As major retailers close stores across the country, the future of brick-and-mortar retail might seem bleak. A recent study about the future of retail paints a different picture, though. The Walker Sands Future of Retail 2017 study, which surveyed 1,622 consumers across the United States on their shopping habits, reveals some surprising statistics.
The study found that among consumers aged 18-25, a majority (58 percent) prefer to shop in physical stores, compared to less than half (46 percent) of 26- to 45-year-old shoppers. And in addition to discounts, consumers say unique experiences compel them to shop more in brick-and-mortar retail stores.
“The study findings aren't surprising," says Brent Ridge, co-founder of Beekman 1802, a lifestyle company with a physical and online presence. “The brick-and-mortar retail industry has reacted like all industries that become bloated—a natural contraction to the 'fittest.'"
In this case, the fittest is not necessarily the most efficient or least expensive, but the retailer providing the best experience, notes Ridge.
"To come out from behind their mobile devices, customers require entertainment they can't get from a digital environment," he says.
Retail Closures a Natural Evolution
“Retail closures are a natural evolution," says Tina Mulqueen, CEO of Kindred Marketing Company, a full service public relations and marketing firm that represents retail industry clients. “First, there was physical retail. Then, e-commerce and m-commerce offered consumers unprecedented convenience. Now, the next level of experience and convenience that customers will come to expect is a connection between digital and physical channels."
Retail is coming full circle, agrees Carrie Wood, chief marketing officer of LeaseRef, an online commercial lease review company.
—Bruce Clark, associate professor, Northeastern University
“The 18- to 25-year-old consumers are the first generation to grow up with technology. While older generations seek the convenience of online shopping, the newer generation hasn't lived through the inconvenience of traveling to physically buy products, and then the introduction of a 'better way.' They grew up with the better way, so the process of experiencing the mall or downtown core is novel."
One of the main reasons the younger generation gravitates to brick-and-mortar retail shopping is the fact that it's the antithesis of the online purchasing experience.
“Online shopping is solitary, research and price-comparison driven, while in-store purchasing is multidimensional and dynamic, involving social interaction and advice-driven persuasion with immediate purchase gratification," says Bryan Payne, CEO and founder of Skout Deals, an app that offers special discounts, which brings customers into stores.
Merging Digital and Physical Retail the Future
In order to successfully transition to the “new retail," the digital and physical retail experiences will continue to merge, believes Larissa Pickens, creative director and founder of design agency Float Design.
“At their best, digital and brick-and-mortar can work together seamlessly," says Pickens. “Physical locations can use digital to build better customer experiences. For instance, the San Francisco clothing store Reformation has a sample of each piece of clothing in the showroom and customers interact with tablets to choose other sizes or variation."
The consumer desire for a sense of place when shopping requires that businesses use a multi-dimensional strategy, adds Chris Wiegand, CEO of Jibestream, an indoor navigation platform that enables developers to embed maps into apps.
“Business owners have an incredible opportunity to increase engagement with shoppers by bridging the digital world to physical space by engaging people before, during and after they enter the premises," says Wiegand.
In the future, the retailers that succeed will be the ones that create a compelling customer experience that flows seamlessly between their online sites and physical stores, agrees Paul Herman, VP of the product and solutions enablement group for Sprinklr, a social media management platform.
“As Amazon's move into the brick-and-mortar retail world [Whole Foods acquisition] has shown us," says Herman, "there's no purely e-commerce or brick-and-mortar retailer that can succeed."
5 Tips for Creating Memorable Brick-and-Mortar Retail Experiences
To thrive in the brave new world of physical retail, you may want to keep the following tips in mind.
1. Start with social media.
“Retailers can enhance the shopping experience by integrating social engagement throughout the entire buying process," says Herman. “For instance, leverage location insights from buyers to understand brand sentiment across key geographic areas and introduce mobile features through social to improve customer experience and convenience. Some retailers provide incentives for tagging their brands in tweets and photos, or for 'checking in' online while shopping at their stores."
Brick-and-mortar retail businesses can take advantage of popular social tools, like SnapChat and Instagram, by encouraging customers to become excited brand ambassadors before they enter a store and long after they leave, believes Wiegand.
"Use grassroots [or] organic campaign styles that allow customers to customize how products are shared with their respective communities," he says. "Such digital engagement makes visiting the store akin to visiting Disneyland, and the shopping experience becomes visceral and deeply engaging."
2. Know your target market.
“Learning about the influences of your target market can help you achieve engagement," says Wiegand. “Depending on the age of the shopper, influences can include music, food, celebrities and sports. Once the key influencers and triggers are known, you can create a unified experience that nurtures the shopper each step of the way to the cash register."
Use available data to get to know your customers, adds Mulqueen.
“From our social media presence to Google Analytics to our point-of-sale software, there's a lot of great data we accrue about our customers from which we can glean insights," she says. "Knowing who your customers are and the behavioral trends of their cohorts allows you to accurately target and provide messaging that's likely to move them through the purchase path."
The online thrift shore thredUP (which also has physical locations) relies on customer insights to provide personalized experiences. “In our San Marcos store, we know customers in that area love designer denim, so we built an entire wall showcasing jeans at up to 90 percent off retail," says James Reinhart, the company's CEO.
“Identifying emerging consumer retail trends amongst the younger demographic of customers also allows you to stay relevant," says Ashley Thompson, CEO of 50 Strong, which produces reusable water bottles. “What worked two years ago may not work today. Knowing your target market allows you to stay nimble and pivot business models and product lines when necessary."
3. Offer unique products.
“The single most important question store owners should ask themselves is why do customers leave the house to come to my store?" says Bruce Clark, an associate professor and group coordinator of marketing at the D'Amore-McKim School of Business at Northeastern University.
“When Amazon has millions of products available with one tap on a computer, it's a good idea for retail stores to have uniquely curated product assortments," says Clark. "Provide a collection of products that serves a niche or addresses a particular need. For instance, a bookstore near me is full of handwritten notes from staff recommending particular books."
Feature unique products that also tell a story, suggests Eddie James, owner of Brownie's Dog Boutique, which carries high-end dog supplies. “It's a good idea to engage customers so they want to tell others about you. We're named after a historic dog from Daytona Beach, Brownie. This allows us to showcase a 'Brownie Museum' in our shop and to tell his story."
4. Make visiting your business enjoyable.
“Is the store fun to visit and is the space interesting?" asks Clark. “If you can make shopping in your store a fun, social experience, that's very difficult for online to imitate."
Consider opting for an experience that creates a lot of “selfie" moments. “Collaborate with nearby businesses to create fun contests and events," suggests Woods. "For instance, have customers visit different stores to complete certain tasks, such as checking in online, and receive gift bags or coupons. The press coverage and social sharing could be tremendous."
Also pamper shoppers, suggests Hugo Saavedra, CEO of Saavy Naturals, which carries body care products. “The younger generation enjoys attractive visuals and enticing scents."
5. Create a personal connection.
In order to attract customers to your brick-and-mortar-retail establishment, do your best to cultivate a knowledgeable and sensitive staff, suggests Payne.
“I'd recommend training staff to interact sincerely with customers," he says. "Also create a sense of community by sponsoring events where customers can interact with each other and your staff. A loyalty program that recognizes and rewards your clients is also a good idea."
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