Online is not shops’ knock-out blow

The rumours persist that shopping as we’ve known it is, if not quite dead, then well on its way to taking its last gasp. Carlos Virgile says rather than laying down and going peacefully, bricks-and-mortar retails have plenty to fight back with, if only they will recognise it

There's a rumour on the street and it's not good news. It's a kind of apocalyptic vision, a prophecy about how we shop and the fatal demise of retail as we know it.

If the experts are to be believed, online shopping is replacing the bricks-and- mortar store. Consumers are turning their backs on the physical experience and favouring the comfort and convenience presented by online retail. In addition the recession is continuing, and will continue to bite, with familiar brands dropping like flies. Meanwhile, the ever-expanding luxury end is fast careering towards its own unglamorous demise, as global expansion into new markets leads to a level of accessibility that undermines the essential exclusivity of the products.

Consumer expectations present yet further challenges. These days, they don't just want to purchase a product for their use and pleasure; they want to engage in a deep and meaningful way with the brand.

These are the signs feared to herald a retail Armageddon; it is an interpretation rearing its unsupported head at all levels of the market.

This may be a good moment to refer to Mark Twain, who after hearing that his obituary had been published announced, 'reports of my death are greatly exaggerated.' The same could be said for the so-called demise of retail.

Retail is, and has always been, evolving. Shopping habits and consumer behaviours change and transform. Last century's traditions are being renewed and influenced by new ones, but shopping is still alive and kicking.

As I see it, the desire to shop is almost a biological characteristic, inscribed in the human DNA; the part of us that seeks out self-gratification and pleasure. It seems fair to assume that as long as we wish to be content and feel gratified, our retail habits will continue to thrive.

While globally, e-commerce sales account for only 4.4 per cent of all those purchases made, Deloitte attributes 54 per cent of last year's Christmas sales to online sources, with digital having an influence in around £9bn of non-grocery sales. It will come as no surprise to retailers that consumers are employing a multichannel approach to prepurchase research. These figures highlight the necessity for retailers to examine their bricks-and-mortar offerings and assess their effectiveness in encouraging customer interaction with their products and brand.

Emotions and direct interaction between shoppers and brands have always been - and will continue to be - at the core of the retail experience. Here lies the major advantage of the bricks-and- mortar store. In these spaces, all tools should focus on accentuating the elements of the sale that cannot be replicated online - the tactile pleasures of shopping. Digital platforms may present convenience, accessibility and value, but they do not provide a sensual, quality experience.

It is understandably difficult for consumers to relate to a brand through a flat, one-dimensional format. Physical experiences are multisensual; we see, touch, hear, small, maybe even taste. Physical stores have the ability to engage with these senses, creating a three-dimensional impression with far greater potential for consumer engagement.

While future retailers might succeed in attracting and engaging consumers by using technology to enrich and enliven the brand's story across multiple channels, digital 'per se' is not the all-conquering successor of physical and tangible brand experiences. It is a new and complementary offering that can enable real and more personal service and consumer participation.

Savvier retail brands will continue to seduce and engage their existing and new consumers through must-have products and real, tangible bricks-and-mortar environments but adding soul and heart to it, integrating technology as practical enablers, not as a replacement of our basic human needs.

While the concept of experiential retailing in nothing new, it has never been as relevant and urgent as it is today. If stores are to continue attracting and engaging with their visitors, experience must be at the heart of their offering.

Shopping is a communal and collective experience as much as it is a personal one. To feel part of a group, a 'retail tribe', is a strong part of the shopping formula. Retailers should exploit the store's potential for active and multisensory interaction. Initiatives such as dynamic demonstrations, collective events and social occasions all encourage congregation and audience participation.

Sometimes it is the honesty and straightforward simplicity of a brand and its products that can act as a magnet to customers who want things to be uncomplicated. Take retailer John Lewis for example. Its stores deliver and engage with customers through clear product presentation and service. Recent John Lewis advertising campaigns also illustrate the brand's success at connecting with its consumers at an emotional level. The brand stands as a poignant reminder that retail works when foundations are solid, and its online, in-store and mobile shopping environments are complementary rather colliding environments. On a different level, the brand experience flagship model adopted by many luxury and high-end retailers, from Burberry to Louis Vuitton, also aims to reconcile the on and offline shopping experiences.

The evolution of 'luxury' is a fascinating topic. For years, the concept has fed the collective imagination and has had a tremendous influence on how the overall retail market moves through the tantalising effect it has on consumers. Luxury is a relative and movable target; there is always something consumers want but can't afford, and as long as that aspiration exists and is perpetuated by brands, there will be a luxury market.

The past decade has seen an explosion of luxury brands opening up their exclusive worlds and making their offer more accessible. They are expanding their business networks, embracing new markets and identifying their relevance within untapped cultures. The idea of 'accessible' luxury has probably been the most groundbreaking marketing concept in a generation of consumerism. It is a contradiction in itself -as true luxury and accessibility sit at opposite ends of the scale.

The concept has affected both brands and consumers. It has spawned aspirational consumers, whose desires are not always matched by their bank accounts, and continues to jeopardise the future development of luxury brands by undermining their fundamental exclusivity.

The original, small, craft fashion and accessories houses have all been converted into commercial powerhouses. Prada, Hermes and Chanel all began either as family-run businesses or under the creative leadership of genuine talent. Driven by growth and commercial results, it seemed inevitable for their success that luxury brands make their offer more accessible and obtainable.

With the democratisation of luxury, retailers created a kind of Catch-22 situation. Marketing tools and store designs became more relevant to midmarket retailers, which began to mimic their high-end contemporaries. The result is a high-street style that borrows from and replicates luxury-end aesthetics. Are luxury brands in an inevitable downward spiral, devaluing their position as protectors of craftsmanship, quality and the meaning of luxury itself?

As long as so-called luxury brands recognise that there is a further step to be made towards exclusivity, then they will move into a new phase. Again this means identifying and building up personal relationships with their consumers. Customisation will be paramount, both in service and the creation of one-off, tailored products. This may mean a reduction in scale for retailers, which contradicts the ambitions of investors and shareholders, but they would be wise to think long-term and protect their brand exclusivity and luxury status.

Although the economy may present retailers with an insurmountable challenge, most have the ability to avoid or survive the apocalyptic vision. They can review their strategy and become more engaging and multisensorial in their presentation. They should combine and integrate their online and in-store retail offering in a harmonious way, recognising their different radius of action. Retailers need to look beyond short-term profit to their long-term vision.

As long as retailers deliver must-have products, exciting and engaging environments and communicate clear brand stories, the bricks-and-mortar store will stand tall, and shopping remain a gratifying experience.

This article was first published in fx Magazine.





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