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Four In-Store Trends Marketers Can’t Ignore in 2015

BY CSA STAFF

By Gary Lee, InReality

As 2014 comes to a close, one thing is clear—traditional retailing is under fire.

Consumers, not brands or retailers, now hold the reigns of power. And, to survive, marketers in brick-and-mortar must take a fresh approach to physical retailing, and carve out a unique value proposition for the in-store experience, one worthy of the consumer’s precious time.

So, before we ring in 2015, here are four in-store trends that retailers and brands should consider if they want to impress consumers in the New Year.

#1: The Social Store

Traditionally, social media and the store are often viewed as separate channels, addressing different parts of the sales funnel. Social media is used for brand awareness and top-of-funnel initiatives, and the store is used as a decision-driver and an end-of-funnel channel. However, with the rise in digital content marketing, consumers increasingly expect personalized, value-driven messages from a digital presence, in-store and out-of-store. And, as digital marketing continues to grow, with budgets increasing by 17% in 2015, smart retailers and brands will work to merge digital marketing with the store presence—tapping into all the various touch points within the store, including checkout, the fitting room/demo station and, of course, the store window. In fact, according to IAB Research, 59 percent of retailers plan to invest more in integrating social media within the retail store.

Examples of retailers working to create a social-store experience include: Nordstrom, Karl Lagerfield and Marc Jacobs. Playing off of its huge Pinterest following, Nordstrom displayed its “most pinned” shoes and handbags in-store, with a recognizable red Pinterest logo across 117 locations to help customers quickly find these pieces. Karl Lagerfeld took a different route, installing iPads in the dressing rooms of his London store to allow visitors to snap selfies and immediately share them across their social networks. And, Marc Jacobs opened a pop-up store during New York Fashion Week to showcase their latest fragrance line, Daisy, accepting tweets and Instagram photos for free gifts in-store.

#2: The Immersive Digital Experience

Social media will not be the only digital element to be integrated within the store. In 2015, shopping will become fun again as more immersive digital experiences visit the store. Not to be confused with digital screens that often replace printed signage with little value to the consumer, these experiences will bridge the physical and digital worlds to create something truly unique for the consumer. And, we've already started to see some brands enter this space, with the advent of beacons, radio-frequency identification (RFID), augmented reality (AR) and digital kiosk displays.

Some examples of these brands include GameStop, which is using AR technology to bring virtual video game characters to life in-store, and U.K. retailer House of Fraser, which is using beacons to allow window shoppers to purchase clothing on the mannequins from their phones. Another example, Adidas is using RFID technology throughout the store—in fitting rooms to help with product information and outfit ideas, in point-of-sale systems to remove the need to manually scan items and in the storefront to allow consumers to browse life-sized products and add them to their mobile cart with a tap of their phone. And, most recently we’ve seen etailer, eBay introduce its own version of the smart store, which connects the consumer to the store through a mobile app and features interactive mirrors on the sales floor and in fitting rooms to bring the ease of shopping online to the store.

#3: The Mobile Checkout

In addition to complementing the digital store experience, mobile will also impact the payment landscape and start taking a chunk out of cash and credit in 2015. Expect to see the mobile app payment landscape grow as more players enter the scene and dominant players, Apple Pay and CurrentC strengthen their offering. Also expect to see some new developments in mobile payments outside of mobile app payment. Not saying throw away your credit card reader just yet, as we may not see the beginning of widespread adoption of swiped-card alternatives until the end of 2015. However, Apple has definitely broken the traditional payment logjam and retailers need to start preparing if they wish to meet consumer expectations in the coming years.

#4: Getting More Out of Consumer Data

With the rise of digital in store and an increased focus on mobile, there will be an even greater need for the right consumer data to help guide personalization, brand and product decisions and marketing spend. On a basic level, brands and retailers will look to voice-of-consumer (VOC) programs to uncover brand perceptions and respond to customer service issues. However, the real retail winners will be those who dive into consumer data as well as offline or indoor analytics.

In 2015, brands and retailers will start looking to make in-store shopping as intelligent as online shopping. Through footpath tracking and targeted consumer research, these marketers will work to better understand the consumer and the “why” behind their purchasing decisions and behaviors. As part of this trend, a new metric—cost-per-visit—will start to emerge, gaining widespread adoption in the following years.

That said, consumer data will be used for more than out-of-store marketing promotions. It will influence smarter supply chains for improved inventory planning and accuracy. And, it will replace “gut feelings” on in-store marketing spend and start providing key insights for merchandising and product and brand decisions.

While it may be difficult to even think about 2015 while in the midst of the 2014 shopping season, it is critical that retailers and brands carefully consider how these four trends will impact their in-store strategies. Next year will be a key turning point in retail—a whole new suite of retail winners and losers will start to emerge. And, brands and retailers must either plan for this shift or brace themselves for failure in the coming years.

Gary Lee is the CEO and president of InReality, a 19-year old retail innovation firm that redefines how consumers experience brands through an integrated suite of research, design, digital and implementation services.

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