This holiday shopping season, a lot of digital ink will be spilled discussing how consumers are checking off their Christmas lists without ever stepping foot in a store.
These stories about the ways in which online sales are taking over retail are neither new nor entirely accurate. In both the United States and Canada, online sales make up only about 10 percent of retail spending, but e-commerce continues to grow at a steady pace, which means that retailers have to change the way they interact with consumers if they want to keep up.
In a world where consumers can easily purchase goods from companies thousands of miles away, retailers need to provide more than a conveniently located room full of products. They need to engage with consumers. This is not news; "experiential" has been the buzzword for the last few years. In fact, I am often the one using it, trying to make retailers understand that they need to stop seeing their interactions with consumers as transactional and, instead, start building a mutually beneficial relationship that starts with experiences and builds to co-creation.
The problem right now—which is exacerbated during the busy holiday shopping season—is that retailers and their real estate partners are misunderstanding what experiential really means. Too many malls think it’s just about getting people in the door, but indoor ski slopes don’t help shoppers find gifts. At this time of year, retailers have two kinds of shoppers—those who have a list and need to find each item as quickly and cheaply as possible, and those who really need help determining the perfect gifts for loved ones. The issue is not getting them in the door, it’s helping them solve these problems.
Pop-up stores and immersive experiences can be great fun, and help retailers and brands connect, but to December’s shoppers, they can seem distracting and annoying. Take Canada Goose’s new Toronto store. It is certainly an immersive experience—guests walk past a two story glacier "through the crevasse where they hear the sound of ice cracking beneath their feet."
They are then invited to try on one of the company’s iconic parkas and walk into a cold room where the temperature is set at -12°C (about 10°F), and the digital, floor-to-ceiling, Arctic landscapes are complete with real snow. Sounds like fun, but, and this is a big but, the store stocks no actual parkas for purchase. So, while they may walk out knowing they want to buy Nana a parka, they will still not have something to put under the tree. Which makes ducking into the next store and picking up something else for Nana pretty appealing.
Some stores are doing a better job using their experiential set up to connect with stressed-out shoppers. Lululemon opened its newest store in the Mall of America just before Black Friday. The space features a restaurant that serves healthy food and drinks, as well as a studio space that offers yoga and fitness classes.
Few shoppers will actually put down their credit cards in favor of a yoga mat, but the setting sends a message to overwhelmed shoppers that the fitness brand gets them, and is making space for them to relax and recharge (while also finding the perfect workout outfit for the yoga enthusiast on their list).
I would like to see retailers and malls take this a step further, and become partners with their consumers in the shopping experience. Let’s face it, there is a significant portion of the population that does not actually like to shop, and these are the consumers most likely to be lost to e-commerce.
Malls have to make shopping even easier—not by simply fulfilling an otherwise online order, but by helping customers solve their shopping problems with easy-to-find products, professional advice, and learning opportunities.
What if malls clustered similar retailers together as a way to curate the products a customer is looking for in one place? Or, what if they allowed customers to order things to try on from multiple stores, and had it all waiting at a shared fitting room location? What if the mall itself became one big department store with the neutrality of an Amazon-like market place? And, what if retailers partnered with each other to offer learning opportunities (perhaps a clothing store, shoe store, and make-up retailer could get together to help shoppers pick 10 wardrobe essentials)?
Of course, many retailers are not big enough to make this a reality as it takes an investment in both digital and brick-and-mortar infrastructure, but it can be done through collaboration. The Mall of America actually has a good example of this called Fourpost, where retailers can rent spaces that include fixtures, signage, lighting, and Wi-Fi, as well as access to an online dashboard that provides retail operating tools and analytics. This allows smaller, often local, retailers to focus on connecting with consumers and selling their product.
Retailers know they need to engage with consumers, and providing them with experiences is certainly a step in the right direction (away from a simply transactional relationship). But the often-frantic holiday shopping season should remind us that not all experiences are created equal. To truly transform relationships with consumers, retailers have to create experiences that actually help consumers solve problems and expand their perspectives.
David Zietsma is SVP, Strategy and Performance at Jackman Reinvents.