Retail’s New Wave

 

David Schwarz, Partner, HUSH examines why the digital experience is integral to in-store innovation and shares a view of digital store experiences from the retail hub of New York.

Emotion has long been the driving force behind a brand’s relationship to its customer. Deeper emotional connections create loyalty, communities and culture. But for retail, the need to create emotional impact is even more fundamental to success. A Psychology Today analysis of fMRI neuro-imagery shows that when evaluating brand purchasing decisions, consumers primarily rely on personal feelings and experiences rather than didactic information like product attributes, features, and facts. This is perhaps why the future of the retail industry will be shaped by the strength of its experiences and the emotional responses they inspire. Transactional exchanges, on the other hand, will move to Amazon where the “emotional” brand is virtually invisible.

There is no better driver for brand connections and growth than real-life, real-world experiences. In fact, research consultancy Forrester confirms that brands that focus on experience outperform the S&P 500 by more than 25% over a six-year span. Innovative, authentic retail brand experiences should represent the aspirations of the corporation, its products and services, in an environment that it can design, refine and support top-to-bottom. As such, brands need to do more than simply present their products to customers. They need to help position products in the marketplace as part of a larger ecosystem of culture, vision, innovation and technology.

Whether the brand itself is a technical-leaning one (e.g. Apple, Tesla, Sonos) or within the realms of fashion, food or hard goods, technology must play a part. Whether or not a brand’s innovation results in the creation of its own technical products and services, in-store digital experiences represent the optics of that innovation to customers.

As digital adoption increases exponentially, real-world digital experiences have become a reality of daily life. This drive toward digital must extend to the retail space experience where it adds a layer of branding that more closely aligns with its own online presence – often the first place of impression for a customer before stepping foot in brick-and-mortar.

As brand designers, we must move past paying sole attention to the fit and finish of materiality and interiors, in favour of incorporating a brand’s digital “reflection” into retail spaces. Digital content (video, photography, data, and social messaging) thus becomes a bold element that reminds customers of the vast, interconnected online language of products, communities, lifestyles and culture that cannot be expressed with the quality of fixtures, lighting and display. This is especially true for retail brands that have large content networks for whom the digital platform represents the ever-changing, and evergreen. Online digital brands move at the speed of light, which often outpaces their brick-and-mortar seasonal refreshes.

Further, bold digital elements within the retail context are a semiotic reminder to customers who have interacted with digital/ social platforms, their stories and content. Conceptually, customers want to feel that the brick-and-mortar experience relates to the preferences they have online, but with the added value of in-person and tactile affordances. If retail brands don’t telegraph their digital reflection in the retail space, they will find it much harder to close that tricky gap between online and offline.

THE EXPERIENCE EVOLUTION

In just the last few years, a handful of notable brands have reshaped their respective consumer experience through innovative digital in-store integration. From Sonos’ flagship New York City store, with its listening “pods,” to Nike’s digital “trial zones” at its SoHo location, to Samsung’s 837 “Un-Store” that the brand describes as a “digital playground,” and pop-up retail experiences for Google where digital “demo” is integral, top-tier corporations have astutely married online and offline experience while showing just how much brighter digital has shone since it was first implemented for customer engagement basics.

This retail experience evolution has progressed in a few waves as brands and designers worked to meet changing technologies and customer expectations. Wave one was simply providing customers with the tools to browse online catalogues and access the infinite suite of products, services and marketing content that exists on digital platforms. It wasn’t that long ago when retailers integrated tablets and screens into their visual merchandising, and the expectation was that this technology led to efficiency (or at least the appearance of digital help) when in reality, it put the burden back on the customer to do the work.

In wave two, retailers connected mobile to the in-store experience leveraging RFID and other location-driven technologies to augment the shopping experience with location-specific information, opportunities, product offerings, and deals. Naturally, there was an ironic tension as retailers spent millions in both physical space design and merchandising, as well as in HR and salesperson training, only to push customer attention downward to gaze at the small windows of their own mobile devices.

With wave three of digital retail, customers will still be asked to engage, but not in the pursuit of functional and instructive information only. Rather, the quid pro quo will be an effort to unlock unique experiences that align the customer and brand to a vision of what’s possible with their products and services. This is how brands demonstrate where they are headed, aspirationally.

Nike leverages run club membership and running data to hold cinematic, group fitness experiences within its retail stores. Even Apple, known for its minimalist approach to product merchandising, is converting to embracing broader, layered in-store digital experiences that demonstrate the power of its connected software and hardware through content, interaction, animation and group trial.

The core idea is moving beyond “functionality-driven” digital touchpoints and into uses of digital that engage customers in experiences they can’t find anywhere else, be it through games, education, community-building, entertainment, or social connection.

The beauty of place-based experiences is that they’ve been around since merchant first met customer – before technology as we know it existed, and before anyone cared about the “how.” For the retail industry, this is where the opportunity for branding and emotional connection will continue to grow. According to a study by intelligence firm Walker, experience will overtake price and product as the key brand differentiator by the year 2020.

Technology isn’t unlocking something in retail experiences that wasn’t already there. It’s simply a way of enhancing interaction among audiences, acting as a catalyst or a recorder of the experiences through data and evaluation. When technology is involved in the conversation, brands can deliver messages in ways that are more fine-tuned, gauging audience interest through interaction, and serving up reactions at the same scale of engagement.

This has always been a key component of digital experience design: walking the line between what is didactic and informational vs. what lives in the world of brand feel, tone, beauty and sensibility. A great brand experience delivers all of the above, along a very strategic, emotionally impactful sequence that mirrors the natural behaviours of its customers.