The physical demise of high street clothing brand Topshop signalled the turn of the UK’s retail sector. As the flagship store closed in 2021, the physical became digital, and the brand was picked up by online retailer ASOS – a move demonstrating the appetite and continued willingness of UK consumers to shop virtually. As the rise of online shopping continues, how can marketers seize the digital opportunity? And is there a role for the physical store anymore?
In a panel discussion spearheading The Drum’s latest Deep Dive: The reinvention of retail and ecommerce, The Drum’s Olivia Atkins speaks with experts from VMLY&R COMMERCE and Heal’s on how to assess the changes in customer experiences; the technology pushing the sector forward; and how agencies and retailers can prepare for what lies ahead.
Brand purpose is here to stay
E-commerce in the UK grew by 46% last year as the pandemic forced stores to close, driving consumers online from the lockdown convenience of their homes.
“People who buy online now are used to buying online – they’ve adapted to the price and the convenience of it; and recognize the advantages of doing so,” said Debbie Ellison, global chief digital officer at VMLY&R COMMERCE, who believes these habits may be here to stay.
Online shopping saw many customers become more aware of their purchases and look into the purpose of the brands they’re buying from – a trend perpetuated by Gen Z.
Ellison recognizes the spending power of Gen Z and their influence in pushing retail trends forward. She suggests brands need to become more relevant to their audiences or risk seeming redundant.
She thinks, “retailers should respond to their shopper’s needs and communicate their brand purpose at shelf – whether that’s in a physical or digital space. In physical retail environments, marketers easily understand their local community and how to engage there. This same logic needs to be applied in the digital sphere.”
David Kohn, customer and e-commerce director at furniture retailer Heal’s, agrees: “Purpose is the single biggest social consumer trend that we're seeing at the moment. In retail, that translates to being a brand that stands for something – whether that’s environmentalism, diversity or even quality design.”
Physical versus digital
Despite the surge in online shopping, retailers should work to embrace both virtual and physical spaces for their brand, as certain purchases may require prospective customers to shop in-person to get a sense of their desired products.
Ellison said: “Over the last year, there’s been a pent-up demand globally to get back in-store with consumers wanting to experience something special. Retailers will be listening to that and thinking how to differentiate their offerings across channels.”
The focus for retailers is to understand the role and purpose of every space they have. Ellison suggests that in-store offerings could feature more sensory experiences where the social aspect of shopping is considered along with how to improve the service and looking at how consumers interact. Technology also works to scale up connected experiences, by automating backend processes and improving the consumer’s experience.
Kohn adds: “Technology in-store can be useful for getting your consumers to imagine. At Heal’s, we try to bring them into our world and get them to visualize our products in their home.”
He’s excited about the prospect of incorporating new technology like virtual reality (VR) in stores, believing it will be a great device for reviving storytelling methods in retail.
Merging e-commerce with in-store
“We've all moved online; we’re all inspired and purchasing within milliseconds,” says Ellison. “But now that the gap between inspiration and purchase has converged, how is that going to translate into the physical retail space? How will creativity be brought through each touchpoint to deliver on both the emotional and functional aspects of buying?”
Despite this change in habitual consumer behaviour, Kohn suggests that retailers need to reassess how they use each space and set them up accordingly to ensure they cater to customer needs. He gives the example of Heals’ online in-store teams who work to connect customers online with relevant store team members.
“As a brand, you’ve got to think carefully about your customer’s purchase journey,” he says. “Try to understand where the customer fits in and what you can do to move them along that process. That's where the fusion between in-store and online can come into being.”
It’s been a trying time for retailers but having a clear understanding of what consumers need and want from each space will only help brands to move more seamlessly between their online and physical offerings. Customers are already overwhelmed by the amount of choice available to them in the marketplace, so brands need to work hard to stand out.
“Selling products is not enough anymore,” said Kohn. “You've got to look at the wider needs of your customer and work towards fulfilling those.”
Ellison agrees and concludes: “Brands need to walk in their customers’ shoes and really look at how they will show up in a connected way across all their different channels.”