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Our white paper on how retailers and brands need to adapt to deal with the latest trends in consumer behaviour.
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Are you ready to take advantageof the exciting new opportunities in 2014?
Retail is Changing
The Evolution of the Retail Store – Do we still need shops?
The Changing Face of the Customer Journey – A Multi-channel approach
The Power of Experience – Creating an engaging environment and and exciting customers
Conclusion
Next Steps for Brands and Retailers
Call to Action
Contents
Despite the doom and gloom from the pundits,
traditional bricks and mortar retailers are still
perperfectly positioned to benefit enormously from the
huge changes sweeping the industry. More than 70%
of consumer electronics spending still goes through
shops, and despite the recent high profile failures of
high street retailers such as Comet, Blockbuster and
HMV, the fact is there's no real sign of a shift in the
fundamental need for people to touch and feel
pproducts before buying.
What is changing is the What is changing is the way consumers conduct their purchasing cycle, driven to a huge extent by the rise and rise of new technologies. The challenge facing both major brands and the bricks and mortar retailers is how to optimize their channel offerings so as to take advantage of the opportunities that this provides. This means doing away with ooutmoded ideas of customer purchasing, and introducing genuinely innovative multichannel marketing strategies which deliver a consistent experience and message at every touchpoint.
A survey of 5,570 UK shoppers found that 76.7% of consumers prefer to shop in-store.Source: Retail Eyes
Source: Verdict
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Retail is ChangingAre you ready to take advantageof the exciting new opportunities?
Once upon a time your customer walked
through the front door, browsed the products
and made their way to a cash register with
their choices. Nowadays the front door has
been replaced by a multitude of different
digital doors, each requiring different and yet
complementary strategies. Just because a
cucustomer now starts their journey using a
laptop or smartphone does not mean there
should be two approaches to satisfying
their need.
The reality is that 90% of total UK retail
purchasing is still done in bricks and mortar
stores according to the Office of National
StStatistics, so successful retailers are learning
fast how to re-engineer their in-store offering
to optimize the experience no matter how the
journey is made. This means a seamless
rrelationship, allied with best of breed sales
staff interaction, along with important features
such as identical online and offline pricing, a
similar if not identical product choice in every
channel and opportunities for the customer to
select their optimum purchase process in-
store, whether it be via a cash register or their
mobile phone.
The most successful retailers of this age have
adopted to the change by delivering best of
breed interactions with their customers at
every point. The journey may begin with a
search engine, a social network link or a
friend's recommendation, but in each case the
winners present a clear and appealing route to
the checthe checkout, with as few hurdles in the way
as possible. Click and Collect and Virtual
Showrooming are just two features which
point to the modern approach to customer
satisfaction en route to the checkout.
We know that about 60% of our customers buy both online and in shops so the approach is to make it absolutely seamless for them to move from one to the other. So they can research in one plaone place and shop in the other, they can buy in one place and pick up in the other – the art of sales is consistent across channels, so the whole approach is to make it channel agnostic. They’re not even supposed to know or see or rrealise which channel they're using because it's one overall customer offer.
Andy Street, MD John Lewis Partnership
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The Evolutionof the Retail Store
Customers who used both online and in-store channels spend 36 % more than single-channel shoppers.Source Intel
For most retailers, the challenge is how to
switch to this seamless customer interaction
fast enough to meet the increasing demands
of a new generation of digitally savvy
customers. The answer seems to be to replace
the cold empty experience of traditional store
floor browsing with a more dynamic and
ininteractive experience. Global brands like
Apple and Microsoft are pioneering this new
approach with retailers such as Dixons in the
UK, but it takes time and investment in staff
training, technical infrastructure and cultural
change to make it work properly.
The traditional bricks and mortar stores of
ttomorrow are less likely to be static shelf
based spaces and more of a sophisticated
environment where sales staff act as trusted
advisors to guide the shopper to not just the
best choice of products but also buying
channels. This is pachannels. This is particularly true where the
product requires more explanation such as in
consumer technology, where pile 'em high, sell
'em cheap is slowly giving way to a more
nuanced approach to customer satisfaction.
