The WEF 2017 report says we will see 15% of stores close in the next decade. Last year saw the highest retail closure numbers in the USA and 2019 is tipped to follow suit.
Australia has a significant amount of retail space per capita and this trend seems destined to head our way. But fear not, according to Cowan and company there’s no cause to think that stores are no longer relevant, we’re seeing a shift in focus, “retailers continue to invest in top malls in the top metro areas at the expense of lower performing malls.”
As retailers focus on optimising the performance of their investment in space and inventory, in this evolution of stores, I wonder, where is the human element going to fit in?
No doubt about it, stores are evolving. What are customers looking for in stores?
A store is now a place where you can pick up an order that you’ve bought online, try on/check the item before taking it home, return or exchange it for something that has already been delivered.
It’s a place where you can have a bit of fun, some light entertainment that has you engage with the emotional story of the brand, touch and try the products before you commit. It’s a place of immediate gratification, and maybe that’s why it remains enduring and powerful as a place to (potentially) lift the spirits.
A recent trip to the gorgeous space that Mecca has in the Strand Arcade would certainly support this!
As the store evolves further it could soon become even more
It could be a place that recognises you as a customer when returning to it and surface helpful information. A place that reduces the purchase friction or assists with after sales service.
It could be a place where the shopping experience is not necessarily facilitated by humans. It’s not new news that allowing customers to grab and go without queues has great appeal. The introduction of Amazon Go, and other variations on the theme, like scan and go Apps has me wondering where the human element of shopping will end up.
Will stores evolve to a point where we need no humans at all?
Customers just love convenience, and they are willing to give their information away (most of the time) if it means a more convenient experience.
Grocery shopping is a weekly necessity and the online version has not been as successful for me as the in-store experience (I like to select my fresh produce). Thinking about cashier-less aisles and stores, they work well when it’s a quick transaction, buying a few top-up items or a quick lunch purchase.
A full trolley with the family weekly shop is not compatible with the DIY checkout. It will be interesting to see how far the cashier-less stores like Bingo Box go and whether this type of purchase process works for more complex purchases.
My favourite store interactions are still dominated by a friendly and helpful human that knows the product in their store and where to find it.
I see the juggle first hand working with retailers that are constantly evolving to stay relevant, using the technology that is available to them and getting their stores to evolve. The pressure is on not only to deliver quickly but at the same time to remain, customer focused. To create a curated selection that your customer is interested in, I think will still require the input of humans to create the ‘newness’ and ‘freshness’ – have you ever noticed that machine learning just keeps giving you more of the same that you’ve already had?
It’s a very exciting and interesting time that we’re living through. I believe retailers that keep a focus on the human element (particularly for that emotional purchase) will succeed, because fundamentally stores are evolving faster than humans have.