It's not a question of whether or when … but one of how
I was recently challenged by one of our readers about my prophecies on omnichannel and its importance in changing retail. Essentially, his argument is that if omnichannel is so compelling and important, why is 90% of retail sales in the US still in stores? Great question! In my view, omnichannel is not about the place of the final purchase. It is all about the consumer journey and how our behaviors are changing as shoppers. It is also about rising expectations on the part of us as consumers, and what retail stores must do to continue to earn our business. Today, is not a question of whether we will shop online or in store, but one of having flexible options to have it "our way" … any time and everywhere.
Why this is important: Many retailers are stuck in the ruts of product merchandising. Today's consumers are looking for options and value beyond products. Future success will focus on serving consumers, not serving up products.
Omnichannel is all about having it your way
Perhaps, Burger King was ahead of its time with the slogan "Have it your way". BK's advertising was referring to catering to customer preferences and giving them a choice in how they wanted to finish their burger, versus buying a fixed order from limited choices on a well-known competitor's menu. In so many ways, the slogan of "Have it your way" has become the moniker and fundamental essence of omnichannel.
In fact, I would argue that omnichannel is in fact a misnomer. It is not about retail channels at all. Omnichannel more aptly describes how we as consumers shop … any time and everywhere on websites, on social media, as well as in stores. The experience of being able to buy anything in the world, at low price from our living rooms has opened up a whole new world of options, flexibility and expectations for retail. Yet, we still prefer to make our final purchase in store … today … so far. The question is will retail stores continue to adapt.
5 Key ways that retail stores will adapt to compete for your business
In this blog, we have quoted Charles Darwin many times: Those that are most successful are the ones "most able to adaptable to change". Great retailers don't wait, they innovate. They are already adapting your omnichannel behaviors and expectations. There are 5 key ways that stores will adapt, and are already adapting to your behaviors and expectations. In fact, these innovations are already in the market place today.
1. Shop Ahead
One of the great hassles of shopping in store is finding things, and the time it takes. We like fresh produce and the options to choose what we want, but we don't enjoy the experience of picking it from the shelves, and then going through the painful process of checkout.
There are many examples of retailers enabling "shop ahead" and pickup in store. One example of this is Best Buy's execution of buy online and pick up in store. But, even the world's largest retailer is experimenting with shop ahead, with option to have items delivered to your car without ever going in store.
2. Kill the cash register
There is no faster way to kill a sale than to make people stand in a checkout line! Apple realized this long ago and enabled checkout on iPhones anywhere in the store. There are a host of digital payment services such as Square. Many are geared to mobile phones such that there is no need for a "cash register".
With all new coming advances in credit cards that have "chips" and pins, NFC payments will become potentially available everywhere. It is no longer a question of "if", but how will retail stores kill the cash register and make your purchase experience easier, more efficient and part of an overall seamless experience.
3. Design your visit and services
Again, Apple has been a leader in retail stores for so long, it is easy to forget how they have made the consumer experience customizable and adaptable. Apple has pioneered pre-scheduling appointments at their Genius Bars from home. That is just the tip of the iceberg of what is possible for the retail store innovators.
Supercuts is already piloting digital services, which enable you as consumers to design your visit and customize your experience at their stores. You can preplan services, request specific options, and check in for appointments all online. A critical differentiator for stores is offering services that can't be found online. The innovators will make the store services a virtual menu, and customizable in ways that pure e-commerce can't compete.
4. Imagine, design and personalize your ideal
Walt Disney said: "If you can dream it, you can do it". Today's omnichannel corollary is that if you can get consumers dreaming and engaged in designing what they want, you will create an experience that is difficult to replicate anywhere else. A good example that has been around for a long time is Nike's design your own shoes. There is tremendous value in engaging consumers in personalizing their own products (not to mention increased sales and margin!)
Lowe's probably has the latest cutting edge example of a design center right in the middle of their stores where you can personalize your room. This is probably the greatest opportunity and challenge for retailers: how to move from displaying products to engaging consumers in the design and personalized use in their lifestyle.
The single greatest albatross of retail stores is the legacy of "product centricity". Stores were built as the "showcases" of products, and everything was focused on building and supporting that product stage. The major challenge and threat today is that there has been a seismic shift by consumers beyond products to experiences.
It's not that consumers have changed cart blanch. They still shop stores for products. But, where and how they shop is highly influenced by their holistic experience. Not just at the point of sale, but during the whole journey, and especially with their post-sale experiences.
An example of innovators in experience are the US Telcos, who are selling a lifestyle versus products. AT&T flagship stores now have automobiles on the floor, so that consumers can experience syncing their phones on Bluetooth and playing music. T-Mobile even has the option for consumers to literally "test drive" their phones and services before making a purchase. Whether it be climbing a rock wall in REI, or baking cookies in a store oven, consumers are voting for hands on experience versus decisions about features at a price.
Evolution or revolution – It's happening now because of you
One of the best retail forecasts I've seen is by PSFK titled: The Future of Retail that they put out each year. In addition to the five trends I've highlighted, they highlight many others based on great examples of how the successful retailers are following Darwin's axiom of "adapting to change".
The safest retail prediction of all: The future of successful retail stores will depend upon adapting to the changing behaviors and expectations of you the consumer, who increasingly insists on "having it your way".
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Sources:
- PSFK: The Future of Retail
- Mobile Register Image: Stuart Miles; Freedigitalphotos.net
- Lowe's Image: CNBC.com
- T-Mobile Image: TMO News
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