The Retail Revolution: Success in the New Era

Editor’s Note: People who know me well know that cheese is one of my basic food groups (along with wine).  I’ve always loved cheese.  There are several markets in my area that have nice cheese selections, but there’s one star in particular that I tend to gravitate to because they always have many different kinds of cheese out for customers to sample.  The selection varies day by day, and it’s just a great way to find something new and interesting.  They’ve turned buying cheese from just another purchase to an experience.  Fiona Blades discusses in this post how creating in-store experiences can revolutionize brick and mortar retailing in the face of the online onslaught.  Pass the cheese plate!

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We are surrounded by headlines like “America is facing a ‘retail refugee crisis’ as thousands of stores shut down and millions of people become the ‘blacksmiths of their era’” (Business Insider, September 2017). We knew that digital would transform retail as we knew it. But the speed is startling!

Back in 2011, we spotted a trend. Within two years the percentage of people reporting experiences in store for our client had halved! Further digging revealed that people were, indeed, going online, mainly to retailer websites. Moreover, we saw this early in the path to purchase, when they were researching what brand to buy, and towards the end of the journey, when they were searching where to buy their chosen brand at the best price. This insight changed the way our client worked with their retail partners.

Customer Values

We had no idea how radically the retail landscape would be changing in the next 5 years. We analyzed thousands of retail experiences in the MESH database to see what people value most:

• Sampling. Consumption touchpoints are normally the most engaging and persuasive experiences that people have with brands. So, getting to try the product in a retail environment is very powerful.
• Speaking to assistants. A great staff interaction transforms a retail experience.
• Touching and feeling the product. Reading about the car online isn’t the same as sitting inside the car, smelling the leather and holding the steering wheel.

These give us clues to how bricks and mortar retail can be re-purposed. It needs to transform from transactional to experiential. The purpose of bricks and mortar retail is no longer to generate sales but to build brands. It needs to be on the media plan alongside TV and other brand building channels.

We are now seeing brands creating amazing brand touchpoints in retail. Take Hermes Dip-Dye Laundromat in pop-ups across Europe and the US. Customers are invited to bring their Hermes scarves, dye them and fall in love with them all over again. And what about the Magnum Pleasure store, another pop-up which sees lines around the block as customers await personalized confections that gleam like jewels?

These brands understand that the experience people have in these stores will have a long-term effect. Seeing and tasting the quality of a gorgeous Magnum ice cream has a greater chance of changing brand perception than being told about it in a TV or press ad. What’s more, not only is the depth and quality of experience greater but, with social media, the spread of messaging to friends and relatives means that those who haven’t ever been will hear about it.

If retail is transforming, we need new frameworks and tools to measure its impact.

We believe that in today’s world marketers should take an Experience-Driven Marketing approach.  We have discovered that Share of Experience (SOE) (all paid, owned and earned media) has a greater correlation with market share than Share of Voice so think “SOE” when it comes to deciding investment levels. A Positive Experience has three times the impact of a neutral one on brand consideration. So, if you want to grow your brand, ensure you are generating more positive experiences. You can give your brand an unfair advantage through message, placement, and context.

In terms of measuring the success of retail activity, we would advocate a couple of points:

• Compare the quantity and quality of retail experiences in the context of all other paid, owned and earned media.
• Don’t stop at sales, measure emotional response to retail display.

New tools can help us. To maximize the impact of retail, it is important to place retail in the context of all your other touchpoints to see whether to invest more here and less elsewhere.

More recently we have started using new tech-enabled tools within retail displays and have developed a way to evaluate retail display using cameras and algorithms, without video and the need to store personal information.

Let’s look at a case study

For Unilever, we took a store in Sao Paulo where we wanted to assess the impact from a change of store display for Knorr Seasonings. There was a new healthier seasoning range with natural flavorings and 25% less salt. To communicate this there was a shelf hanger “stopper” placed on either side of the product range. We compared two periods to see the change in shopper display interaction. The first, during November, had no display. The second, during December, had the display material. To contextualize our data, we used Google’s Popular Times feature. Of course, for a bigger study, we would envisage putting in cameras to understand footfall to the store and to the aisle and contextualizing with sales data, the weather, and other data streams.

We also created specific terminology:

• A viewer is someone who looks at the display for at least a second.
• Noticeability is the number of viewers.
• Attention is how long the viewers looked at the display.
• Engagement is the percentage of the viewers who displayed a happy, smiling emotion whilst looking at the display.

Results

• Even with relatively small pieces of display (the Shelf Stoppers) we see a massive lift in Noticeability with over three times as many viewers. Of course, we need to better understand why. Maybe more people walked down the aisle? By putting another camera to observe traffic we could account for this.
• Noticeability is relatively flat when there is no display (except around lunchtime on weekdays) but, for the display period it seems to stand out around peak times. Is this new information catching people’s eyes?
• The display seems to be noticed more by men than women and this is particularly the case during those peak shopping times.
• On average people pay attention for just 3 seconds. And most peak time views only last a second. So, it’s important that your message is easy to take out.
• The percentage of people displaying positive emotions is fewer with a display than no display. Is this because we are capturing the attention of those not looking to buy stock cubes. We pick up a variety of emotions so there is plenty more analysis needed to understand how display is impacting on people’s emotional responses. For example, are they irritated to be interrupted in their shopping? Even if the display is not generating engagement, as it is getting noticed it should be increasing awareness and therefore longer-term brand building.

In terms of implications, we are seeing billions spent on display with a dearth of evaluation. Technology can help marketers understand the return on their investment. With real-time camera ethnography, we can see how many people the display is reaching – much more than store traffic, location matters. We can see whether the display is engaging people, doing a brand building job and converting to a sale. Moreover, this new technology enables us to do this cost efficiently without the privacy issues of video.