Enhancing In-Store Shopping: Strategies to Compete with Online Retail

18 MAY-JUN 17

The largest shopping center in the world exists mere inches away from your customer’s fingertips. Though online purchases account for a growing percentage of retail sales about 80% of consumers still want to browse and shop in-store according to The Wall Street Journal (WSJ) in a piece datelined December 30 2016.

While the number of folks who have never purchased anything online has dwindled over the past five years Kantar Retail ShopperScape reports that “roughly 22 million households didn’t use [Amazon] in 2016.” Research has also found that online purchases have a return rate of nearly triple the in-store purchase return rate.

Footwear return rates for online and in-store combined run just under 10% according to AlixPartners cited in WSJ on December 27 2016. All that said the upside potential for brick-and-mortar shopping is pretty bright so long as you keep in mind what you are dealing with.

My Italian friends often say “Keep your friends close and your enemies closer.” That advice couldn’t be more true than when dealing with online retail. Let’s explore some of the many things retailers can do to compete effectively with online sellers.

Compelling Reasons to Shop In-Store

Perhaps two of the more compelling reasons to shop in-store versus online are:

1. the in-store experience
2. the personal interaction

The In-Store Experience

Gone are the days of simply putting goods on display unlocking the front door and ringing up annual sales increases. If this is your current merchandising and marketing strategy you are undoubtedly going to have a difficult time thriving – and perhaps even surviving – in today’s fast-paced retail world.

Customers today demand an experience. This can be anything from tastings for a wine shop or trunk shows for an apparel or shoe retailer to product demonstrations and clinics for an outdoor or sporting goods operation. Authors can speak at bookstores; artisans might discuss their work at gift

Stores

The point is that whatever you are selling it is imperative to create excitement for your product and a connection with your customers through the in-store shopping experience. Remember the “sizzle” is just as important as the steak – everyone has steak!

Personal Interaction

Next let’s review the personal interaction with another human. It doesn’t – and can’t – happen online. People buy from people they like. Keep that in mind when you are interviewing sales associates. Do you like them? Are they friendly and outgoing? Are they effective communicators? Do not put someone on the selling floor just to have a warm body there. It’s simply too expensive these days.

Sensory Experience

The more sensory the experience the more spontaneous the buying. Don’t believe me? Walk through a Costco store on a Saturday and see how many product samplings you are offered. Even the most disciplined shopper among us has fallen prey to this marketing tactic. Some gift and home stores I am familiar with burn scented candles in the store. This hands-on approach of seeing touching tasting smelling even trying a product gives the brick-and-mortar retailer a huge advantage over the online competitor.

Car Dealers

Car dealers are masters at promoting not only through the senses but also by using emotional appeals. The experience begins with your visual attraction to the automobile’s sleek lines then goes on to the new-car smell. The next level is how you feel sitting in the driver’s seat. Then finally comes the test drive coupled with the salesperson’s appeal that “you deserve this car” or “this baby could be sitting in your garage tonight.” Once you have succumbed to the power of this sensory and emotional maneuvering you’re an owner. All that’s left to do is the paperwork.

Ritchie Sayner

Sharing the Pie with Online Retailers
Ritchie Sayner
continued on page 33

Though online purchases account for a growing percentage of retail sales about 80% of consumers still want to…

Browse and Shop In-Store

According to The Wall Street Journal (WSJ) in a piece datelined December 30 2016.
Published in the May/June 2017 issue of Shoe Retailing Today Copyright © 2017 National Shoe Retailers Association Tucson AZ www.nsra.org. All rights reserved.

Creative In-Store Events

• Show women the many ways to tie and wear a scarf.
• Hayden Harnett an accessories retailer held an event where customers could get their leather bags inked with customized “tattoos” by a local tattoo artist.
• Invite professional shoe shiners in not only to provide shoeshine services but to talk about how to care for different kinds of shoes.
• Offer shoe-care packages at a discounted price. Shoe care events are especially popular around the holidays.

Hospitality

Throw a “local” party! Find a unique-to-the-community reason to celebrate and team up with popular local groups/businesses to salute it. The reason might be historical – say Founder’s Day/Settlement Day or the date the community’s first school opened – or current – such as school teams finishing with winning seasons.

Maybe you can ask customers what they love most about the community and find your local theme there. You’ll be amazed how many folks will attend due to the multiple streams of promotion via the participants.

