The business news is full of bleak outlooks or bankruptcies for a number of big retail stores, with iconic Toys ‘R’ Us one of the latest casualties. The crumbling of several brick-and-mortar giants continues during the rise of e-commerce, led by Amazon. Some of those still in business are attempting to improve their online capabilities as a way to compete better in the changing landscape. Walmart, for example, plans to open fewer stores so it can focus on e-commerce while enhancing existing stores. Target has been building out its digital offerings, with same- and next-day delivery services being tested.
Such online upgrading illustrates a shifting business model for some long-time retail titans. But Larry Light, a global brand revitalization expert, says to know where they’re going, they can’t forget where they came from. Their survival, he says, will likely depend on how they blend their retail brand strengths with new online know-how.
“Retail giants are feeling the ‘Amazon effect,’ ” says Light (www.arcature.com), co-author with Joan Kiddon of The Paradox Planet – Creating Brand Experiences for The Age of I. “Struggling retailers are focusing on catching up in the online space and giving up on investing in sociability and sensory aspects of creating a special in-store experience.
“The challenge is how to provide the best combination of both online and retail. This is the big opportunity space that traditional retailers seem to be ignoring.”
Light suggest three ways that retailers can adapt and survive in the e-commerce era:
- Re-establish the emotional store connection. One reason people consistently shopped at a brand retail store, Light notes, was the way they felt connected with the brand and the store experience. “Connecting with customers’ emotions is the way to find success in the age of online shopping,” Light says. “No matter how much we appreciate the ease and speed of online shopping, we crave the joy of seeing and touching the product. A computer cannot match that human experience.” So increase the emotional rewards, Light says, by enhancing the shopping environment, making it more relevant and distinctive.
- Translate data to identify shopper behaviors. According to a Forbes article, retailers need to analyze a wide variety of metrics to better understand their customers and what impacts their purchasing decisions. “There are many variables to the in-person shopping experience,” Light says. “Detecting these variables and how they impact customers can bring solutions on how to optimize the shopping space.”
- Don’t have an identity crisis. A brand has a distinguishing character, and Light says it’s vital to avoid losing it in the midst of change. “IKEA, Walmart and other retailers are struggling to catch up with online venues, focusing on creating a brand experience that has less to do with the legacy retail environment and more to do with virtual environments,” Light says. “You walk in a Sears and see an abandoned brand.”
“A brand is more than the promise of features and functions,” Light says. “It’s a special feeling for the customer. The retail experience and online enhancements can make it more powerful.”
Larry Light, a global brand revitalization expert, is the Chief Executive Officer of Arcature (www.arcature.com), a marketing consulting company that has advised a variety of marketers in packaged goods, technology, retail, hospitality, automotive, corporate and business-to-business, as well as not-for-profit organizations. Prior to consulting, Light worked on the advertising agency side as a senior executive at BBDO and CEO of the International Division at Ted Bates Advertising. He was global Chief Marketing Officer of McDonald’s from 2002-2005 where he was involved in one of the most recognized brand business turnarounds. From 2010 to 2014, Light was Chief Brands Officer of the global hotels group IHG.