Even before 2020 and the Covid pandemic crisis, the growth in digital trends posed a threat to physical retail space. The pandemic didn’t usher in anything new, it merely accelerated already existing trends. E-commerce was increasingly successful at meeting the needs of consumers with convenience through a single click.
The idea of a physical retail apocalypse was not positive for those whose entire business model relied on physical foot traffic. Lockdown further drove the growth in this economic sector and the realisation that consumers want more than just a product.
Herein lies the opportunity.
Retail store renaissance.
Adaptability means survival
It’s not always a pandemic that brings a fatal blow. It is the mere refusal to change and adapt. In 2017, South Africans saw the permanent closure of Stuttafords stores. The household name was not hit by a pandemic but rather an immobility to embrace the then fast approaching rise of online retail. Around the same time, Edcon, who today faces business rescue, began to experience financial strain. The chain attributed the challenge to increased competition from online retail and increased availability of cheaper imports. Conversely, stores such as Dischem have found a way to continue to encourage physical bodies in store by integrating their online platform which allows for in-store collections at a separate queue thus still maintaining a level of convenience for customers. The lesson is that it is important to understand changing customer needs and trends and adapt accordingly. Customers are now multi-dimensional: They are physical, on-line, and a mixture of both; and more importantly, expect a seamless experience when shifting between these dimensions at any point in time. Your brand (BX) is thus only as strong as the experience it provides.
The Need for Experience
Customers are now more sophisticated and demand more from brands in exchange for loyalty. Customers want convenience, personalisation and a great seamless experience. There is also a trend towards greater support for brands that are socially conscious. As a result, brands face the reality of not being the only option for customers who are more connected and more aware.
The good news is that today’s brands have all the tools available to hear and understand their customers’ voices. Businesses can gain all the knowledge needed to adapt to the fast-changing needs of their consumers and drive insights-based decisions through various methods of market research including strategic focus groups, customized surveys, in-depth interviews between stakeholders, to mention a few. You can activate your brand through customer experience.
In truth, the physical store plays a key role in creating a smooth omnichannel experience for 2 reasons:
- Physical stores present a customer feedback touchpoint.
- Physical stores provide an opportunity for companies to take advantage of the experience economy allowing for the creation of a smooth positive and memorable customer experience (CX). You can activate your brand (BX) through customer experience.
A great example of how a brand moved from a product offering to an experience offering is Starbucks. On the surface, Starbucks sells coffee but in reality it’s the in-store coffee-shop experience, the atmosphere and the ambiance, with coffee as an accessory (and at a premium!) that has made them one of the leading coffee-shop brands. Starbucks played a leading role in the establishment of the coffee-culture and successfully created and tapped into the on-the-go consumer need for coffee and convenience! Today, they have traded the convenience for experience and customers are happy to swop out some convenience and privacy for a winning overall experience.
Similarly, we can look at Exclusive books. Traditional bookstores all over the world faced extinction with the arrival of eBooks and reader devices or apps such as Kindle. While many people at the time still claimed to enjoy the tactile experience of turning the page and holding the book, the convenience of being able to purchase a new book anytime and anywhere and in essence take many books on holiday without the extra weight in your luggage, went unmatched by physical store counter-parts. Like many other retailers, exclusive books opened an online store, however, today their physical stores are still widespread and growing. Not unlike Starbucks, the secret lies in the experience.
Exclusive books stores together with their coffee shops whisper intellect, contemplation, knowledge, quietude, and nostalgia associated with traditional libraries many of which lie unvisited in South Africa today. Both Starbucks and Exclusive books offer us a momentary pause and escape from our busy lives. In essence, they are selling the experience. Afterall, the book can be delivered to your door or your device.
As a physical store retailer, you have the opportunity to rebirth your physical space through investment in the experience economy. Ask yourself how experience in your store makes your customers feel. Will they want to return? What do you offer experientially around your product? Did the experience integrate with a broader omnichannel solution?
If brick and mortar retailers do not evolve, adopt tools and techniques to attract, delight and retain customers through superior and on the mark customer experience (CX), they run the risk of competitors stealing the fire. In fact, the same is true for all aspects of businesses today whether on or offline. The world expects smooth omnichannel integration, personalisation, and incomparable experiences that are broader than a mere product or service.
Adapt to survive.
This will guide how you communicate and serve all your stakeholders.
Interact RDT is here to give you the insights to reimagine and enhance your company’s operations, offering, and go-to market strategy to leverage a more cohesive omnichannel strategy.
