Does the square meter actually bring in the sales that hard-core retail sales managers expect? Probably not. It does not matter anyway. Because stationary retail is merging with online retail and the role of the stores has changed. They are no longer (only) responsible for sales, but rather serve the need for convenience and destination.
The Bershka store in Milan shows how it can be done: technology and digital in physical retail – it works. ‘Click & Collect’ stations in the shop window, options for self-check-out (SCO), returns charges prominently in the store and opportunities for influencers to produce content and thus act as disseminators.
Convenience
Ordering online often seems easiest. But misdirected parcel deliveries, delays, incorrect sizes and returns also make purchasing complex and time-consuming. Easily accessible ‘Click & Collect’ terminals and returns stations directly in the store can make the process easier. Prerequisite: They do not disrupt the flow of customers in the store and fit into the overall picture. In addition, customers are also informed that ‘pain points’ are perceived in the store – for example long queues at the checkouts, which can be avoided through self-checkout.
Bookable changing rooms, interactive mirrors that can present color variations and combination suggestions, as well as the easy ordering of these additional items without having to leave the cabin, are further technical integrations that increase convenience in the store and thus become more attractive for many target groups. Because in the end, the desired result is only one thing: getting the perfect outfit with little effort. And for the brand and retail: sell as much as possible and ensure a repeat visit for the next purchase. Technology in the store makes this possible – regardless of whether the actual purchase is made online or offline. Therefore, the use of technical interfaces to the brand’s online outlet is a must, especially for large chains.
Destination
When online and physical retail are seamlessly linked in the backend, sales per square meter are no longer crucial. The store should be the ‘place of experience’, where the brand is experienced – transactions, on the other hand, can and should take place online, preferably with on-site interfaces. The store is intended to offer a unique experience, a place that makes repeated visits worthwhile. But even more important: It should give buyers a sense of community, the feeling of being part of a group of like-minded people. There can be many incentives for this. However, these can be roughly divided into three focus categories: event, Instagrammable and community.
If the store is to become the central hub of the brand community, it makes sense to create a target group-specific program here – from regular events to changing content campaigns and opportunities to connect with each other to memberships that offer special benefits – online and on site.
On the other hand, stores become attractive when they offer something extraordinary – either for direct sharing on social channels or through the opportunity to showcase yourself for content. The target group acts as a multiplier and makes the location even more attractive for the respective peer group. Design, gamification, or technology make it possible. Especially the Bershka store with its prominent ‘Click & Collect’ tower, bold design and spacious changing rooms. The latter in particular offer a lot of space for self-presentation – changing lighting and music moods, space for the closest circle of friends, enough space to pose. Changing clothes is not an annoying requirement here, but is celebrated. An activity that you plan in advance and enjoy. The store is no longer a transaction space but creates emotions and experiences.
In Asia and the Middle East, malls that were declared dead are once again becoming destinations for the younger generation. Through digital twins of the buildings, target groups who are familiar with the mobile game Pokémon Go – where players travel in the real world to experience digital experiences in specific physical locations – can collect goodies and through various incentives in different stores be guided. Technology that inspires – across all target groups.
Does every store need this?
Not every store can, should and must utilize all technical possibilities. Quite the opposite. To put it bluntly: the smaller the shop, the less technology is profitable. Boutiques in particular make a name for themselves through their curation services, by addressing a specific target group that seeks and rewards precisely this service. Click&Collect and self-checkout are less desired here than more curation and personal customer loyalty. Especially since there is usually less space available here than in the large high street chains.
However, what applies to most people is that technology should be integrated to such an extent that it meets and – ideally – exceeds the expectations and needs of customers. From a simple newsletter to invite the community and draw attention to the curation performance to an interactive mirror – there are enough options. The decision is up to each brand itself.
About the author
Torsten Dietz is Managing Director at Liganova, a leading group of companies for effective brand and retail experiences from idea to implementation – physical, digital and virtual. He is responsible for the areas of Global Retail Campaigns & Sustainability Solutions and thus the topics of Retail Transformation, Innovative POS Solutions, International Production and Sustainability Transformation. With over ten years of experience in international trade marketing and a keen sense of the changing retail landscape, he focuses on developing sustainable concepts for Liganova’s customers – global premium brands from the lifestyle, sporting goods, automotive, luxury, fashion and retail sectors.