To be fair, it’s tough diving into all of the data, and even harder to digest all of the different numbers that seem to crop up. For example, today’s infographic presents a cautionary tale to retailers who aren’t serious about the trend: according to creators 360pi, showrooming is costing retailers a hefty $217 billion in sales losses, and 35% of shoppers engage in the activity in-stores. See more of that data in the infographic, below.

Meanwhile, you’ve also got the industry people reporting that showrooming is another trend that’s been way overhyped. For example, according to another new study from xAd and Telmetrics, while mobile accounts for roughly 1/3 of all retail activity online and 98 million shoppers use their smartphone during their retail excursions, the vast majority of those shoppers still buy in-store. When all is said and accounted for, where do you turn?

The answer is to take it all in and use your best judgement. Per the infographic below, see what you can do it about it. Know your shopper and cater to them in the way it makes the most sense for your business. And, above all, give them a good experience and they’ll always come back. Happy Memorial Day Weekend!

Upon entering the new “City” Target at State & Madison, I didn’t really know what to expect. As a huge Target fan, I had imagined both a compact, mini-Target sort of like a Walgreens or CVS and had also conjured up the image of a sprawling superstore (however unlikely in downtown Chicago) more like the many Home Depots that litter the city. What I got was, well, a combination of both.

Click through the photos, below.

City Target is housed in none other than the iconic Carson Pirie Scott building at 1 S. State Street, with entrances flanking the intersection of State & Madison, as well as on each respective (major) street. Having walked there from POPAI’s downtown headquarters (about fifteen minutes), I approached City Target expecting to see flashing red and white from blocks away. While it was true that I didn’t miss the historic columns and ornate black detailing coupled with the signature red “target”, it was much more city-friendly than their usual megastore layout. The branding with City Target, at least on the outside, was more subtle.

Once inside, however, it was all typical Target. Red and white and the word “city” was everywhere; all successfully designed with Target’s style of clean lines and organized, bright color. One thing interesting I saw right after walking in was a new mini-department. To my immediate left after walking in through the State & Madison entrance, I noticed a “City” section: a place for Chicago-pride apparel as well as touristy knick knacks and other assorted items. Not bad, Target, not bad. Appeal to my sense of Chicagoan-ism (or, you know, to those Chicagoans who have lived here longer than 2 months).

Another bit of beautiful branding City Target employed was the gigantic “CHICAGO” they spelled out for shoppers behind the checkout lanes. Yes, it’s obvious, but I’m all for reminding people that this is a  new  kind of a Target, a special Target. The distinction is important because it helps appeal to a different kind of shopper, one who might have previously deemed Target as too “suburban” to be city-friendly. No more.

Walking through the first level of the store, I oohed and aahed over the pretty, bold department descriptors (yay, merchandising!), as seen in the photos above, as well as geeked out about knowing what an endcap is. I was also relieved and very happy that the dollar section was still included. Other notable inclusions Target made in the sleek new City store were large LCD screens used for digital signage, as well as POP displays in line with their clean design aesthetic.

On my way to the escalators to the second floor, I ran into City Target’s new food court area, in which they were offering food from Pret a Manger, a European sandwich chain I had never before encountered. Cue tummy rumbles.

Despite my desire for a cold cut, I pressed on up the escalators, taking note of how City Target had those cool escalator/assembly line contraptions for your shopping cart, making it easy to maneuver between floors. The only other place I had seen those before was on a recent excursion to IKEA in nearby Schaumburg.

The second floor was a bit more crowded than the first, or at least felt that way, probably because the ceilings were lower (the first floor has a loft-like, open floor plan). Still, the same organized beauty coexisted throughout each department, offering shoppers a cohesive, simple shopping experience. It was easy to find different departments, and the way products were organized (did you see the beautiful selection of fresh fruit in the photos above?) made it almost impossible to not find what you’re looking for. Finally, floor-to-ceiling windows lined the outer walls, giving shoppers a chance to look out over Chicago’s grand downtown. All in all, pretty cool, and I think pretty appealing to city shoppers. Of course, the test of time will determine how City Target fares. For now, I think they’ve employed enough good shopper marketing practices to stay afloat.

Of course, we all know how City Target’s doing now–pretty darn well, judging by the constant customers inside. Till the next tour!

