Retail Marketing Archives

By Olivia Atkins

The physical demise of high street clothing brand Topshop signalled the turn of the UK’s retail sector. As the flagship store closed in 2021, the physical became digital, and the brand was picked up by online retailer ASOS – a move demonstrating the appetite and continued willingness of UK consumers to shop virtually. As the rise of online shopping continues, how can marketers seize the digital opportunity? And is there a role for the physical store anymore?

In a panel discussion spearheading The Drum’s latest Deep Dive: The reinvention of retail and ecommerce, The Drum’s Olivia Atkins speaks with experts from VMLY&R COMMERCE and Heal’s on how to assess the changes in customer experiences; the technology pushing the sector forward; and how agencies and retailers can prepare for what lies ahead.

Brand purpose is here to stay

E-commerce in the UK grew by 46% last year as the pandemic forced stores to close, driving consumers online from the lockdown convenience of their homes.

“People who buy online now are used to buying online – they’ve adapted to the price and the convenience of it; and recognize the advantages of doing so,” said Debbie Ellison, global chief digital officer at VMLY&R COMMERCE, who believes these habits may be here to stay.

Online shopping saw many customers become more aware of their purchases and look into the purpose of the brands they’re buying from – a trend perpetuated by Gen Z.

Ellison recognizes the spending power of Gen Z and their influence in pushing retail trends forward. She suggests brands need to become more relevant to their audiences or risk seeming redundant.

She thinks, “retailers should respond to their shopper’s needs and communicate their brand purpose at shelf – whether that’s in a physical or digital space. In physical retail environments, marketers easily understand their local community and how to engage there. This same logic needs to be applied in the digital sphere.”

David Kohn, customer and e-commerce director at furniture retailer Heal’s, agrees: “Purpose is the single biggest social consumer trend that we’re seeing at the moment. In retail, that translates to being a brand that stands for something – whether that’s environmentalism, diversity or even quality design.”

Physical versus digital

Despite the surge in online shopping, retailers should work to embrace both virtual and physical spaces for their brand, as certain purchases may require prospective customers to shop in-person to get a sense of their desired products.

Ellison said: “Over the last year, there’s been a pent-up demand globally to get back in-store with consumers wanting to experience something special. Retailers will be listening to that and thinking how to differentiate their offerings across channels.”

The focus for retailers is to understand the role and purpose of every space they have. Ellison suggests that in-store offerings could feature more sensory experiences where the social aspect of shopping is considered along with how to improve the service and looking at how consumers interact. Technology also works to scale up connected experiences, by automating backend processes and improving the consumer’s experience.

Kohn adds: “Technology in-store can be useful for getting your consumers to imagine. At Heal’s, we try to bring them into our world and get them to visualize our products in their home.”

He’s excited about the prospect of incorporating new technology like virtual reality (VR) in stores, believing it will be a great device for reviving storytelling methods in retail.

Merging e-commerce with in-store

“We’ve all moved online; we’re all inspired and purchasing within milliseconds,” says Ellison. “But now that the gap between inspiration and purchase has converged, how is that going to translate into the physical retail space? How will creativity be brought through each touchpoint to deliver on both the emotional and functional aspects of buying?”

Despite this change in habitual consumer behaviour, Kohn suggests that retailers need to reassess how they use each space and set them up accordingly to ensure they cater to customer needs. He gives the example of Heals’ online in-store teams who work to connect customers online with relevant store team members.

“As a brand, you’ve got to think carefully about your customer’s purchase journey,” he says. “Try to understand where the customer fits in and what you can do to move them along that process. That’s where the fusion between in-store and online can come into being.”

It’s been a trying time for retailers but having a clear understanding of what consumers need and want from each space will only help brands to move more seamlessly between their online and physical offerings. Customers are already overwhelmed by the amount of choice available to them in the marketplace, so brands need to work hard to stand out.

“Selling products is not enough anymore,” said Kohn. “You’ve got to look at the wider needs of your customer and work towards fulfilling those.”

Ellison agrees and concludes: “Brands need to walk in their customers’ shoes and really look at how they will show up in a connected way across all their different channels.”

By Olivia Atkins

Sourced from The Drum

By Stefano Hatfield

As brands and consumers seek a return to the physical retail space post Covid-19, the technology that has enabled ecommerce to fill the gap as stores were closed will play a vital role in the recovery of that same bricks-and-mortar retail. Shoppers, particularly in the UK, want a “connected shopping” experience.

