1. REimagining
the retail store – thought starters from
the shopper’s perspective
NRF Innovate 2011
Dr Alan Treadgold
Global Head of Retail Strategy
Leo Burnett Group
Wednesday, March 23, 2011
2. Who we talked to
2200
US Adults
Online Survey
40 Retail Brands June 2010
Wednesday, March 23, 2011
3. What we asked them
What stores do shoppers like to visit and why?
What makes stores interesting and inviting
to shoppers?
What are their expectations for personal service
within the store?
What role does the store visit play within the overall
shopping process?
What role does price play when shopping in a retail
store?
How synergistic does the store need to be with other
shopping channels?
How does the use of technology influence and
enhance their store visit?
Wednesday, March 23, 2011
5. Writing the obituary for
the retail store is very
premature…
Wednesday, March 23, 2011
6. But the relationship between the retailer and the shopper has changed
Past:
the store managed
the shopper’s experience
Today:
the shopper manages
her own shopping
experience, in-store and
beyond
Wednesday, March 23, 2011
7. Understanding the new landscape for retail stores
8 DYNAMICS
Wednesday, March 23, 2011
8. Key Finding Shoppers organize stores in terms of
the experiences they want to have,
1 not just the merchandise they want to buy
Wednesday, March 23, 2011
9. Shoppers distinguish 6 types of stores
Price led All about ease
Low prices important, self service can help. Convenient locations. Get what you need in time.
Convenience and good return policies. Store May include self-service. Don't tend to have good
environment lacks inspiration. Service can be return policies. Don't offer inspiration, but doesn't
lackluster. In-store experience doesn't offer much matter. High penetration and frequency in physical
that consumers can't find online. store. Lowe web penetration.
All about atmosphere Ideas led
Extraordinary in-store experience. Fun for A bit experimental. Have greater product selection
consumers, even if they don't buy. Don't tend to than other cluster. Appealing displays. Offer fresh
sell wide array of products. Prices thought to be ideas and unique products.
high.
Price plus Efficient errands
Good value on what they sell. interesting place to Convenient locations with decent service.
shop, but not as much so as other clusters. knowledgeable sales people. Lack interesting
Frequently add new merchandise. Shoppers take environment. Seen as pick-up places.
their time. Offer a more seamless online and
offline experience.
Wednesday, March 23, 2011
10. How shoppers cluster stores:
Buying vs browsing; self-directed vs retailer-guided
Buying
Price Led
All About
Ease
Price Plus
Efficient
Errands
Self Retailer
Directed Guided
Ideas Led
All About
Atmosphere
Browsing
Wednesday, March 23, 2011
11. “Price Led” stores
Buying
Neighborhood
Market
by Walmart
CVS
Walmart
Price Led Sears
Target
Best Buy TJ Maxx
Self Retailer
Directed Guided
Browsing
Wednesday, March 23, 2011
12. “All About Atmosphere” stores
Buying
All About
Self Atmosphere Retailer
Directed Guided
Nordstrom
Barnes and
Noble
Aberchrombie Pottery
Barn
Williams Sonoma
Tiffany’s
Bass Pro
Browsing
Wednesday, March 23, 2011
13. Key Finding
2 It’s not just about price,
shoppers want everything else too.
Wednesday, March 23, 2011
14. Price is important.
But so are quality and
experience.
Price is the most important consideration in choosing a brand.
36%
The most important thing when shopping is to find high quality products.
42%
When it comes to stores, it’s important to me to go to those that have high quality products and
excellent service. 42%
Wednesday, March 23, 2011
15. Key Finding
Shoppers are disappointed in
3 retailers’ ability to deliver the basics.
inability?
Wednesday, March 23, 2011
16. What matters most to shoppers: Importance
Convenient location 61%
Great selection of products 59%
Store I can trust 59%
Items in stock 56%
Has good value for the money 55%
Right mix of products 55%
Has a consistent online and in-store return policy 54%
Makes shopping quick and easy 53%
Good range of prices on the items I shop for there 53%
Prompt service 52%
Keeps prices lower than the competition 52%
Top-3 box agreement scores
Wednesday, March 23, 2011
17. What matters most to shoppers: Delivery
Convenient location 47% 61%
Great selection of products 47% 59%
Store I can trust 50% 59%
Items in stock 40% 56%
Has good value for the money 39% 55%
Right mix of products 43% 55%
Has a consistent online and in-store return policy 42% 54%
Makes shopping quick and easy 43% 53%
Good range of prices on the items I shop for there 40% 53%
Prompt service 38% 52%
Keeps prices lower than the competition 33% 52%
Top-3 box agreement scores
Wednesday, March 23, 2011
18. Key Finding Shoppers are largely unimpressed with
4
in-store service. It’s not just the delivery that’s weak
– it’s the service proposition itself.