One of the more positive results of the past year’s struggling retail marketplace has been retailers’ realization that, yes, evolution would be necessary in the coming years. As shoppers evolve, so must the market, after all. That evolution means pinpointing new strategies, technology and more to be honed and utilized in the retail environment–including in-store analytics.

According to this article from RetailNext, not only has this past year yielded brands and retailers ready to start using better test and measure practices and in-store analytics, but also, the sophistication of the technology and methods that make it possible. In other words, it’s time to start implementation. Read the article in full, here, to see how.

Introducing Test & Measure
By Tim Callan
RetailNext

This past weekend, I went shopping at one of my favorite retail stores for a weekend sale, which, in respect to of the negative experience I am going to relay to you, will go unnamed for the rest of this article. How did I have such a bad experience when it was one of my favorite retailers? Two words: fitting rooms.

It’s a well known fact that women pretty much can’t stand fitting rooms, myself included. Not only do they have long lines of women trying to get into them (effectively stalling a shopper’s path to purchase), but many retailers still haven’t gotten the hint that the best way to sell a piece of (often pricy) apparel is by shutting a woman up in a claustrophobic, badly lit and really badly mirrored little room.

In other words, bad fitting rooms don’t equal happy, satisfied shoppers, and they likely don’t help increase sales. In fact, they probably hurt them. Now there’s a study I think we’d all like to see.

What’s even worse about the faux pas that is badly designed fitting rooms is this: while we’ve been aware of the problem on the retail side of things for a while, there hasn’t been much done about it. Upon searching for related pieces about the tragedy that is bad fitting rooms (for shoppers and retailers alike), I was only able to find a few recent sources of information: two informative articles highlighting how select retailers were giving fitting rooms makeovers from 2011, and a couple more recent articles (one notably from BBC this past April) that mention women’s fear of fitting rooms but highlight using new in-store technology to bring shoppers back in-stores, rather than fixing the problem.

Yes, virtual fitting rooms are cool. And they probably have a place in some retail stores. But there is a simpler solution for many retailers out there looking for a quicker, easier, and, yes, cheaper (that’s right, cheaper!) fix: spring for space, flattering lighting, and anti-funhouse mirrors. And hey, if you can tilt the mirror upward a little bit, most women don’t mind a little funhouse effect if it’s making them look a smidge better.

As for those two-years-old pieces talking about retailers giving fitting rooms this exact much-needed makeover, I say this: clearly, the trend has not become widespread enough to make much of a difference. In one article from The Wall Street Journal, writers Elizabeth Holmes and Ray A. Smith discuss how retailers such as Ann Taylor, Old Navy and Anthropologie have all made design efforts to remedy the issue–but most of these aesthetic changes are not for the actual fitting rooms themselves, but, rather, for where they are located within the store to the waiting room around them. While all of that is fine and good, let me reiterate something: the main problem with bad fitting rooms is that they are badly lit, too small, and/or have horrible mirrors that distort shoppers’ bodies.

Oh, and if you need more convincing about how important fitting rooms are to sales, the article also points out that as of 2011, the conversion rate for shoppers who tried clothes on in store fitting rooms is 67 percent, while those who didn’t was a mere 10 percent.

So, to recap–in order to fix your fitting rooms the right way, retailers need three things:

1. Roomy fitting room (arm and leg space required).

2. Attractive (not fluorescent!) lighting.

3. An accurate, well-positioned mirror (nothing from a carnival funhouse).

Bottom line: when it comes to fitting rooms, there is no reason any retailer should not be investing in making them a safe, comfortable, and attractive place for shoppers to try on clothes. The fitting room is a vital pausing point on the shopper’s path to purchase. You can’t afford to stuff fitting rooms in the corner, throw a few mirrors back there under harsh fluorescents and hope for the best. If you want female and male shoppers to want to buy your apparel, then don’t accidentally ruin their experience by underinvesting in fitting rooms–in the end, it only hurts the retailer or brand, who ultimately may lose out on a potential sale.

Best Buy’s gotten a lot of flack in recent months (years?), and not without cause. But, in light of their decision to partner with Samsung on a store-within-a-store concept, they might be on the right track to recovery, though perhaps not in the way they expected.

