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The Rise of Experiential Retail

The Rise of Experiential Retail

We’re all familiar with this gloomy synopsis: traditional bricks-and-mortar stores are dying, online shopping is inevitably inheriting the retail crown and the high street is doomed…right? Well, not quite it seems. In a rather delightful demographic twist, it appears that while Millenials and Gen Z take the availability of online retail for granted, they actually value physical, meaningful, ‘in real life’ connections with the things they’re buying more than digital convenience. Shopping, in this context, is a leisure activity – so why shouldn’t it be entertaining, exciting and fun? The next generation are not just shopping for products – they’re shopping for experiences.

Emotional purchase power

“More and more, consumers are shopping with their emotions instead of their wallets.” Forbes, 2019

Enter the era of omnishopping – where the lines between on- and offline retail and marketing are becoming increasingly blurred. For all its convenience, digital retail has its work cut out trying to create meaningful connections with customers. Gen Z in particular are turning to social media (predominantly Instagram) to try and experience the brands and products they desire, but even then, statistics are showing that nothing can beat actually getting up close and personal when making purchase decisions. This is where a return to real customer service can truly make the difference.

Consumer analytics firm Adoreboard surveyed 10,000 18-34 year olds, and found that on an emotional level, 49% preferred to shop in physical stores, compared to 39% who preferred websites, and 11% who preferred apps. According to Adoreboard, “the next generation…want, need and value that in-person, human, individualised experience.”

Connect before you buy

“Gen Z is the Instagram/Snapchat generation, driven by gorgeous visuals and fleeting attention spans…they want products that they feel are unique to them and reflect their values.” Criterio, 2018

It’s a whole lot more than just remodelling stores to be more attractive however. Brands looking to survive this fundamental change in retail habits need to leverage both their physical and digital assets to create entertaining, engaging and memorable experiences that capture consumers’ attention. There is a fantastic opportunity to combine the best of on- and offline retail into one seamless experience for the customer. Interactive displays, augmented and virtual reality, hands-on product testing and rich media content are all already being used to great effect by savvy brands in-store – and if we add into the mix the ability to complete a purchase started online by a customer, or access previous ecommerce order history to provide personalised advice in-store, then the concepts of ‘channels’ and digital competition simply disappear. Even brands with no traditional retail presence are turning to physical touch points enhanced by digital content to wow their potential customers and deliver their brand values in a tangible form.

Consumers – especially the next generation – want to feel excited and valued. Whether consciously or not, they’re making an emotionally-driven judgement of a brand that’s directly proportional to how much apparent effort has been put in to a retail experience. And they’re looking to belong – they want to discover brands that speak to them and their values, and there’s no better place to do that than in person.

Bringing it all together

“The retail store is not experiencing an apocalypse: on the contrary, it is on the cusp of a renaissance.” Retail Systems Research, 2018

The future is far from gloomy then. The conclusion is that this isn’t a ‘one way is better than the other’ situation – a successful, deep retail experience needs to be part of the bigger picture, where physical and digital channels work seamlessly together to deliver a whole new level to consumers. That’s where digital becomes a part of the in-store experience and vice versa – imagine a retail display that talks to an app on a customer’s phone for example, or a website that knows if you’ve visited a shop in person. That’s not the future, that’s happening right now. Make sure you don’t miss out.

Does Virtual Reality have a future in-store?

Virtual Reality is finally coming of age. The magic point where technological progress meets cost affordability has brought with it an explosion of virtual – and augmented – reality experiences, uses and applications. So, where does this reality-enhancing revolution fit with in-store retail? We’ve examined the benefits, the future potential and the possible obstacles to uptake to answer the question: is VR an investment that will pay off in physical retail? Spoiler alert – the answer is yes. Let’s find out why.

Rewriting the rules

Goldman Sachs has forecast that the VR/AR retail market will be worth $1.6 billion by 2025”

The inescapable laws of physics – time, space, dimensions – while undeniably useful, are frankly a little limiting to us creative types. We can work within their boundaries to create beautiful, memorable experiences in a physical retail space – and have a great track record of doing just that – but sometimes we wish we could take consumers to a completely different dimension. The good news now is this is where virtual reality steps up. We can entice a customer into an immersive shop-in-shop, surround them with all the benefits of a brand, show them the products and then…whisk them away to a virtual space that transforms that physical experience into a fully interactive, extraordinary journey.

Legendary outdoor brand North Face demonstrated the potential for this approach a couple of years ago by adding a virtual reality tour of Yosemite National Park to 3 of its flagship US stores – transporting customers to the incredible landscape to see North Face products in action first hand. You could live the brand’s values of remote exploration while standing in a busy urban store in Fifth Avenue. Toms (the ethical shoe brand) put 100 Samsung Gear VR headsets into stores to take customers on a virtual trip to Peru to see how their buy a pair/donate a pair philosophy actually looks in the real world – an undoubtedly powerful sales technique.

Virtual vs Augmented

While much of the focus has been on virtual reality, augmented reality’s transformational potential – especially in retail – can’t be ignored. AR provides in some ways the most natural evolution of the in-store retail space by adding a virtual layer to existing physical objects. Want to show off your new line of products before they can shipped to stores? You could play a video or use an interactive display – both proven to be effective – or you could build an AR experience that ‘teleports’ the products virtually into the store, allowing customers to walk around them, understand their scale and even (in the case of LEGO) play with them without anything actually being there. That’s pretty powerful for retail; in an age where Millenials and Gen Z are buying into experiences over just buying things, being able to show them your new product in explorable 3D rather than just tell them about it will pay dividends.

