Experiential Retail

Adding value to the customer’s journey

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While once retail stores existed strictly as a place to transact they have started leveraging experiences to customers rather than products. Rajiv Sheth explains how brands and retailers are building value for the customer through an immersive experience.

The retail industry is going through a transformation. There is no longer a need to step into a store to buy a product. Now you can buy whatever you want, wherever you want. All it takes is a click of a button and a good internet connection. This transformation was already happening and with the covid-19 pandemic, it just gotten more rapid. When the industry gurus state that technology has changed the way we shop, the reference is not just to the increasing popularity of online purchases but also to the makeover of brick and mortar stores. The physical stores as they existed – a place where a product or service was sold in exchange of a cost – are facing a moment of reinvention. To survive, they have to offer an experience to the customers that cannot be replicated online. No wonder, physical stores are revamping their stores layout, services and customer journey to become more of a discovery or experience zones for the brands. Coresight Research had predicted the year 2019 to be the year of reinvention for the retail sector as shoppers increasingly expect “Smart Retail” interactions. Pair this expectation with artificial Intelligence, and you have the key to unlock the customer’s interest and involvement in your brand through ‘experiential retail’.

How is experiential retail different from its traditional form? While retail continues to be a place where customer needs are addressed, what is new is the way the customer is introduced to the products. The in-store services are built in a way that stimulates the customer’s senses. 

Fragrance brands: the pioneers of experiential retail?

Interestingly, what the retail industry is waking up to now, has been the norm in the fragrance sector. Take for instance, the example of Cleopatra. It is documented that before the Romans saw her, they smelled her. She announced her arrival to Rome, a place alien to her, by perfuming her boat with roses, and having all its streets adorned by its petals. The olfactory marketing techniques have always revolved around immersive experiences. Did you know Coco Chanel started influencer marketing much before it was in vogue? Before the launch of her first fragrance, she invited a group of elite friends to dine with her in an elegant restaurant where she surprised and delighted her guests by spraying them with Chanel No. 5. On the official launch of Chanel No. 5 which was in her Rue Cambon boutique, she infused the shop’s dressing rooms with the scent. The success of Chanel No. 5 was immediate. 

It’s a challenge to sell fragrances online, especially new ones, as the customer cannot decipher the fragrance through the sight of the bottle or the list of ingredients. That’s why fragrance brands are always looking at innovative ideas to immerse the customer in the brand journey. In recent times, the retail experience at the Le Labo store has inspired many brands from different sectors to customise the customer journey. So, when you walk into the Le Labostore, which has vibes of an old apothecary, you get to not just smell but also have your perfume of choice made right in front of you. Now, that’s a personalised experience, specially appealing to the individualistic millennials, which online shopping can’t match. 

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Experiential retail is immersive and instagrammable

Big brands are investing heavily into creating experiential flagship stores that offer more than just products. These spaces are aesthetically designed which inspire social media worthy pictures. Unlike in the past, where the staff was meant to put on a snobbish air and entertain only those who had potential to buy, now luxury brands are becoming more inclusive. They are not averse to the idea of people visiting these stores just for the Instagram pictures, which in turn introduces them to the brand.Most brands are finally acknowledging that user-generated content is a cost-effective way of marketing and engaging with customers.

Early this year, MAC Cosmetics has opened an experience centre in Shanghai which crosses the divide between the physical and virtual worlds. The store, brings together product discovery, social engagement and purchase for an interactive retail experience for customers. As you enter the centre, digital totems greet and invite you to scan for a check-in, using MAC’s Wechatmini-program. In the lipstick section, customers can try the latest shades via a virtual makeup mirror, letting them sample 18 lipstick colors in 30 seconds. Move further and on the next floor, there is an open platform space for master classes and influencer events, letting influencers create their own events and content.

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Discovering the brand through sensorial experiences

Stepping in a store is no longer need-based rather it’s driven by a desire to experience something new. In an absolutely clever marketing strategy, Casper Sleep, a US based e-commerce company, created the Dreamery in New York, a space where the city-tired population can take a 45-minute nap for $25. Here is a store where you can pay to sleep in a private sleeping pod using Casper mattress, sheets, and pillows, along with a fully-equipped bathroom to freshen up after your nap. So, while people may not end up buying the mattresses, they are getting an entry into the calming world of Casper. Let’s go a little back in time and revisit Apple’s tactile approach, where the even the not-so-potential customers were encouraged to discover and touch the products instead of watching them in a box. The process of discovery drives the need to make a purchasing decision.

This reinvention holds true for the entire sector, not just the big or luxury players. Even the relatively smaller brands have to engage the customers in their story and get them as an insider.

Not just in malls and stand-alone stores but in airports as well, brands have to take step towards products that offer an experiential dimension, especially to match the customer expectations in the travel retail segment. Earlier travellers would drop in shops as a way to kill the waiting time. Now they have so much to distract them from shopping, whether it is variety in food & beverage and free wifi that the brands have to pull up their socks and work to deliver more than just great merchandising of great products.

Service is the key

While Instagram-worthy spaces are trending at the moment, what cannot be ignored is the quality of service. Experiential retail also includes making shopping easy, quick and convenient for the customer. Engaging with the customers on a one-to-one basis rather than looking at a pure buy/sell approach is the future of retail.Whether it is entertainment, education, discovery, convenience, picture-worthy interiors – the question the brands should ask is – what can our brick and mortar retail space offer the customers which they can’t access online? With the new normal of social distancing, wearing masks & mind-sets of people, worldwide the traditional retail format in all sectors will need to reinvent themselves extremely fast to survive. 

Author :  Rajiv Sheth

Rajiv Sheth is the Founder , ‘Nose’ & CEO of All Good Scents , a contemporary perfume company. He is on a mission to spread good ‘fragrance’ and share his perfumery expertise and knowledge.