We’ve all heard and read the headlines by now. ‘Bricks-and-mortar is dead’, ‘E-commerce’s rise spells end of physical retailing’ and many more of that ilk.
But the reality is that shopping is now a hybrid experience where shoppers move between the physical and digital worlds of retailing as they research products and make purchases.
McKinsey research into online shopping trends in Australia in 2019 found 85 percent of Australians are more likely to shop in store for groceries; 75 percent to buy supplies for a DIY project; while 72 percent will head in-store to replace their television.
For these products, McKinsey said the research shows stores still offer what online cannot: shoppers prefer to see and feel the merchandise and value stores for sales advice on big ticket items.
Meanwhile, the latest Australian Bureau of Statistics retail data found online retail turnover contributed 7.1 per cent to total retail turnover in November 2019 – the crucial festive-season shopping period. Then there’s the 2019 e-commerce industry report by Australia Post, which found online contributed 10 per cent of total retail sales in 2018.
Physical retailing is not sick or on the way out – it is merely changing.
Showrooming or webrooming?
Consumers now have the power to research products in-store and buy online. Consumers also do the opposite, research online and buy in-store.
“While online shopping is now part of our DNA, shopping centres will continue to thrive as places for the community,” says Selena Atkinson, director and owner of retail interior design firm, Dovetail Design Group.
“E-commerce is just an extension of the retail environment and means store design needs to be more compelling, destinational, and respond to its unique location.
“Retailers need to be seen in this space to retain credibility, be memorable, stay relevant and be accessible. Essentially, providing them with the opportunity to express the physical qualities of their brand and customer experience.”
According to McKinsey, while retailers operating in the grocery, DIY and electronic goods space are likely to maintain the amount of selling space they operate, the design of stores may change to better cater to customer missions. For example, by shifting to smaller format stores in high-foot traffic locations.
Over the last 10 years, Atkinson says changing demands have culminated in a focus on smaller footprints with rationalised product ranges. Conversely, shopfronts have become wider and more inviting while store layouts create specific areas of focus, with the goal of creating better navigation for enhanced customer experience.
“Store design needs to respond to regular adjustments to range or categories by incorporating flexible display solutions and layouts,” says Atkinson.
“Time frames are also shorter and design needs to be agile to capitalise on lease opportunities with restricted handover periods. Time is money in retail and more sensory elements and wow factor are expected, but budgets are tighter – design needs to be resolved with changing requirements and financial conditions.”
And with more innovation expected by consumers, design elements have to be suitably creative. Captivating signage, environmental graphics and digital displays are now standard integrations along with unique high-quality finishes and fittings.
In-store activities – including product trials or personalisation of items – are now expected by customers, who have a greater range of lifestyle influences and higher expectations.
“The design process is becoming more collaborative between designer, retailer, landlord, and shopfitter,” says Atkinson.
“If we understand the constraints that each party is under then the design can be more accommodating and tailored.”
What can you offer?
So, if the store is not dying, but its role is adapting to the demands of modern retailing, how can consumers be enticed to stay longer and return more frequently?
Atkinson says introducing suitable lifestyle and service offers into the environment that compliment a retailer’s primary offer can attract and drive repeat visitation. This builds a human connection to drive traffic. Think books and coffee, beauty products and brow bar, plants and gardening workshops.
Improving the overall shopping centre experience through interior design and environmental graphics allows destinations such as fresh food markets, dining and entertainment precincts to shine.“Centres are making carparks and customer journeys more welcoming by adopting friendly wayfinding and decorative environmental graphics to create a better customer experience before and after purchase,” says Atkinson.
This also means providing better facilities; carefully designed toilets and amenities that are comparable to those found in hotels, larger and more comfortable parent rooms, designated children’s precincts with playgrounds adjacent to great cafes and comfortable Uber waiting areas.
Relaxed, ambient seating zones and charging facilities or places where someone can work with their own technology are all aimed at keeping people in centres longer.
“Shopping centres went through a period of paring back the design elements and we ended up with architectural spaces that lacked intimacy and interest,” adds Atkinson.
“The current trend is to layer in enhancements to create themes and a sense of place. The result is an aspirational environment that makes shoppers feel good in a leisure-focused destination where they can meet, dine, do business or be entertained – shopping almost becomes a secondary activity supported by a cast of experiences.”
Find out more ways to increase dwell time and keep customers coming back at Dovetail Design Group.