RETAILTAINMENT STILL MATTERS.

Retailtainment may not be top of the agenda during the Covid-19 crisis, but our desire for an engaging retail experience hasn’t gone away. For our third blog post on the Post Covid-19 Retail Landscape series, we focus on the theme of customer experience and in particular the trend of Retailtainment – a more emotionally engaging customer experience.

This time last year, V360° presented Irish Retail Landscape Reimagined 2024 at MII DMX. Examining four fundamental themes of retail – Convenience, Curation, Experiential and Social, we looked through our crystal ball to what the future retail landscape in Ireland is likely to be in 2024.

On average, it takes more than 2 months before a new behaviour becomes automatic — 66 days to be exact . Two months since the schools were first closed, on the eve of Phase 1 to ease Covid-19 restrictions, is a timely moment to revisit this work from 12 months ago, and see how the forced Covid-19 Lockdown restrictions are likely to shape the Irish retail landscape going forward. By understanding how retail is likely to evolve, we can provide a useful framework for developing commercial marketing plans and activations going forward, for both brand owners and retailers alike.

CAVEAT EMPTOR. Our job at V360° is not to predict exactly how things will turn out in the coming months or years, but to help prepare our clients for the outcomes that are reasonably possible. To that end, this blog is intended to provoke positive discussion to help navigate the current crisis and prepare for the future. It’s fair to say that we do not have any clairvoyant powers to predict what’s going to happen in the next 15 minutes, let alone 5 years. However, we have a good idea, based on our expertise and experience in shopper and retail what is likely to transpire.

Retailtainment, at its heart is about creating a more emotionally engaging customer experience, in contrast to the functional, supply chain, pile them high and sell them cheap approach. A more technical definition states that Retailtainment is “the convergence of leisure and entertainment by retail stores, to raise their offering to attract shoppers across their threshold” . Neither one has strong relevance during the Covid-19 crisis, but our desire for an engaging retail experience remains as strong as ever. Digital is an increasingly important enabler of Retailtainment, as the lines between the virtual world and the real world are continuously blurred. The rise of Phygital (physical plus digital) perfectly captures this blending of digital experiences with physical ones.

Virtual Running Tracks at Life Style Sports award winning store; Skiing at the Mall Of The Emirates in UAE; John Lewis Staff being trained by Oxford Playhouse Theatre; Inglot makeovers at Dundrum Town Centre; Dyson portfolio being brought to life their pop-up shops.

CUSTOMERS’ NEEDS REMAIN CONSTANT, EXPECTATIONS EVOLVE.

Customers’ fundamental needs of cost, choice, convenience, and customer service remain constant, but their expectations as to how these needs should be meet continues to rise. While the Covid-19 crisis has caused an unprecedented challenge to retail operations, shoppers have dramatically reframed their expectations, once the crisis passes, their underlying needs and preferences will come to the fore once more.

The closing of all non-essential businesses has forced many of us to transform how we live our daily lives as well as our purchasing behaviours overnight. We can no longer shop, socialise, or partake in wellbeing activities with the pre-Covid-19 freedom. We are adapting our behaviours accordingly, finding alternatives, often enabled by digital solutions to fulfil these needs.

The Salesforce Q1 Shopping Index shows a dramatic shift from physical to digital browsing and buying as more people work from home and navigate their lives digitally iii. The fact is that in times of change such as life-stage, holidays, economic crisis and global pandemics, people try out new behaviours, some of which stick. Two months into lockdown, certain adopted behaviours at key touchpoints on our purchase decisions journey are likely to stick in the long term:

  • Appreciation of the work that retail staff do and the daily challenges they face.
  • Utilising digital channels for pre-purchase consideration/evaluation phase.
  • Increased use of digital channels to complete and fulfil purchases.
  • Significant increases in mobile and social purchasing.
  • Adoption of new omni-channel services like ‘click‘n’collect’.
All of which will impact how the Retailtainment trend will evolve, as we emerge from lockdown and live in hope of a Post-Covid-19 world.

Recent research from Shopper Intelligence shows shopper behaviour is evolving in the Covid-19 landscape, two months on from initial lockdown measures. While the ‘Big Shop’ with its accompanying higher basket spend continues to dominate, ‘Top Ups’ are on the rise again. To highlight how shoppers’ expectations have been dramatically reframed, Satisfaction scores have risen during the Covid-19 crisis (a statistically significant +4% points rise in Satisfaction) compared to pre-Covid-19 scores.iv

Post Covid-19, it will come to pass, these expectations will realign, customers will value more emotionally engaging purchasing experiences. The challenge for retailers and brands is to anticipate and meet these needs.