The pandemic has obviously hit the UK high street, but shoppers are ready to return, particularly if the ease of online shopping is blended with the richness of the in-store experience. Some 40% of UK shoppers use their mobile in-store to look up more information on a product. And there is a huge increase (80%) among Gen X shoppers who say they will use augmented reality (AR) in shopping over the next five years.

These are the headline findings of a new report, ‘Future of Shopping’, based on a global survey of 20,000 shoppers by trends agency Foresight Factory, for Snap Inc. Technology, rather than sounding the death knell for bricks-and-mortar retail, has led to an irreversible shift to omnichannel that genuinely benefits both shoppers and retailers.

As we have seen over the past 18 months, when new technologies are built primarily around human behaviour, rather than imposed because of internal business needs, their impact can be positive. Yes, online shopping has disrupted bricks-and-mortar retail over the past two decades. However, technology has also helped retailers navigate the increasing overlap between online and physical environments, now a part of our lived experience.

The report reveals that consumers worldwide feel their shopping experience has been greatly enhanced by camera technology and accompanying digital innovations. It is clear that shoppers are keen to get back into stores, but they also want to keep all the advantages of technology when they return; for example, instant access to stock information or home delivery service.

Britons seem more wedded to online shopping, particularly for clothes, than others. Some 44% plan to do the majority of clothes shopping online, above the global average of 38%. Only 34% of Brits said buying in-store was their favoured method of shopping – compared with 43% globally. But nearly half (49%) of Brits missed the social aspect of shopping and more than half (51%) found the inability to try on products frustrating.

This desire to blend online and in-store highlights how vital the mobile phone has become across the shopper journey and explains why the new consumer habits forged in the pandemic are here to stay. However, consumers have missed the social component of physical shopping, so e-commerce advertisers need to greater humanize their brands online.

The report identified several other key takeaways:

Growth in e-commerce during Covid-19 will be sustained

81% of UK shoppers are expecting to do the same amount or more online shopping in the next 12 months compared to last year, with only 19% indicating they plan to do less.

A post-lockdown return to physical retail

Shoppers returning to store post-lockdown will seek the social and tactile experiences they have missed in the last year, albeit combined with the convenience and safety of shopping online. But bricks and mortar stores must act fast to ensure they do not lag behind shopper expectations.

Technology will drive shoppers into stores

Some 35% of global consumers would visit a store specifically if it had interactive virtual services such as a smart mirror that allowed them to try on clothes or makeup.

Mobile will connect brands and consumers across the shopper journey

One in three global consumers choose the mobile phone as their preferred shopping channel, and 50% of Generation Z and millennials say they never go shopping without using one. These trends will only continue, not least in the area of price comparison.

Virtual testing could accelerate e-commerce further

Some four in 10 consumers globally state that not being able to see, touch, and try out products puts them off online shopping. Retailers will therefore need to invest heavily in try-before-you-buy technology to help encourage purchase and reduce the potential need for returns, by enabling consumers to more tangibly engage with products.

Shoppers will demand widespread AR

Within five years we will see a 57% increase in Gen Z shoppers who use AR before buying. Significantly, 56% of consumers who have used AR when shopping claim it encouraged them to make a purchase. The mobile phone will be the core tool.

New technology could reduce the number of online items that are returned annually by up to 42%. The study estimates that the cost of online returns now amounts to around $7.5 billion each year – and £377m in the UK alone.

Resale platforms cement their position as a credible alternative

Four in 10 consumers globally have bought and sold something via resale platforms, which attract shoppers searching for cheaper prices and unique products. Second-hand goods no longer come with stigma, but are a more desirable, sustainable alternative. Retailers like Levi’s, Ikea and H&M are moving into the branded resale space.

The key trends identified above talk to the blurring of consumer needs and expectations across physical and digital shopping channels. They reflect shoppers’ primary demands (beyond pricing): convenience, social interaction and product testing.

Ed Couchman, general manager, UK, Nordics and DACH, at Snap Inc. says: “People thought the internet and technology was a threat to physical retail but this report clearly shows that those who harness the benefits of tech are best placed to thrive post pandemic. Shoppers want to read reviews, compare prices and try on items using AR – but they also enjoy the experience of going into a shop, speaking to staff, and looking at items. They want the best of both worlds.”

The ‘Future of Shopping: Global Report 2021’ from Snap is available here