Media headlines continue to proclaim the demise of physical retail. Sure, there have been a number of store closures already this year. But there are also brands forging full steam ahead with new brick-and-mortar locations. Just this week, Lululemon announced its five-year strategic growth plan, which includes an expanded footprint both nationally and abroad.
Think tank Coresight Research (How the In-Store Experience Affects Buyer Behavior) said retail isn’t dead….bad retail is dead. In fact, retailers will open nearly 3,000 stores in 2019 – including Internet companies like Wayfair. There is something to say about the power of the store if the super successful furniture company is joining the list of digital natives growing offline.
So, why is physical retail an opportunity for companies like Lululemon and Wayfair?
Brands Bet On Brick and Mortar
Wayfair’s CEO Niraj Shah believes permanent locations will bring the brand’s website pages to life. Even more, the knowledgable support of the in-store design team will attract new customers – and capture the loyalty of existing. Shah says clients will know more about their products and have a stronger affinity for the brand when they can interact with both in real life.
We previously discussed the idea of applying a digital perspective to physical retail to meet consumers’ evolving needs and wants. It’s clear more and more retailers are adopting this mindset, or know they need to. We know there is a future for stores, but what does the future store actually look like?
As we make our way toward the Future Stores Conference in London in May, let’s zoom in on some of the ways you can build the store of the future.
Empowering Store Associates With Real-Time Data
It’s important to include a human touch in today’s digital world. Brands need to balance the need for technology with the customer’s desire for an authentic and personalized experience. Enter the store associate, your secret weapon.
By leveraging the collective knowledge and skill of store associates, and real-time data from various technologies, brands can provide a more personalized, informed experience for the digital customer. And even keep the relationship growing after the client leaves the store.
- Social Media & Messaging: Brands can turn social media and messaging tools into a sales channel through clickable, monetized content. This is why it’s important to encourage BYOD in the retail environment – it boosts associate productivity, and makes it possible to sell to loyal customers anytime, anywhere.
- Beacon Technology: With proximity technology, store associates can receive real-time client information – like when your client is in-store to pick up her BOPIS order or for her scheduled appointment. Beacon technology can also send promotional offers to clients, which can be personalized based on how or when they shopped the brand last.
- Omnichannel Inventory: A real-time view of stock across all sales channels and supply locations opens up the aisle and allows for customers to get what they want, every time. RFID is one of the technologies that make inventory management efficient and accurate (although, it’s also really useful for frictionless grab-and-go self-service and enabling automatic loyalty program enrollment).
Empowering Clients to Choose The Way They Transact
Checkout conversions and cart abandonment is a huge problem online. It is often caused by some type of friction in the path to purchase – long form-filling, time-consuming authentication processes…the list goes on. You’ve likely invested significant resources into capturing your shopper’s attention and interest, so why risk losing them at the very last turn in their buying journey?
The same goes for in-store, and it’s why the store of the future will empower shoppers to choose how they transact. By innovating at the point of sale, you will keep customers engaged and make them more likely to convert. Some notable ways to ensure the checkout experience is seamless:
- Mobile: Your customers will love the idea of being able to skip the line and checkout from anywhere on the store floor. Your brand will also look much more sophisticated if your store associates are able to process a transaction with nothing more than a mobile device, rather than several systems tethered to a checkout counter.
- Digital Tenders: Offering alternate payment methods reduces risk, provides better client data, and can be helpful in attracting international clients. Also, by the year 2025, 60% of U.S. consumers think shoppers will carry a phone but no physical wallet. This means emerging payments like Apple Pay will become the status quo.
- Ship to Store: Space is often limited in some stores. However, having the ship to store capability opens up the range of products available to customers in-store and enables your brand to sell more. Think about it. You now have a captive customer in-store, meaning store associates have the opportunity to cross-sell and upsell other merchandise.
Experimenting with Store Formats
Lululemon is opening more stores, but it also believes physical retail is not one size fits all. It has plans to open everything from temporary, pop-up stores, to massive 25,000-square-foot superstores. The trick is being able to breathe life and experience into every corner of the store floor. That’s what our client Decathlon did with its new 47,000-square-foot experiential retail center in the Bay Area.
- Product Advertisements: Brands can maximize non-selling areas within stores to promote products and encourage client engagement. Turn the bottom left corner of your bathroom mirror into a digital billboard; same for the menu display screens in your in-store cafe. These additional touchpoints will keep your shoppers in the brand experience, even when they’re seemingly elsewhere.
- Mobile POS: Having a mobile POS instead of traditional cash wraps significantly frees up store floor space. Now you have more room for product displays, customization centers, interactive experiences, and more – the things shoppers expect in modern stores. By flipping your space, you invite your customers to engage with your brand and store associates in a meaningful way.
Introducing AR/VR, AI and Other Emerging Tech
Emerging technologies like AR/VR, machine learning and artificial intelligence are real and very tangible in most industries, retail included. Wayfair is one brand leading the charge in the AR/VR category specifically. It recently joined an open consortium of companies – retailers and tech giants alike – creating a common set of technical standards for 3D content.
Wayfair’s Director of Next-Gen Experiences, Shrenik Sadalgi, said: “We believe 3D will be ubiquitous in the coming years and that it is imperative to standardize 3D content so it can be exchanged effectively and experienced consistently.”
Walmart on the other hand just opened a 50,000-square-foot “store of the future” called the Intelligent Retail Lab. It’s called IRL for short (read: in real life), which makes a lot of sense because the location is a testing ground for AI and other tech-enabled solutions that will benefit both customers and store associates. The win-win.
Omnichannel Is The Future
Becoming an omnichannel organization is hard, but it’s a must for retailers that want to win today and in the future. Physical retail is an important part of the equation, you just have to reimagine it to get it right.
Think of all the novel features available online today, and bring them into your store – in unique and different ways. Technology can and will drive down the walls between your channels – let it. And don’t forget to adopt a service-first mindset. Every store in the future will exist to deliver your customers true value.
Are you thinking about your store of the future, or attending Future Stores in May? Reach out, we’d love to help you build your new store!