Future of Multichannel Retail Is Future of All Retail
The statistics for Showrooming in physical retail are getting scary: 44% of shoppers frequently use mobile to research products while in retail, 49% compare prices on a competitor’s site and the same proportion read product reviews while in store, according to a Vibes/Equation survey.
So this behavior is no longer just for advanced technology users, but is the default for value-conscious shoppers across main street America. With an emphasis on low prices, showrooming risked triggering a race to the bottom in retail margins, raising existential questions for the future of the entire sector.
At this point it would be easy for retailers to simply bemoan the fact that even in their hallowed retail temples, the likes of eBay and Amazon are able to undercut their prices – offering next-day delivery, free shipping and more to ostensibly have a much more attractive overall offer, but retailers are fighting back. Their argument has always been that the in-store experience offers a personal and consultative touch, and that after-sales is a key benefit – something that will resonate with anyone who has tried to return goods bought on eBay.
New technologies offer unique ways to entice customers and add value to purchases through digital and physical integrations – driving consumers to retail locations. For example, New Balance and Foot Locker have partnered to offer customers the chance to build one of 48 quadrillion possible versions of their new shoe through an interactive feature in Times Square. Meanwhile, Nordstrom is using Pinterest to track its most popular items and then highlight them in stores with physical ‘Pins.’
There is also great potential to differentiate from the mechanical, transactional experience of online sales through retail theater. For many retailers, sacrificing productive shelf space for essentially non-productive marketing activity is a big leap, but Apple is proof positive that sacrificing space for experience is key in continuing to draw foot traffic into stores.
Before we dive into these rich multichannel experiences, however, there are opportunities to bring a brand’s own retail experiences to life digitally. I call this opportunity ‘Magazining’ as it capitalizes on two aspects of the current retail context.
First, it uses the retailer’s expertise and heritage as the champion of their category, as opposed to the transactional price-based nature of eBay and Amazon. Secondly, it extends the retailer’s credibility as style or technology leaders by transforming product into content.
With phones and tablets becoming our major channel for both commerce and content, the opportunity lies in creating advanced forms of merchandising that are more magazine than retail store.
This idea was embodied in one of the most surprising executive hires in recent history: Apple tapping Burberry CEO Angela Ahrendts to oversee the retail experience in-store and online in an effort to extend the success of its retail experience into the digital space. Burberry was one of the first digital pioneers in the luxury retail space, and Apple is hoping Ahrendts will bring some of the same polish into their online stores.
Some great examples of this already exist in the marketplace. ASOS is well known for its physical magazine, but with its Fashion Up iPad app, it creates a premium space to display shoppable content interspersed with quality editorial. Similarly, Gucci Style aims to look behind the style into broader seasonal trends, origins and inspiration as well as showcasing the product.
The future of multichannel retail, which to my mind is the future of all retail, depends on developing a long-term engagement with consumers. Therefore it’s surprising that so few brands have yet developed a capability with content to create Magazining products. The benefits are not just those that stem from developing immediate engagement with content and clicks-to-buy, the whole notion of having a permanent space on the user’s device enables a wealth of multichannel opportunities. It’s a touchpoint for CRM messaging, a bearer for vouchers and incentives, a location sensor using iBeacon or GPS, and a simple way to gather data -- the new retail lifeblood -- through a painless and intuitive interface.
So Magazining techniques should become a key part of our retail future, and vanguard the fight against Showrooming. It will just take some bravery and commitment to the digital future of retail to get Magazining off the ground.