Experiential retail is an immersive experience offered by traditional retailers to shoppers. An example of this includes pop-up shops, in-store masterclasses, and hosting community events.
What is Experiential Retail?
Experiential retail is the process of creating unforgettable shopping experiences for consumers. It directly engages customers and invites them to experience your brand in-person and on-site.
As consumers become increasingly selective about the brands they shop with, in-store shopping experiences must stand out from the rest. However, it should not be just a marketing gimmick and ignore the commercial aspect. At the end of the day, shoppers come to discover and purchase products.
According to a study by Forrester Consulting on behalf of Shopify, more than two-thirds of consumers (35%) plan to engage with brands through experiential experiences in the coming year. Therefore, it’s not surprising that 40% of brands stated that offering experiential retail would be a top priority for them in the upcoming year.
Benefits of Experiential Retail
Three out of four brand marketers gave an “important or somewhat important” rating to experiential marketing, according to a study by Crossmark. Certain countries are witnessing the positive impact of experiential retail more rapidly than others. In China, for instance, 78% of department stores have added experience elements in their stores.
Let’s take a look at the reasons why experiential retail is high on the priority list for many retailers.
Meeting Experience-Seeking Shoppers
The retail landscape is constantly changing. Today’s customers are not just looking to buy products; they are seeking memories. They are willing to spend more money on them: about 76% of shoppers prefer to spend money on experiences rather than products.
Experiential retail combines products and experiences for the best of both worlds. For example, a hair care store that includes a barbershop offers an experience that the younger audience is eager to spend money on, with the products available for purchase naturally.
Highlighting Community and Charitable Issues
Quality, price, and convenience are three elements that many consumers consider when looking for brands to purchase from. However, there is one box that retailers often overlook: purpose.
Research indicates that 77% of people feel more positively about brands that make efforts to support the community. Additionally, for some generations – such as Gen Z and Millennials – community is essential. After being labeled the “most lonely generation” after growing up amid a digital revolution, half of Gen Z consumers want brands to have a social impact that they can be a part of.
Mark Tiperson, Chief Strategy Officer at Afterpay, said, “Three times as many Gen Z said they shop in-store most of the time compared to the number who said they shop online most of the time.”
Consequently, 31% of consumers want retail experiences that reflect a sense of community in the stores they visit, such as organic product fairs and book clubs. Experiential retail allows you to provide those experiences to customers eager to support their local community.
For example, Love Record Stores uses a physical retail space to host live music performances, DJ sets, and sell its products. It uses experiential retail as a way to support the cause its customers care about: #saveourvenues.
Experiential Retail Ideas to Try
Ready to start with experiential retail? Here are five ideas to try, even if you don’t have a store at the moment.
Mobile Trucks
Pop-up shops have become popular in recent years, but small retailers may find it challenging to launch a temporary store on a limited budget. Opening a pop-up shop for 30 days can cost more than $30,000, making this a less effective way to reach new customers outside of small store limits.
The alternative
The likely option is to launch a pop-up truck instead. Agencies like Pop-Up Mob specialize in creating customized temporary experiences for small retail brands.
Pop-Up Mob worked with a jewelry brand to create a pop-up truck to coincide with the Art Basel festival in Miami. The golden transformation of a classic Volkswagen van featured several items from the Bittar collection and encouraged visitors to take selfies with the vehicle amid the exhibitions. Products were also available for purchase from the truck.
Pop-up trucks have two significant advantages over their brick-and-mortar counterparts in terms of timing and mobility. The itinerant truck of Alexis Bittar was strategically parked outside the Faena Hotel in the historic Miami Beach area during the Art Basel Miami festival. This allows the brand to capitalize on the heavy foot traffic generated by the event and attract a wide range of potential customers among the exhibits during the festival that draws tens of thousands of people every year.
Community-focused Events
Many merchants run events for members of their local community. You can take this idea a step further and provide a commercial space for individuals who could benefit from a place to meet. This is exactly what Peak Design, an accessories and bags company, did when it made its flagship location in San Francisco available as a co-working space for artists.
