What's Next for Retail Environments: Social Experience Retailing
Historically, conventional wisdom suggested that retail environments be updated every three to five years to remain “fresh” and plugged into the consumer marketplace. Today, the cycle is more of an ongoing process, say experts at Gruskin Group™, one of the nation's leading retail design firms, and “social experience retailing” where their virtual and real world strategies converge, is pivotal to how retailers will keep their customers engaged.
“The explosion of technology and the subsequent real-time access to thousands of petabytes of data through smart phones, tablets, and computers, coupled what we refer to as the four 'C's' – convergence, convenience, connection, and cost – are having a meaningful and collateral impact on retail. This, in turn, has allowed fickle consumers in our 'immediate gratification' environment to flip the personalization promise on retailers from the very nice 'have it your way' offer to 'provide it my way or it's the highway,” explained Kenneth A. Gruskin, principal and founder of Gruskin Group.
“As a result, retailers are rolling out 'experience store' concepts, combining physical and virtual strategies with localization and individualization to keep customers engaged and their brand relevant to their physical and digital lives,” Gruskin noted.
According to Gruskin Group, in order to offer this kind of social experience retailing, retailers will offer their own unique recipe of the 4Cs, which are defined as follows:
Convergence: with the unification of social networking, commerce, and technology, augmented reality (AR) will become a key technology that will help to close the digital divide that separates our physical and virtual domains. Also, retailers will form brand sharing partnerships to provide compelling alignments that will attract customers and get them invited into their lives and communities through the integration of SER (social experience retailing) and CTR (convenience transaction retailing).
Convenience: retail products, services, and virtual goods being provided through multiple physical and virtual channels will become ubiquitous to the end user. Localization will become “neighbor hooding” with virtual, smaller and better trained, localized brick-and-mortar facilities supporting a retailer's embedded customer base while offering a global reach. The supply chain distribution system will be updated to provide instant gratification by delivering goods and services immediately from anywhere to anywhere. Further, technology and systems will empower customers to learn, explore, and make knowledgeable, informed purchasing decisions wherever they are.
Connection: Successful retail brands must continuously establish deep, personal relationships with their customer and reflect their value and core beliefs with authenticity if the brand is to be seen as an extension of who “they” are. The brand and retail experience must be literally connected and accessible to the individual wherever they are through the web and local brick-and-mortar stores alike (which celebrate the community in which they are located). As a result, the design of all of these retail touch points, both physical and virtual, will be more important than ever to keep a brand positioned to be visible, to maintain/improve its perceived value, and to help individuals identify and stay connected with retailers that align with their core beliefs and lifestyle.
Cost: For the individual customer, cost will be based on their personal view of the perceived value of the product or service being offered. For the retailer, cost will primarily be a function of whether SER or CTR is the priority. If CTR is paramount to the retailer, lowest cost and convenience will be the priority. For those with SER as the end goal, brand equity, alignment, and integration with their personal goals, lifestyle/life stage and community will be crucial. For both SER and CTR, global/local manufacturing approaches and supply chain management will not only continue to have huge cost implications, but as customers demand personalization/ individualization of all of their goods and services, being able to manage the costs of customized, mass produced goods “on-demand” will prove to be the real challenge.
“Total convergence of the virtual and brick-and-mortar retail experience empowered by social networking concepts and technology is inevitable. And the relationship between brand equity and cost will be shaped to a large degree by how consistently retailers deploy their brand image. For retailing, it means the next 10 years, the next 40 years, will be exciting times of experimentation and constant reinvention,” Gruskin added.
About Gruskin Group™
Gruskin Group™ is an integrated design firm that builds unified brand experiences through architecture, brand development, visual communications, web/interactive, industrial design, interior design, strategic consulting, and sustainable design.
Ranked by DDi magazine as one of the top 20 retail design firms in the U.S. for the past three years, Gruskin Group was named to the Inc. 5000 in 2009 and 2010. The firm's and its professionals' award-winning work has been recognized by AIA, the Retail Design Institute, New York Ad Club, New Jersey Ad Club, ASID, Graphis, and the Association of Graphic Communications. For additional information, visit www.gruskingroup.com