In an increasingly digital world, retailers are asking themselves what future role their stores can play in order to stay relevant to customers.
Many have predicted the demise of the store, but I’d argue it’s actually taken on more importance.
Customers in increasing numbers choose click-and-collect as a fulfilment method and continue to research online, but purchase offline too.
Online can be a threat to stores, but digital provides potential for retailers to operate smaller units, reduce operating costs and still deliver a good customer experience.
Sephora has opened a smaller footprint format, combining an edited in-store range with virtual shopping baskets, allowing ordering from a broader online catalogue for collection or delivery.
In the UK, House of Fraser has done something similar, testing small footprint order points.
Whatever your plans for stores and leveraging digital, my advice is to always start with the customer and work back to determine what experience is relevant in the context of your brand and product category.
The role of the store will certainly change. It will become much more about experience and true retail theatre. The store environment will seek to entertain, educate and engage. I can’t resist a good three-letter acronym, so you might call it the triple E of in-store.
Another way to think about how to leverage in-store digital technology is in terms of customer acquisition, conversion and retention.
Digital can help to pull more customers into the store environment, convert more than ever before and capture their data and attention in order to drive retention.
While still not that widely adopted by retailers, it seems fairly obvious that certain digital technologies will become ubiquitous over time. For example, the mobile till will allow some retailers to provide relevant personalised customer experiences.
While Apple was the disruptor in this sense, a number of brands have designed stores with no fixed electronic point of sale – Victoria Beckham is one.
Removing fixed EPoS takes a barrier away and encourages customers to engage with store colleagues using iPads and other mobile devices. This in turn provides opportunities for cross-selling, better engagement and data capture, as well as creating more selling space.
Mobile tills also lend themselves to offering customers e-receipts. And e-receipts help retailers to overcome the age-old issue of how to capture customer data instore.
In the changing room, digital technology can be leveraged very effectively. Luxury fashion brand Rebecca Minkoff has been an early adopter of digital technology in changing rooms. It allows customers to digitally request other sizes or styles to try on and complete purchases while still in the changing room.
The jury has been out on iBeacons. In my opinion, proximity-led marketing will become far more prevalent and used for customer acquisition, by pinging offers to customers near a store as well as recognising in-store customer behaviour and dwell time and targeting customers with personalised offers.
So stores aren’t going anywhere soon as retail theatre and digital innovation only makes them more relevant.
After all, Amazon is opening hundreds of bookstores for a reason. Who would have imagined that a couple of years ago, when everyone thought bookstores were a dying breed?
- Martin Newman is chief executive and founder of Practicology