The secret to successful store expansion

Online retail is no stranger to positive headlines. In fact, it sometimes seems that all we hear about in the industry is the strength of ecommerce.

And it’s these types of stories that have put stores in the spotlight for the wrong reasons. Although 90% of all sales still happen in physical shops, there seems to be far more of a focus on the aspects of bricks-and-mortar that aren’t doing quite so well. For example, in the last few weeks alone, BHS, Greggs and Dixons Carphone have been making headlines regarding store closures.

One of the key reasons that stores close is because they don’t resonate with shoppers; in the interactive, instant world of digital commerce, store layouts and processes can appear outdated. However, this is something that can be amended – and there’s a huge appetite amongst retailers for getting the store right and growing its presence. New research by CBRE has revealed that retail estate expansion still remains high on the agenda, with 83% of retailers adamant that store growth will not be influenced by the rise of ecommerce this year. After all, there is no online substitute for seeing, touching and trying items before purchase.

The benefits of bricks-and-mortar haven’t gone unnoticed by e-tailers. Already this year, we’ve seen their eyes move towards the high streets, with the likes of Missguided announcing its first offline stores. Yes, the business is doing very well trading as it is, but if they want to grow even further, it makes sense to offer a physical experience as an alternative too.

So how can retailers optimise their stores for profit growth – and potential expansion if they get their formula right? For starters, today’s connected consumer is all about convenience and, as we well know, that doesn’t necessarily mean choosing between online or offline retail. Instead, shoppers want to switch between the two at different stages of their journey, and they need to know that retailers will allow them to be flexible in this respect.

Achieving this level of agility means incorporating some of the elements that shoppers love about digital platforms into the store experience. Some retailers are already way ahead of the game, launching concepts that aim to convey the ‘store of the future.’

House of Fraser, for example, recently experimented with shoppable windows, whilst Tommy Hilfiger has brought the runway to the store using virtual reality headsets. These are pretty ambitious of course; the store must focus on perfecting the basics before taking this kind of leap. Investing in more mainstream technology such as mobile POS is one good example of connecting the bricks-and-mortar experience through online functionality.

Another key consideration is the interaction between ecommerce and store activity through click-and-collect. Even though many retailers already offer the service, there are still elements of the process that frustrate customers. Perfecting the ‘collect’ part should now be a major focus for stores, making it a pleasant experience for those finalising their purchase. Enabling speedy payments technology, such as contactless, will be handy here, as well as ensuring the right amount of staff are there to keep the queues running smoothly. Streamlining the click-and-collect element will increase the opportunity to encourage further impulse purchases.

Of course, not all online browsing will take place at home. In an era of smartphone addicts, it’s now habit for consumers to rely on their devices whilst in a store too. Vodat International recently commissioned some research that revealed 54% of shoppers use their smartphones to compare prices in the aisles, 46% look up product information and 44% for personal reasons, such as checking social media. The bottom line is that consumers expect to be able to connect to the web whenever suits them – and that includes within the bricks-and-mortar shopping journey.

It may seem obvious, but there are still retailers that do not invest properly in strong WiFi to encourage this behaviour in controlled circumstances. In fact, 3 in 10 shoppers don’t find the current standard of WiFi unreliable. Retailers with sub-par WiFi are not only at risk of frustrating their customers, they are also losing a valuable opportunity to understand (and react to) their behaviour patterns. Provided they select the right provider, retailers will be able to interact with, influence and capture insight on consumers when they log on to the network.

It’s great to hear that retailers are feeling optimistic about the potential of stores, especially at a time when ecommerce is threatening share of sales channel. Gone is the time where stores and online were two separate things; the future of the store is very much intertwined with digital interaction. If they go about it in the right way, retailers can now harness the power of ecommerce in the physical environment, and use it to boost profitability.

Stay tuned for our new report – Battle of the bandwidths: why customers are won and lost on the strength of retail networks – which will provide even more insights into the connected consumer.

Is retail ready for the mobile-obsessed shopper’s rise to power?

123: that’s the number of times the average 17-25 year-old checks their iPhone every single day. To put this into context, that’s 30 times more than 26-35 year-olds, and a whopping 86 times more than those aged 55+, according to the latest Kantar data.

This information is not surprising – we all know the younger generations are glued to their phones most of the time – but it does beg the question as to whether retailers are listening to such statistics?

Right now, it doesn’t matter too much on the whole, because older shoppers are those with the greatest disposable income. Last year, the average 30-49 year-old could enjoy up to £1,400 to spend on goods and services each month, compared to around £100 for the 18-30s.

However, today’s tech-obsessed shoppers are tomorrow’s young professionals, and today’s young professionals are tomorrow’s high flyers. And when their disposable income starts to grow, they’re going to be just as (if not even more) affiliated to their mobile device.

To capture this audience when they reach their most profitable, retailers need to be creating a mobile-first strategy today, which puts in place the foundations for effectively reaching customers via this ever-growing channel.