According to a video interview Monday with industry analyst David Strasser of Janney Montgomery Scott from Bloomberg Businessweek, though the store-within-a-store concept might not be the saving grace Best Buy was looking for, it does offer up another source of value: real esate. Watch the full video, below.

Best Buy Finds Value in Real Estate Over Retail
By Bloomberg Surveillance – Bloomberg Television
Bloomberg Businessweek

The threat of e-commerce to the way we do brick-and-mortar today is very real; there’s no denying that. So is the rumor that clicks will beat bricks true? No. We know it’s not. We also know that although brick-and-mortar probably won’t become extinct anytime soon (much to chagrin of online competitors/doomsday enthusiasts everywhere), it is changing. Evolving. The question is, what is it evolving into? What will the retail store of the future look like?

A lot of people have tried to answer this somewhat premature question, and we’ve seen a lot of retailers begin to execute their own interpretations. That’s all fine and good–innovation is one of the drivers of success in our industry. But the answer to that question isn’t just new, better, sci-fi-like tech inside retail stores (though that is often part of it), it’s a bigger concept than just the latest gadgets: the retail flagship.

In the second half of the last century, a trend occurred: American shoppers started to leave big metropolitan areas in favor of the suburbs, taking their dollars with them. Thus, the high-profile flagship stores in downtown metro areas became less profitable while still expensive to maintain. We know, of course, that many still stuck around–for instance, Marshall Fields here in Chicago, which, apart from being bought by Macy’s in 2005, has remained largely untouched since 1852. In fact, Chicagoans still call it ‘Marshall Fields’ even though it’s a Macy’s flagship.

While the big flagship stores endured or died as Americans moved to suburbia, the advent of strip malls and suburban shopping centers came about. In recent years, however, the trend has flipped, and American shoppers’ urban push has brought flagship stores back in the limelight–for good reason.

So, how will the return of the retail flagship help ward off the horrors of e-commerce for brick-and-mortar? Think about it like this: before airplanes, the way to travel across long distances was typically by train. But the invention of airplanes hasn’t forced trains to disappear; instead, it has made traveling by train a rarer, more distinguished and novelty way to travel, at least in America (and, in some parts of the world, more convenient). Trains now have a tourist-appeal to them. Now, apply that same idea to online shopping and the traditional brick-and-mortar store: instead of dying out, these stores will be less common, but altogether more impressive and often tourist attractions. Enter the flagship store.

Look at retailer Walgreens, for example. They’ve already begun to take note of the urban push trend, and are phasing out smaller stores in metro areas only to replace those presences with flagship stores specifically tailored to their neighborhoods. They have two in Chicago already, in fact: the State Street flagship in the downtown area, and the Bucktown/Wicker Park flagship in the Bucktown/Wicker Park neighborhood.

Walgreens | State Street, Chicago, IL

Walgreens | Bucktown/Wicker Park, Chicago, IL

If you check out the pictures, above, you’ll notice that while both flagships are obviously Walgreens-branded, they’re very different in that the downtown location is the sleek store of the future, while the Bucktown location offers up modern amenities while paying homage to its architectural roots, housed inside an old bank.

The meteoric rise of e-commerce is undoubtedly reshaping the world of retail, especially for traditional retailers. It’s this evolution that has revived the big, bold flagship concept, according to many industry experts, including Credit Suisse analyst Michael Exstein. Exstein, among others, believes that the big-city flagship store has all of the potential to become an attraction in and of itself, especially in a marketplace where the Internet is the new way to shop, as well as the way brands become visible.

“In an age where e-commerce is emerging from its infancy to a more established and integrated part of the retailing system, it seems that flagships serve two purposes. These include retailers’ affirming brand stakeholders in addition to a hedge against how the retailing structure could evolve in the next decade,” Exstein said. “The result could be fewer locations, less inventory, but more powerful locations in their own right.”

The trend of online retailers looking for physical retail space has been occurring for some time now, but while physical retailers might have embraced these online retailers renting new retail space as brothers in arms, now, they’re more competitive than ever. According to this article from The Wall Street Journal’s MarketWatch, online retailers aren’t just setting up shop on actual streets–they have another keen advantage over traditional brick-and-mortar stores: they’ve already curated enough data to target shoppers in-store, as well as online. Read the full article, here.

