Experience Manifesto

Making Physical Retail Relevant

As we become more digital, our physical environments becomes even more important, for both employees and customers.

Given how crowded the retail world is today,and given the number of brands reaching out to consumers, the ability to touch and engage consumers in a place where you control the entire message has incredible value.

Instead of viewing retail presence as a necessary evil, you should be using it to create a better connection with your audience. Retailers need to look for ways to ‘e-tail’ their retail.  There also needs to be a much better connection between the in-store experience and the information that's available online.

The Big Question for You

If you were building retail for the very first time today - you had no legacy physical retail -- how would you design your retail experience?

We know that millennials, GenZ and high-income shoppers — especially keen on experience, differentiation and personalization — still want the sensory experience before making a purchase.

In many cases, stores are becoming more like showrooms that entice customers with one-of-a-kind experiences – rather than being traditional point of purchase spaces. To meet shoppers’ expectations and counter online competition, stores are becoming an alternative to restaurants, coffee shops, and movie theaters.

Brands are starting to launch immersive, technology-enabled flagship stores while displaying minimal inventory, with environments that invite consumers to luxuriate in the engaging, social and interactive experience.

As you look at your retail experiences, are you offering anything of value other than the product? Are you helping the guests in a way that makes them feel confident in purchasing from you? If all you're offering is product, then all you have to compete on is price. People will comparison shop until they find the best price.

Four Key Elements

• Retailers need to tailor the shopping experiences to me and all of my information needs to be available wherever I am.
• You need to better connect the online and in-store shopping experiences.
• You still need to have a compelling story if you want me to pay a premium.
• Physical retail needs to focus on what it can deliver that’s different than online shopping.

What happens when places know you better? What happens when we have intelligent stores? 74% of retail CEO’s are worried about keeping up with the rate of technology changes, and they also worry about how to attract the younger, more digitally savvy consumer.

Today, it’s not simply using one technology that will create these spaces. It’s combining several to create a singular experience. And, it’s understanding how consumers want to have the experience that will drive more adoption of these technologies. Our ability to combine technology, business and experience will be critical in making sure that these experiences drive both business needs and consumer engagement.

This is what we do at the Unified Brand Experience Lab, help brands and retailers answer these questions and build compelling, authentic and relevant experiences for their audiences. Want to know more, reach out to me, Jim Ackerman, or Alexandra Zelcer and come out to Jersey City. Give us a day, we'll help you build your future!

Third Places: Putting People and Experience First

Since the onset of the Covid-19 pandemic, our interaction with the physical world has undergone a profound transformation. In the realm of community building, the concept of the "third place" has gained significance. This term refers to social environments distinct from the home ("first place") and the workplace ("second place"). Examples of third places include churches, cafes, clubs, public libraries, bookstores, and parks. Ray Oldenburg, in his influential book "The Great Good Place" (1989), emphasizes the importance of third places for civil society, democracy, civic engagement, and fostering a sense of place.

Consider the innovative office spaces created by companies like Google and Facebook, seemingly designed to blend the second and third places. For younger generations, social life often revolves around work environments, blurring the lines between professional and personal spaces.

Reflecting on my own experiences, I recall frequenting a Burger King with my daughter Sydney when she was young. The indoor playground was not just about the physical space but the social aspect, providing Sydney, as an only child, the opportunity to interact with her peers. This Burger King became a "Third Place" for Sydney, highlighting the social significance of spaces beyond home and work.

In the evolving landscape of retail, the value of real estate is being reevaluated. With the rise of online shopping and the comfort people now have with delayed gratification, the traditional emphasis on merchandise space is shifting. The question arises: If we reduce the need for inventory in retail spaces, what alternative purpose can these spaces serve? The potential lies in transforming retail environments into social hubs rather than purely commercial spaces.

As our work structures undergo significant changes, an opportunity emerges to socialize retail spaces. The trend seems to be moving towards creating a more engaging and community-driven experience. Rather than focusing solely on our purposes, we should consider the needs and desires of our guests, as prioritizing their experience encourages their continued engagement.

In this context, incorporating familiar amenities like coffee bars and DJ booths becomes vital. These additions draw from hospitality, personalizing the retail experience and increasing the "dwell time," as noted by Gensler's Kathleen Jordan. The right amenities complement the products being sold, offering a respite that allows consumers to recharge and extend their time within the space.

Furthermore, the universal need for fun becomes apparent. Fun is a powerful tool to foster understanding and peace. Hate struggles to thrive in an atmosphere of fun. To create meaningful experiences, we should focus on bringing people together to share joyous activities. The challenge is to celebrate the joy we create and continue exploring ways to unite people through shared, positive experiences.

Retail can be the new (old) third place. As Ray Oldenberg said, third places are important for civil society, democracy, civic engagement, and establishing feelings of a sense of place. Today, more than ever perhaps, we need our third places as a society and what better way for retailers to help than to be our gathering places.

Some additional reading:

• Retail as the New (Old) Third Place
• Why Don't More Retailers Have Genius Bars?
• Creating the Right Experience Post Covid19
• How Lloyds Coffee House Became Lloyds of London
• Great, Good Places
• Are You Telling a Great Story

Is the Drive to Efficiency Hurting Starbucks

A few days ago, Starbucks had a pretty big earning miss, prompting lots of discussion about what went wrong and how to fix it. In a recent interview with CBS, CEO Laxman Narasimhan had this to say:

The company's plan to turn things around includes updating its app and mobile payment offerings, speeding up service, and overhauling its menu to lure customers back.

Ex-CEO and founder of Starbucks, Howard Schultz had no issues jumping into the discussion saying in an interview:

“The stores require a maniacal focus on the customer experience, through the eyes of a merchant,” he added. “The answer does not lie in data, but in the stores.”

As Will Roger says in the quote below, it's never a bad idea to reinvigorate you products and offerings. Afterall, you can't just sit there, can you?

But I have a different take on the situation. I think that it's possible some of their fixes will actually hurt them more than they will help them and that as Schultz says, they really need to refocus on their customer experience.

Starbucks was one of the first companies to embrace the idea of the 3rd place, a place where people can gather. It was a place where people who worked from home, pre-Covid of course, could get out of the house, have some good coffee and get some work done. As importantly, they had a place to gather with others and not be so isolated.

Because you could sit the for as long as you wanted, I think that people didn't mind paying as much as they did for coffee. They weren't just buying coffee, they were getting an inexpensive office and meeting space. They were getting an opportunity to socialize or at least people watch. They were getting some time out of their homes. That was a pretty good deal for the price of a coffee, even if you splurged for a fancy cup!

As they added mobile ordering, they created a situation where they were often ignoring the person actually in the store for people who were somewhere else. I remember once waiting for 10 - 15 minutes to have a barista take my order and then waited for it to be made while I could see them making lots of mobile orders, making them the priority.

Now Starbucks is building a lot more of their stores with drive throughs and putting even more emphasis on mobile orders. While I'm sure this will help them drive better efficiency, I'm not sure that it will solve the issues they have. There are plenty of places to grab a quick coffee. There are many small, wonderful coffee houses where you can still sit and relax with your coffee. The advantage Starbucks has is that you can find them everywhere and they had a good and consistent menu. They were comfortable.

Maybe in our stressed, overscheduled world we don't always want or need that much efficiency. Maybe sometimes we need to good comfortable place to go, where we can slow down a little and be around other people. Maybe that's worth paying extra for a cup of coffee!

As always, love your thoughts too! #futureofretail #customerexperience #topretailexpert