Despite apocalyptic predictions and some high-profile bankruptcies and closures, physical retail is far from dead. About 90% of all retail purchases still take place in brick and mortar stores, and many of America’s top chains, from Sephora and Warby Parker to Target and Dollar General, continue to expand their physical footprints.
Consumer behavior, however, has shifted dramatically. Today’s shoppers will no longer tolerate impersonal service or unwelcoming spaces. They expect seamless, memorable experiences when they venture in-store. And they expect the experience to be seamless across channels.
The forward-thinking retailers who’ve evolved alongside their customers aren’t just surviving—they’re thriving. They are omni channel and are leveraging it:
- Buy online pick up and in store? Sure.
- Buy online and return it in store? No problem.
- Send me a ping to my mobile for an item, now on sale, that I saw on your web site? Definitely.
Take a look at the innovations making waves in today’s retail landscape and the disruptors who are leading the way.
Seamless integration between retail and ecommerce
Consumers, used to the convenience and personalization of ecommerce, now expect the same level of service from their real-life interactions. Winning brands help customers move effortlessly between channels, using brick-and-mortar to reinforce their ecommerce business and vice versa.
Amazon’s expansion into physical retail is a case-study in seamless integration. After buying Whole Foods in 2017, the ecommerce behemoth installed in-store lock boxes to make it easy for online shoppers to pick up their purchases—along with a few impulse purchases. Whole Foods also now offers discounts and delivery perks to Amazon Prime members.
Amazon’s cashierless Amazon Go stores capitalize on its technological clout to provide instant checkout: a computer vision system detects when a customer takes products off the shelf and charges their Amazon account as they leave. Amazon reportedly has plans to open 3,000 Amazon Go locations by 2021, which would put them in direct competition with convenience stores and quick-service restaurants.
But Amazon is not fully there yet.
- Buy a book on Amazon.com for your spouse? Heaven help you if you try to return it to one of Amazon’s physical stores. “Sorry, we can’t store online returns. Let me assist you with getting a return packing slip so YOU can send it back yourself” was the friendly line I got from an Amazon store employee last holiday season.
A customer experience worth showing up for
Smart retailers realize that physical stores must do something that ecommerce can’t: provide a sensory experience. Innovative design and creative activations increase a brand’s visibility, draw customers in and spark engagement.
Nike’s five-story SoHo store is a benchmark, giving would-be customers a multitude of reasons to show up and hang out. New Yorkers and tourists flock to test shoes on the gleaming indoor basketball court or play on the mini AstroTurf soccer field. Shoppers run on a treadmill that simulates jogging in Central Park as special cameras track their stride. The store also has a regular schedule of special events and limited releases, hourlong appointments with Nike experts and the option to get items customized on the spot.
Thinking outside the (big) box
Traditionally, department stores and retail chains used a similar store blueprint across all locations. Today’s landscape requires much more agility. Many brands are seeing the benefits of a test-and-adapt approach that makes use of small spaces, pop-ups and short-term, low-risk leases. Others are leveraging the power of partnerships to establish shop-in-shops inside existing retail spaces.
Toys R Us is only now reimagining how its brand can appeal to a well-informed consumer in an ever-changing landscape. Following bankruptcy, the toy giant’s former lenders pivoted, recently announcing a partnership with Kroger for the holiday season. Nearly 600 Kroger-owned grocery stores will feature a selection of toys that were once exclusive to Toys R Us. The venture will be branded as Geoffrey’s Toy Box, after the iconic giraffe mascot.
Navigating today’s retail reality requires investment in innovation that enhances the customer experience. The savviest retailers are harnessing the power of data to spend strategically. Customer analytics and insights help companies learn which tactics and activations will best resonate with their audience—ensuring they put their money where it matters most.
Download Retail Rising to learn more about this big shift and how AI marketing technologies can save retailers.
Glenn Pingul is VP of Scientific Marketing Strategies for Amplero, an Artificial Intelligence Marketing (AIM) platform that helps enterprises better connect with their customers. Prior to joining Amplero, he was a co-founder of the online video advertising ad tech company, Mixpo, where he was VP of marketing.
He has an extensive background developing digital marketing, analytics, and loyalty and retention strategies while serving in executive level positions at T-Mobile USA, Nordstrom.com/Inc., AirTouch Wireless (Verizon Wireless), Starbucks.com and The American Express Company.
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