Every Wednesday from 1:00 PM to 5:30 PM, the Peak Design showroom and lower-stock store transforms into a co-working space for local photographers, artists, and other creatives. This targets 30% of the city’s shoppers who wish to see more merchants offering in-store workspaces.
The Peak Design co-working initiative provides a venue for artists and photographers in the area, many of whom could become future customers of Peak Design. It creates a space for creators to discuss their work and share ideas, which can be challenging to achieve in isolation.
It also addresses an urgent need in the art community. While co-working spaces may be plentiful in the San Francisco Bay Area, the costs can be prohibitive for working artists who may lack the financial means to join a more traditional co-working membership.
Balancing the provision of space in this way aligns perfectly with Peak Design’s core values of positive change and being a responsible member of the creative community in San Francisco.
In-Store Collaboration Initiatives
For some brands, an in-store collaboration initiative can become a form of retail experience.
This is the approach taken by luxury accessories brand Senreve – which derives its name from the French words for “feeling” and “dream” – when it hosted a co-trade event in its San Francisco store with luxury jewelry maker Aurate.
At first glance, it may seem that joint events have little in common with some of the innovative examples of experiential commerce mentioned above. However, the experience isn’t about the nature of the joint event itself but in the coordination of complementary goods sold by retail merchants that share similar missions and brand values.
Hands-on Workshops
You can start with something simple by hosting in-store events at your location. For example, teach customers how to use your products or offer a workshop focused on a skill relevant to your niche.
Educational events are increasingly popular as a means for merchants to raise awareness about important issues as well as their own products.
The Fellow brand aims to help its customers learn more about its coffee. At the Fellow Store + Playground, the flagship store in San Francisco, the brand offers short presentations and tasting experiences, as well as in-depth classes on advanced brewing techniques provided by invited tea professionals.
It provides
These events for customers allow them to learn more about coffee as a product and get familiar with Fellow’s wide range of products.
Fellow workshops are a great example of how to apply experiential retail in simple ways. Many people know the basics of brewing a cup of coffee, but Fellow’s classes elevate the experience from a mere display to an exciting educational experience with like-minded coffee enthusiasts.
They also help to enhance the Fellow brand as a company passionate about coffee, just like the participants in their workshops.
Examples of Experiential Retail
Experiential retail is challenging. Let’s take a look at six well-known brands that do it well and analyze what makes their experiences effective in driving foot traffic, increasing sales, and building long-term loyalty.
LIVELY
The entire shopping experience at LIVELY is an experience. LIVELY’s founder, Michelle Cordeiro Grant, wants every store to feel like a club: “We want women to come in and feel comfortable. They can count on us to come in here and not feel any pressure to shop.”
Part of their experiential retail strategy is fit sessions. Customers book a session online and head to their appointment in-store, where a LIVELY sales associate helps them find their correct bra size.
The results are impressive, to say the least. About 30% of LIVELY’s in-store revenue comes from customers who booked a fitting session online. The average order value from those shoppers is 60-80% higher than those who walk into the store.
The matter starts by offering them a drink, as people are usually busy here; it’s New York. You want them to arrive at a place where they feel like they’re with their girlfriend because now, all of a sudden, they’re more candid, more open, and you’re going to have fun.
gorjana
The atmosphere in your retail store contributes to the customer experience when visiting. Jewelry brand gorjana understood this. Instead of filling its store with best-selling items and maximizing floor space, its founders prioritized the scent, aesthetics, and feel that a person experiences when they walk in the door.
Co-founder Jason Griffin Riedel says, “I want to think about the woman who just wants to go shopping alone. How does she feel? What about the woman who is in with her kids; how do they feel? What is the person who walks in with their dog? What’s the husband who really doesn’t want to be there? What’s the person walking alone looking for a gift? Who are all these little characters that are happening?”
Answers to all those questions help the gorjana team design each retail store. Additionally, personal fashion consultants are available in the store and free engraving is offered to support people purchasing jewelry as a gift.
Manifest and Flow
Manifest and Flow sells crystals and magazines to its customers. The brand launched into experiential retail through its online retail store.
