Evolution of physical stores to complement digital-first shopping behaviour by PHYGiTALNOW - a digital marketing consultancy in Dubai

November 25, 2020by Anitha Smith

PHYGiTALNOW is a digital marketing consultancy in Dubai, focused on helping SMEs rebuild for growth. We know that as the pace of digital adoption and global connectivity accelerates, small businesses continue to face increased competition. They have to embrace online selling to go beyond their physical stores and increase their customer base. In this article we talk about ways to adapt the physical stores to offer customers a seamless omnichannel experience.

In our previous article on Phygital marketing we spoke about how ‘Place’ is no more  a brand-owned only environment. Often a customer’s first interaction with a brand is within his/her own personal space. Digital economy drivers like Amazon, Google, Facebook, Alibaba, Baidu and Tencent have disrupted the retail industry and impacted consumer expectations. Online and offline commerce now converge into an integrated Omnichannel experience.  Physical stores traditionally focused on conversion. But compared to online conversions, physical conversions are burdened with substantial costs for infrastructure and sales personnel. Some retail brand owners therefore are scaling down the number of outlets and focusing on flagship stores at prime locations. These stores are repositioned as spaces for value creation. For this, adoption of right technology solutions is important. It helps generate a deeper customer understanding through data, deliver more personalised and engaging brand experiences, and act as fulfilment centers integrated with the Omnichannel architecture.

Below outlined are 5 ways to reorient physical stores towards value creation

Improved personalisation

  1. Improved personalisation: This is all about the ‘single customer view’. Leveraging technologies like IoT, RFID, artificial intelligence, and machine learning, every step of the customer journey can be tracked.  By combining different data sources businesses can generate deep insights to deliver customized offers and experiences according to individual needs. Use every customer touch point – physical and digital – to reinforce what value the brand can offer. Data flow between disciplines improves personalisation. CRM data feeding into product development creates better segregated product lines according to different customer personas. Insights from online marketplaces can be used to optimize physical store inventory and thereby catering to individual preferences. Designating a ‘personal shopper’ for high value customers equipped with ‘online purchase history’ has proven to be an effective loyalty building tactic.
  2. Omnichannel infrastructure: Foundation for offering a seamless experience across channels is to develop an omnichannel infrastructure. To make the task less daunting, a phased approach can be adopted. Start with an easier integration by integrating website with other online marketing and sales channels. Next integrate the EPOS system by which instore data can be integrated with online data. Next on the integration agenda is supply chain and product development. Once the source to customer journey is fully integrated, creating a seamless brand experience across channels is achievable. This improves the operational efficiency, leading to higher revenue generation.

Richer in-store experiences

  1. Richer instore experiences: The pandemic has altered the concept of physical safety and hygiene. Customers expect stores to follow the ‘social distancing’ norms and offer ‘contact-less’ alternatives to inventory browsing. ‘Virtual fitting room’ category is expected to grow to US$6,565 Million by 2025. Technologies like AR and VR have already proven to be conversion drivers online.  Shopify reports a 95% higher conversion for AR integrated content. Therefore, brands have to invest in creating immersive experiences instore, far richer than the online experience. The physical store becomes a destination. Gentle Monster store in LA is a good example of this.
  2. Integrating social media: Social Media platforms are now both engagement and transaction channels. Leverage them to drive instore traffic through ‘fulfilment’. It can be a simple product pick-up fulfilment or an incentivised store-visit for access to additional/exclusive items. Creating a social media friendly instore atmosphere like ‘Instagram-worthy’ décor or check-in badges can also improve footfall. ‘Retail-tainment’ is gaining more traction. Conducting a product demonstration session or exhibiting inventory in a creative way can encourage shoppers sharing their experiences through social media platforms.
  3. Frictionless check-out: One of the key success criteria for online marketplaces is an optimised check-out journey. Today customers expect the same in a physical store. ‘Scan and go’ technology has been adopted by numerous retail brands to improve the buyer experience. Mobile checkout stations across the store, newer technologies that integrate the digital shopping cart with the real in-store shopping cart and options for customers to pay online for their physical selection are all solutions to save time and effort for the shoppers. Store owners can use less space and fewer employees to the checkout process, thereby increasing efficiency and having a positive impact on the bottom line.

Evolution of physical stores to complement digital-first shopping behaviour by PHYGiTALNOW - a digital marketing consultancy in Dubai

Technology is vital for the future success of bricks and mortar retail. It is important for brand owners to consider technology as a benefit. It is fueling e-commerce; however, it is also offering the opportunity to re-imagine physical stores. Customers expect and reward a seamless, unique and personalised experience. From mobile apps that make your employees more efficient and happier, to retail technology that keeps your customers loyal, retail is changing. Transformation of physical stores is no doubt labour intensive and requires upfront investment. Cost benefit might not be immediately visible, especially in the current economic climate. It takes discipline and clear planning to choose the right time to start investing for the future. Because, when the shopper sentiment starts to pick up, brands that have adapted to the transformed mindset of the customers will stand to gain more. At PHYGiTALNOW, we believe in transformation that guarantees sustainable growth.  Reach out to us at growth@phygitalnow.com and we can together develop a road map to maximise benefits of transformation.

PHYGiTALNOW helps clients realise their full revenue potential by providing best-in-class Digital Marketing Services – Search Engine Optimisation, Search Engine Marketing, Website and App Development, Social Media Strategy and Activation, Email Marketing and Digital Advertising. We also provide E-commerce specific services – Online Marketplace Management, Conversion Optimisation and Basket Analysis. We tailor-make our consultancy packages depending on the digital maturity of the business.