Over the last five years, the retail industry has undergone a seismic structural shift. In the new retail environment, a bricks and mortar store frequently forms part of a wider strategy to increase sales. Indeed, with today’s consumers increasingly accessing information and making purchasing decisions through multiple channels, restricting your retail operations to any single channel can drastically limit your profit making potential.
Understanding the shift
Consumers are an increasingly savvy and demanding bunch. The advent of online retailing has utterly transformed the buying behaviour of consumers; a transformation which many retailers acknowledge they must pay attention to, and understand, if they are to thrive in this new retail epoch.
Customers now have access to more information than ever before, at their fingertips, which has served to make them increasingly informed, as well as augmenting the way in which they choose to shop. Some still prefer the experience of shopping in a bricks and mortar store, others shop solely online and some prefer a mixture of the two, through innovations such as Click and Collect.
According to a recent research report, The Changing Face of Retail, published by consultancy firm Deloitte, ‘driving sales of the product in store’ should no longer be the goal of retailers, stores need to become a ‘brand and product showroom that drives revenues across all channels.’
The changing role of the store
While customers may increasingly choose to shop online, the bricks and mortar store still has an integral role to play in the retail process, with Deloitte reporting that 78% of consumers purchased their last item of clothing and accessories in store, while only 8% made their last purchase online.
The percentage of total sales made up of digital sales may be seemingly insignificant at present, but it’s the area that is predicted to grow most rapidly over the next five years, at a rate that is 8.8% faster than overall retail sales. If online is to continue to be the fundamental growth area within retail, the issue of how bricks and mortar stores fit into your retail strategy needs to be approached in a more holistic manner.
A destination experience
Customers appear to be increasingly willing to buy online, but a large proportion still want to be able to touch and feel an item before they purchase it, as well as enjoying the sensory experience that is associated with shopping in store.
As a destination, the bricks and mortar store is your opportunity to provide your customers with a fully immersive brand experience. A unique, personalised lifestyle experience is now expected by consumers, a physical store is your chance to showcase a selected range of products and excellent customer service is now a prerequisite, rather than an optional extra, if you are to truly build brand loyalty.
Rather than worrying that in store sales may decline over the next five years or more, savvy retailers understand how their customers’ shopping expectations have changed. Customers are no longer concerned with seeing a full product range crammed into a store, as they are willing to purchase their preferred items online. This offers an opportunity to retailers to create a unique sensory experience. Companies such as Burberry understand this and have reacted accordingly, turning their London store into an entertainment venue at the start of each new season for their most loyal customers, filled with iPads, large screens and a fully immersive digital experience.
Becoming a globally local retailer
Moving forward, the bricks and mortar store offers retailers an opportunity to tie their brand together. The store has the capacity to act as the central cog in the retail wheel, which is essential, but certainly should not be the focus of all customer centric activity.
By utilising the store as a local destination and inspirational focal point, it’s possible to use the store to drive sales on a global level, opening up opportunities and markets that may previously have seemed unfathomable.