Conventional wisdom suggests that retail environments be updated every three to five years to remain “fresh” and plugged into the consumer’s mindset. Today that cycle is more of an ongoing process.
Social experience retailing (SER), where virtual and real-world strategies converge, is pivotal to how retailers can keep today’s customers engaged. The trend responds to the growing group of global consumers armed with technology that allows them to connect in real-time to socialize, shop, “like” and “share,” resulting in what is referred to as social commerce. On the flip side of SER, convenience transactional retailing (CTR) provides the continuous streamlining of basic cost-sensitive, commodity/neighborhood retailing with a strategy based on proximity and/or convenience.
The movement toward SER and CTR is being driven by four underlying forces: convergence, convenience, connection and cost. Empowered by technology, these “4C’s” ultimately are reflections of our own hardwired nature as social beings. Retailers that can adapt to this new world will flourish and prosper; others, stuck in an “old-school” mindset, will perish and be remembered as great, lumbering beasts of another age (such as Virgin Megastores replaced by online music stores and internet sharing sites, for example).
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In order to deliver SER and CTR, retailers will need to create their own unique recipes of the 4Cs, which are defined as follows:
Convergence: The unification of social networking, commerce and technology, with the eradication of the digital divide that separates our physical and virtual domains, Augmented reality (AR) will become a key technology helping to close the divide.
Convenience: Retail products, services and virtual goods being provided through multiple physical and virtual channels become ubiquitous to the end user. Localization becomes “neighbor hooding,” with virtual, smaller and better trained, localized brick-and-mortar facilities supporting an embedded customer base.
Connection: Successful retail brands must establish deep, personal relationships with individuals on a continuous basis. Authenticity of a brand’s values and core beliefs will be seen by customers as an extension of who they are. Products and services must be personalized so that individuals now can have it “their way.” The brand and individual become connected, aligning customers with retailers that embrace their core beliefs and lifestyles.
Cost: This will be based on an individual’s view of the perceived value of each product or service. If a retailer is at the CTR end of the scale, lowest cost and convenience will be paramount. For those at the SER end, brand equity, alignment, and integration with individuals’ personal goals, lifestyles, lifestages and communities will be crucial.
Example Of An SER Store
The traditional shoe store has been fairly stagnant, evolving more in style than in substance, and is under assault by online mega-retailers such as Zappos. But imagine an SER shoe store designed as a series of “mobility lifestyle lounges,” where shoppers can make their shoe buying experience as social as possible. The staff is not focused on “selling shoes” but on assisting customers with enhancing their “mobility lifestyle aspirations.” This SER-focused shoe store would offer custom manufactured shoes to fit its customers’ personal aesthetics or functional needs that cannot be met with “off-the-shelf” designs. NIKEiD, for example, currently lets shoppers personalize sneakers with user-selected colors, graphics and logos.
In this SER store, shoe shoppers could have access to any type or style of shoe through a virtual inventory system connected to designers, shoe brands and specialty boutiques. Customers could design their own shoes using in-store, interactive technology or an app on one of their personal devices or computers. In stores, samples might be provided for customers to feel, since tactile engagement is critical for clothing and accessories in particular. The store would not have product stock in the traditional sense, but the technology to scan a customer’s foot then “print” or produce the shoes instantly on or off premises (through various partners) while the customer waits or goes shopping, if not opting to have the product shipped.
The store’s lounges would have AR mirrors — digitally enhanced monitors that help shoppers visualize in real-time how different shoe styles would look on them. If they wanted to share remotely with friends, they could connect virtually, allowing friends to see their selection(s) and provide feedback. If shoppers need to visualize how the selection(s) might look with a specific outfit, an online version of that outfit could be added virtually to the reflection in the AR mirror. Cross-shopping opportunities with other retailers would be seamlessly integrated as the shoe store suggests accessories, clothing and other items. As with online shopping, the smart AR mirror would suggest alternatives based on previous purchases, current selections or lifestyle information provided by the customer. When customers are not in-store, they could use their smart devices to access personal foot scan information to “see” how new shoe selections might look.
The SER store could use crowd sourcing to determine the styles and types of shoes that should be offered. An app could suggest and show, through AR, the shoes that match outfits then offer an easy way to order, with fast delivery. A connection to consumers’ digital wallets could alert the app of new clothing purchases, which could then suggest shoes currently in their virtual closets that might complement the new item, while also providing new shoe ideas. When shopping in the store or online, consumers could be connected through the store’s social network (or other popular social avenues) to allow others to provide feedback via a virtual lounge; this feature is modeled after lounges found in the stores, where customers, friends and other like-minded shoe/clothing aficionados shop and share together.
Retailers that prosper with this new generation of social shoppers will need to experiment constantly to adjust to consumers’ fickle nature, with preferences that can pivot en mass without warning and go viral in real time.
The total convergence of the virtual and brick-and-mortar retail experience empowered by social networking concepts and technology is inevitable. For retailers, this means that the next five, 10 and even 40 years will be exciting times of experimentation and constant reinvention.
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Kenneth A. Gruskin, AIA, is Principal and Founder of Springfield, N.J.-based Gruskin Group, an integrated retail design firm that builds unified brand experiences through architecture, brand development, visual communications, web/interactive, industrial design, interior design, strategic consulting and sustainable design.
