Why Consumers Crave In-Store Experiences
Online fashion retailer Piperlime recently announced plans to open its first brick-and-mortar location (the store will be in New York City). With this announcement, Piperlime joins Amazon.com, eBay, Google and other major online brands in a migration beyond the frontiers of the cybersphere and into the physical retail space.
Why would Piperlime want to leave the relative comfort of online-only for the notorious uncertainty of brick-and-mortar retail? Or for that matter, why would any other successful online brand want to do this? The reason is, like it or not, online retailers are beginning to realize that for certain types of products and purchasing scenarios, consumers crave in-store experiences.
The Value of In-Store Experiences for Online Retailers
Historically, lower overhead and other factors have allowed e-commerce brands like Amazon to undercut brick-and-mortar retailers on price, putting traditional retailers at a marked disadvantage in head-to-head product matchups against their online counterparts.
Online retailers’ expansion into brick-and-mortar isn't about leveraging price as a competitive advantage, it's about finding new ways to connect with the marketplace by tapping into the value propositions at the heart of the in-store experience.
- Human interaction: Online buying experiences are quick and convenient, but they don't offer the personal, human interaction that consumers get in-store. Brick-and-mortar retailers understand that strategic interactions with store personnel drive long-term customer loyalty and can be used to improve sales revenues and increase average order size by as much as 35 percent. Successful e-tailers have done a great job leveraging product recommendations online — now they're learning how to reap the benefits of human recommendations and interactions in a physical store setting.
- Product demos: Leading online brands like Google and eBay are starting to use brick-and-mortar as a high-touch way to demonstrate their products to consumers. The need for in-store product demos is particularly relevant for technology products, a category in which consumers demand the ability to try out products in a supported environment. By offering hands-on product experiences in an atmosphere populated by knowledgeable sales associates, brands can gain a significant advantage over companies that only sell their products online.
- Tangible product interactions: Some product categories are simply more conducive to in-store shopping experiences. For example, clothing and furniture are high-touch products that consumers prefer to experience up close before they commit to a purchase. Since style, appearance and fit are important elements in the buying process for high-touch products, in-store sales associates can play an important role in confirming and reinforcing consumer buying decisions.
- Hybrid experiences: In the brick-and-mortar space, cross-channel retailers have the ability to create "hybrid" experiences for consumers. The gap between in-store and online is rapidly closing as consumers increasingly rely on mobile technologies during in-store shopping excursions. By combining online and brick-and-mortar programs with the latest technologies like Google Glasses or QR codes, retailers can generate truly unique experiences that are impossible to reproduce in either the online-only or in-store only spaces.
The decision to expand a digital presence into the brick-and-mortar universe isn't necessarily the right move for all product categories. Repeat purchases and items that can be easily evaluated via digital images or online product descriptions are well-suited for the e-commerce space.
In general, however, products that require a certain amount of "customer intimacy" will require some kind of in-store experience. This could include new or unfamiliar products as well as products that need to be touched, tried on or tangibly experienced prior to purchase. Many retailers, including a growing number of online-only brands, are starting to see that there's no substitute for the live experience of interacting with their products.
Dr. Gary Edwards is the chief customer officer at Empathica. Gary can be reached at gedwards@empathica.com.