Wednesday, March 23, 2011
19. Shoppers want more
Old school
(Acknowledgement)
New school
(Relevance)
Wednesday, March 23, 2011
20. They want real help to make better informed decisions
Easily accessible information in the store
46%
Help when they need it, but to be acknowledged
and left alone when they don’t 40%
Service personnel who are insightful and well informed
49%
Don’t want to wait 52%
Wednesday, March 23, 2011
21. Key Finding
5 Shoppers are promiscuous.
They shop around.
Their loyalty has to be earned every visit,
not just bought with a card in their wallet.
Wednesday, March 23, 2011
22. Loyalty to retailers is, for the most part, notably weak.
Loyalty is limited
even among a
store’s current
shoppers.
52% 48%
Definitely prefer to go to
this store or a
Don’t have a strong
preference
competing store
Wednesday, March 23, 2011
23. Loyalty programs have a role, but what
really keeps a shopper interested is a
new and fresh experience
each time they visit
Wednesday, March 23, 2011
24. Key Finding Eataly, NYC
6
Shoppers look to stores to
deliver what the web cannot
Wednesday, March 23, 2011
25. Physical stores perform better than the web
in several functional and emotional ways
The physical store is better than their website for… Average store
Getting it
51% Stores excel at being
pick-up points and
time savers.
Returning it 47% They do relatively
poorly when it comes
to stimulation and
learning.
Saving time
42%
Stimulating or entertaining me
32%
Learning about brands or products
26%
Saving money
25%
Wednesday, March 23, 2011
26. Physical stores should be able to
offer experiences beyond the
reach of the web
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27. Stores can become meeting
and gathering places for
like-minded enthusiasts
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28. Stores can offer learning
and participation
opportunities
Wednesday, March 23, 2011
29. Key Finding In-store technologies are often not
delivering on their promise of a better
7 shopping experience
Wednesday, March 23, 2011
30. Technology can enhance a shopper’s relationship with the store if
it delivers an enriching experience.
Technology
for efficiency
Technology to deliver more
enriching, engaging experiences
Wednesday, March 23, 2011
31. In-store technologies are being used to deliver on basics,
but at the expense of emotional engagement between the shopper and the retailer
Buying
Self Retailer
Directed Guided
Browsing
Wednesday, March 23, 2011
32. In-store technologies are being used to deliver on basics,
but at the expense of emotional engagement between the shopper and the retailer
Buying
Quick and easy self-
service checkout
Welcomes, tries to enhance
my cell phone use during A place to go pick up
in-store shopping something I've already learned
about online
Kind of store where I go on
their website on my cell phone Has put lots of technology
while I'm in the store in the store to improve my
information access
Makes it easier to
order online & pick-up
products at the store
Self Retailer
Directed Guided
Allows me to shop online
but return in-store
It’s easy to move between
their website and store - a lot
of synergy between them
Browsing
Wednesday, March 23, 2011
33. In-store technologies are being used to deliver on basics,
but at the expense of emotional engagement between the shopper and the retailer
Buying
A store I can trust
I can learn more about the merchandise
in the actual store than online or catalog
Has figured out how much or little
interaction I want with the sales staff
& has gotten it right
Self Retailer
Directed Guided
When I leave the store, I always
feel good - like I got something out
of the experience above & beyond
any products I may have purchased
The kind of store where I go
there more because I want to
than because i have to
Browsing
Wednesday, March 23, 2011
34. Technology can be used
to help establish trust
Wednesday, March 23, 2011
35. Technology can be used to
reinforce the breadth of
selection
Adidas virtual footwear wall features
4000 styles of shoes, and links to
Twitter and Facebook
Wednesday, March 23, 2011
36. Physical stores need to be made relevant with
Key Finding the Internet. It’s not stores or Internet, it’s
stores and Internet
8
+
Wednesday, March 23, 2011
37. Product
email
In-store
support
web offer
In-store
sale
Recycle
email
Wednesday, March 23, 2011
39. 8 DYNAMICS
‣ Shoppers organize stores based on the experiences they want to have
‣ It’s not just price – they want it all
‣ They’re disappointed in retailers’ inability to deliver on the basics
‣ In-store service is a real opportunity
‣ Loyalty has to be earned thru better in-store experiences
‣ They’re looking to stores to deliver what the web cannot
‣ In-store technologies are not delivering on the promise
‣ It’s not stores or web, it’s stores and web
Wednesday, March 23, 2011
