Over the past few weeks and even months, we’ve seen how quickly retail stores have been innovating and pushing their physical services and experiences online. The digital disruption over the past five years and now COVID-19 have driven the necessity for retailers to quickly transform their business model. Every day, we see how creative retailers are using new technology to deliver all that physical stores have in the past, and more.
Online, consumers can now get a human touch with real people through live-streaming technology and virtual “try on” videos. Consumers can connect directly with KOLs with chat access. They have the controls to ask the questions and interact wherever and whenever they need. Gucci recently launched “Gucci Live,” a store with cameras and TV-style lighting that is set up for direct connection to consumers through personal video consultations.. This type of personalized convenience is delivered through big data customization, recommendations and fast delivery at the touch of a button. Visualizing the product in your home or on your body is possible through VR/AR technology as we’re seeing with IKEA and Sephora. As technology continues to evolve and the gap between physical and virtual slowly narrows, it begs the question…is there a future for physical retail?
I believe the future doesn’t have to be an either or situation. Whether you’re at home, outside, or at a physical retail store, brands need to meet you wherever you are and deliver value. Retail’s physical presence will continue to exist and be valuable in the future. However, it must evolve in light of this future reality.
We see five opportunity areas where offline retail can provide unique value now:
1. True Personalization
As consumers increasingly demand personalized products and experiences, there’s nothing that can replace face-to-face interactions to deliver individualized and customized attention. In-store experiences enable a deeper level of personalization with consumers than online recommendations or limited customization, delivering a truly unique and one-of-a-kind product experience.
Levi’s Tailor Shop
Levi’s has done this with their new Levi’s Tailor Shop. In the shop, you can fix it, customize it or make it. Working with an in-house master tailor, you can adjust for your perfect hem and fit, or discuss your design idea for custom distressing of fabric or embroidering a personal emblem. There’s a seemly endless array of choices to make your Levi’s your own.
2. Try-the-Product Experience
Consumers need a compelling reason to visit physical stores beyond shopping as they increasingly get used to purchasing online. Compared to e-commerce, physically experiencing a product allows the consumer to connect with the product on a more personal and emotional level, increasing the brand’s impact and influencing purchasing. Whether it’s the actual touch, the physical try-on, the smell or the taste… there’s nothing quite like experiencing a product first-hand.
Post-COVID-19, there will certainly be a heightened sensitivity to ensuring the proper health and safety measures are in place when smelling, touching or tasting products. Creating safe ways for trying or testing products will be an area for future innovation. Ideas like recyclable sample testers for makeup or standardized sterilization procedures will give consumers more confidence to engage and try products again.
Nike SoHo Store, New York
Nike’s 55,000 square foot store in Soho, New York takes creating a trial environment to the next level by incorporating a variety of space and equipment to allow consumers the ability to try out sneakers in real situations – to monitor performance and even record themselves to share with others. They’ve installed basketball courts with monitors and sensors, a treadmill that records the runner’s gait, and even a soccer pitch.
3. Natural Socialization
Physical spaces have always provided opportunities to gather, socialize and spend time with others. Compared to the online shopping experience that is typically individual and passive, physical retail creates a space where people can interact and spend time together in a casual and immersive environment.
Disney x Vans at House of Vans, London
The House of Vans is a great example of a purposefully designed environment for their skaters to mingle and hang out. It has multiple locations around the world that combine art, music, street culture and fashion in a single destination. The London location houses a cinema screening room, a bar area, a large live music venue showing a mix of world-renowned acts and fresh talent, a studio for artists to create and showcase their work in the Gallery space, and even a skate park with ramps for avid skaters to socialize and mingle. This retail experience is less a place to buy products, but a place to gather and socialize with people who share similar interests and passions and extends the brand’s reach and relevance.
Lululemon Soho Broadway Store, New York
Lululemon has created fandom through merging a traditional fitness studio with its retail store. The “Sweat Studio” classes and “Fuel Bar” equips consumers with training and education to help them achieve their fitness goals. And while they also now offer online virtual workouts and training programs, it will never give people the same motivation and social atmosphere you would receive at a physical location.
While COVID-19 has forced retailers to pause some of their physical programs and activities and move them online, when we’re able to be together again, people will yearn to find places and spaces to socialize again physically.
4. More Convenience
As customers grow more comfortable with shopping online, offline stores will become another enabler for them to get products even faster. Through formats such as BOPIS (buy online, pickup in-store) physical stores can also function as a fulfillment channel.
Walmart Curbside Pickup
Walmart has been at the forefront of click-and-collect services. During COVID-19, the retailer was among the first to offer curbside pickups where a consumer can order online and drive to a nearby location to have the order brought straight to their car. Similarly, Starbucks has been pushing an expansion of its convenience-led pickup formats powered by the Starbucks App, particularly in dense areas and cities.
5. Individualized Service
Having an in-person interaction with a retail employee offers the most natural and no-pressure environment to ask questions or voice your needs. Your unique situation, mood, temperament and personality can be picked up on and responded to. While online services are trying to close this gap with individual product consultants and stylists, there’s still a delay in being able to fulfill a request immediately and try or see the product physically.
Nordstrom Personal Stylist
Nordstrom has always been known for its exceptional and personalized customer service and led the way with online and offline integration. With their app, customers can book an appointment with a personal shopper, select what they’d like to try on, reserve a dressing room and Nordstrom’s store associates can leverage digital tools and location services to track when they are on their way making sure their fitting room–with the customer’s name on the door–is ready the moment they arrive.
The Next Step: Finding and Owning Your Competitive Edge
While it is true that online retail experiences are becoming more immersive with innovation and technology, offline retailers also have the unique advantage of being able to provide physical locations and real, human interactions. With the right strategy, planning and execution, physical retail experiences will lead to return store visits, higher likelihood of purchase and greater brand loyalty.
Post COVID-19, the successful brands will be those who are prepared with the right integration and reinforcement of brand experiences both online and offline to respond continuously to evolving customer needs.
Contact us at Prophet for more details on how to achieve uncommon growth by designing retail experiences that matter today.