Online to Offline: Why are retailers making the leap?

Mood Media study examines the thinking behind online-only players moving into the physical retail space

In recent years, many would be forgiven for thinking that consumer confidence in bricks and mortar stores is in irreversible decline. With the e-commerce giants dominating news headlines and reports of stagnant footfall on the High Street, it would appear that consumers are consciously choosing online over the in-store experience.

However, the recent trend of ‘online to offline’ – online retailers choosing to open physical stores – is one that challenges these assumptions.

Fast fashion brand Missguided’s foray into the physical in November 2016 and both Amazon’s Go stores and their recent acquisition of Whole Foods are some of the most high-profile examples of retailers who, despite enjoying huge success via e-commerce, have ventured into bricks and mortar. But why would this be?

A recent study by customer experience company Mood Media has suggested that such industry movements could actually be in line with the demands of consumers – with a more personalised opportunity to experience brands in person proving increasingly popular.

The international report – ‘The State of Brick & Mortar, 2017’ – looked into the expectations consumers have of their in-store shopping experience. The research was gathered from over 11,000 consumers, spanning nine different countries – Australia, China, France, Germany, the Netherlands, Russia, Spain, the United Kingdom and the United States.

The key findings from the research revolved around the importance consumers place on sensory stimulation, as well as their demands for an enhanced level of interactivity within the in-store environment.

Of those surveyed, nearly 80% of consumers cite “the ability to touch, feel and try products” as being the number one reason for choosing stores over the web. More than three in five say that if a store offered a bespoke multi-sensory environment (music, visuals and scents), they would rather shop in a physical store.

The study also uncovered the level of importance consumers place on retailers to deliver the right type of music. Overall, when the right type of music is playing in store, over 90% of consumers cite feeling positive emotions while more than two thirds of those surveyed assert that they feel more connected to the brand.

Mood Media marketing director international Valentina Candeloro (pictured) said: “With modern technology playing an ever-increasing role in everyday life, consumers are craving sensorial experiences and still value highly the stimulation provided by seeing, hearing, touching or smelling.

“Consumers – particularly younger consumers – aren’t just buying a product when in-store; they’re buying an experience. And their expectations for a positive, emotionally engaging experience are high.

“Our study shows that those businesses who deliver an enhanced customer experience can secure increased engagement from their customers, with half of those surveyed more likely to both stay longer and revisit in future, and around 60% likely to recommend the store to friends and family.”

The study also offers insight into the next generation of sensory innovations to entice in-store shoppers. The prospect of receiving redeemable promotions to one’s phone is something that more than half of respondents were excited by across the globe.

Likewise, the opportunity to influence music played in store would be well received – three quarters of consumers aged 18-24 would welcome this innovation.

Valentina added: “There are certainly challenges that retailers face when it comes to combatting the convenience provided by e-commerce. However, our research shows evidence to suggest that if retailers correctly read their audience and gauge their demands, the offline space can still be a successful one.

“Despite the ease of use online shopping offers, there are still a number of limitations it faces, with the vibrancy and atmosphere of the in-store experience being – to date – impossible to replicate.

“If retailers wish to attract customers in-store, it’s fundamentally important to ensure the transition between online and offline is completely seamless as each channel is valued for its own unique benefits.”