Leasing for the Store of the FutureBY Phillip Chapman
95 percent of all retail sales are the result of some combination of online, mobile, and in-store interaction along the path of purchase.
For consumers today, shopping is all about speed, convenience and flexibility. They want to shop anywhere and anytime, which requires a seamless experience whether they’re shopping in-store or online. In fact, retailers need to break down the silos of “online” and “in-store” and embrace the fact that “digital real estate” and “bricks and mortar real estate” must be morphed to deliver to the evolving consumer experience. And while e-commerce is a significant piece of the modern-day shopping experience, 90 percent of retail purchases are still made in stores. In fact, 95 percent of all retail sales are the result of some combination of online, mobile, and in-store interaction along the path of purchase. For retailers to succeed in this new era, they need to use technology to both enhance the in-store experience and bring physical and digital shopping into one omnichannel retail sale transaction.
Close Proximity – Smart phones
Sensors near the entrance to stores need to identify loyal customers and make offers to ensure engagement and interact action with Point-Of-Sale database. For example, a regular purchaser of vitamin supplements passes by a pharmacy, and this system notes that the last time they bought a month’s supply of multi vitamin was two months ago. From here, a one-off offer is sent with an offer on these products (valid for 20 minutes). The question will soon arise as to who controls the close proximity space outside a store within a shopping centre?
Shop Assistants – Product Experts
Shoppers want information at their fingertips by scanning the product tag or entering the item number (QR code) into their smart phone - shoppers can get the product information, sizing, colours, associated products, accessories and even stock available in store.
Further, Shop assistants and sales staff become product experts when provided with an arsenal of information at their fingertips via mobile digital devices. This technology empowers staff members to become personal marketers, service providers and product experts with the ability to provide mobile Point-Of-Sale.
Stores of the NOW!
Retailers need to transform their delivery now. This will require a review of how traditional and quite frankly outdated, merchandising, store planning and physical components of the premises that will bring omnichannel retailing to reality. A vision is required for retailers, retail designers and shop fitters to take up the challenge to ensure in-store retailing not only remains relevant but exceeds the current consumer experience as the new norm.
Virtual Dressing Room/Show Rooming
3D scanning allows shoppers to be discreetly measured virtually, try on outfits and even view product ranges in-store or at home. This removes barriers to purchase of the extended assortment online, and provides data on what customers try on versus what they purchase creating customer insights that drive product recommendations.
Further, embracing ‘showrooming” (where customers come in store try, touch and assess your products then go home and shop online) is vital. This can be achieved through a range of techniques including in-store “buy now” offers, price matching, warranty and exchange benefits.
Interactive Fixtures and Displays
Research shows that shoppers are 60 to 70 percent more likely to buy something they touch or pick up in a store. Interactive store displays attract shoppers and use projectors and sensors to serve up rich media content when products are physically interacted with. Shoppers increasingly expect access to product information, reviews and other content right at the point of purchase.
Shoppers are yet to fully embrace the concept of buy online and pick up in store (“click n collect”). Online-only retailers are ahead of the curve here, where shoppers can order online and then receive a code that will allow them to pick up the merchandise from a post office locker or nominated point (i.e. Big W) as a 3rd party location at their convenience. Introducing pick up lockers near the store, or even as part of the shop front can provide the edge for omnichannel retailers.
Leasing for the store of the Now
The planning for new stores and the transformation of current stores requires a new level of thinking when negotiating retail leases. These will need to include a future-focused vision to ensure that retailers can remain flexible throughout current and new lease terms. Elements such ‘category one’ items like internet capacity and speed (not just the old view of power, phone and hydraulics), and access to after-hours lockers must be taken in to account. Also, a considered approach as to the rights to proximity air space will be required by both Lessee and Landlords.
The challenge is not in front of us, it is here now. It will be those who strive to transform and deliver that will remain profitable, relevant and not end up on the list of retailer failures that have filled the business pages over the past 12 months.
Lease1 is Australia's leading specialist Retail Shop Lease Information and Service providers and understands the industry of Retail. For more information visit http://www.lease1.com.au/
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