As the retail sector gets ready for the “golden quarter” - with Black Friday and Christmas on the horizon - it is good to see that consumer confidence edged up in September, despite the looming ‘second wave’ and ongoing uncertainty.
Of course the pandemic is very much in evidence on our high streets and in our city centres and shopping malls, and retailers who have reopened their stores are still adjusting to the current retail reality. We are witnessing the extremes of the impact of Covid-19, from store closures on the one hand to accelerated retail transformation on the other.
As you’d expect, the innovators are shaking things up, like Pret a Manger with their new ‘follow the customer’ survival plan, or Selfridges’ Project Earth sustainability initiative. Others are harnessing current in store trends, like the contactless click & collect trials by M&S, or the new partnership between John Lewis and the Co-op which will expand the reach of JLP’s customer collection points.
There’s been a rise in other customer-centric services such as instore appointments, like Phase Eight’s new ‘personal stylist’ service which can be booked online and aims to not just drive footfall but hopes to leverage higher order value too.
And even the winners from the ‘lockdown’, like DIY brand Homebase, recently announced significant investment in their digital transformation.
Time to embrace a culture of experimentation
Back in July the American retail commentator, Steve Dennis, wrote in Forbes about his hope that the Covid-19 crisis would finally encourage more retailers to embrace a culture of experimentation. So it’s really good to see his wish coming true, at least for some retailers and brands.
But we are also seeing far too many retailers who have simply reopened with an attempt at ‘business as usual’! To them we say, let’s be clear, we can’t ignore the rapid change in consumer shopping habits. For instance, John Lewis has seen a swing to 60% online sales compared to 40% pre-pandemic. However, with 40% of JLP’s sales still coming from their stores, their physical shops continue to play a crucial role in their overall brand story.
The experience economy has arrived!
Shoppers that make it over a store threshold today need to be rewarded with engaging and enjoyable experiences. They don’t just want to feel safe, they want a very warm welcome, and a tangible sense that their effort is worthwhile.
After months of ‘lockdown’ and limited activity, consumers are craving life-affirming human interractions and immersive brand experiences that they simply can’t get when they shop online. They want to be served by pleasant, knowledgeable staff. They want to engage with the brands they love. They want to make reassuring connections with people and products.
So it’s no overstatement to say that the quality of the instore experience has never been more important than it is today. The arrival of the ‘experience economy’ can no longer be ignored, and retailers who don’t move rapidly from ‘selling’ to ‘service’ will struggle to survive.
To quote from a recent Mary Portas article in the FT, “There will always be a place for physical shops, but they will have to be exceptional.”
However, there are no shortcuts to ‘exceptional retail’. It takes a willingness to place customers firmly at the heart of a business, a razor-sharp understanding of brand vision and values, and a top down culture prepared to invest in experimentation and innovation.
Retail reinvention
Of course, the need for retail reinvention is nothing new. We’ve been working tirelessly with clients and blogging about it for years! Indeed, after last years’ retail property industry event (MAPIC), we wrote a piece about the dawning realisation from the sector that ‘individualising the store experience for the customer is now a must’.
So we’d like to applaud the innovators out there and wish all retailers success with their retail reinvention in the coming weeks and months ahead.