Retail Week, recently asked us to comment for a report on, “How retailers are connecting the physical and digital shopping experiences in their shopping centre stores”. Andy Jones, our Group Director of Operations (former Director of Customer Experience) had this to say.
Andy, how is retailer usage changing in shopping centres?
“The retail landscape is currently in a state of flux. Thanks to the proliferation of eCommerce, consumer preferences are changing, affecting the requirements for retailers and shopping centres. Online shopping has made it incredibly simple for consumers to look around, easily comparing products and reviews. It is harder for shopping centres themselves to develop a strategy and react to changing consumer behaviours, as this typically is down to the retailer. As a result, shopping centres run the risk of losing their footfall, as shopping takes place across multiple channels and becomes increasingly digital. Shopping centres now have to develop more of an experience to entice customers, making themselves destinations where customers can spend their time doing more than just shopping such as providing restaurants, cinemas, and other leisure activities.”
How are retailers connecting the physical and digital shopping experiences in their shopping centre stores to the benefit of customers? Which retailers are doing this particularly well and why?
“When it comes to connecting the physical and digital shopping experiences in retail, it is evident that some retailers are doing it better than others. The trouble is that we are seeing some retailers view the convergence of these two operations as add-ons, keen to tick the boxes. But for best practice to take place, retailers need to look at both their in store and eCommerce infrastructure and align the two, developing a proposition that supports both.”
“The retailers we are seeing excel at this are the catalogue retailers who have been able to set up their online stores to operate in alignment with their high-street stores. For example, Argos’s Click and Collect system reserves products from the same stock pool as in store, resulting in a low cost amendment to their way of working. Other more traditional retailers however, have not been as successful at this. For instance, retailers whose Click and Collect operations send products to store from a distribution centre, rather than from the local store, incur additional costs from packaging and transportation. As a result we are seeing some retailers finding the service unsustainable.”
“Having a blended approach to retail is a necessity and physical and digital provisions will only continue to become more integrated. For retailers, the key to best practice with such services is harnessing data and new technology to visibility of products, services and customers, which will result in improvements in customer service all round."
Which digital technologies are proving most popular in a shopping centre setting and which are providing the best return on investment?
“Over 40% of consumers still prefer to shop in-store and as a result shopping centres are seeking strategies to enhance the shopping experience. With 75% of store shoppers using their mobile devices in-store, savvy retailers are leveraging this finding to implement beacon technology and make shopping in bricks and mortar stores more like eCommerce.”
“Research has shown half of the top 100 US retailers are already testing beacons for a more engaging retail experience and they are infiltrating the UK too. Retailers can create an immersive shopping experiences using location based targeting to help customers to navigate large stores or shopping centres and receive personalised offers. Simultaneously the retailer can gather data on shoppers’ in-store habits, linking them up with consumers’ online personas to unlock additional context about the shopper and track the entire customer journey across various platforms. This, unsurprisingly, will help improve customer service.
“With over 50% of consumers saying they would embrace in-store beacon technology, both shopping centres and retailers must connect online behaviour with offline sales to ensure they are future proofing their business.”
The full report, by Laura Heywood Commercial Editor, Retail Week, “When physical and digital collide” can be found here.