MWC

The role of the shop in an omnichannel world

David Murphy

GroundTruth EMEA MD Theo Theodorou considers the changing face of the high street, and where location data fits in.

From mods in miniskirts on London’s Carnaby Street to tweed-suited country folk, the long list of influential British brands like Alexander McQueen, Vivienne Westwood and Burberry and the array of prestigious education institutions, it’s safe to say that the UK is a fashion powerhouse.

But, as consumers, our relationship with the way we interact with brands has changed dramatically throughout the years. Where we would once only be able to get our hands on the latest designs if we physically visited an independent, specialised boutique we can now, at the click of a button, have something delivered to our front door within hours.

While the recent hike in business rates and the depreciation of the pound have a lot to answer for, the recent finding that planning applications for new shops has fallen for a ninth year running is concerning. Whilst it seems like every day we see a new headline about the ‘struggling’ high street, it’s a myth that people have stopped flocking to physical stores to pick up products. For example, figures today revealed UK retail sales growth crept higher in January compared to sales in 2017. In addition to this, we know the majority of sales in the UK (89%) are still made in physical stores.

Physical retail isn’t dead, the face of it is just changing. Just like it did when Harry Gordon Selfridge opened the first department store, the world-renowned Selfridges in 1909. He saw an opportunity and ran with the idea. However, retailers today have something Harry never had – data, and therefore better insight that there’d be demand for such a store. In particular, data driven insights from location technology is key to understanding the complex consumer path to purchase journey as they move from online to offline and device-to-device, engagement and ultimately store visitation in today’s hyper-connected landscape.

Showrooming
Napoleon called it by saying: “We are a nation of shopkeepers”; however shopkeepers have very much evolved in order to keep up with consumer demand since this statement was made over 200 years ago! Take the new trend of showrooming. For example, Glossier, the much hyped online-first skincare brand on social media launched its first perfume in a ‘concept’, ‘offline experience’ shop in NYC where users could go in to try the perfume, and later buy online. Closer to home than Amazon Go’s Just Walk Out recent store opening, Zara opened a pop-up in London’s Westfield Stratford – a space with a curated selection of women’s and men’s clothing available for in store try-ons but only for home delivery.

It’s of little surprise that online brands are now adopting a more omnichannel approach, just in the same way physical retailers have, understanding the need to offer a seamless online-to-offline customer experience. At the heart of the digital-to-physical world lies a good location strategy. The ability to understand behaviour across both online and offline means that retailers can react on multiple fronts; whether that’s if someone is nearby a store for in-the-moment messaging, or has visited similar stores indicating a preference for product types. Location behaviour gives a better indication of when intent is highest, therefore enabling brands to deliver timely and relevant communications which are more likely to result in real sales - whether online or offline”

But where to open up?
For retailers, deciding where to open up a new physical store, pop-up or showroom shouldn’t be a finger in the sky ‘guesstimate’ but rather a foolproof choice that will be a hit. With accurate and precise location technology retailers can uncover clusters of shopping activity, enabling them to understand where else their target audience likes to visit. So if Zara were looking to open another pop-up, and knew that many of its customers travelled from a Starbucks before heading to their store and there was a space opening up near a Starbucks in another location then this could indicate an opportunity.

In addition, our shopping habits are becoming incredibly unpredictable. As consumers, we are very fussy when it comes to the way we want brands to communicate with us. Therefore knowing what online campaigns are successful in driving footfall to brick-and-mortar stores is important for brands looking to understand the impact their online marketing campaigns are having in the ‘real world’. This is imperative in uncertain times when consumer behaviour is changing so rapidly. Location intelligence provides brands with the insights to prove the ROI online marketing has when it comes to driving sales in physical stores.

Marketers now have more plates to juggle, more trends to keep their eyes on, and more touchpoints to track than ever before. As a consumer, I may first see a new pair of headphones on Instagram, then see them again on YouTube, after that I might see a digital display ad for the product in Waterloo train station. I may then go online to search for the best deals before purchasing the headphones in a physical store. Whilst this journey may feel seamless and increasingly easy for the ever-empowered consumer, for a brand, my behaviour is difficult to track.

To drive the likes of myself, and consumers across the UK to physical stores in order to get them experiencing your brand, it’s imperative that retailers invest in tech that provides data that will empower retailers with quality insights about both their customers’ path to purchase and where to open up shops. To boost high street footfall, retailers firstly reach customers in the moments that matter, understand where they like to visit and what types of campaign messages drive them to their store. And this is precisely what location does.