It was our imagination, design thinking and an innovation capability that created the technology we used to disadvantage physical retail. Now is the time for CEO’s of brick and mortar to enlist the same design practices using the tools of technology to reinvent the customer experience.
Einstein said, “In the middle of difficulty lies opportunity.” The world of physical retail today lives in a state of anxiety due to the accelerated ease of use of all things digital, specifically the convenience of purchasing online. This comfort level has created new rituals and behaviors in our daily lives.
- We live in a creatively customized world that is constantly adapting and improving how we connect with all things of interest.
- We freely enter digital portals of discovery enabled through immediate access to anything we can imagine.
- We control consumption, distribution and destination without physical contact.
- We are the empowered communication vehicle of networked consumer reports.
- We are the influential force of the retail economy.
We now go online to visit our convenient shopping boulevards. And as our digital express train continues to move at higher speeds and feeds, our physical retail store experience feels like it moves in slow motion. Why?
Human behavior tends to repeat what is tried, true and comfortable. The demise of physical retail could be explained by the absence of an intellectually curious retail culture without an organizational innovation capability. Perhaps it’s the hubris of leadership’s conditioning of prior success. Or the challenge of change in the magnitude of size and scale of our legacy retail institutions. These and external forces, such as mobile technology placing the power of immediacy in the hands of the user, have thwarted a creative resolve. Retail leaders face an existential dichotomy: consumer curiosity and consumption awakened in the midst of corporate complacency. Internet sales increase by double digits in the high teens as we witness more store closings with abandoned valuable real estate yearning for a new purpose.
Crisis = Opportunity
With new technologies come new behaviors, and these behaviors become new opportunities. In other words, the disadvantages posed by online present advantages for physical retail reinvention. This must be viewed as opportunity with a call to action to awaken the culture to address these changing times and consumer tastes and behaviors. Logically, our physical environments must respond to these new consumer values and lifestyles shaped by mobility. Online quick-click journeys inform, compare, suggest, inspire and motivate us on a convenient and productive trip to unknown places of surprise and discovery. Does traditional retail provide this level of surprise and delight?
These online advantages have paradoxically created disadvantages when it comes to our physical and tactile experience. Many digital critics believe that we live isolated lives where we choose to connect on screen rather than participate in the real-life screenplay. Are we losing touch with our own humanity with each of these technological advancements? Has this new mode of behavior dulled our senses and weakened our desire to participate with others in a public manner? Is this the age of screen-to-screen as opposed to eye-to-eye?
I suggest that we consider this optimistically as the age of advantage for enhancing our human condition; an opportunity for reinvention in the equally important spaces of physical and social experiences. Technology is a support tool, not the endgame to transcendence of our human-to-human experience. Use it as a tool to enhance the customer experience.
We have witnessed many examples of retail reinvention occurring in both existing and new companies.
- The coffee house has become our community center, a sense of place and belonging, serving up connectivity, conversation and creativity to collaborate with others.
- There are achievement “stores” where you can climb a rock wall, take yoga classes, learn how to use technology, take cooking classes, hit golf balls, learn how to compose an interior or coordinate a wardrobe.
- Creative maker spaces bring the digital and physical together serving us ideas, inspiration, and food for creativity.
- The branded technology store has evolved the format to become a “Town Square,” eliminating the mindset of the word, “store.”
We thrive on positive emotional experiences that connect us. We respond to physical spaces with environmental atmospheres providing panoramic pleasure. There is excitement and anticipation of being in a grand movie theater providing immersive, big screen beauty that is larger than life. Our favorite restaurants have become theaters. Sporting events are the poster children of shared experience. Bookstores offer the tactile experience of a book in hand, the joy of browsing and observing what others are reading. One of the greatest strengths of physical retail is its visually stimulating representation of our interests, tastes and personal philosophies.
Store as Stagecraft
The store today must be a playground of emotional engagement, a stage for special events that attract people to a place. These places are our societal landmarks and require constant refreshment of experience-based design. We grow through reinvention and improvisation, and physical stores can provide this level of inspiration when done well. The meaningful retail model must move from pushing products and merchandise densification to providing curated end-use presentations. The ultimate purpose is to make people feel good. Emotional intangibles become present through high quality service that provides peace of mind and trust. The successful local market must represent the diversity of the community making it an inclusive welcoming environment. A multicultural environment sets the stage for the business of relationships and creating memorable experiences. Once again, this reminds us that our imagination is the answer to create the future of the physical environment, using technology with humanity through the design and innovation process.
Innovation and Systems Design
Einstein worried about the day that technology would surpass humanity: are we witnessing this invasion today? We are already integrating technology in the physical day-in day-out existence of life. Most brick-and-mortar retailers have sat on the sidelines while life in the digital age marches on. They still struggle with integrating technology because they are still product and price centric. Many of these organizations lack diversity of thought. This is counterintuitive, causing an imbalance of EQ in a typically linear organization.
Most traditional retailers do not have design thinking and innovation lab capability. System designers understand human behavior and can play a valuable role in continuously challenging the orthodoxies of convention. Designers are problem solvers and system thinkers. Their assignment is creative disruption, looking ahead, anticipating the future. Design is the constant that unites all disciplines and customer touch points.
Innovation labs must be separate from the operation of the business. Without this separation, companies are likely to inhibit breakthroughs, depriving the company of competitive advantages and future growth. There must also be a capital deployment strategy that separates the annual budget process from investing in the future. Investing in design and innovation can unite technology with humanity.
From Apocalyptic to Opportunistic
To avoid your retail apocalypse, replace complacency with imagination. After all, Einstein said, “Imagination is more important than knowledge.” Truth be told, we are not living a retail apocalypse; the use of the word is debilitating and should be eradicated. Replace apocalypse with opportunistic. Innovation can only occur through the constant pursuit of opportunistic iteration. It is why we are always seeking to find better ways of improvement.
When we forge the positive creative mind with the logical and technical mind it lifts us up to higher levels of purpose, possibility, productivity, education, knowledge and imagination. The design thinking process helps us remove the unnecessary missteps of previous behavior. This is why retail reinvention is so critical in keeping up with the changing behaviors of our digital evolution. Retail store leaders must be the agents of change in service of the employee and the customer. This calls for courageous visionary leadership powered with imagination and innovation to respond to this social challenge. If not, the fear of Einstein’s warning will result in surpassing humanity with technology and then the word apocalyptic really will replace opportunistic.
The retail brand promise is the connector between online and in store. One platform informs the other. Through this interdependence the challenge sits squarely on the shoulders of physical retailers to redesign the customer experience using the customer as the guide. Walk in your customers’ shoes. Create a seat at your table for the customer. Understanding their wants and needs provides a lens to the future. Above all, engage the younger generation as co-creators of your customer experience, from the edge of early adoption to loyalty. They live at the intersection of technology and life.
We have shaped our digital tools and they have shaped us, now we must reshape the physical environment through the use of our technology tool kit, with the customer at the center. Technology cannot cause the disintermediation of life as long as we are committed to the human experience. The future of design is our continuing commitment to enhance the human experience. The human experience is the future of retail. Design creates the future, it is the advantage of disadvantages.