The shopping centre giant Unibail-Rodamco-Westfield have carried out research on the impact of the pandemic on the future of shopping. Westfield’s study, which polled 2000 UK consumers and 500 UK retailers, identified a range of trends:
One of the five key areas of change will be the significance placed on experiences, set to become the most important element of stores in the next five years.
Retailers will hit an “experience tipping point” by 2025, by which time more store square footage will be devoted to experiences than products, as 52 per cent of shoppers state they now crave in-store experiences.
From full shelves to full experience
Retail – and the high street in particular – is at a turning point. Increasingly, the focus is less on location, location, location and more on experience, experience, experience. The last 18 months have shown consumers that they can get by for the most part with online shopping. So, although the appetite to return to in-person shopping is there, people are looking for more from the experience.
This consumer-driven trend could see bricks and mortar destinations act as the base for tailored events, influencer shoots, limited edition signings and much more. Anything that will act as the additional pull to draw customers in-store. Retailers are going to have to become increasingly innovative when it comes to offering brand engagement opportunities.
Think of the Apple Store. Love it or loathe it, you walk through the doors and are greeted by people and experience. Not shelves and shelves of product for you to sift through. The focus is on interacting with and discovering the technology – or receiving support with issues – and it’s impossible to just walk in, choose your item from a display and walk up to a cash desk to purchase it. The one-on-one personal attention you are guaranteed to receive and the opportunity to engage more with the products ahead of purchase are the major virtues of the set up.
Focus on delivery
In the future, shopping experiences like this are likely to become the norm with getting your hands on the actual products being secondary to the interactions and advice you receive. Consider an interior design service – rather than walking around a showroom stocked with products and having to sift through for the items you feel are to your taste, that experience could become far more tailored. Discussion with an expert consultant – possibly including the use of VR technology to simulate the space you’re looking to makeover – will lead to personalised recommendations and a virtual shopping list of products that can be delivered straight to your door.
For retailers for whom this high-end offering doesn’t fit their business model, there’s still the question of physical retail space. There’s a clear competitive advantage to be had if you can hold more product lines and expand your offering without the associated storage and logistics headaches and costs. Just as Next is looking to become the Ocado of fashion, by outsourcing the actual product considerations further back up the supply chain, retailers can focus on using more space for experiences whilst still delivering exceptional customer service in terms of the final product.
Delivered by wholesale
But, for retailers to be able to pursue any of these innovations, they need to transfer much of the logistical burden upstream to wholesalers and manufacturers. Not only do those relationships need to be strengthened, wholesalers need really tight control over their supply chain. The entire offering loses its power if there is no immediacy to the product arriving with the consumer after their in-store experience. It is essential that the gap between customer expectation and reality around delivery and returns is closed.
To be able to react to the demand from retailers, a resilient supply chain with the ability to flex where needed is crucial for wholesalers. Are you in a position to enable the competitive advantage retailers are going to be looking for over the next four years? If you can’t deliver the logistics to support extended product lines, faster and more dependable delivery or the personal service behind experiential shopping, you might get left behind as the shape of retail changes.
To learn more about how the AGR software can strengthen your position to provide retailers with the advantage they need for the future, get in touch today and discover just how much of a difference it could make to the resilience of your supply chain.