- THE POWER OF EXPERIENTIAL MARKETING
- 12, FEBRUARY 2018
How to Make the Grade in Retail Customer Experience
We were just a few days into the new year when USA Today shared 17 retailers on its “2018 death watch.” After all the closures and bankruptcies of 2017, one might hope for a reprieve for some of our largest, most tenured chain stores. Yet, the future for many of them seems dismal.
Take Toys R Us, for example. Following news of the company’s bankruptcy last September, the toy retailer marched into its most lucrative quarter, its head high. It had no plans to close any of its 1,600 stores. That is, until just three weeks into 2018. Then we learned that more than 10% of its locations are to be shuttered in the coming months.
Reports, such as those from CNBC, say Toys R Us had a tough end of year. The holiday season didn’t deliver for the company as planned. Instead, big-box retailers offered big discounts on toys to lure consumers in to buy other products. And, Amazon offered sales and the convenience of purchasing right from the comfort of shoppers’ homes. Still, Toys R Us plans to soldier on, focusing on its most lucrative stores. The plan is to turn several stores into “interactive destinations” – a smart move to enhance the retail customer experience. But, is it too late?
While competitors’ deep discounts may have held the company back over Christmas, as USA Today points out, the problem lies elsewhere, too. Toys R Us has fallen behind in the experiential retail trend, which it “should have been doing for years.” It should’ve offered activities to make trips to its stores more exciting, including more chances for kids to get hands-on with toys.
The bottom line is, if retailers want to avoid a similar fate, they need to continually up the customer experience. Especially in 2018.
Why the Retail Customer Experience is Paramount in 2018
Forrester reports “the key to successful retailing in 2018 is obsessing about customer experience.” Yet, in this day and age, the word “experience” means so much when it comes to consumers. Not only do they prefer to buy an experience over goods, they expect retailers to personalize the experience when they do shop. Companies need to deliver both a memorable encounter and one that is specific to each customer.
Much of the talk surrounding personalization points to diving deep into data. And yet, a Retail Dive article tells, “everyone talks about it, but almost no one is really doing anything about it.” Instead, retailers are implementing measures within stores to support personalization.
In fact, the Forrester reports says 72% of retailers plan to “extend personalization projects to stores” in 2018. This raises the bar even higher for those who’ve avoided the experiential retail movement.
But, the good news is there are still ways to provide an enriched retail customer experience this year. It’s this freedom to experiment in store, says Retail Dive, that will drive more online retailers to physical locations, further escalating the competition.
3 Ways to Compete in the Retail Customer Experience
Smart retailers are using what could’ve become empty space to offer consumers new reasons to visit them. Nordstrom, for example, has opened a new type of store dedicated to a convenient experience – Nordstrom Local. There, visitors can get style advice, alterations, and manicures – or just have a drink. Meanwhile, skateboarding brand Vans operates London’s “House of Vans” to encourage consumers to stop in, stay a while and (of course) shop. And with a café, live music, art and skate ramps onsite, the prospect of hanging out is incredibly alluring.
While these are elaborate examples, brands can use the following simpler solutions to enhance the retail customer experience and win the hearts of consumers.
1. Hands-on workshops and classes.
Cosmetic brands are synonymous with product demos, just as Sephora is with experiential retail. The cosmetic retailer is known for activations outside its stores, such as at the Coachella and Panorama music festivals. There, the brand serves as a haven, allowing attendees to cool off and freshen up. But, it has boosted its in-store efforts with the availability of events, particularly its Beauty Tip Workshops.
These classes gather like-minded shoppers at one table for tutorials from the experts. They also have access to Wi-Fi, iPads and the company’s Virtual Artist technology to try on makeup digitally. The concept has proven so successful that two stores dedicated to the experience have opened in NYC.
2. Technology adoption in store.
Sephora also proves the effectiveness of technology for in-store application. It’s giving shoppers an experience – and one that’s personal – with its Virtual Artist technology. As we move forward into 2018, we can expect more technology at the brick-and-mortar level. For instance, a recap of NRF 2018, “Retail’s Big Show,” says the year’s focus will be on “interactive displays, digital signage and proactively incorporating a mobile experience.”
Sephora’s use of augmented reality achieves the first and latter. But, it’s not the only retailer making strides with augmented reality. Home improvement retailer Lowe’s partnered with Microsoft to launch the “Hologram Experience” in two pilot stores. This experience allows customers to don the Microsoft HoloLens to visualize their own kitchen renovations.
Other retailers are using virtual technology to boost the retail customer experience. A Harvard Business Review article gives several potential use cases. But, the main goal is to show how products solve consumers’ issues “and naturally extends the brand’s connection to the consumer.”
Yet, shoe company Toms is using it to play on shoppers’ emotions. Known for providing shoes to someone in need for each pair sold, the brand put Samsung Gear virtual reality headsets in more than 100 stores. Wearing them, users took in “panoramic views of a schoolyard as children are handed boxes of shoes.” One shopper remarked on his realistic view by admitting he wanted to wave back at the children. Toms gave this customer (and likely countless others) a personal experience and memories to last, all while displaying corporate values and purpose.
3. Influencer marketing and events.
Almost three out of four luxury brands engage in influencer marketing. And, many are hitting it out of the park with their chosen ambassadors, who are bringing in the “likes” with their #ad posts. Yet, a recent article makes a good point. It says, engaging an influencer “makes for a great photo opportunity. But if it’s not woven into the fabric of a bigger activation, it usually doesn’t provide the return the C-suite is looking for.” That’s where REVOLVE online clothing retailer stands out.
REVOLVE is active in engagements with influencers, taking them on trips and hosting parties and events. And, it does so with strategy, such as its #revolvefestival campaign surrounding Coachella, with efforts paying off. It’s been reported that influencers drive up to 70% of the company’s revenues; their total 2017 impact estimated around $650 million. So, in November, REVOLVE held an awards ceremony to honor the achievements of fashion influencers. Fans submitted votes for a number of categories. Yet, in the end, the retailer took home the biggest reward, as participating influencers had a combined 11 million followers.
These efforts to up the retail customer experience show that retailers can deliver the personal touch people want.
At Elevate, we help retail brands bring truly memorable brand interactions to consumers. Learn how our event staffing services can help your retail customer experience make an impact.
