The changing role of the physical store
E-commerce is without a doubt the biggest shift in retail, with traditional retailers facing increasing competition from online channels. Customers will go into a brick-and-mortar store but immediately pull out their phones to compare products and pricing. In fact, research from our client, global management consultancy Oliver Wyman, revealed that three in five shoppers plan to browse in store before buying online this Christmas. Whilst this might be cause for concern for a brick-and-mortar, doesn’t it also suggest that physical stores still have an important role to play in the customer’s shopping journey?
For years the traditional store has been expected to make money on its own. But as the retail industry rapidly evolves, the focus ought to shift to its role as an acquisition channel, bringing customers into the experience and the brand.
So, in the age of Amazon, what will make us want to go into the store? One approach to creating an innovative in-store experience has been adopted by Rachel Shechtman, Founder and CEO of Story. Speaking at the Financial Times: Future of Retail Conference earlier this year, Shechtman talked us through her retail concept – a Manhattan store entirely reinvented every three to eight weeks like a gallery, has a point of view like a magazine and sells things like a store. Partnering with brands to launch a new ‘story’ focused on different themes, Shechtman says her store provides ‘experience per square foot’.
For example, the “Making Things” edition was telling a story about making things, so they enabled people to do just that! By dotting MakerBot 3-D printers and injection moulding machines throughout the store as well as hosting workshops and live innovation events, shoppers were exposed to more than just an item for a price.
In an interview with The Business of Fashion, Shechtman acknowledges that “if time is the ultimate luxury and people want a higher return on investment of their time, you need to give them a reason to be in a physical space.”
So, in a world where brick-and-mortar retailers fear being phased out by tech giants and hip online start-ups, the key to survival is leveraging the advantage of the customer experience. Many customers will continue to go to a physical store as a destination for socialising, advice and experiencing products. With technology now infringing on so many aspects of our lives, the idea of more stores offering discovery and human connection is something I very much look forward to.
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