Adidas upped the AR game last year with an ingenious use of the technology at ComplexCon in California. They placed AR points all around the convention centre, challenging visitors to find them, scan them and then actually see and unlock exclusive limited edition trainers floating in virtual reality through the lens of their smartphone – and buy them, right there and then.

The potential for customer engagement, conversion and increased sales is simply enormous with these applications. A retail display enhanced with AR technology offers us a glimpse into what may be commonplace in the near future, provided it’s used and delivered intuitively and accessibly. Here we must consider one of the big advantages of VR over AR – VR is much more easily controlled by the brand or retailer. The experience you deliver and the technology that’s used to deliver it are all up to you – AR relies far more heavily on users having a compatible phone or device, the patience and incentive to install an app and the ability to use it successfully.

So, why is it not everywhere already?

Virtual reality has definitely arrived in a meaningful way – but it’s still early days. The technology itself brings with it certain limitations, from headset portability to motion sickness. Its current usefulness depends very heavily on exactly how it’s used, and these are lessons often being learned in the wild by pioneering brands and early adopters who are willing to take the risk. Constant consumer testing and feedback is essential – an investment of this size needs to prove itself to be a genuinely experience-enhancing sales tool, not just a fad-ish novelty.

There is little doubt in our minds it does – and will – have an ongoing place in the in-store retail experience toolkit however. We’ve already shown how incredibly effective it can be on the client-facing side of a project – now it’s time to take consumers to new realities too.

Why going green is good for the world and your business

The world is in the throes of a sustainability revolution. Customers are increasingly shopping with their hearts in favour of brands that adopt eco-friendly processes. The Nielsen Global Corporate Sustainability Report showed that 73% of European millennials are willing to spend more on a brand that they know is sustainable. Furthermore, an impressive 81% of millennials expect companies to publicly share their corporate social responsibility efforts.

What does this cry for corporate social good mean for the retail experience? It means to remain competitive and relevant your environmental and social efforts need to be both impactful and obvious.

As with anything that evolves quickly, the new wave of conscious consumption has left many with a watered down understanding of what ‘going green’ actually means. In truth, it’s a full circle, all-encompassing vision that takes into consideration material origin, manufacturing waste output, energy consumption, processing, packaging, transportation and recycling when it’s reached the end of its use.

In the midst of all of this, many companies get so caught up in the eco-friendliness of the product and packaging itself, that the in-store brand experience can be an afterthought. In reality, your customers are going to be casting just as critical an eye over your retail displays.

Today’s consumers don’t want to buy a product, they want to buy into a lifestyle that’s congruent with their own values, choices and preferences. For brands, this moves in-store sustainability up a gear from an opportunity, to a necessity.

Materials make or break

With ‘Europe’s Single-Use Plastics Directive’ proposed for June 2019, finding alternatives to plastic is at the top of most companies’ lists. Bamboo is an excellent substitute to single-use plastics as it’s tough, renewable and also grows fast (3 to 5 feet per year) in comparison to forest trees.

Recycled materials can be used creatively and will be appreciated by eco-conscious browsers. Recently San Francisco-based sustainable fashion brand, All Birds, mirrored their world-friendly approach (Campaign Live, 2018) to making sneakers out of eucalyptus and sugar cane by using natural materials in their shop displays too. They use greenery and moss throughout the shop, and an interactive wall displaying laces encased in 100% recycled plastic bottles.

Minimize energy usage

There’s no need to use an unnecessary amount of energy in your in-store experience. Modern advances in LED, computer and connectivity technology have dramatically improved energy efficiency on the whole. To minimize energy use, make sure your brand is leveraging all of the options available. Smart and sparse use of the latest generation of LEDs in lighting, for example, will deliver real impact while using almost no power.

Consider transportation

Better materials and energy use are highly laudable, but remember to consider how it’s all all being transported in the first place.

Getting your in-store experience from A to B in a considerate way is a point that many companies completely forget to factor in. If your display parts are packed in bubble-wrap, polystyrene and an abundance of non-sustainable materials, you need to look into other options. It’s natural to want to protect your investment in the most effective way, but there are structured card protection options, and even easy to assemble flat-packed designs that can do the job just as well.

Smaller box sizes also have the added benefit of using less fuel while en route to your destination, so it’s a win-win all round.

Be smart with digital use

Integrating interactive digital elements into your in-store brand experience not only bridges the gap between on- and offline retail, it also presents a great opportunity to replace traditional physical marketing materials with virtual ones. No need for printed brochures or wasteful and gimmicky giveaways – give shoppers a digital takeaway instead, and if you’re smart about it you could convert their interest to a sale in the process.

Communicate your efforts

Communication is the key to everything, so spread the word across all your communication touchpoints. Tell your customers (and the world) all about your sustainable efforts and you’ll soon reap the benefits and enjoy the natural ‘feel-good’ effect of your business contributing to a more sustainable world.

Remember, in the wise words of Pete Seeger: “If it can’t be reduced, reused, repaired, rebuilt, refurbished, refinished, resold, recycled, or composted, then it should be restricted, redesigned or removed from production.”

Get started on your sustainability and you’ll soon have an in-store brand experience you can proudly promote.

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