“Sixteen shops are closing every day as retailers restructure their businesses and more shopping moves online.”
This quote from a BBC news story earlier this year paints an apocalyptic future for high street retailers, and you can find much the same sentiment whichever news source you look at. The high street is under attack from all sides. Consumer spending has plummeted as prices have spiked and wage growth flatlined. Retailers have been beset by uncontrollable overheads, rocketing business rates and crippling debts. To compound matters, the advent of ecommerce has transformed shopping habits, leaving retailers scrambling to catch up.
You could be forgiven for thinking that the situation is terminal for the high street. But it’s altogether more nuanced than that. The picture is much rosier when you look outside of the UK, and if you dig into the numbers a bit, it becomes clear that consumers remain keen to shop in-store. In fact, 76% of purchase decisions are still made in shops.
It’s not some unstoppable inertia that’s pulling the high street down, but a failure to adapt the shopping experience to new consumer habits. Changing the experience could be the UK high street’s salvation.
Experience is the future of retail
The plight of the UK high street is not due to a lack of consumer interest, but a lack of relevant experiences. A huge majority (70%) of shoppers said that if a retailer doesn’t excite them, they’ll simply go elsewhere, while 86% of shoppers will pay more for a better experience. Indeed, the administrator of high street chain Toys R Us, Simon Thomas of Moorfields Advisory, conceded that the impersonal shopping experience of its large stores wasn’t what consumers wanted any more.
Commodity goods lend themselves to being bought online. Why go to a store that merely presents racks and racks of product if you get the same treatment in digital? Now, when consumers go to high street stores, they need to be presented with a differentiated experience. They need to be excited. They need to feel engaged. High street shops need to be destinations, not merely repositories for goods.
Providing a stellar retail experience encourages customers to return, boosting revenue and long-term profit. In other words, it’s a given that the in-store experience is crucial to driving the high street turnaround. However, the only way to drive meaningful change is to embrace a new way of thinking.
To grasp the opportunities presented by creating shopping experiences, the shopper must be at the heart of your retail campaign planning. Don’t start with the product you want to sell, but with what the customer gets out of bed for. Where do they like to spend their time, and why do they like spending their time there? If you weren’t selling anything at all, why would they want to come to the shop in the first place?
It’s thinking like this that forms the basis of truly shopper-centric retail. But thinking in such a way is hard to get your head around, particularly with decades of best practice pushing you in other directions.
A greater challenge still is gathering the right insights on the shopper in the first place. It originates from the fact that retail campaign planning and execution is fragmented, with the online business often separated from what happens in store, or brand teams sitting apart from retail teams. There can be little sharing of data between the two, which impacts the veracity of any insights you can draw.
To form a truly 360º picture of the shopper, you must understand what is and isn’t engaging to them, both online and off. You need to break out data from the entire shopper journey. Quantitative data such as online sales and shop footfall should be combined with qualitative data such as customer sentiment.
This joined-up insight can be developed into a detailed shopper persona that forms the basis of truly a captivating shopper experience. Better still, with a single view of data providing insight on what is and isn’t working for the shopper, you’ll be in a position to adapt and optimise retail campaigns in real time.
Many organisations are already reaping the benefits of this customer-centric way of thinking. One business putting shoppers at the centre of its retail experiences is French beauty brand Sephora. The LVMH-owned property has invested heavily in experiential in-store service, comprising aspects such as virtual mirrors and touchscreen questionnaires.
Sephora’s sales have increased fourfold in the last eight years, which isn’t surprising when you consider that 76% of customers say they like to use touchscreens during shopping and 57% to use interactive digital displays.
Meanwhile, technology giant Samsung overhauled a handful of its customer care centres in the US to double as remote working spaces. Partnering with co-working space WeWork, three pilot locations were opened in Detroit, Miami and Williamsburg, offering customers a workspace complete with video conferencing systems so they could stay productive while waiting for their devices to be repaired.
Transforming the shopping experience in such a way is no mean feat. It requires joined-up insights based on data from your customers’ online and offline lives, plus a creative approach to turning those insights into engaging new experiences.
One shortcut to doing so is to collaborate with a partner that understands both the hard and soft sides of retail: that can manage the data flows, turn them into actionable insights, and has a network of creative partners that can conceptualise, design and build cutting-edge, effective and trackable retail experiences.
By understanding the entire journey a shopper makes and turning those insights into experiences that play to the strengths of physical shopping environments, the transformation of retail from transactional to experiential becomes possible. It’s clear that the high street needs just such a transformation if it is to avoid the apocalypse the media is so confidently predicting.
Steve Pitts is business director at Tag
NOTE: This piece was submitted before stores closed as a result of the Covid-19 pandemic.
Main image: Adobe Stock
Author image courtesy of Steve Pitt/Tag