RETAILERS AND SUPPLIERS DELVIERING GREAT OUT OF HOME EXPERIENCES IN THE HOME.

Innovative retailers, brands and service providers are getting to market with new experiences every day. Many restaurants and bars have pivoted during lockdown to offer their products in kit-forms such as ‘cook at home’ and ‘mix at home’ kits. They have proven popular among people who are not only missing their favourite burgers, pizzas, or cocktails, but also those consumers who are seeking an experience that goes beyond ordering a prepared, cooked meal, such as Box Burger or Uno Pizza via www.stuffuneed.ie or your favourite “Quarantini” cocktail.
Monkey Shoulder, the premium whisky, has launched a free door-to-door cocktail delivery service in partnership with some of Sydney’s most exciting venues. Launched on World Cocktail Day (13th of May), with Australia’s Largest Cocktail Mixer Truck, delivering cocktails direct from a number of premium cocktail bars. vi

Not to be outdone supermarkets are also getting creative by using virtual platforms to connect with consumers. Seattle-based PCC Community Markets is hosting online cooking demonstrations through the Zoom platform for $25 per class. The one-hour classes give shoppers the opportunity to enter inside instructors’ home kitchens and learn tips and tricks for certain dishes or types of food. Recipes are shared in advance so students can gather the ingredients, prepare questions, and follow along.

SOCIAL SHOPPING BECOMES JUST SHOPPING.

Social (media) shopping, enabled by Augmented Reality, which was already in growth pre-Covid-19, has gone from strength to strength. Each day more than one-third of all UK digital audiences are interacting with Augmented Reality (AR) in just one social media app – Snapchat. When it comes to younger audiences that number rises to 78%. 31% of UK and US young shoppers are enjoying using AR within their purchase decision-making vii.
Under Covid-19, social shopping has become shopping for many, with the moment of choice moving from the store (real or virtual) to the home.

Italian make-up brand We Make-Up leveraged Facebook Augmented Reality Ads to try on different shades of liquid lipstick through a face filter viii.

Ralph Lauren worked with Snapchat AR Lenses and Snap Ads to provide users a gamified way to experience the brand’s products. This yielded a 19% attributable lift in sales ix.

Saudi youth clothing brand Nisnass also leveraged Snapchat’s AR ad capabilities to deliver a 40% lift in profitability in ROI. x

In early 2020, fashion brand Burberry partnered with Google to incorporate an AR experience directly within mobile search results. xi

VIRTUAL EXPERIENCES THAT YOU CAN TRY BEFORE YOU BUY.

Unable to get to the shops? There’s probably an app for to help you.

More and more retailers and brands are enabling customers to virtually try before they buy, from personal beauty products to clothing and shoes as well as household furniture and decoration. A retail trend that will be accelerated by Covid-19. A great example is the rise of Stich Fix, the online personal styling service that uses recommendation algorithms and data science to personalize clothing items based on size, budget and style. The company was founded in 2011 and had an initial public offering in 2017 with a valuation of $1.6 billion.

Others to leverage this trend are ModiFace, a technology app that includes live 3D makeup simulation, live anti-aging/skin-care simulation, and hair style and colour simulation. ModiFace’s technology currently powers augmented reality experiences for brands including Armani, L’Oréal Professionnel, and Samsung.

IKEA’s augmented reality (AR) application allows customers to test IKEA’s products in real time through Apple iOS 11’s ARKit technology. The app automatically scales products, based on room dimensions, with 98% accuracy according to the company.

The Dulux Visualizer app lets you see your room live in any colour before you paint it. The App gives you an instant, realistic impression of how your room could look, enabling customers to easily choose paint colours that complement their home.

Jenzy launched a new foot-sizing and eCommerce app that makes it easy to buy perfectly fitted shoes for young children online. Jenzy recommends the best shoes for your child based on their stage of development and matches your child’s foot to the best size in each pair of shoes. They promise to ‘send the perfect size, every time’ xii.

LEVERAGING STAFF, IN-STORE AND ONLINE TO CREATE ENAGIING CUSTOMER EXPERIENCES.

In the short-term, person-to-person and bricks-and-mortar retail will continue to be severely restricted under Covid-19. Clothing retailers face a particular challenge when it comes to dealing with customers trying on items as well as dealing with returns. When safety of customers and staff alike is paramount being hands-free while maintaining social distancing will be the norm.