Turning Clicks Into Bricks–And Dollars
By Jill Puleri
MarketWatch

According to this Friday’s infographic, in just 5 years, roughly 50% of the population of the United States will be over the age of 50. Does that sound like a group of shoppers you should be overlooking? Didn’t think so. Not to mention, we already know that more mature shoppers are more likely to shop in-store. Baby Boomers to the rescue for brick-and-mortar!

See the full infographic from Marketing Zeus, below, for more information on this amazingly powerful shopper demographic, and why you should focus your marketing (in-store, online, wherever the wind blows you) efforts on them, as well as on their younger  cohorts. Happy Infographic Friday!

 

 

The study took a deeper look at shoppers’ interaction with their mobile devices, and was done by Michael R. Sciandra and J. Jeffrey Inman. In the study, shoppers in-store phone us was divided into four categories:

• No Use (85% of respondents): Shoppers didn’t use their mobile phone while shopping.
• Related Use (7%): Shoppers used their smartphones to compare prices, retailers, pull up a shopping list, scan a QR code, or call someone for help with a shopping-related decision.
• Unrelated Use (7%): Shoppers used their phones for private conversations, personal texts, checking email, listening to music, surfing the web, or playing games.
• Both (1%): Shopper used their devices to perform both shopping-related and unrelated activities.

Based on the above criteria, the study was able to discern that shoppers who used their mobile phones for unrelated activities while shopping made more unplanned purchases when compared to shoppers who didn’t use their phones at all.

If the dependent variable remains the minutes the shopper spends inside the store, than the unrelated phone use some shopper exhibit stands to lengthen the amount of time they spend in-store, which in turn increases the likelihood of them purchasing unplanned items. Personally, I have this happen to me all the time–I’ll meander around the grocery store on the phone with my mom, and absentmindedly grab impulse buys in addition to sticking to my list. For brands and retailers afraid of the impact of mobile, this could be valuable information about shopper behavior in-stores.

Conversely, according to the study, phone use can also lead to more planned but not purchased products; in other words, shoppers’ related use of their smartphone/mobile device also leads to not buying items they had on their list. Shoppers in the Related Use category missed more items than participants in the No Use category, as well as the shoppers in the Unrelated Use category.

In conclusion, mobile isn’t the big bad wolf for retail. In fact, encouraging the use of mobile tech in-store, particularly unrelated to shopping, can be beneficial, as it leads to increased unplanned purchases, more time spent in-store, and more repeat trips. Finally, if brands and retailers become aware and remain cognizant of the impact mobile devices can have on purchases. So, when you talk about in-store, don’t think you can exclude mobile from the mix.

About the Study

Previous research acknowledges that almost 60% of all consumer purchases are completely unplanned prior to entering the store (Inman & Winer 1998). Given the prevalence of in-store decisions, additional research on in-store factors influencing consumers’ decisions is vital. Therefore, the goal of this research is to investigate the role of in-store mobile technology use (i.e., using a cell phone or smartphone while shopping) on consumers’ in-store decision making. For the full study, click here to download, or visit POPAI’s Research Library.

About the Data

The data in our study comes from the 2012 POPAI Shopper Engagement Study. The sample consists of 2400 supermarket shoppers from four US geographic census regions. Prior to shopping participants completed an entry survey detailing planned purchases, expected spending, and demographics. After shopping, an exit interview was used to collect information on products purchased, actual spending, cellphone or smartphone use, and store attitudes.

For more on POPAI’s 2012 Shopper Engagement Study, please click here.

Here at POPAI, whether we’re talking about in-store or online, we always champion the experience that is shopping, and how a good experience in turn is the key to a successful path to purchase for the shopper (and for brands, CPGs, producers and retailers).

One retailer with that whole experience thing down pat? Zappos, the online retailer that’s got an insanely good reputation when it comes to working with shoppers. According to this article from Forbes, there’s a reason Zappos CEO Tony Hsieh has written the go-to book on customer service–and it’s that Zappos delivers a “wow experience” every time. How, you might ask? And more importantly, how can we apply the same principles to our own retail practices, in-store or online? Read the full article from Forbes, here.

What Zappos Taught Us About Creating the Ultimate Client Experience
By Barry Glassman
Forbes