It’s no secret that retailers have come to the realisation that simply selling a product at the best price is just not enough to lure in customers and keep them loyal to their brand anymore. Now, ‘experience’ is the name of the game and bricks-and-mortar retailers in particular are considering creative ways to go above and beyond for time-poor shoppers. Enter the recent rise of retail services in physical stores and even shopping centres. Mecca Cosmetica’s new store redesign is more serv
ice-orientated and incorporates dedicated spaces for added skin consultations and group make-up workshops.
Part of Kikki.K’s future plans involve creating a workshop program which can be exported overseas – this includes classes on mindfulness, organisation and setting goals.
Recently, Myer has opened barbers, blow dry bars, nail salons and personal shopping at selected stores.
Meanwhile, Healthy Life has just launched an in-store experience centre named the Wellness Hub, where customers are offered advice on topics such as how to get a good night’s sleep and breastfeeding.
According to retail strategist Matt Newell from The G Store, back in the day, the role of the retailer was to sell brands in their stores, while the brands themselves, like Coke and Pepsi, were in charge of creating engagement with customers. Retailers would compete more on supply chain than the demand side of the equation.
“It’s now transitioning into retailers building their own customer relationships in their own right. So now they’re building more engaging things from a demand point of view, like running advertising campaigns and creating more engaging stores. There’s been a power shift from product brands to retail brands,” Newell explains.
“[Retail services are] like an extension of that continuum in that quest of retailers to own more of the customer relationship. It’s not just about what your store looks like now, it’s about how staff interact with customers on a basic level, it’s about expertise that has value associated with the service experience.”
Supercheap revs up services
Earlier this year, Supercheap Auto unveiled its new flagship store in Penrith in western Sydney amid great fanfare and a renewed focus on customer experience and services. Some of the services now on offer include Tesla electric vehicle charging, nitrogen tyre inflation, windscreen chip repair and baby seat fitment demonstrations.
Recently, the brand teamed up with Bosch to open full service auto workshops in the greater Sydney area.
“This emphasis on services and solutions is at the heart of our differentiated customer offering, and an increasingly important part of our business. We see a significant opportunity to present convenient and cost-effective solutions for our customers that are provided by our passionate team members,” explains Super Retail Group CEO Peter Birtles.
“This has underpinned the significant growth in fitment services that we provide through our network of Supercheap Auto stores, the access to third-party service providers that we provide for our customers through our website, and the early stage development of our joint venture with Bosch to provide car servicing through the ‘Auto Crew powered by Supercheap Auto’ brand.”
It’s well-known that customers are now choosing to spend less money on products and more on services and entertainment. As Birtles says, customers want a solution which can be delivered through a combination of products, advice, information and services.
Due to the increasing complexity of vehicles, this trend towards more retail services is even greater. Not only do customers want to spend less time working on their cars, even if they wanted to, it’s becoming harder for them to do so. It’s what Birtles describes as a shift from the typical ‘do-it-yourself’ customer to the ‘do-it-for-me’ shopper.
“In the current environment, services are an opportunity to differentiate your customer offer from the competition, particularly from those business that do not have a physical presence,” he says.
“Services provide the opportunity to build a much stronger relationship with the customer – I always say that we will build a much stronger and more enduring relationship with the customer who we helped catch the ‘barra’ they’ve been chasing than the customer to whom we sold a fishing rod.”
Shopping centres up the ante
It’s not only retail stores that are increasing their services either. In an effort to combat online retailers and entice more customers away from their devices, shopping centres are also becoming more diverse in their range of offers, from banks, health insurers and eyewear services to drycleaners and hair and beauty salons.
According to John Schroder, CEO at Stockland, 17-18 per cent of the total proportion of gross rent paid in the company’s portfolio is in apparel, kids, men’s, ladies, unisex, surf wear and jewellery. Meanwhile, services makes up another 18 per cent of the business – it produces the same level of gross rent as fashion and jewellery.
“At Wetherill Park, we’ve a 24-hour pharmacy and when we re-developed it, we worked closely with them to make sure they had the right amenities and external-facing nomenclature and that they were adjacent to convenient parking, because it’s what they need as a 24-hour pharmacy,” Schroder said.
“At Balgowlah on the northern side of the harbour, at that Stockland in Cammeray, what’s on top? A 1,500sqm childcare facility called Little Dove Childcare. It’s been there since we built it and it’s very, very successful.”
According to centre manager Gerard Coorey from Chevron Renaissance Shopping Centre in Surfers Paradise, childcare centres help to extend the hours in which shoppers are visiting the centre. In fact, next year, Chevron will open the first and only childcare centre in the area.
“With the childcare centre having capacity for 88 children, there are parents who will drop their kids off in the morning and pick them up at the end of the day. It’s another destination that attracts people to the centre and gives residents a reason to purchase or live here. It’s all about having the right tenancy mix, offering convenience and giving the centre a point of difference,” Coorey says.
“There are plenty of other novelties in Surfers Paradise with games and the beach, but people tend to forget that people in holiday mode also need basic services and it’s nice to have a spa, the services of the banks and a Flight Centre. Services are critical and we don’t want to be a centre with just gift shops and food. We want to cater not only to tourists, but to the local market as well.”
A new light rail has also recently been built near Chevron, so it is now much easier for customers to shop at the centre, too.
“It’s given us another avenue of accessibility and convenience. People don’t have to go to larger centres if we’ve got key services like banking, travel and hairdressing – it’s easy for them to come in and experience a bit of downtime with the kids instead of just going to the beach,” says Coorey.