THE ROLE OF RETAIL
My son and I recently visited a small bakery we had been to once before as a family. On our first visit, the proprietor had greeted us warmly and ploughed my husband with delightful freebies – a slice of fresh bread, a warm cinnamon roll. In addition to these treats, we purchased a few small items to eat immediately and a few to take away.
On our second trip, the proprietor again welcomed us and proceeded to ask my son if he had tried a whoopie pie. No, he hadn’t but he looked at me uncomfortably as if to say, ‘is this okay, mom?’. I encouraged him to go ahead as I rounded out my purchase – more than double what we had spent the first time.
Surprised at his discomfort – what 12-year-old turns down a free chocolate and cream treat – I asked him about his concerns as we drove away. “It’s such a small store, I feel bad taking something for free” was my son’s response. It led to a good conversation about math and marketing.
It also reminded me of a significant reality of retail versus e-commerce, the opportunity to leverage the power of authentic human connection. Our first interaction at the bakery brought us back a second time. The second rewarded my loyalty and drove up my purchase. The warm reception and the contribution of a 10 – 25 cent whoopie pie resulted in a $23 purchase overall.
It is not always about free stuff – although a small tidbit thrown in here or there can go a long way. It is really about the reception, the curation and the emotional bond that can be built between a store or brand and an individual over time.
Take Trader Joe’s – my family loves those free samples too – but they also, more often than not, result in a new type of ‘unique to TJ’s’ food item showing up in our cart, and I’m a relatively frugal shopper. And, it isn’t just the free samples that brings us back. Have you ever had trouble finding a Trader Joe’s associate when you need help? Their ready, willing and able staff create a consistent and positive experience that more than offset the reality of the sometimes-shaky produce.
And lest you take my examples too literally, the importance and the power of human connection, transcends free food. From Lululemon’s in-store yoga to REI’s pack-fitting, ski waxing, and bike servicing, to Home Depot’s expert staff, the brands that bring their business to life through human interactions and authentic connections will add an advantage to their arsenal – experience inspired loyalty.
As we enter this era of Amazon for everything, many are calling the death of retail and forecasting an apocalypse. I agree challenges are ahead. However, I’d argue a good portion of the pain in front of us is due to over-saturation of square footage. The U.S. has 24 square feet of retail real estate per capita – 5x more than the UK, 10x more than German and even 40% more than Canada, where arguably the availability of land is more similar. What mall can you think of that doesn’t have an abundance of competing big-box retailers within a mile or two?
Nonetheless, for brands that have not participated in massive roll-outs and even for those that started online and are looking for growth, permanent and/or pop-up retail may just be the thing to defend against Amazon’s invasion. The Amazon experience is about ‘I know what I want, please just make it as convenient as possible and promise me I will pay the least for it’. But shopping isn’t always about knowing in advance what you want. Easy and convenient are not the same and price is one of many factors in a purchase decision. Most consumers need more, at least sometimes.
The question then becomes – what does that authentic human interaction with my brand look like – and how does that come to life in a profitable retail experience. The answer starts with your strategy, knowing your vision, mission and unique consumer value proposition and building your narrative. It might require some work on your story and recognizing and developing some new capabilities.
Retail won’t stop the growth of e-commerce but it will complement it and will be a real, if not the most critical, basis for differentiation. For a branded business looking to inspire and build loyalty and affinity – brand love – an authentic human interaction in a store could be the basis by which a consumer does know exactly what they want when they go online – your brand