The state of the UK physical retail space - part 3: Second chance saloon
The third instalment of a 4-part commentary on the current plight of physical retail spaces in the UK by CAKE Strategy Director, Alex Venner.
If you’re a glass half full type, you could view the fallout from COVID enforced lockdowns as physical ‘non-essential’ retail being given a second chance to get things right. When the dust settles on the fallout from repeated lockdowns, shopping places will have the opportunity to re-engage with their consumers and drag people back into the physical world. The initial results are certainly encouraging – with the post-lockdown footfall bounceback in April proving what many commentators thought would be the case: pent up demand creating a surge of retail visits. Which is great. But the reality is that this was the easy bit. The much more challenging bit is how bricks and mortar will keep the level of engagement and spend over the longer term. Shopping habits have changed, and will keep changing, and it is the responsibility of the retailers to keep up - and for those at the head of the curve – to drive change themselves.
Knowing what inspires the shopper to shop is at the heart of preparing for the future. Getting and keeping ahead requires two stages: to constantly gather and interrogate data relevant to specific customer groups, and then convert this insight into a compelling retail experience for the shopper. As Amazon have proved time and time again – putting the customer first and gearing everything in terms of innovation and development to satisfying the customer provides a hugely successful retail model. Perhaps for the first time, technology is available now that enables physical retailers to compete with their on-line counterparts in gathering real-time shopper data. Whether through computer vision technology to record basic shopper mood and demographics, or through mobile/wi-fi applications (or a combination of both), there are solutions to deliver the ammunition for physical retail to enhance their customers’ experience, and possibly of even greater value, the means to communicate directly with customers to influence their shopping habits.
Aside from the advantages of consumer engagement, there are other benefits for retailers and managers of retail space. The technology solutions can be applied through existing infrastructure – so improving operational efficiencies and maximising the potential of all too frequently underused platforms. For example – the majority of shopping centres have a customer wi-fi capability available to visitors. Many – if not most – of these centres have a very low take up as customers benefit from widely available 4G networks and fail to see the need to use a dedicated shopping centre service. As a result, a shopping centre has an expensive, under used service in place simply because someone somewhere said that it was essential that shopping spaces offered wi-fi to visitors. Marrying this service to a relevant messaging for customers has the capability to dramatically increase customer engagement, and consequently opens up a real-time communication channel between retailer/shopping space and customer. And once the customer is engaged, the circle is completed as shopping preferences can be monitored and captured to develop an ongoing database of valuable insight. Rather than reinventing the wheel, maximising the potential of tech systems already in place is a win-win for retailers and shopping places, helping to drive cost efficiencies at a time when operational budgets are coming under increasing scrutiny.
It goes without saying that once a retailer can deliver relevant messaging, at the right time to the right potential customer, the experience of that customer is improved. As is the bottom line for the retailer. Assuming that retailers and retail spaces can deliver on their promises.
Ongoing, unobtrusive opt-in customer data gathering in real time isn’t the future – it’s here now. The tools are available for forward thinking proactive operators to look to the future where knowing what their customers want is a reality. Planning communication and promotional strategy can happen with genuine confidence in the all-important return on investment. Change in retail has been ever present, it has just accelerated through the time of COVID as consumers react to their circumstances. Physical retail can still give customers what they want, and knowing and delivering on what they want will turn the current bounceback in to the new normal.
Check back next week for part 4.
If you would like to chat to CAKE about the possibilities of gathering real-time customer data in your retail outlet or shopping space and how this can positively influence customer engagement, then please get in touch.
Alex Venner, Strategic Marketing Director at CAKE, has over 20 years’ experience creating and leading strategies for some of Europe’s leading retail property owners and managers. alex@wearecake.agency