at that particular center. That's why it makes sense to operate mall-wide broadcasts. "Our idea is to motivate customers to come into the stores that are advertising on the system," Digby says. "We'll run an ad on MillsTV for a month for basically the same cost of getting a one-time ad in a newspaper."
Hanging on the wall The days of clunky TV sets stacked up behind mannequins may soon disappear. Companies such as Pioneer New Media Technologies now offer a range of thin, lightweight plasma displays offering greater creativity and flexibility.
"The plasma displays are like a picture you can hang on the wall," says McManis. "But they display full-motion video or computer images. They perform really well in ambient light and are visible from acute angles. So they have some of the optical properties of a printed poster."
The units can connect to a small personal computer on site connected to a phone line or some other data-transmission source, like a satellite. "Somebody can sit at his head office someplace else in the country or the world and download information to be displayed on that panel."
The same Pioneer division also markets interactive kiosks and video wall technology. The video wall units can be stacked up to almost any size or shape, with a gap between two screens of just 1 millimeter.
Pioneer's DVD-V7200 industrial DVD-video players are helping create brand awareness at the Mall of America. One retailer there, the KSTP Broadcast Center store, uses Pioneer's equipment to attract business for two local radio stations. Visitors use interactive kiosks to see music videos of their favorite bands, access musicians' biographies, get the latest on the stations' radio personalities and learn about issues discussed on talk radio.
Meanwhile, AME has designed a centrally controlled software/hardware package that plays music but allows individual store locations to customize the advertising they play through the audio.
"It can direct customers to different locations for different products in the store," says Balfour. "Our package, called the AME 2020 Digital Music and Marketing System, actually operates on the Internet. It allows retailers to customize the advertising in every one of their store locations, right from their office desks."
The system costs retailers $1,200 for the hardware and $79.95 a month. "If you're able to sell ad space to companies, it's not even a cost anymore," Balfour notes. "It's a profit."
Other customized delivery options include the all-digital audio and visual marketing system offered by Axis Services, a departmental group of Los Angeles-based DMX Music.
"It's a complete end-to-end network," explains vice president James Condon. "It enables us to provide programming mixes based upon customer profile data. We're able to control the channels or styles of music, and we can insert marketing messages and advertisements in the same way.
"This system allows us to control the music experience and the overall integrity of the music," Condon continues. "We are able to manage all of this through a secure network, which is pretty amazing."
Amazing is the word for the future of multimedia technologies in retail stores. Emerging technologies mixed with marketing and merchandising know-how will continue to prove a powerful combination.