The change in the retail store experience is
also being driven to a large extent by the
incincreased incidence of showrooming, where a
shopper visits a store to examine a product in
detail before returning home to buy online at
a cheaper price. Massive online retailers such
as Amazon have definitely benefited from this
trend in recent years, but now the bricks and
mortar outlets are fighting back with more
appealing point appealing point of sale interaction, and
improved checkout procedures to entice the
customer to purchase immediately.
Our job is to make buying technology not just fun, but also easy, and I think this takes us another giant leap forwards in achieving that goal for our customers.
SebaSebastian James Dixons CEO
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The changingfaceof the customerjourney
While online shopping typically offer lower prices and a broader product choice, consumers still prefer to take time to touch and feel the products, and compare them against others in a live store environment, and this is where the successful retailers are stepping in to take adadvantage of that opportunity to close the sale through engaging, exciting sales activity. The last nine feet of the sales process is becoming more important than ever.
At the other end of the scale we are likely to see a rise in the number of retailers offering integrated Click & Collect services, with additional additional concierge type services on offer (like a free cup of coffee while you wait) for arriving customers. In-store kiosks, express checkouts and store wide free WiFi are other features which will become more popular as the traditional retail space fights back against the speed and convenience of online rivals.
As retail evolves so too is experiential marmarketing. The social interaction and touchy feely nature of visiting a bricks and mortar store is still considered to be a key part of the buying process by many consumers, especially with higher ticket and more complex products. The growth in online shopping and the resultant showrooming phenomenon has also served to highlighighlight how careful high street retailers have to be not to alienate their customers and degrade their brand.
Clever retailers with the most to lose to online sales cannibalism, have ensured that they adopt a strong online presence as well, to offset the lure of their rivals, but most importantly they have started to alter the way their retail stores operate in order to make them more valuable and attractive to prospective customers.
InInstead of just offering a cash register and shelf environment, the most successful are adopting a more experiential approach, offering an entertaining and engaging environment.
If you look at the future of technology and where the manufacturers are heading, it’s all about innovation, creating experiences and exciting customersSebastian James Dixons CEO
Jonathan Marsh, John Lewis
‘‘‘‘
for the shopper to enjoy. Product demonstrations, interactive displays and more expert sales staff are just some of the ways the bricks and mortar stores are fighting back.
Pop up experience stores are also becoming a larger feature of the traditional retail landscape, with augmenaugmented reality displays, integrated online browsing and teams of enthusiastic demonstrators eager to engage the customer in brand experiences, games and other interesting and vibrant events.
RRetailtainment is the extreme end of this trend, but there's no doubt that the rise in the use of in-store brand ambassadors and trained sales presenters is proving successful in wooing back disaffected shoppeshoppers once again. The huge success of places like the Apple stores, with their trained consultants and open plan shopper friendly playground of a sales floor has spurred a new generation of experiential enthusiasm.
The store is changing from a place to transact, to a place where a customer's loyalty and relationship with a brand can be significantly enhanced. Customer engagement is becoming a key part of the process, with advice, demonstrations and problem solving as a crucial element crucial element of delivering optimum customer satisfaction.
The tThe traditional function of retail stores may be changing, and their numbers reducing through multichannel attrition, but there's little doubt that they are here to stay. Having a shop window on the street encourages recognition and engagement with brands, and it can also have a significant knock on effect on the amount of online revenue that the bthat the brand generates. Trust plays a big part in convincing shoppers that a brand is here to stay, and a high street or mall presence offers that reassurance much more effectively than a remote online website.
The Power of Experience
The result is that stores are now maximising their customer ininteraction areas and reducing the space given over for basic product display, along with using virtual displays and interactive shop windows to entice shoppers to experience the brand in a more direct way.
At the heart of all this technology hhowever, lies the comforting human touch, which remains a large and crucial part of the equation. Browsing products may be easier and more leisurely when done at home via the Internet and PC, but people seem to gravitate to more expert guidance from a real person when it when it comes to making the final purchase. Showrooming is likely to occur when the experience is less than satisfactory, the environment is cold and unwelcoming or the route to the checkout is obstructed by stock problems or missing and unengaged sales staff. The challenge for retailers is turning showrooming in to a positive, whereby the customer comes in to the store to touch, feel and experience the product and then ultimately buys it from the retailers own website.
