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In-Store Digital Retail Study: Exploring the Reality of the Digitally-Enabled Store

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Highlights from SapientNitro's 2014 Digital Retail Study - proprietary research on 72 U.S. and Canadian retailers. To what extent are retailers responding to the challenge of the always-on consumer?

Presented at Toronto Advertising Week in 2014. #FFWD2014

Published in: Business, Technology
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In-Store Digital Retail Study: Exploring the Reality of the Digitally-Enabled Store

  1. 1. In-Store Digital Retail: Exploring the Reality of the Digital-Enabled Store David Bradfield Strategy @dbradfield Hilding Anderson Research & Insights @hildinganderson
  2. 2. 1. How to plan for and engage in an omnichannel world DISCUSSION HIGHLIGHTS 2. The current state of digital retail 3. Three insights driving change 4. Six research highlights 5. Five truths shaping the next wave of retail 2
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  5. 5. © 2013 SAPIENT CORPORATION | CONFIDENTIAL
  6. 6. PUSH DRIVEN BRAND ECONOMY IT WAS SIMPLE It was all about 360° marketing, having a great ad campaign and a robust media plan. Consumers watched the commercial and did what they were told. BRAND EXPERIENCE TECHNOLOGY/ PHYSICAL 6
  7. 7. Each connection inspires engagement with another, ultimately infusing the brand into the consumer’s own story… and the consumer into the brand story. BRAND EXPERIENCE TECHNOLOGY/ PHYSICAL
  8. 8. Stories People seek affinity. By connecting to consumer  desires, digital channels deliver compelling stories  in the moment, the ones fans will want be a part of. Experiences We activate channels as an integral part of physical,  digital, commerce and service experiences to  turn engagement into action. We tap into your  community to drive behaviour and growth.  Relationships You’ve worked hard for your fans to take action.  Make them work for you. Tap social, CRM, loyalty or  community programs to turn your best fans into an  always‐on advocate network, moving from  B2C to C2C. 12
  9. 9. The Future of Digital Retail: Based on SapientNitro Proprietary Research
  10. 10. About your Speaker: Hilding Anderson Director of SapientNitro’s Research Institute 15 years of experience Editor of Insights Published in Forbes, speaker at SXSWi Entrepreneur 14
  11. 11. "That truth is that traditional brick and mortar retailing is an inflection  point. No longer are many retailers only required to compete with stores on  the other side of the street. They are now required to compete with stores  on the other side of the country." Starbucks CEO Schultz, January 23, 2014 15
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  16. 16. 3 INSIGHTS DRIVING THE CHANGE 6 HIGHLIGHTS FROM THE RESEARCH 5 TRUTHS FOR TOMORROW’S RETAIL 20
  17. 17. Our insights on THE EVER-CHANGING retail consumer 21
  18. 18. 01: NEW SHOPPING BEHAVIOR: ‘SHOPPING-IN-INCREMENTS’ 22
  19. 19. CONNECTED DEVICES DEMAND UNIQUE EXPERIENCES Minutes Average Minutes Spent Per Interaction By Device 50 45 40 35 30 25 20 15 10 5 0 UK consumers switch between devices 43 39 21x 30 17 per hour Source: OMD 2013 Study TV PC/Laptop Tablet Smartphone Source: Google, August 2012 23
  20. 20. DRIVEN BY TIME SPENT U.S. Consumer Media Consumption Share 50% 45% 45% 44% 43% 42% 38% 40% 35% 30% 25% 25% 26% 26% 26% 20% 20% 20% 17% 16% 15% 15% 14% 12% 12% 9% 10% 9% 6% 8% 7% 6% 4% 5% 4% 7% 8% 7% 5% 5% 0% TV Source: eMarketer, August 2013 Online Radio 2009 2010 Mobile 2011 2012 Print 2013 Other 24
  21. 21. 02: A DIMINISHED AND CHANGING ROLE FOR THE STORE U.S. 2013 holiday foot traffic is just 50% of 3 years ago 52% of Canadians report shopping online more than 3 years ago, amid more options than ever Source: SapientNitro 2013 Study 25
  22. 22. 03: EXPERIENCE IN DIGITAL + PHYSICAL HAS IRREVERSIBLY COLLAPSED INTO ONE 62% of Canadians want to use all their devices (mobile, tablet, laptops) to help them shop Source: SapientNitro 2013 Study 26
  23. 23. Highlights from the 2013 IN-STORE DIGITAL Retail Study 27
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  25. 25. Methodology: Approach:  On-site, unannounced visits to 72 major retailers  At least one location, primarily Flagship stores in NYC and Toronto, selected Chicago stores  Ipsos Consumer Survey sent to 1,500 customers  Comparison to 2012 survey  July 2013 – September 2013 What we found: • 500 points of data collected • Based list on 2012 with addition of 12 Canadian-based firms, and added several known, leading retailers 29
  26. 26. KEY FINDINGS OF IN-STORE DIGITAL RETAIL STUDY • For first time, three retailers crowned “excellent” • Just 18 (of 72) retailers emerged with scores higher than 45 (out of 75 total points). • Several of last year’s leaders were outpaced by newcomers • Interactive tools and the store experience separated leaders from followers
  27. 27. KEY FINDINGS OF IN-STORE DIGITAL RETAIL STUDY
  28. 28. FIVE AREAS OF EVOLUTION (BUT NO REVOLUTION) • Mobile tools are the area of greatest change • Omni-channel shopping technology is widespread • Retailers have significantly improved the integration of digital content and store design • Not enough focused on interactive tools • Few retailers use their store to create digital + physical experience 32
  29. 29. 01: MOBILE: WAYFINDING AND BARCODE SCANNING
  30. 30. 02: OMNICHANNEL SHOPPING
  31. 31. 03: IN-STORE DISPLAYS AND LAYOUT
  32. 32. 03: IN-STORE DISPLAYS AND LAYOUT CONT’D
  33. 33. 03: IN-STORE DISPLAYS AND LAYOUT CONT’D
  34. 34. 04: INTERACTIVE AND PERSONALIZED TOOLS
  35. 35. 04: INTERACTIVE AND PERSONALIZED TOOLS CONT’D
  36. 36. 05: EARLY STEPS IN CROSS CHANNEL STORYTELLING
  37. 37. 06: DIGITAL ENGAGEMENT CREATES MEASURABLE VALUE
  38. 38. Rules for Tomorrow’s RETAIL EXPERIENCES 42
  39. 39. RULES FOR THE NEXT 5 YEARS OF RETAIL 1. A single, connected experience: physical and digital spaces have irreversibly collapsed into one. Physical stores must enhance our digital spaces. 2. Stores still matter: Consumers still want specialty stores, value the services that they get from them, and the human interaction. 3. CMTOs must embrace new tech: BLE, touch screens, mobile payments, in-store real-time analytics, and even native advertising are enablers for creating new blended experiences. 4. Be participatory: Beyond push advertising, generic merchandising and passive shopping patterns. Shoppers now want to own the experience. 5. Build around themes: To build powerful experiences, shape stories around an organizing idea.
  40. 40. More in the IN-STORE DIGITAL RETAIL STUDY 44
  41. 41. THANK YOU! © 2013 SAPIENT CORPORATION | CONFIDENTIAL

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