Daily Dose of iQ: The Store of the Future Should Do What Amazon Can't

Nov 20, 2013 — Alen Puaca

A few weeks ago (Oct. 31), an article by Forbes' Clare O'Connor caught our attention. O'Connor wrote about a recent report from retail consultancy WD Partners, which encourages brick and mortar retailers to update their stores to appeal to modern shoppers "rather than trying to chase Amazon online."

WD Partners is espousing an approach we’ve been blogging about for some time: “(Traditional stores should be) doing what Amazon can’t.” The stats that jump out from this study are:

  • Shoppers still value immediacy above all else, with 79% listing “instant ownership” as the most appealing attribute of any retailer.
  • After the ability to buy a product immediately, “touch and feel”, or sensory perceptions of a store, ranked as the second most appealing attribute (75%), with “exclusive products and bargains” coming in third (65%).

While the above findings are certainly advantages to buying in person, putting all retail verticals in a single bucket can be deceiving.

What I'm really looking for out of a store is a sort of wow factor.

What is physically relevant for groceries (bought daily), is very different from clothing or electronics (bought periodically). In the case of electronics, for example, I would rank "touch and feel" ahead of "instant ownership" because I would personally like to experience a device hands-on with a product expert before buying. If I'm happy with the experience, it'd be great to buy it in-store immediately, but I wouldn't mind waiting a few days to have the product drop-shipped either.

Besides those two benefits, what I am really starting to expect from the in-store experience is an element of surprise -- a wow factor of some sort. It could come from the store design, from sales rep behavior, in-store media, contextual discounts, store/brand relevance to my community, or all of the above. 

Today's consumer knows more about what they're buying than ever and they can get it shipped to their homes.

So, as a designer or a retailer, I really need to start thinking beyond shopping as a utility. First-hand product experience and instant ownership are of course crucial, but there is so much more that we can bring in the mix:

  • Salespeople as brand ambassadors: Your staff on the floor should be your true brand ambassadors, that live and breathe your brand and your products.
  • A relaxed and engaging store environment: Retail space should be designed for all (or targeted) demographics to feel relaxed and engaging, because spending more time in the store leads to spending more money in the store. This is one of the everlasting truths in retail.
  • Information and convenience: A new breed of consumers, regardless of their age, has become accustomed to having information at their fingertips and being able to pay anywhere. Interactive in-store media and mobile POS systems need to meet and exceed those expectations.
  • The X Factor: If, in addition to the above items, the store can offer some kind of opportunity for social participation and extend that to online space, then we are really describing the store that would fully utilize the physical presence. 

Three things WD Partners suggests for the store of the future: 1) endless aisle, 2) devoted associates on the sales floor, 3) integrate online characteristics.

I have listed these and few more under 5 Checkpoints for Next Gen Retail Places (p. 20): 1. Online in-store 2. Checkout Anywhere 3. Relationship 4. In-Store Edutainment 5. Social Hub. WD's wording is a bit different, but the core essentials for sustainable stores of the future are the same. The reasons are simple: Today's consumer knows more about what they're buying than ever and they can get it shipped to their homes if they want.

The goal of every good sales associate: To establish a solid, trusting relationship with the customer, so both sides can profit in the long run.

So once that utilitarian function is out of the way (if both online and in-store tools can allow that) the next most important thing is the brand/retail experience in the store and the "devoted associates," so to speak. What is the goal of any good sales associate or retailer? To establish a solid relationship with a customer based on trust, so both sides can profit in the long run.

The major differentiation between retailers in the next 5-10 years will take place will be in the execution of checkpoints 4. In-Store Edutainment and 5. Social Hub. Traditionally, all successful public spaces, whether they are retail or not, need to have meaningful activities for all demographics and opportunities for social interaction. The WD Partners report shows a glimpse of that as well. 

I really enjoyed WD's "rendering slideshow” that accompanied the article. Among the 8 slides, my personal picks would be 

  • The Look Of A Nightclub (scroll up, above): "Stores with sexy, dynamic and club-like atmospheres will captivate and drive traffic." Although I wouldn't go to such extremes as "nightclub," designing relaxing, beautiful environments is not just for cafes and restaurants anymore. It is becoming a must for retail spaces as well, since we want customers to stay longer in stores. 

Tech_Is_Front_And_Center_-_WD_Partners_via_Forbes.jpg

  • Tech Is Front And Center: "Associates and shoppers will be empowered, whether with an endless digital aisle and information-rich mobile apps or tablets on the sales floor." This part is all about matching online tools of "long tail" product availability and checkout anywhere. This is also part of something we call omnichannel (convergence of all touch points in seamless experience) with a brand/retailer. 

Voyeurism: People are attracted to stores filled with people.

  • Built For Voyeurism: Again, the title is little exaggerated, but it's illustrative. What does this mean? One thing that attracts people the most is other people! So if we start to design and treat the store floor as extended window display or, as Disney would say, "The Stage," where the actors are not mannequins, but actually the engaged customers and sales reps, we suddenly get very a organic and attractive scene that passersby want to become part of. That's plain human nature. 

  • More Than A Store: The entire retail world must now operate as a "third space," write WD Partners. You have your first space - your home, second - your office. What is the third space? Parks, squares, cafes, restaurants -- where you go for certain activities and for social interaction. If the retailers truly think about becoming the "third space," they have to address checkpoints 4. In-Store Edutainment and 5. Social Hub. Having all 5 will make them truly Next-Gen Retail Places. 

Topics: Retail Operations, Wireless Trends, Mobile Industry, Customer Experience, e-Commerce

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