Despite the challenges of operating in such a volatile environment, it seems that there are significant opportunities available for strategically oriented retailers and brands who focus on delivering customer needs in whawhatever form they take. The big differentiator is a combination of intelligent technology choices - i.e. not just deploying technology for technology's sake - coupled with an understanding that at the end of the day the role of retail is to deliver a happy customer eexperience no matter which channel they choose to use or originate from.
The current obsession with multi-channel or omni-channel marketing offers no revolutionary blueprint for success in modern retail, but simply a way of delineating the didifferent methods through which retailers and brands can engage with their prospective customers. The most far-seeing brands already undeunderstand that in a few years time there will be no separation between traditional retail and multichannel, it will all sit under the same roof, with the same vision, strategy and goals of serving the customer.
In a similar vein, the artificial differentiation between mobile, desktop and other routes to pupurchase will start to blur, as they already have. The unifying mantra is the growing rrealisation that the Internet and the browser is the fundamental touchpoint that customers are growing most comfortable with, irrespective of platform or system. Retailers and brands need to understand this and deal intelligently with the opportunity this provides.
The major feature that seems clear from the current state of the industry is the growing importance of face to face marketing as an added value customer service and brand differentiator. Intelligent use of in-store marketing and evangelism, coupled with a seamlseamless experience whether online or offline will ensure that retail and the major brands that power it, will continue to provide the customer with improved choice, flexibility and ease of use as technology improves and systems become more powerful.
There may well be significantly fewer retail ooutlets in the coming years, but the ones that remain will provide the kind of service oriented customer environment that today is largely just a pipe dream. It's a brave new, exciting world, and one where the digitally empowered customer solidifies their position as the king of the marketing tree.
There may well be significantly fewer retail outlets in the coming years, but the ones that remain will provide the kind of service oriented customer environment that today is largely jujust a pipe dream.
The major feature that seems clear from the current state of the industry is the growing importance of face to face marketing as an added value customer service and brand differentiator.
Conclusion
Identify specific products in your sector which may
be vulnerable to comparison shopping by analyzing
shopping habits over a period.
Use customer loyalty services and other incentives to
appeal to shoppers at the point of sale.
Focus attractive pricing offers on your most vulnerable
pproducts, which are typically big ticket items.
Use technology to fight technology. Digital coupons and
one click express checkout are examples of the kind
of thing which works.
Make use of evangelist and specialist staff sales teams
to provide added value to shoppers at the point of sale.
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Retailers Five ways to turn Showrooming in to a positive experience
next steps
Make best use of brand evangelists to explain and enthuse
customers and retail sales staff about the benefits of
your brand.
Encourage more interaction with your brand at the point
of sale via innovative technologies such as augmented
reality displays and demonstrations.
CCombine your online and in-store promotions to drive
traffic and provide a seamless customer journey to
your brands.
Use the power of mobile to drive customers to your
in-store retail brand locations through the use of digital
coupons and incentives.
Capture customer details at the point of sale and via
online miconline microsites and niche blogs. This can be used for
digital marketing to drive shoppers to retail premises.
next stepsBrands Five things Brands should be doing to take advantage of the changing face of retail
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Channel Advantage is the field marketing agency
of choice for the leading technology and consumer
electronics brands in the market.
An essential link in the marketing mix:
our professional field marketing discipline infuses
life and value into a product to add that last 20% of
peperformance in store.
A better calibre of people:
we profile, train, equip, coach, appraise and motivate a team
of specialist brand ambassadors to represent technology
products and innovations like no-one else - both in store
and on site.
Full-time retail advocates:
wwe are dedicated to working with and championing retailers
so that we can deliver intelligent field marketing
programmes borne of balanced insight for clients.
To be seen, heard, touched, tried and tested...
to instruct, educate or demonstrate... for visibility, recognition,
penetration and elevated sales... to launch, position or promote...
Switch on to Channel Advantage. We’re your channel advantage.
call to actionChannel AdvantageOur 30 second pitch...
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Contact Andrew Boothroyd Business Development Director 01628 50933607811 [email protected]
channel advantageSwitched on field marketing