It’s certainly an interesting time in the retail space. Some would have us believe that we’re on the precipice of an apocalypse with consumers changing where they shop, how they shop and what they shop for. The collapse of established brands such as Woolworths, Blockbuster and more recently BHS, Maplin and Toys R Us have only heightened these fears.
The perfect storm
Although ‘apocalypse’ feels a little alarmist, one thing is clear - things are changing and they’re changing fast.
Time-poor consumers are moving towards convenience shopping and e-commerce, looking for opportunities to minimise mundane shops (like the weekly shop) and maximise chances for more pleasurable and unique shopping/leisure experiences.
At the same time, new brand entrants are causing seismic changes in major retail sectors like grocery. At the lower end, the rise and rise of Aldi and Lidl has firmly shaken the middle ground, stealing the crown of price fighters such as Asda and Tesco, forcing them to forge new reasons for being. At the mid and higher end, brands like Wholefoods – and their new owners Amazon - seem poised to lead the transformation of how stores look and feel.
The need to set a brave new course
Retailers must evolve with these changing market conditions or face obsoletion, and critical to success will be finding the way to delight customers both online and in-store.
The online channel for many has become the optimal channel for maximum convenience, choice and value. But retailers who overly focus on online will only perpetuate the downward trajectory of their in-store business, as one cannibalises the other. And while there’s no doubting the benefits of online, nothing (yet) has replaced consumers fundamental desire to see, feel and smell the goods first-hand – or indeed simply enjoy a physical experience out in the ‘real world’ (where powerful brand building can take place).
There is therefore a clear and pressing need to recast the in-store experience around changing needs. No longer can it be acceptable for stores to simply exist as distributors of products, when in most cases online home delivery does this best. Instead, they need to create something that delivers a different mix of customer benefits – creating deeper bonds with customers and proving their brand is different and worthy of their interest and loyalty… yet ultimately always ensuring they are making their customers lives better and easier.
The retail brands who find the optimal ways to harness and blend the strengths of online and in-store will best capitalise on the current turbulence in the retail space, with rich rewards for those that get it right.
At Redblue we have a real passion for all things retail, and have advised a range of brands on how to delight shoppers both in-store and online - if you’d like to chat further on any challenge you are facing, big or small, don’t hesitate to get in contact – we’d love to show you our thinking.