We’ve all seen it, department stores in refurbishment mode, with entire
floors boarded up, sectioned off and hidden from view, while it undergoes a
never-ending re-lift or re-format to help it boost sales. Often these
refurbishments take many months or even years to complete, without the
guarantee that once its new design is unveiled that said departments will
see an uplift in sales. Imagine rolling this out across multiple stores, or
hundreds or thousands if you’re a fast fashion chain or luxury conglomerate.
In the digital era, customers need a reason to visit brick and mortar. That
reason is experiential. No longer do stores function solely for
transactional purposes, just as shoppers no longer shop only with an intent
to purchase. Shopping in physical stores has to provide an experience that
can’t be had with a mouse click or pressing the pay button on our screens.
Stores are brand building opportunities that should appeal to a customer’s
sense of discovery, in addition to touching a product, examining the cut if
it is fashion, smelling a scent and trying something on.
According to strategic advisers McKinsey, the sensory experience is the
store format of the future, allowing retailers to offer distinctive and
compelling experiences, giving a reason for shoppers to come through their
doors. McKinsey this month released an insight report called “The
ever-changing store: Taking an agile, customer-centric approach to
format redesign,” which highlights why retailers should embrace speedier
and less expensive format redesign that quickly yields returns on
investment.
McKinsey recommends an approach that marries the creativity and empathy of
design thinking with the discipline and speed of agile methodologies. This
entails making high-impact changes rather than department-wide or storewide
remodels. Indeed, retailers must adopt a mind-set of “never being done.”
This is why concept boutiques like Dover Street Market and department
stores such as Selfridges have mastered the art of retailing, selling
valuable experiences as much as products.
One of the key concepts of McKinsey’s insights is for retailers to define
their vision. What is the primary function of the store? Where does it sit
in its omnichannel portfolio? Is it a showroom to introduce new products,
but with little inventory? Is it to offer a service that can’t be executed
online? Is it a changing curated product assortment?
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Mapping the customer journey
Retailers would do well to listen to their customers to see if their needs
are being met. Why are they visiting their stores, what are their
purchasing and browsing habits? How do they behave in-store? Are they
shopping for items, goal-oriented, or do they interact with the store
environment and are open to discovery? What are their pain points and
obstacles they face to meeting their retail needs?
According to McKinsey, retailers would use a variety of methods—such as
structured interviews, ethnographic techniques, and analysis of internal
data (e.g. customer complaints, customer-satisfaction surveys, and
point-of-sale data)—to understand the customer journey, in order to uncover
a consumer’s unspoken desires, motivations, and concerns.
Of course some customer journeys are to meet a simple retail need, like
visiting a store because you need a pair socks. But it is precisely those
companies who go beyond the bounds of old-fashioned retailing that may have
you go home with a newly acquired wardrobe.
Photo credit: Selfridges-geograph.org.uk, source Wikimedia Commons, license free; Article source: McKinsey “The ever-changing store: Taking an agile, customer-centric approach to format redesign.”
