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To drive store traffic, give shoppers something they can't get online

Effective retail strategy is about where and how a retailer can engage consumers at experience touch points in the journey.

June 17, 2014 by Chris Petersen — Owner, IMS

Every once in a while you need to step back from the daily grind of retail and look at the bigger picture. There are a lot of retailers talking and posturing about "omni-channel." Does omni-channel simply mean more than one place to buy? Retailers think in terms of channels — consumers don't. Omni-channel is best used to describe how today's consumers shop, anytime and everywhere. Retail success will require strategies for how to engage consumers on their terms. If retail stores are to survive and thrive, they must give shoppers something that they can't get online … personalization plus experience.

Omni-channel is how consumers shop, not a retail strategy

One only needs to peruse the retail headlines to see how frequent the topic of omni-channel comes up. To really appreciate how pervasive the term omni-channel is, just scan through retailer annual reports to see their statements about the future and how they will be addressing omni-channel as part of their strategy.

But, omni-channel is about how today's consumers shop … it is NOT a retail strategy!

Omni-channel is about consumers and their behavior. Today consumers armed with smartphones literally shop anytime and everywhere. Shopping includes much more than the purchase itself — it is all about discovering new things, deciding what is relevant, researching options, gathering feedback on best options, deciding the best solution for their lifestyle, and finally making the purchase. This purchase journey involves not only websites and stores, but information gathering from social media and networks.

A retailer can NOT be part of every phase and facet of a consumer's omni-channel behavior. Effective retail strategy is about where and how a retailer can effectively engage consumers at experience touch points in the journey.

To lure shoppers back in stores will require a differentiated experience

If it is only about finding a product and purchasing it at the lowest price, online e-commerce sites win hands down. Consumers are moving their purchases to e-commerce because of increased choice, flexibility and services available. The net result is that store traffic is steadily dropping. Even the retail giant Walmart has been seeing footfall traffic declines for many consecutive quarters.

If retail stores want to lure consumers back, they have to do more than display products and run price promotions. They have to do much more. Today's omni-channel shoppers are expecting much more from stores than products with signs and fact tags. To get shoppers in store and keep them coming back, successful retail stores must create something that consumers can't get online — engagement plus personalized experience.

Using technology to create unique retail store experiences

1. Big tech – Lowes 3D virtual reality showroom

Lowes has recently announced that they will be piloting virtual reality showcases in their stores. Consumers coming to the store can shop for items for a specific room, such as a bathroom or kitchen remodel. Instead of just seeing a visual image on their computer screen, Lowes plans to build "Holorooms" within stores so that consumers can literally "step inside" the rooms they are designing and experience it in 3D.

Retailers like REI have long known that getting consumers to climb rock walls in store creates an experience that you can't begin to get online. What is different about Lowes is they are using technology to engage consumers in designing and personalizing solutions for their life in ways that create both an experience, and motivation to purchase. As consumers design their room in the Lowes "Holoroom," the device keeps track of all the components needed for purchase in order to create it.

2. Virtual personalization – Virtual reality mirrors

Department stores such as Macy's in the US and John Lewis in the UK have been using digital technology to enable consumers to "try on" different clothes, colors and styles while in store. Without having to undress and change outfits, the consumer can have the experience of visualizing what they will look like. And even more importantly, the consumer can share their experience in real time by sending images via Instagram & Facebook to family and friends for feedback.

Sephora is now installing virtual makeup mirrors in order to enable consumers to personalize choices, colors and styles. The key is not only the engagement at a personal level in store, but the opportunity to build a long term relationship resulting in repeat visits of the customer — and their friends who want that experience.

3. Phone bait – Navigation plus personal offers

Mobile phones have been seen as the nemesis of the retail store when the customer "showrooms" by looking at merchandise in store, and then buys it online. Instead of trying to "fight showrooming," the smart retailers are embracing mobility as part of the behavior of omni-channel shoppers.

Through iBeacons and other location technology, stores are directing consumers to departments and products they want to see. Stores can also personalize offers and services to loyal consumers through their phones by detecting their presence. Smartphone technology and apps will become a fundamental store differentiator IF used to create a personal hands-on experience in stores that transcends products and prices. For example, help keep track of my purchases, suggest what else will be valuable, tell me where to quickly find it, and even better, enable me to page a store associate to help.

The ultimate "P" in store personalization you can't get online

There is, and always has been, a secret weapon for stores that create a unique, powerful personal experience you can't get online: PEOPLE! Somewhere along the way of creating big-box retailing focused on assortments and merchandising, retailers forgot about the power of people. The big box stores are increasingly costly to operate, so many stores are cutting staff to control SGA operating expenses.

The thing you absolutely can't get online is a knowledgeable person who takes an interested in helping you find exactly what you need. What you absolutely can't get online is someone going out of their way to show you a better solution you had never thought of. Perhaps the greatest use of technology (e.g. tablets) in retail stores will be to enable associates to engage omni-channel consumers in ways they shop, and provide unprecedented levels of personalized experience that can never be delivered online.

(Photo courtesy of Lowe's.)