How in-store shopping principles drive omnichannel retail

2 Comments | This entry was posted in Marketing, Retail Trends

Learn more about May is Marketing MonthThe convergence of websites, kiosks, tablets, smartphones and social media with brick-and-mortar stores is the backbone of today’s exciting retail world. But where would the omnichannel environment be without sound marketing principles on Main Street? To better understand the synergy, we asked Array Marketing’s EVP for Marketing and Business Development Rob Gruen to explain why retail executives should not overlook basic in-store principles, and what retailers need to be doing to have an effective strategy on both fronts.

What should retailers be doing to better understand how customers view the in-store experience?

While there is plenty of buzz surrounding the effect omnichannel retail is having on the industry, retail executives must remember to get ‘back to the basics’ when it comes to leveraging a memorable in-store experience. Retailers must ask themselves — Have we forsaken the basics of retail inside the four walls of our stores? Are we forgetting the impact of in store marketing and the need for a compelling brand experience?

A strong grasp on how consumers perceive your store is critical to success. In order to have brand integrity and consistency in the store and online, retailers should have their store managers do these things first:

Rob Gruen, EVP, Marketing and Business Development, Array Marketing

  1. Measure your store traffic – The old-school gauge for success is knowing how many people are coming through the front door. It’s important to determine if customers have a compelling reason to come in and shop, and if they understand the brand message you’re trying to convey in an appealing, easy-to-shop manner.
  2. Take a look at your in-store conversion rates – A mainstay metric of online retail, conversion rates are still an important factor on Main Street. Don’t overlook the 4 P’s of Marketing – store layouts and store presentations are designed to maximize sales. Paired with the right product at the right price, customers will find a reason to come back and shop.
  3. Look at the average transaction: Are there enough impulse items? – A recent study by OlilvyAction reported in RetailWire indicated that 29% of respondents made unplanned category purchases when going into a store. Retailers should not lose sight of the effect of eye-catching, point-of-purchase products as a way to drive sales and build transaction size.
  4. Spend time in your stores watching and talking to the customers and store associates – Don’t just rely on reports coming across your desk. Watch how customers shop, what they are buying, and more importantly, what they are not buying.

What recent example have you found where a retailer has gone ‘back to the basics’ and reconnected with their customers?

The success story of Lululemon immediately comes to mind. I was impressed by comments in a recent article which said, ‘when it comes to making decisions, Lulu has gone back to basics. It doesn’t use focus groups, website visits or customer-relationship management software, which tracks purchases…Instead, Chief Executive Christine Day spends hours each week in Lulu stores observing how customers shop, listening to their complaints, and then using the feedback to tweak product and stores.’ I think this type of customer engagement is something all retailers can benefit from.

What advice do you have as the retail industry continues to evolve?

A recent report by Deloitte issued last year entitled ‘The Next Evolution: Store 3.0′ clearly stated that the retail store is not dead. Their research said, “while social and mobile channels provide avenues for retailers to be cutting edge, the consensus among the executives surveyed is that brick-and-mortar stores are still the leading format for providing higher service and promoting brand awareness.”

There’s no magic formula, but retailers should not lose sight that over 90% of retail sales are happening in the physical world. As we continue to integrate into the omnichannel environment, let’s make sure we don’t forget the sound marketing principles that have always proven effective. Having the right product at the right price, promoted and presented properly in store will always work.

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2 Comments

  1. Posted May 31, 2012 at 4:27 pm | Permalink

    Rob’s comments are refreshing indeed. I would add one other key component to in-store best practices: ensuring that product SME is readily available to shoppers. In the old days, providing information, suggestions, and advice to help shoppers make informed purchase decisions was the key role of sales associates. Today, that’s rarely the case, with major retail chains stocking tens of thousands of SKUs, making it nearly impossible to impart the resulting amount of category and product-level expertise to staffers on the floor. And this is further mitigated as FTEs and seasonal sales associates are rotated across departments. So, enabling shoppers to find, discover, and understand the product options that may be right for them is a key requirement for every omni channel retailer, particularly against the backdrop of the ‘showrooming’ phenomenon. The good news is that we do have numerous options to deploy at the in-store level, including kiosks offering relevant merchandising information; QR codes with enhanced product content at the shelf’s edge; and product finder tools that can help both sales associates and shoppers. Full disclosure: at Vendaria we are fortunate to produce and deliver tools like these to numerous Tier-1 retailers.

  2. Posted June 3, 2012 at 6:09 pm | Permalink

    We agree Tony, thanks for shining a light on what we think is a fundamental measure of health too often overlooked in favor of same store sales comps. Wall Street is taking notice as well, more analysts are asking “what’s your conversion” or “what are your traffic comps”.
    Our rapid growth is the leading indicator retailers are taking notice and having their traffic and conversion delivered in real time or next day, many have begun integrating traffic at the POS (watch the wireless space for more news here).

    Chris A Angell- Dir Global Marketing, ShopperTrak

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