In a move perhaps contrary to their entire 21-year history, Amazon are starting to open stores. The brick-and-mortar manifestations of the world’s most profitable e-commerce site will largely be used as click-and-collect depots, but Amazon has also dipped its toes into the high-street book store market, with a personalized and modified shopping experience. The creation of these ‘stores’ is part of a wider step back toward the tangible, and could be part of a high-street renaissance as the physical looks to exist alongside the digital.
The move makes a lot of sense for Amazon. The retailer will be able to offer same day delivery at a heavily reduced logistical cost, as well as offering the type of click-and-collect service which is already fairly ubiquitous. Products will be displayed in store, in the hope of upselling to those collecting products or for marketing purposes, but the stores are essentially just another delivery option for the e-commerce giant.
Even so, the fact remains that 90% of consumer purchases are still made in store. Despite e-commerce’s unstoppable rise, most consumers are still more comfortable in a tangible shopping environment. Footfall has dropped and vacant stores are common, but the brick-and-mortar store is still alive and well. What is in desperate need of improvement, though, is the prevailing disconnect between the digital experience and the in-store journey. It is commonplace for brands to have dedicated, round-the-clock content teams, online-only offers and a great deal of personalization - the more innovative, though, are finding ways to connect that digital experience to their high-street stores.
The digitization of physical stores needn’t be particularly complex, and it is surprising how slow the average high street store has been to adapt. 84% of US customers said that watching content on digital displays passes the time in checkout lines, and 40% of consumers said they were more likely to shop in grocery stores that utilize video in their checkout lanes. With 76% of these shoppers saying that they wanted content showing what’s on sale in the store, a grocery store could increase both footfall and awareness of promotions simply by adding screens to their checkout lines.
Starbucks are utilizing mobile specifically to enhance sales, allowing customers to order and pay for their coffees through an app, a service that already comprises 4% of its total transactions. The likes of Taco Bell offer similar services, and brands are finding that app users spend a considerable amount more than the average customer - as much as three times more in Starbucks’ case. Mobile order-ahead will only continue to grow and, according to Business Insider, it will be a $38 billion industry by 2020, accounting for 10.7% of total quick-service restaurants industry sales.
And this is the more basic end of the spectrum. Luxury department store Barneys New York are employing technology to combine the best of physical and digital retail in the hope of giving a personalized shopping experience in-store. Customers who opt in will receive notifications when they near items in their mobile shopping bags or on their wishlists, as well as customized editorial content - videos, lookbooks, designer interviews, etc. - as they navigate the store. On top of these, staff in store are equipped with tablets that act as mobile point-of-sale devices, utilizing Apple Pay to speed up the payment process and reduce congestion at the checkout.
This kind of direct targeting favours luxury brands thanks to the customer’s willingness to engage and take time in-store, but will only spread as the consumer becomes more comfortable with the concept. Video content will replace the promotional poster, checkouts will be supplemented by roaming point-of-sale devices and the shopping experience become personalized just as it has done online. Amazon’s click-and-collect locations could exist alongside these new digitally-savvy stores, on a high street that brings together the tangible comfort of the physical store with the convenience and personalization of the online experience. The high street isn’t dead, far from it - it’s being dragged into the digital age, for its own preservation.