Retailers, reliant on a traditional
bricks-and-mortar heritage, face a complex task of maintaining
relevance to an increasingly elusive consumer base.
The question we are increasingly asked
is: how do brands take advantage of all the shiny new toys in the
digital playpen to both drive traffic to their physical shopping
environments and maximise e-commerce potential? Our answer is
always that the solution must be a seamless integration of the
virtual environment with the physical one in a way that's fresh,
dynamic, and interactive.
Many retailers have been tentative
about pursuing such a strategy in the past. However, with no
slowdown in the mass proliferation of technology and the
fragmentation of media platforms, what we find is that the sector
is facing up to the sobering reality of increasing consumer control
and a purchase path that's ever harder to manage.
What retailers have learnt is that
innovation and creativity are no longer aspirational luxuries for
retail marketers: they are business essentials.
Circular Path to
Recently I was discussing these
challenges with Gwen Morrison, CEO of The Store, The Americas and
Australasia, the retail hub of the WPP Group. Her view was that
technology has changed the path to purchase.
"It used to be that the path to
purchase was linear," she said. "A retailer would build brand
affinity, followed by a call-to-action, which would trigger the
consumer to put the product into the shopping cart and go. Now,
with all of the digital tools at the consumer's disposal, the path
to purchase is more of a circular one."
What this means is that thanks to
social media and geo-social applications, the consumer has now
circumvented - or even "toppled"- the traditional purchase path.
Consumers now have the ability to research product information via
Google, Facebook and other social media, as well as from
manufacturer websites. Increasingly, it is only after extensive due
diligence that consumers actually pull the trigger on brand
The problem has been that while most
retailers might rate a 10 for the emphasis they put on digital in
their marketing plans, both MediaCom's experience and The Store's
is that they often fall short when it comes to actually
committing the required resources.
"Allocating incremental resources is
difficult when you aren't making your numbers because of the most
severe global economic downturn since the Great Depression," is how
Gwen expresses this conundrum.
Ironically, the increasingly
precarious state of the global economy could encourage marketers
willingness to experiment with digital. That sounds
counterintuitive but because investing and experimenting in digital
is generally cheaper than spending in traditional media, the
pendulum could swing in its favour if or when margins and budgets
Already brands are pushing us and we
are constantly pushing the media owners we work with to be cleverer
in leveraging digital opportunities in a more cost-effective
manner. Until the economy turns we expect that many retailers won't
be able to invest in bricks-and-mortar capital improvements, so the
focus will be on the digital arena as the place where they can
afford to make a difference.
One of the lasting effects of the
recession is that consumers remain price sensitive and value
conscious. Because times have been tough and could get tough again,
they are demanding greater transparency and engaging experiences
Some smart bricks-and-mortar
operations have been able to evolve through high-tech acting as a
momentary escape for jaded shoppers who are yearning for richer
For instance, Bloomingdale's recently
created a very slick, high-tech fashion counter at its flagship
midtown Manhattan store. This beautiful environment is bursting
with digital video touting high-end cosmetics. To promote it, the
retailer surprised shoppers with a flash mob. Actors, posing as
shoppers, were recruited to drop their bags at an appointed hour
and start dancing at the cosmetics counter to loud music blaring
from the store's speakers. This impromptu dance party was
videotaped by Bloomingdale's and then posted on YouTube to great
It's an approach that harks back to
the 1980s in some ways. "In the '80s, brands were striving to
become a part of the popular culture," recalls Gwen. "Nowadays, it
is about going viral. The trick is to integrate rich experiences
online with bricks-and-mortar."
This is not to suggest that every
retailer should start contemplating their own Bollywood
bricks-and-mortar production; in fact, more subtle but progressive
ideas that focus on practicality and service to the consumer can be
as effective as entertainment.
For example, Topshop, the proprietor
of stylish and trendy apparel, has installed virtual display
technology near dressing rooms to allow shoppers to immediately see
how they look in a particular outfit. Diesel in Spain has taken it
a step further with the introduction of Diesel Cam, which allows
shoppers to photograph themselves in Diesel clothing at the
physical store and post it on Facebook.
American pharmacy chain Walgreens has
been successful in using mobile not only as a marketing
medium-through which it offers coupons and other incentives-but
also as a means of facilitating the shopping experience.
Walgreens' shoppers now have the ability to use smartphones to fill
prescriptions and order photo prints in advance, saving them time
waiting in line and placing orders. This also helps stores operate
at peak efficiency.
Finally, some daring marketers are
extending their brands out of the stores and into the streets. Gap
launched its very own gourmet taco truck, dubbed Pico de Gap. The
mobile unit promoted the brand's newest 1969 denim offerings for
the Fall season, while offering fun faire by TV chef Ryan Scott. To
further the brand message, two tacos and a drink were cleverly
priced at $1,69 and, with a proof of a same-day Gap denim purchase;
the tacos were on the house. Visitors received a $20 coupon on the
1969 collection. Truck destinations were unveiled on Twitter and
With all of these exciting new case
studies involving online video, mobile and social media, have other
retailers been inspired to follow suit? As often happens with new
technology, some retailers are remaining tentative for longer than
they need to.
One thing that is holding many back is
the inability to track these new initiatives to sales results.
However, a new spin on ROI is emerging in the retail sector, and
ROI is being re-defined as Return-On-Involvement in many quarters.
This is based on the notion that if you create more relevant,
highly targeted offers with sustained interaction (for which
digital media is the perfect platform), retailers will develop more
To me that would seem to be as close
to the Holy Grail as you could find in retail.