There are many ways to make an event feel festive. Invite a local trend-setting chef a popular music group a cool DJ or radio talk show host. Create a tailgating atmosphere with grills outside. Sponsor a wine-tasting. Offer snacks using locally sourced ingredients.

Bring in a student a cappella group to sing. Set a budget for your part of the party invite groups and businesses to co-sponsor and start planning. People enjoy celebrating and it’s a great way to engage all the senses – plus the run-up to the actual event will bring customers in to ask questions offer ideas and anticipate while they shop.

In-store events are ways to show your…

Customers

How much you value them. And when the event creates an emotional appeal offers something free “just because” and/or makes a customer feel like a special VIP it helps strengthen your brand and your relationship with each customer involved.

About the Authors

Lyn M. Falk is owner/president of Retailworks Inc. where Allie Jeka serves as social media manager. For more information visit www.retailworksinc.com.

Becoming the Local Expert

That example translated from car buying suggests that you become the local expert in your industry. I work with an outdoor store whose motto is “Ask Us – We’ve Been There.” Whether the activity is camping hiking boating climbing or backpacking this store hires local experts who relate to what the customer is going to be using the product for. Think about it: Would you rather buy a pair of running shoes from someone who hasn’t run a mile in his or her life or from someone who goes for a daily run before or after work?

Pricing Strategy

When it comes to pricing brick-and-mortar retailers should know the online prices for the products and/or services they are selling. Unfortunately these days this includes shopping not only other online retail sites but also many vendor sites since they often sell directly to your customers. You must at least consider offering on-the-spot price-matching whenever possible and free shipping when it is economically feasible.

The idea that all shoppers will justify paying more to support a local retail establishment reflects what is indeed a noble intent. However I don’t believe it is sustainable over the long term. About 80% of adults today have either a smartphone or some sort of access to the internet. Today’s shopper knows what product prices are going to be and probably has done some homework prior to coming in your store. When you can post current online prices next to certain items. Why not encourage your customers to do online comparisons? They’re going to do it anyway. We all do! This is not a

Suggestion for Pricing Strategy

Seek out and post the lowest price possible; instead it is a way to show your customers that your prices are reasonable and include the cost of knowledgeable and expert service which cannot be provided online.

Advantages of Traditional Retailers

Traditional retailers also have another advantage over e-commerce-only merchants. It is the opportunity to make another sale when merchandise comes back – as it does nearly 30% of the time for online-only retailers. Use this opportunity to your advantage; you might even go so far as to stick a $5-off coupon in the bag to be used on the next trip to the store just to counter any perceived inconvenience a customer experiences in making a return.

Creating a New Experience

One more advantage: You can give customers a “new” experience every time they visit you. Don’t forget to keep the merchandise fresh and exciting. Change the window and in-store displays weekly and rotate current inventory on end caps. Above all else manage your open-to-buy (OTB) and especially the inventory on-order. You always want a constant flow of merchandise landing in the store – new looks and products to excite and delight your customers. Remember: Nobody comes into your store to see what came in last year.

Ritchie Sayner is vice president of business development at RMSA Retail Solutions and author of Retail Revelations: Strategies for Improving Sales Margins and Turnover available through Amazon. He can be reached at rsayner@rmsa.com. To follow him on Facebook go to www.facebook.com/RitchieSayner.

Summary

Despite the rise in online shopping about 80% of consumers still prefer in-store experiences due to personal interactions and sensory engagement. Retailers can capitalize on this by creating compelling in-store events and maintaining competitive pricing strategies to enhance customer loyalty and satisfaction.

“Keep your friends close and your enemies closer.”

Real-World Examples of Brick-and-Mortar Advantages

Here are some real-world examples that highlight the advantages of in-store shopping experiences and personal interactions as discussed in the article.

• A local bookstore hosts regular author meet-and-greet events where customers can interact with authors get their books signed and participate in discussions. This creates a personal connection and enhances the in-store experience.
• An outdoor sporting goods store offers free workshops and clinics on weekends where customers can learn new skills like rock climbing or kayaking from experienced instructors. This hands-on sensory experience attracts enthusiasts and builds a community around the store.
• A boutique clothing store organizes seasonal fashion shows and styling sessions where customers can see the latest trends in action and receive personalized fashion advice. This interactive experience encourages spontaneous purchases and builds customer loyalty.

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