Some companies already are; Walmart recently announced the launch of an SMS service, which sends shoppers verbal directions through their smartphone to the item they’re trying to find. They can then text the word ‘chat’ to receive one-to-one customer service.

Others are beginning to incorporate mobile into their outbound marketing strategy. Just this week, Pizza Hut launched a number of ‘smart restaurants’ in mainland China, which uses iBeacon technology to beam coupons, special offers and competitions to patrons’ devices.

But there is one absolutely fundamental component to any mobile-based retail and hospitality strategy, and that’s the network. To connect with customers, customers first must be able to connect – and this means having a robust, secure public Wi-Fi connection.

Free Wi-Fi is still not a universal concept in UK retail, so a huge step forward must be taken by the industry if we want to truly engage with shoppers across the devices that have come to dominate their lives.

Until consumers are able to get online in-store in a frictionless manner, retailers are missing an opportunity to build and strengthen relationships with them. This needs to be addressed as a priority, before Millennials grow up to become the country’s biggest spending group, or the chance to drive mobile revenue could slip through companies’ fingers.

Is your store ready for the mobile shopper?

Fashion retailers are immersed in one of the most competitive markets out there. With constantly changing trends to keep up with, meeting customer demands has always been difficult to achieve.

Alongside this, retailers now have consumers’ tech-addiction to contend with. As new devices constantly hit the market, shoppers are being presented with alternative ways to browse and pay for goods – with fashion being the first stop it seems!

According to the latest research from the British Retail Consortium, UK consumers are increasingly using their mobile devices to shop online, particularly when it comes to buying clothes. In fact, popularity is soaring, with smartphone searches rising by over 50% since last year.

While this may seem intimidating for bricks-and-mortar stores, there’s no reason why they can’t embrace mobile technology too. It’s very likely that most customers will be carrying a smartphone, so why not see the device as an untapped resource to help boost business?

Many retailers are already doing just that. UK shoe specialist Clarks has noticed the appeal of mobile to today’s shopper, and actually promotes the service to passers-by. Featuring stickers in their shop windows, Clarks urges shoppers to use their devices in-store to browse their entire product range online. This not only caters to consumers’ growing reliance on technology, it encourages them to complete their full journey in the store – even if their desired item might not be there at that time.

Some retailers are taking this one step further, creating mobile apps aimed to enhance the store experience. Ted Baker is a great example of this, finding a way to combine mobile and beacon technology to draw in more shoppers. The retailer’s Westfield White City store recently installed beacons in its mannequins, allowing them to send push notifications to customer smartphones about the displayed items. If the shopper has downloaded the Ted Baker app, they will be able to quickly purchase the clothing directly from the website.

However, before retailers consider launching an in-store mobile strategy, there are some factors to consider. For one, there’s no use advertising mobile services if their website is not mobile optimised. Surprisingly, Barclays recently revealed 70% of UK retailers have admitted they do not have a responsive website or an app in place – which can be very off-putting for a smartphone shopper.

Secondly, retailers must ensure they have a robust Wi-Fi network in place if they are offering mobile facilities in the store. A slow internet service will not only discourage customers from using it in the first place, but will likely open doors to complaints too.

Mobile offers a very lucrative opportunity to build stronger relationships that drive revenue in the store. However, retailers need to get the basics right to create a solid foundation on which to build impressive customer experiences.

The high street is fighting back so make sure your store is ready for the battle

Last year’s eCommerce stats are quite astounding – in the UK alone, online spending topped £91billion – that’s a growth of 16% year-on-year.

With this continued online growth in mind, which has been further bolstered by the use of smartphones, retailers are currently re-strategising, trying to determine how the store now fits into the changing retail landscape.

Although eCommerce is booming, there is still an overwhelming need for the store, as is evidenced through the current good feeling on the high street and increase in multi-channel retail – a report from Southampton University commissioned by the Government’s Future High Streets Forum found clothing and footwear sales increased in town centres from 20.5% in 2007 pre-recession to 25.4% in 2013.

For some types of retail business, if showrooming hasn’t been considered at this stage, it should be now. The modern consumer is increasingly choosing to use both online and in-store channels to shop – perhaps browsing in-store first and making the final purchase online. So give your staff the tools to encourage the completion of purchases in-store – use tablets which allow in-store ordering of products that might not be available at that particular location. This also enables up-selling and the ability to move with the customer to any point in the store.

The store should be seen as a destination in its own right so employing an inspirational store design could entice more customers inside. Think about what your store offers that other don’t; consider design, layout, quirky displays and technology. Could you be the first retailer with a merry-go round in-store or could you install a dedicated chill out zone serving free refreshments? Think outside the box.

Under pinning all of this, is how the store is connected. All elements of the business must be able to communicate with each other to give a unified view of all store operations. Get this function right and the rest will follow.