The boom of online retail and the inability of bricks & mortar counterparts to compete has been well documented. Much ink has been spilled chronicling the inherent disadvantages physical stores face compared with their digital rivals.
Not only is high street retail space costly – prices are continuing to increase year on year – but an effective workforce can be hard to develop and even harder to retain. On top of this, the locational aspect of business rates is putting physical stores at a disadvantage, meaning bricks & mortar retailers are subsidising those that operate from low-cost locations or warehouses.
Recent news that Britain has lost more than 6,000 high street retail outlets in the past five years seems indicative of this long-term trend, and of the direction in which we’re heading. However, I believe there is a way back for physical retail – they need to stop following the same approach as online vendors.
Lately there has been a shift in priorities when it comes the in-store experience. Many retailers have been cutting prices and fitting as many products as possible into their stores, in a bid to compete with the assortment of options offered online.
However, doing so only exacerbates the issue that has hampered in-store retail in the first place. The convenience of online ordering means visiting a store is already perceived as a chore. Searching for a product in a shop crammed full of stock only adds to that perception.
So rather than trying to match the variety of online shopping, physical retailers should instead use their space to their advantage, by creating an accessible, inspiring, eye-catching environment that customers enjoy. Our studies in grocery and home retailing demonstrate that customers spend more money in a store they perceive as inspiring.
Simply taking the time to display your product in an aesthetically pleasing, accessible way can make a huge difference on this front. In one instance, our team of researchers was able to more than double wine sales for a well-known European grocer by redesigning its wine department. Doing so required simple changes, such as providing information on country of origin, grape varieties and serving suggestions.
Another sure-fire way to trigger inspiration is by developing a workforce that is capable of sensing what consumers really want. A human touch is the key to success in physical retailing – competent, friendly and inspiring employees are integral to ensuring shopping is an enjoyable experience for the consumer. With this in mind, it’s important to recognise your staff as an asset, not a cost.
Our research with frontline employees in grocery, DIY retailing and hospitality has shown time and again that positive emotions and attitudes displayed by staff will be mirrored by customers. So, operators should prioritise investing time and resources into developing a workforce that provides the best representation of the brand they wish to convey.
The digitalisation of society means online retail will continue to grow its presence. However, by combining a smart e-commerce strategy with a memorable and inspiring in-store shopping experience, retailers can prove the calls of the death of high street are not just premature, but wrong entirely.