Project owner Kate Manigold says, “We started our business during the lockdown when shopping in person wasn’t an option. With increased stress and many people confined at home, we wanted to inject more lighthearted energy into the online shopping experience and implement experiential retail techniques into play.”
The brand created a crystal mystery machine as a way to do that. Anyone placing an online order of $20 or more receives a mystery bag from the machine.
Kate says, “We have an automatic vending machine stocked with custom crystals, bracelets, and crystal kits. The customer orders the product online, chooses their vending machine number, and then we take a video of entering that specific number and revealing the item from the vending machine. We then ship it to them with their mystery bag.”
She says
Kate: “Some of our clients call them gift bags and don’t want them photographed because they give them a delightful surprise they can enjoy when they receive a package. Others love to see what they will receive and enjoy getting a sneak peek on TikTok or Instagram. We receive requests for photography on social media as well as feedback attached to their orders.”
Based on the buzz on social media around the brand’s crystal machine experience, Jane said: “We decided to open an in-store experience where customers can use the crystal machine or choose a crystal from the pink crystal cart.”
To encourage social media participation at these events, Manifest and Flow places great importance on store decor. “The decor is very attractive with standout elements and flower walls, and we encourage social media participation for discounts,” says Jane.
Canada Goose
The clothing brand Canada Goose is known for its outerwear. It specializes in winter clothing for extreme weather and is worn by people engaging in winter sports or planning a trip to a cold area.
The only problem? Customers at many locations cannot actually test the product. You have to rely on Canada Goose’s word and pray that you won’t feel cold when the coat is tested. By that time, it’s already too late. Either you’re freezing in the Arctic or outside the return window.
To solve this problem for its customers, Canada Goose created a cold room in five of its retail stores. Shoppers can wear a coat and stand in a refrigerated room with temperatures reaching -27 degrees Fahrenheit. The benefit of the product is clear; anyone in a place that cold knows they need a Canada Goose coat to take with them.
No wonder it was named “Best Retail Experience of the Year” by RetailDive.
Tecovas
Not all experiential retail strategies are quirky. Footwear retailer Tecovas takes a straightforward yet effective approach by offering services in its store in Austin, Texas.
Shoppers can enjoy beverages, shoe shining, and tips to maximize their experience during their visit. There is also a range of exclusive products that shoppers can find only in-store. You’ll have a hard time getting this experience from other shoe retailers.
Nike Rise
The Nike sports brand is no stranger to experiential retail. Its new retail concept, Nike Rise, is the store of the future.
The flagship store in Guangzhou, China, has been transformed into a haven for Nike lovers, including:
- A Nike By You bar to customize products with their favorite sports team logos.
- Weekly games and sports matches for members of the Nike Running Club app.
- Workshops hosted by sports influencers and Nike athletes.
- In-store shoe fitting experiences using Nike Fit technology to find the perfect shoe size.
The Future of Experiential Retail
The future of retail is hard to predict. However, trends and changes in consumer behavior suggest that experiential retail is here to stay – just with some changes.
Augmented Reality
Retailers can rely on emerging technologies to provide the experiences shoppers are looking for. Augmented reality is one such example. It works by overlaying graphics on a live broadcast of something – whether it’s your store, the customer’s body, or their home.
Data suggests that 71% of people would shop at retailers more if they offered this kind of augmented reality technology. And 40% more would be willing to pay more for a product if they could try it through augmented reality.
With augmented reality becoming widespread, experiential retail is already spreading fully. I can imagine customers being able to launch a 3D image in their homes to see the product in its full dimensions. It’s particularly useful for the home decor sector.
Showcase
Goods
As part of a study conducted by Forrester Consulting on behalf of Shopify, we asked brands about the area where the company is investing to improve the store experience in the upcoming 12 months. The most common answer (46%) was goods presentation.
Goods presentation allows customers to
Source: https://www.shopify.com/retail/127297923-5-creative-ways-stores-are-experimenting-with-immersive-retail-experiences
Leave a Reply