Retail business reinvented: The key to unlocking next-level profits
ILLUSTRATION BY RUTH MACAPAGAL
Now is a golden age for retail. This is a unique time full of opportunities for the companies that use change as an advantage, and not as an obstacle. What do I mean by that? And where are these opportunities?
In recent years, the traditional shopping experience has been undergoing a dramatic transformation. After the rise of e-commerce had fundamentally shifted consumer expectations, brick-and-mortar stores grappled for relevance.
Enter experiential retail—a concept that mixes immersive experiences with traditional retail, offering new profit opportunities for businesses. Embracing experiential retail is a strategic move toward future-proofing retail businesses. It’s about creating spaces where shopping is not just a transaction, but an experience, a memory and a connection.
Turning browsers into buyers – Nike’s House of Innovation
The cornerstone of experiential retail lies in transforming physical stores into destinations. This transformation is not just about selling products but creating memorable experiences that forge lasting customer relationships. Nike’s House of Innovation, exemplifying the concept of experiential retail, represents a groundbreaking approach to how retail spaces can be more than just places to buy products; they can be immersive, interactive environments that engage and inspire customers.
Nike’s flagship store, known as the House of Innovation, is located in prominent locations such as New York City and Shanghai. These stores are designed to deliver a personalized and digitally connected shopping experience. The concept behind these stores is to create a dynamic and interactive environment that reflects Nike’s innovative spirit and its commitment to athletes and sport.
Innovative features and technologies
1. Customization services: One of the key attractions is the level of product customization offered. Customers can design their own sneakers and apparel, choosing from a variety of materials, colors and exclusive features.2. Digital integration: The stores are heavily integrated with the Nike app. Features like ‘Scan to Try’ allow customers to scan barcodes on products to have them sent directly to a fitting room or to a pickup spot within the store. This seamless integration of digital and physical experiences represents a major shift in retail.
3. Speed shop: This area is stocked with products based on local buying trends and online data analytics. It allows for quick and easy access to popular items, emphasizing convenience and personalized experiences.
4. Personalized recommendations: Using data analytics and past purchase history, the House of Innovation can offer personalized shopping recommendations, further enhancing the customer experience.5. Interactive and dynamic spaces: The store layout is designed to be flexible and regularly updated with new themes and products, keeping the retail experience fresh and engaging. This approach encourages repeat visits, as customers are likely to find new experiences with each visit.
Impact on retail and customer experience
The House of Innovation goes beyond the traditional retail model by creating a space that is part showroom, part interactive playground and part design studio. This format has a profound impact on customer engagement and loyalty. It turns shopping into an experience, building a deeper emotional connection between the customer and the brand. It’s a powerful example of how retail spaces can evolve to meet the changing needs and expectations of modern consumers.
Case study: ‘Today at Apple’
‘Today at Apple’ is a pioneering initiative by Apple that reimagines the role of its retail stores as community hubs, offering more than just products but a space for customers to learn, explore and connect. This program reflects Apple’s commitment to enriching the lives of its customers through education and creativity, leveraging the potential of its technology and retail spaces.
‘Today at Apple’ features a wide array of free educational sessions and creative workshops. These sessions cover various topics such as photography, video editing, music production, art and design, coding and more. The workshops are designed to be accessible for people of all skill levels, from beginners to more experienced users, and are led by experienced trainers, including Apple Creative Pros who are skilled in both the arts and Apple products.
Community building
A significant aspect of this program is its focus on community building. By hosting these sessions in-store, Apple turns its retail locations into gathering places where people can learn new skills, meet other creatives and feel part of a larger community. This approach fosters a sense of belonging and connection among Apple users.
Special events and collaborations: Occasionally, Apple stores host special events and collaborations with artists, musicians and creatives from various fields. These events often include performances, talks and interactive sessions, providing unique experiences for the local community.
Next steps
For businesses looking to embrace experiential retail, here are some actionable next steps:
1. Conduct market research: Understand your target demographic and their preferences. Identify what unique experiences will resonate with your customer base.
2. Invest in technology: Explore technologies like augmented reality, virtual reality or artificial intelligence that can create immersive and interactive experiences in your retail spaces.
3. Develop a unique brand experience: Define what makes your brand unique and how you can translate that into an experiential retail environment.
4. Train your staff: Ensure that your staff members are well-trained to deliver an exceptional customer experience, aligning with the new experiential strategy.
5. Plan events and workshops: Start planning in-store events, workshops or classes that can attract customers and provide added value.
6. Collaborate with local artists and businesses: Build community ties by collaborating with local artists, businesses and influencers to create unique in-store experiences.7. Leverage digital channels: Enhance your online presence to reflect the in-store experience, offering a seamless omnichannel experience to your customers.
8. Monitor and adapt: Continuously gather customer feedback and monitor the success of your experiential strategies, adapting as needed to stay relevant and appealing to your customers.
9. Network and learn: Attend industry conferences, join retail-focused forums and network with other business leaders to learn about the latest trends and best practices in experiential retail.
10. Sustainability and social responsibility: Consider how your experiential retail strategy can align with sustainability and social responsibility, as these are increasingly important to modern consumers.
Taking these steps can help transition your retail business into a more experiential, customer-centric model that stands out in today’s competitive market. INQ
Tom Oliver, a “global management guru” (Bloomberg), is the chair of The Tom Oliver Group, the trusted advisor and counselor to many of the world’s most influential family businesses, medium-sized enterprises, market leaders and global conglomerates. For more information and inquiries: www.TomOliverGroup.com or email [email protected].
