Reinventing retail through engaging shopping experiences
Time to consume: 5 min
22 October 2020
Retail is undergoing huge transformation due to changing customer needs and demand as well as rapid technological development, which is making it increasingly challenging to navigate the retail landscape. The formula for success must be reinvented and innovating the business model is critical to build a competitive advantage – for brick and mortar, engaging shopping experiences are key.
Not long ago, the customer journey was relatively simple. The physical store was the focal point of most purchases, and businesses could count on footfall simply by putting products on the shelves. In newer times though, online is growing and many customers no longer need to make a trip to the store. But they still do. In fact, most consumers still prefer the physical store due to many other factors than buying; they like to feel and see the products with their own two eyes, try them, seek out advice from the staff, and engage with products, staff and other customers. In other words: they want to experience.
Due to this, the role of the store is changing rapidly – from a transactional center to an engagement hub in an effort to accommodate consumers’ digitized lifestyle with a focus on inspiration and the highly sought-after experiences that promote loyalty through customer centricity.
Creating engaging store concepts
Customer centricity and experiences are thus more important than ever before. 42% of consumers would rather pay for experiences than material goods (Refresh Retail 2.0, Retail Institute Scandinavia, 2020). Retail must ensure that their stores remain relevant and are places that customers want to return to. In engaging store concepts, customers return as they are allowed to experience products by engaging in e.g. activities related to the brand. It's not about having shelves stacked with cameras divided by brand or price, instead it should be about creating a camera or brand experience where the customer, for example, can learn how to take better photos. Examples include American Girl that lets customers play with their dolls through several interactive experiences, including dressing them or taking them for a haircut, or Apple with their “Today at Apple” concept that offers free classes in coding, video editing and much more for free, creating basically a small community hub through services. Customization and co-creation, where customers can be co-creators of their own product, is another great example of how to engage customers as it heightens identification with the brand.
Overall, shopping in physical stores is all about what the physical environment can offer; personal, interactional, experiential. When consumers choose to shop in the physical stores, they seek the personal, human interaction and experience that online cannot provide. The interaction is crucial for the customer experience, as it allows for more accurate identification of customer needs, building relationships, loyalty and personalizing the shopping experience.
Engagement is on the one hand driven by staff and their expertise, but with the ever-growing commitment to e-commerce, employees need to fill a new role and offer customers what neither machines nor e-commerce can deliver; to engage and build relationships with customers through interaction and expertise by educating, guiding, training and entertaining and thus creating a sense of presence and personal experience. Consumers do not choose products based solely on the functional value, but also based on an emotional attachment, which a high level of engagement will ensure. Intensive storytelling and strong content in-store are therefore also crucial for creating identification and an emotional connection and thus brand loyalty.
Customer to customer interaction can further be essential for the store experience. Retailers and brands can differentiate the experience by adding a social dimension to the store – not only through the interaction and engagement with employees, but also with other customers (family, friends or strangers). By establishing the store as a provider of social experiences, e.g. a community hub, where customers not only come to buy products, but to form social relationships, the emotional connection to the brand is created.
It's all up to the customer… and your creativity!
A successful business model is based on customer insights. How you choose to create engaging and relevant in-store customer experiences must depend on knowing your customer, and your ability to spice those insights with a bit of creativity to create truly compelling, engaging and customer centric experiences.
Article written by
Laura Simone Andersen
Retail Institute Scandinavia