Just the other day I was stuck in traffic on my way home from work, and decided to stop at the mall to wait it out. Upon entry, I realized that it was the first time I had stepped into a mall in at least a full year. Apparently, I was not the only one who switched almost exclusively to online shopping, as most of the mall was empty. As I began my research into this sudden shift, I discovered that the US is not the only country that has embraced the mass offerings of online retail over the traditional brick and mortar shopping experience.
Why is it that most have now shunned brick and mortar for online retailing? Is there any way for stores to maintain with the surge of e-commerce and discount retail sites, (generally offering comparable goods at considerable discounts)?
McKinsey recently detailed marketing strategies to excel at multichannel sales, skills they believe global retailers must maintain to stay afloat:
1. “Be the Authority” – By representing the best of a given product area, a retailer can subtly take a consumers side and be seen as a consumer advocate. Providing expert reviews and recommendations across all channels, including highly trained sales staff and rich engaging online content, all help increase brand loyalty.
2. “Use that Data” – With the increasing availability of data, marketers can target micro-segments in individual consumers’ patterns of purchase behavior. This enables a stronger relationship with customers, and allows retailers to cater to specific needs, utilizing limited retail space to the best of its ability.
3. “Re-Imagine the Retail Store” – Retailers must re-conceptualize the role played by their stores, turning them into more of a service hub integral to easing common online shopping issues. Clean lines, eye catching store fronts, and a limited product selection are also key to increased retail traffic.
4. “Make it Personal” – The personal touch that is lost through e-commerce can be regained through offers such as personal shoppers across multiple channels. Neiman Marcus is currently looking to enhance their service legacy with an app that IDs customers entering the store and prompts staff to engage based on purchase history.
5. “Partner Up” – Cross retailer loyalty programs, could help create a multi-category loyalty experience, such as what Amazon has done with their Prime service.
6. “Be Unique” – To break the commodity perception, international retailers must develop unique offerings. Exclusive lines of merchandise, particularly with celebrity partnerships, have proven to be fruitful again and again.
7. “Be First” – International retailers should focus on emerging markets where their competitors don’t have a foothold. They recommend China, India and even Africa in particular because of the rapid growing middle class, and wide access to technology.
Multichannel retailers need to focus first on nailing the digital shopping experience, as modern day consumers expect such. However, the ability to additionally turn physical stores into profit centers will prove a brand’s prosperity, at least for the time being.