With digital adoption rates increasing and brick and mortar visitation plummeting, property owners and retailers have got to tackle one question that continues to linger: Are their physical locations still relevant?
Over the last decade, e-commerce has amassed a significant share of the market and in some functions, a commanding lead. However, retail destinations still have an opportunity to shape exceptional experiences in their favour if only they can deploy their strategy effectively. And here is how physical stores can build and sustain competitive advantage.
LOCATION, LOCATION, LOCATION
Unless your store is the dominant player in cost leadership, you must pay attention to your choice of location. A recent study by D&I Consulting which surveyed over 2,000 customers that shop at a major retail location) ranked “proximity to location” highest in motivating factors when deciding on where to shop while 25% ranked affordable products second. Your location matters. And it is not addressing convenience and value for money; chances are that you may struggle to remain relevant. Your location should cater to sufficient parking bays, closeness to a residential or commercial node that reflects your target market for instance. A thorough research and feasibility studies are essential when deciding a retail location.
OMNICHANNEL STRATEGY
A single sales channel is no longer sufficient especially if it is a brick-and-mortar store. To succeed in today’s ultra-competitive retail world, you must become omnichannel, which means providing a smooth approach for customers to purchase things and engage with your brand both digitally and in your physical shop. Here is another customer feedback worth sharing. When respondents were asked how their shopping behaviour and preferences had changed regarding categories mostly conducted in-store, 41% mentioned that they still visit retail locations but conduct more online shopping than before in those categories majorly carried out in physical stores; including groceries and vegetables. If this does not inspire brick and mortar operators to explore omnichannel solutions, we are not sure what would. A physical store relying solely on walk-ins will continue to suffer and lose ground to ecommerce. The right thing to do is to build an Omnichannel solutions that create personalised automated customer journeys, long-lasting relationships with customers that will increase their lifetime value.
TENANT MIX THAT CAPTURES LIFESTYLE
Property owners, real estate consultants and Retailers can increase sales and amortize by broadening their product and service selection. The retail location of the future must carry a wider assortment of categories that does not just captures
entertainment, leisure, and shopping. Mixed use offering should also be included. The Dubai Mall is an obvious example, which has opened several luxury hospitality options from tourists and visitors to choose from. The first step is to understand who your customers and then work backwards to proffer a solution to their wants or needs. That is what The Dubai Mall did. The first step is to craft an effective strategy to understand customers behaviour and preferences. And one way to accomplish this is to conduct a simple survey asking customers their preferences, behaviours and even for ideas.
CUSTOMER EXPERIENCE IS AT THE HEART OF THEIR STRATEGY
Customer experience is the new currency in retail. When organisations focus on getting this right, they automatically deliver on the expectations of other major stakeholders. But let us be honest. You can get away with normal customer service (bleh) if the retail location has extensive shopping categories, available products, and services. The issue is that it is not a sustainable business model. Zooming in on the six pillars of customer experience is imperative here. Exceeding expectations, turning a poor experience into a great one, personalised and trusted advice, and imbibing customer empathy will foster less friction in the process, leading to a superior experience. This is what the retail location of the future will look and sound like. This strategy is not meant for everyone unless your purpose is linked to “enriching customers lives.” According to Giovanni Gavetti, the most successful strategies become attractive because they are extremely difficult for most competitors to imitate. While the bottom-line may be the major driving force for some, the retail location of the future will be driven by experience. That includes immersive exploration. A few retail businesses have introduced have AR and VR technologies to enrich the customer in-store exploratory experiences for instance. Nike, Adidas, and Chanel are just a few examples.
TALENTED & EFFECTIVE PEOPLE
People deliver the strategic choices that culminates into pleasurable experiences for customers. Purpose, Leadership, innovation, strategy, marketing (PLISM) are critical areas that sum up the culture of an organisation. The retail location for the future will need talented and effective people in abundance to deliver on not only meeting but exceeding customer expectations. When people are ill-equipped, poorly compensated, inadequately trained, unmotivated, or not rightly compensated, the experience that they are mandated to deliver will suffer. Period. When there is no culture or values in place to hold people accountable, the organisation will run amok. People will choose to interpret situations in their favour and not necessarily in the interest of the customer. This is extremely vital; that they are empowered and motivated to deliver. There are workshops and training sessions tailored for each situation whether the goal is change management, store sales optimisation, total quality management, restructuring and the like.
THEY WILL INTENTIONALLY MEASURE WHAT MATTERS
You must have heard this one. “You can’t improve what you don’t measure.” Never has the truth been so succinctly put together. Measuring who does what and why is critical for business growth and sustainability. The retail location of the future must have answers to these questions. It must have intelligent, relevant, accurate and timely data to act on. Advanced solutions include products that caters to retail locations, their tenants, and standalone stores. From data accuracy, queue management features, to gender differentiation capabilities. These solutions will give retail businesses insights that will shed more light on actions to take to position for growth, conduct diagnosis, and formulate strategy for competitive.
