Getting shoppers off their phones requires engaging with experiences
Every once in a while you need to step back from the daily grind of retail and look at the bigger picture. There is a lot of retailers talking and posturing about "omni-channel". Does omni-channel simply mean more than one place to buy? Retailers think in terms of channels … consumers don't. Omni-channel is best used to describe how todays' consumers shop, anytime and everywhere. Retail success will require strategies for how to engage consumers on their terms. If retail stores are to survive and thrive, they must give shoppers something that they can't get online … personalization + experience.
Why this is important: Online and stores are not channels to consumers, they are part of the total shopping experience. In order to compete successfully with online prices, retail stores must provide shoppers with something they can't get online.
Omni-channel is how consumers shop, not a retail strategy
We have posted previously on the topic of how "Omni-channel is the new normal". And, one only needs to peruse the retail headlines to see how frequent the topic of omni-channel has become. To really appreciate how pervasive the term omni-channel is, just scan through retailer annual reports to see their statements about the future and how they will addressing "omni-channel" as part of their strategy.
But, omni-channel is about how today's consumers shop … NOT a retail strategy!
Omni-channel is about consumers and their behavior. Today consumers armed with smartphones literally shop "anytime and everywhere" … 24/7/365. Shopping includes much more than the purchase itself – it is all about discovering new things, deciding what is relevant, research options, gathering feedback on best options, deciding the best solution for your lifestyle, and finally making the purchase. This purchase journey involves not only websites and stores, but information gathering from social media and networks.
A retailer can NOT be part of every phase and facet of a consumer's omni-channel behavior. Effective retail strategy is about where and how a retailer can effectively engage consumers at experience touch points in the journey.
To lure shoppers back in stores will require differentiated experience
If it is only about finding a product and purchasing it at the lowest price, online ecommerce sites win hands down. Increasingly, consumers are gaining confidence online. They are moving their purchases to ecommerce because of increased choice, flexibility and services available. The net result is that store traffic is steadily dropping. Even the retail giant Walmart has been seeing footfall traffic declines for many consecutive quarters.
If retail stores want to combat showrooming and lure consumers back, stores have to do more than display products and run price promotions. They have to do much more! Today's omni-channel shoppers are expecting much more from stores than products with signs and fact tags. To get shoppers in store and keep them coming back, the successful retail stores must create something that consumers can't get online – engagement plus personalized experience.
Using technology to create unique retail store experience
Lowes has recently announced that they will be piloting virtual reality showcases in their stores. Consumers coming to the store can shop for items for a specific room, such as a bathroom or kitchen remodel. Instead of just seeing a visual image on their computer screen, Lowes plans to build "Holorooms" within stores so that consumers can literally "step inside" the rooms they are designing and experience it in 3D.
Retailers like REI have long known that getting consumers to climb rock walls in store creates an experience that you can't begin to get online. What is different about Lowes is they are using technology to engage consumers in designing and personalizing solutions for their life in ways that create both an experience, and motivation to purchase. Oh by the way, as consumers design their room in the Lowes "Holoroom", the device keeps track of all the components needed for purchase in order to create it.
2. Virtual Personalization – Virtual reality mirrors
Department stores such as Macy's in the US and John Lewis in the UK have been using digital technology to enable consumers to "try on" different clothes, colors and styles while in store. Without having to literally undress and change outfits, the consumer can have the experience of visualizing what they will look like. And even more importantly, the consumer can share their experience real time in omni-channel ways by sending images via Instagram & Facebook to family and friends for feedback.
Sephora is now installing virtual makeup mirrors in order to enable consumers to personalize choices, colors and styles. The key is not only the engagement at a personal level in store, but the opportunity to build a long term relationship resulting in repeat visits of the customer … and their friends who want that experience.
3. Phone bait – Navigation plus personal offers
Mobile phones have been the nemesis of retail store when the customer "showrooms" by looking at merchandize in store, and then buying online. Instead of trying to confront "fight showrooming", the smart retailers are embracing mobility as part of the behavior of omni-channel shoppers.
Through ibeacons and location technology, stores are directing consumers to departments and products they want to see. Stores can also personalizing offers and services to loyal consumers through their phones by detecting their presence. Smartphone technology and apps will become a fundamental store differentiator IF used to create a personal hands on experience in stores that transcend products and prices. For example, help keep track of my purchases, suggest what else will be valuable, where to quickly find it, and even better, enable me to page a Store Associate to help.
The ultimate "P" in store personalization you can't get online
There is no question that technology will play a role in creating differentiated experience in stores. Tapping mobile devices to deliver personalized services and offers is already happening today. But the real question regarding applications of technology such as virtual reality is whether they will produce Results that Count. What will be the ROI for the big tech installations enabling virtual reality experience in store? It is in fact very measurable!
There is, and always has been, a secret weapon for stores that create a unique, powerful personal experience you can't get online – PEOPLE! Somewhere along the way of creating big box retailing focused on assortments and merchandising, retailers forgot about the power of people. In fact the big box stores are increasingly costly to operate, so many stores are cutting staff to control SGA operating expenses.
The thing you can't get absolutely can't get online is a knowledgeable person who takes an interested in helping you find exactly what you need. What you absolutely can't get online is someone going out of their way to show you better solution you had never thought of. Perhaps the greatest use of technology (e.g. tablets) in retail stores will be enable the Associates to create engage omni-channel consumers in ways they shop, and provide unprecedented levels of personalized experience that can never be delivered online.
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Sources:
- CNBC.com: Lowe's 3-D room makes remodeling a (virtual) reality, Krystina Gustafson; June 11, 2014
- ABCNews.com: Macys Unveils Its 'Magic Mirror'; November 23, 2010
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