As competition in global markets escalates, the pressure is being piled on brands to provide new areas of competitive advantage, and in particular, areas which cannot be easily replicated and can be sustained.
With old school marketing tending to focus on price or quality as the sole poles of differentiation, sales focused campaigns and tactics were every marketing team’s bread and butter. In recent years, emphasis on the use and creation of an emotional human connection with customers has lead to the emergence of more consumer centric trends, and development of traditional marketing communication channels. This advance marked the progression into the Experience Economy, a phenomenon that was craved by consumers, albeit unconsciously. Customised products and consumption experiences are increasingly integral to consumer purchase decisions, and a brand is no longer viewed as a static but as an accumulation of experiences that a person has with a company. In line with this marketing evolution, the physical role of a retail store is shifting from purely pragmatic, sales-based functionality to experiential showcases of products and brands.
UK based fashion retailer Missguided opened their first retail store in late 2017, using the physical space as an experiential stage to push the brand image, style and messaging, with very little focus on the clothes themselves being sold. The store was designed holistically, incorporating trendy neon lights and slogans on the walls to ensure it was as “instagrammable” as possible. Birchbox have used the same sort of strategy, utilising their Carnaby Street pop up store as an instagrammable hub of all things Gen-Z and, more importantly, introducing the brand identity to a previously untapped, less digitally reliant, pool of potential consumers. Cha-ching!
Amazon have also recently made the move into physical retail, among whispers of WTF and various other expletives from newly competing retailers, and cementing their position as the company of the future for consumers. While I wouldn’t go so far as to suggest that this is an indication of a dramatic strategic shift into physical retail, but the fact remains that Amazon are using these stores as a product showcase, a chance for customers to experience the brand holistically prior to purchase, and, importantly, they are doing so successfully worldwide.
Research as far back as the turn of the millennium predicted that the degree to which a company is able to deliver a desirable experience will largely determine its success in the global marketplace of the new millennium. More recent research has confirmed that this has in fact been the case, with consumers displaying new and increasingly pertinent desires for experiences of any kind. By avoiding assumptions made in traditional marketing, experiential marketing strengthens consumer- brand relationships by recognising them as emotional beings that are not always totally rational. This deep understanding of consumers’ purchase motivations is an absolute necessity in the competitive retail environment of the Experience Era.
The key goal of experiential marketing is to stimulate positive emotions within a consumer, ultimately resulting in them enjoying the holistic consumption experience and increasing their propensity to purchase whatever it is a company has to offer. The customer purchase journey no longer consists of two distinct channels, and so, retailers who are unable to keep up with agile customers of today are in jeopardy. It is widely acknowledged that there remains to be no replacement for the sensory touchpoints provided by bricks and mortar stores, offering a distinct opportunity for marketers to use experiential combined with digital to marry up the core benefits of both online and offline channels.
In regards to this digi-retail relationship, Nike are clearly leading the charge, with their omnichannel approach marrying up virtual and physical product offerings. Their concept stores follow predictions of the new retail era to the letter, emphasising time spent with the brand over on the spot sales, and educating, tech reliant physical experiences over a quick non-meaningful interaction. The concept stores also feature personalisation stations, fitting rooms with digital check outs and adaptive lighting (because who really likes their reflection under 8000 watt bulbs) and even trial zones to try before you buy. Each of these novel feature areas contribute to the accumulative retail brand experience.
With emphasis on consumer engagement and excitement growing due to their role facilitating the consumer-brand relationship, the key to creating a successful holistic journey lies in unifying digital tools with memorable in store brand experiences. The establishment of a desirable experiential environment forms a source of competitive advantage that is difficult to imitate or substitute, and the incorporation of digital ensures that retailers are continuously moving forwards and attracting the increasingly important Generation Z-ers. All hale the new breed of retail, a chance for brands to gain ultimate competitive advantage, with experiential marketing up front and centre.