According to Piers Fawkes, Founder and President PSFK, “it is an exciting time when it comes to retail. There is transition taking place and some of that is painful. And it will continue to be painful in some places such as department stores. But we are seeing a lot of really exciting ideas and innovations. It’s like retail has woken up.”
His company just released the latest results of a trend
study which tracks the evolution of retail in all of its forms. Here are the
highlights:
No More Digital and Offline Divide
The future
looks very different from the retail of the past. This point in time marks the
end of the digital and offline divide. For one thing, there are more
opportunities for brick and mortar stores as shopper experiences are increasingly
blended with retail sales. There is a digital underpinning to store sales
because now customers expect coordination between all channels from online and
the physical store space.
For retailers, it is more important than ever to build an
integrated retail business now referred to as blended retail. It is no longer an
offline versus online competition. Offline should work more to its strengths
and use online channels to fulfill certain needs. The result, brick and mortar stores
are becoming more of a playground rather than a place to just purchase and
eventually, in the near future, won't be the place for the actual purchase transactions.
Higher Consumer Expectations
The consumer
mindset is shifting. Consumers don't only want to save time in their shopping
excursion, but also want to add value during their visit. They are seeing all channels
– offline and online – as a way into the store and seek consistencies across
each platform and device. Ideally all should work together holistically.
Nike seeks
to meet their most avid consumers’ expectations by, as Ron Faris, General Manager,
of Nike’s s23NYC Digital Studio and SNKRS App, described, “creating a sense of
community and vibe that you might get in a festival, but on your phone.” Nike
is building emotion digitally among their coveted demographic of Sneakerheads
fanatics by treating product as content. For example, using AR, Nike buries hints
to a stash of highly prized, limited-edition sneakers into their mobile app.
Sneakerheads see the shoe on the app and enter a geo-fenced physical area, like
a park, where they locate the hidden limited-edition sneakers that they can
then purchase in the store. In this way, Nike is shaping sneaker culture by
creating a sense of urgency, excitement and scarcity within their most ardent
consumer segment.
Advice for Brick and Mortar Stores
Stores should avidly create opportunities for consumer exploration
and identity-building through:
>
Revolving discovery. No more static retail
space. Create excitement by changing merchandise frequently to support themes.
Support that effort by programming events around the store. An example is the Timberland
Concept Store Tree Lab which changes every six weeks.
> Integrated wellness. Capitalize on continued
growth of wellness market by making spa and fitness part of the retail
experience. An example is The Wellery
at Saks Fifth Avenue.
>
Educated confidence. Offer hands on workshops
and immersive learning activities in the store to build confidence around
purchases. An example is Lowe’s Holoroom How To
which can show consumers how a new bathroom would look before the project
begins. Learn basic home improvement skills before applying them in the real
world using VR technology.
? >
Valued attention. Serve need and connect to
specific consumers based on their interests and proclivities. Transform
previously frustrating shopping moments into luxurious experiences that add
value to a retail experience. An example is MM.LaFleur which offers a personal
shopper experience via a pre-visit survey. The dressing room is set up before
the shopper arrives.
Conclusion
While
offline retail has remained fairly static over the years, e-commerce has gone
through three modern digital cycles according to PSFK. 1.0, the Follow Model, uses
platforms like Facebook. 2.0 is the Intimate Model like Snapchat and 3.0 is the
Tribal Cult Model that fuses the first two trends and adds influencers into it
by building energy and emotion and creating social bonfires. The inclusion of brick
and mortar into the digital Tribal Cult Model hearkens a brand new age of retail
when both offline and online can benefit and thrive.
