Are cool experiences enough?
We know that the opportunity for in-person experience is a big advantage brick and mortar retail has over e-commerce. Customers can get in amongst it - talk to store associates, touch the merchandise, try free samples, attend VIP launches – things they can’t do online. So should physical retailers focus on building cool in-store experiences to get customers through the door? Can in-store experiences save retail?
Getting customers through the door is a good start, but experiences should translate into sales
What if I’m in a hurry? I’d rather be able to pull up a shopping list on my phone, receive relevant offers and directions to aisles with specials than get invited to participate in VR or a game or a social sharing exercise. I’m all for having cool experiences in-store, but a lot of the time I just don’t have the time.
If I’m not in a rush then I’m more likely to participate in activities or whatever experiential marketing excitement is taking place that day – I too enjoy furnished climbing walls – but there’s no guarantee I’ll buy anything solely as a result of that marketing. If the brand can identify that I participated and follow up with an offer that’s both related to the experience and relevant to my interests, well then we’re getting somewhere.
E-commerce is more than capable of delivering sales, and the associated costs can be quite a bit lower than they are for purely physical retailers – Amazon wouldn’t be considered such a threat if this wasn’t the case. It’s unlikely a purely experiential retail model is going to ‘save’ anything if it can’t also generate revenue.
Fun vs functional
Personalization drives sales; offering someone what they need when they need It is more likely to result in a purchase than a generic advertisement is. To make this happen you need a range of data: customer information, purchase history, environmental and contextual data. You need connected customers, connected technology and a system that ties them together. You need a way to collect and analyze the data, send out offers and measure the results (probably some kind of IoT-driven CRM). It’s maybe not quite as headline-grabbing as some recent forays into the world of experiential marketing, but it’s a practical application of marketing technology that’s achievable without a massive financial outlay, and it gets results.
When it comes to experiences, this connected CRM approach provides exciting amounts of data that can be used to influence what you do for customers in-store. You know who loyal shoppers are, so you can invite them to participate in VIP experiences and reward their referrals. You know when people usually come in, so you can schedule events and drive more traffic in your quiet periods. Because you have the infrastructure in place you can spend a little time, collect a little data and tailor experiences to your high-value customers, rather than going all-in on something that may net you little return.
What does success look like?
After all your marketing efforts you’ll hopefully have a solid cadre of customers who consistently get what they came for, leave the store happy, will return again, and who recommend the brand to others. These customers will continue to spend their hard-earned money with you, knowing they’ll get a positive shopping experience in return. They could be coming in for the cool interactive experiences, sure. They could also come because you always send them just the right offer on a rainy Sunday afternoon, or because you stock the one brand they’re loyal to, or because Steve the Associate knows them by name and tells the best jokes.
You simply have no way of knowing you’re spending your money in the right places unless you’re collecting the right data, and using it the right way. Showy experiences alone will probably not be the savior of physical retail – but personalized experiences may well be.