What apocalypse? Why we're going through a retail Ragnarök
Photo by iStock.com
By Glenn Shoosmith, CEO and founder of BookingBug
For the last decade the retail industry has been prophesying about an impending apocalypse where physical retailers will be toppled by online only counterparts.
Yet, we're also seeing some of the most innovative and customer-friendly reinterpretation of the retail experience that has ever existed. Just look at Amazon's new ‘no checkout' store in Seattle and JD.com's plans to open 500 automated supermarkets across China.
These examples alone make it clear that reports of retail's death have been greatly exaggerated. But what's really interesting is how the industry is really changing.
Rather than an apocalypse, there's actually a similar, but crucially different analogy, that strikes me as more relevant.
Bear that in mind as you read this description of the Norse legend of Ragnarök from Wikipedia:
"A series of future events, including a great battle, foretold to ultimately result in the death of a number of major figures. Afterward, the world will resurface anew and fertile, the surviving and returning gods will meet, and the world will be repopulated."
Starting to ring any bells yet? Instead of the entire industry facing an imminent end there's a real battle underway for the future of physical retail.
While many traditional retailers might meet an untimely end, a new world will rise from the ashes. A better world for both customers and the retailers that manage to survive.
Let's look at how we ended up here, the nature of change and the lessons that successful retailers are already learning and deploying to be part of this fabled future.
Offline should complement, not copy
Retail trends rise and fall like a wave. As we move toward commodity and scale, people reminisce about a local shopkeeper who knew their regular order off by heart. The plastic-wrapped, clean and cold environment of supermarkets may have appealed in the 90s but now we want the character back in our experiences.
Many retailers and banks have stopped hiring real experts, substituting them with sales teams. Despite setting up spaces to sometimes resemble what came before, they couldn't really escape the huge corporate reality of their experience. Now, what do you expect to happen if you dilute the most important advantages that physical stores have over their online counterparts?
It's clear that online and offline should serve different roles. While online has speed and convenience covered, retailers now need to work on refining in-store to create truly engaging experiences.
Make the experience everything
For the most important interactions with your most valuable customers, an offline meeting with real experts is almost irreplaceable.
Instead, retailers aren't ready for the coming recreation of their world. Institutional issues are holding them back and leaving them unable to plan for the shift in shopping habits we're seeing.
Meanwhile experimentation with different store types, and how they interact with the online world, has never been more diverse. The retailers that are leading the pack are realizing its a mistake to look at only one channel instead of the full omnichannel customer experience.
The real questions they should be asking are how customers can be tracked from offline to online and back again? And what role should each channel play?
As technology eats the world, every industry will have to go through this harsh experience, and those who survive may count themselves lucky to have taken their turn quickly.