Gap is closing its fitting rooms and holding returned clothing for at least a day, to ensure that clothes are not contaminated. “Our whole goal is to be the gold standard when it comes to safe retaining,” Gap Chief Executive Sonia Syngal said in a recent interview xiii.

Men’s suit maker Suitsupply is installing standing partitions in its stores as they reopen, which it says allow for ‘safe up-close interaction’ for people who still need to have their pants or jackets fitted and tailored. It is also allowing customers to book fitting rooms or private shopping suites, by appointment, which it says will be sterilized beforehand. xiv

Chinese cosmetics company Lin Qingxuan was forced to close 40% of its stores during the Covid-19 crisis, including all of its locations in Wuhan. However, the company rapidly redeployed sales efforts to new channels both in B2C and B2B enterprises. They deployed its 100+ beauty advisors from those stores to become online influencers who leveraged digital tools, such as WeChat, to engage customers virtually and drive online sales. As a result, its sales in Wuhan achieved 200% growth compared to the prior year’s sales. xv

ENHANCING THE IN-STORE SHOPPING EXPERIENCE.

Creating a great in-store experience of course doesn’t always have to be about Retailtainment, simply removing the friction for shoppers can enhance their experience. The Covid-19 crisis has accelerated the adoption of existing technology, such as contactless payment, ‘Scan & Shop’ and ‘Click‘N’Collect’ that help remove friction for the in-store customer experience, but there’s still room for improvement. One area that stands out is raising the payment limit for contactless payments, so that it’s on a par with ApplePay and Chip & Pin.

But what about contactless shopping? Technologies like RFID, Bluetooth and QR Codes can seamlessly transfer content to a shopper’s smartphone without contact. They also make it possible for customers to complete transactions on their mobile devices and opt for delivery to their home. This evolution of the omnichannel shopping experience will accelerate as retailers invest in experiences that reduce the need for physical interaction and time spent in-store xvi.

In the meantime, there are existing technologies that can improve the customer experience pre-store, in-store, and post-store.

The aswaaq Reach Mobile App (Dubai, UAE) can create a shopping list, add products from recipes, navigate the shortest route in the supermarket based on your shopping list, while receiving promotional offers based on your shopping preferences. As if that wasn’t enough, it can also call a store assistant for help, create gamification options to make shopping more fun, as well as offering product information for healthier choices. At the end of the in-store shopping trip, a self-checkout option avoids the checkout queues. xvii

Amazon Fresh enables you to shop from your phone, including Whole Foods’ 365 private label products. Browse virtual ‘aisles’ and just drag and drop items to your list at the bottom to fill your cart. As an alternative, shoppers who have an Amazon Echo in their home can create shopping lists by simply asking Alexa for help. That shopping list becomes available in their Echo apps for perusing later on. xviii

Target’s Cartwheel app simplifies your trips to the store and online orders by gathering up hundreds of deals in one place. Create a list of your go-to items and it will tell you which ones are currently on sale. Another handy feature: a map of where to find those specific products in the store.

Supermarket Check In is a social app which allows people to check their local supermarket queue and stock level information, added by other users, and then ‘check-in’ themselves after they shop to share their experience.

Lidl Ireland’s WhatsApp Chatbot helps you shop at the quietest period. Simply send a message with the day and time you intend to visit and it’ll instantly let you know whether that’s a Quieter/Average/Busier time to visit.

German supermarket chain Edeka has introduced a robot called Pepper to teach customers how to appropriately social distance during the coronavirus outbreak. And, as you can see from this tweet, it gives out to people when they don’t follow the rules. xix

IMPLICATIONS GOING FORWARD FOR CREATING A GREAT RETAIL EXPERIENCE.

The Covid-19 crisis has highlighted the essential role, which had been taken for granted, that the supermarkets, delis, butchers, bakers, green grocers, and retail outlets of all descriptions play in our day-to-day lives. eCommerce has been overwhelmed and while it has a brighter future as a result of the crisis, what is clear is that the phoney war between bricks‘n’mortar and virtual eCommerce is over.
The future of Retailtainment lies in a symbiotic relationship between digital commerce and physical stores – Phygital. This blended customer experience will enable an emotionally engaging retail experience, with the potential to continually surprise and delight customers.
Retail will continue to adapt, rapidly in some cases, in the immediate future. Going forward there are five aspects that retail and brands will need to focus on to create emotionally engaging customer experiences. The fundamentals of great customer experiences and Retailtainment are as important as ever and must remain a key focus for retailers and brands alike.

PEOPLE: The future of retail will continue to be people centric. Staff are more important than ever in creating engaging customer experiences. Customers judge their experiences primarily based on how they felt at its peak and its end [The Peak-End Heuristic – Daniel Kahneman]. Staff are often the final point of contact with customers and can make the difference between customers just remembering a store and actively returning to and recommending that store to others.

SPACE: The in-store environment can significantly influence the mood, feelings and behaviour of shoppers. Creating a safe, secure, and relaxed environment for shoppers is of paramount consideration at present and likely to be relevant for the foreseeable future. Be choiceful in how space is utilised in-store; lighting, fixtures, signage all have a role to play in enhancing the customer experience.

COMMUNICATIONS: Will continue to play an important role in helping shoppers to intuitively navigate the in-store environment, while abiding by the new shopping etiquette, and find the items that they are looking for. Figuring out creative ways to disrupt and engage shoppers in a meaningful way will be as important as ever.

TECHNOLOGY: Can help to take the friction out of shopping: 100% contactless payments; managing queues; keeping shoppers at a safe distance. However, it can also help to surprise and delight customers, through serendipitous discovery of new and interesting solutions, gamification and reward loyalty.

PLANNING: Make a virtue out of necessity, by utilising appointment bookings or virtual queuing, to control physical numbers in store with the added potential of a more personalised, premium experience. Brands need to find ways to extend their influence in the customer journey prior to visiting the store or website, through social and digital media as well as creating great at home usage experiences.

Lets Talk

To find out more on this topic, arrange a presentation or discuss how we can help your business navigate through Covid-19 and the post Covid-19 retail landscape, please contact:

robert flavin

ROBERT FLAVIN

Director, Strategic Planning at V360°

i European Journal of Social Psychology. ‘How are habits formed: Modelling habit formation in the real world†’ Philippa Lally Cornelia H. M. van Jaarsveld Henry W. W. Potts Jane Wardle. First published:16 July 2009.

ii BeyondRetailIndustry.com. ‘Retailtainment: the convergence of leisure, entertainment and retail’. May 2018. LINK.

iii Salesforce Q1 Shopping Index. Online Retail Revenue Grows 17% in the UK. 01 May 2020.

iv ECR Ireland Covid-19 Webinar 4 – Shopper Intelligence The Irish Grocery Shopper Covid-19 14 May 2020.

v AustralianBartender.com. ‘Monkey Shoulder’s Monkey Mixer is partnering with bars to deliver free cocktails’. May 2020. LINK.

vi TheProgressiveGrocer.com. ‘How Zoom can help grocers during Covid-19. May 2020. LINK.

vii Bionic….. eCommerce Advertising BEST PRACTICE REPORT 2020 – April 2020.

viii Facebook For Business – We Make-up Increasing sales with Facebook’s Augmented Reality ads 2020 LINK.

ix Snapchat.com. ‘Ralph Lauren combines AR lenses and Snap Ads to drive +19% lift in sales on their website’. December 2019. LINK.

x Snapchat.com. ‘Snapchat drives 40% higher ROI for Nisnass’. May 2019 LINK.

xi Mobile-AR.Reality.News.com. ‘Burberry teams with Google Search to let you browse high fashion in augmented reality’. February 2020. LINK.

xii PRNewsWire.com. ‘Jenzy launches foot-sizing and eCommerce app to make online shoe buying for young children a perfect fit’. June 2018. LINK.

xiii CNBC – Here’s how you’ll be safely shopping for clothes as stores begin to reopen 11 May 2020. LINK.

xiv CNBC – Here’s how you’ll be safely shopping for clothes as stores begin to reopen 11 May 2020. LINK.

xv Harvard Business Review. How Chinese Companies Have Responded to Coronavirus March 2020. LINK.

xvi RetailCustomerExperience.com. ‘Covid-19 will bring lasting innovation to retail’. April 2020. LINK. SpringWise.com. ‘Chinese beauty retailer moves in-store advisers online during Covid-19. March 2020. LINK.

xvii Interact-Lighting.com. ‘A personalized, frictionless shopping experience’. May 2020. LINK.

xviii GoodHouseKeeping.com. ’10 best grocery shopping list apps, according to nutrition and tech experts’. April 2020. LINK.

xix RetailTechInnovationHub.com. ‘Edeka deploys Pepper robot to combat coronavirus.’ April 2020. LINK.