The Impact of Experiential Retail on Market

Impact of Experiential Retail on the Market
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Impact of Experiential Retail on Market
Marketing is arguably the heart of any business. It helps get the word out regarding the products offered by the business which in turn translates to higher sales. Through marketing, a business can also successfully create a strong brand, a factor that is of utmost importance in the modern market characterized by cutthroat competition. These factors make marketing, though expensive, important for any business (Kasemsap, 2018). However, the business environment has undergone several changes in the recent past calling for a change in marketing strategies. Traditionally, advertising through magazines, newspapers, radio, telephone, and television were the major marketing strategies. In the past when the majority of the population read newspapers and listened to the radio, the strategies were solid and successful. However, this landscape completely changed with the advent of the internet. More and more people are relying on online sources for news, pushing the traditional modes of marketing lower in the logs.
Moreover, getting the customers to come to your well-stocked store is no longer enough. Customers are getting more concerned with the shopping experience. Owing to the existing stiff competition and the ease with which consumers can switch from one seller to another, modifying marketing strategies is necessary for all businesses. As the traditional marketing strategies fall, new ways of marketing are on the rise. Experiential retail is one of the emerging strategies and is largely considered to be the marketing strategy of the future. This paper seeks to explore the impact that experiential retail has had on the market and look at some brands that have profited from experiential retailing.
Experiential Retailing
Experiential retail seeks to maximize the consumer experience and make shopping more enjoyable and less tiring through the creation of attractive and delightful in-store spaces. It is also aimed at creating a connection between the brand and the consumer through interaction and making them feel as if they are part of the brand. It is also referred to as engagement or participation marketing. Unlike in the traditional marketing where only a single sense was involved at a time, experiential marketing targets multiple senses at the same time. Rather than just buying the service or the product, experiential retail aims at selling an unforgettable experience to the buyer (Kohler & Esch, 2018). The rise of experiential retail has been informed by various factors, especially technological changes and changing consumer mindsets. Creating customer loyalty has always been, and remains, one of the major goals of any organization. However, as the economy became more on-demand, securing customer loyalty became increasingly harder. Stocking quality products became an inadequate means of achieving this goal. Improving the in-store experience took over as the main way of creating customer loyalty, hence the concept of experiential retail gained ground. The shift has also been informed by changing customer needs. Owning a product become less important than the experience lived during the shopping process. For instance, people value shopping spaces where there are activities involving the entire family.
Moreover, with the rise of online shops, which provide faster, cheaper and more convenient services without having to go to a store physically, brick-and-mortar stores have to improve the in-store shopping experience as a way of countering competition from the online stores. The decline in store traffic in some industries has also informed the shift to experiential retailing in a big way. Experiential retail is a continuous process since it is subject to the changing customer needs. Investment in research is therefore important in helping businesses keep abreast with the changing consumer needs.
Research has shown that there exists a set of elements that consumers want to be incorporated into their shopping experience. These elements include intuitive, human, meaningful, immersive, accessible and personalized (Maloney, 2018). The human element of experiential retail means that consumers need to feel human during their shopping process. This can be achieved through interaction with strategically located and friendly staff to help them navigate through the products and space. The rule taken by most establishments is that if the consumer did not want any human interaction, they would probably have bought the product online. The shopping experience should also be meaningful and immersive. Accessibility regarding payment for instance by allowing mobile payments is another way to improve customer experience. Finally, the shopping experience should be personalized for instance by incorporating discounts and perks that reflect the consumer’s shopping. Other factors that consumers look for in their shopping experience include convenience, product selection, customer service, as well as the general store environment. Convenience covers the ease with which consumers can find various products. Product selection covers the quality of the products, their uniqueness, and variety. Excellent customer service leaves a lasting impression on the consumer. The store environment should possess the ability to relieve, comfort and inspire the consumer. For instance, the environment should be able to engage the senses of the consumer – smell, sight, and sound- through lighting, hanging pieces of art, and music. To further draw consumers into the stores and create an unforgettable shopping experience, the concept of entertainment is increasingly gaining popularity among retailers. This has led to the emergence of the concept of ‘retailtainment.’ It basically refers to the merging of retail with entertainment and technology, with the aim of engaging and entertaining the consumers. This can be achieved through the provision of extra services such as in-mall entertainment, art exhibitions, theatres, restaurants, among other entertainment amenities within the shopping areas. Technology can also be incorporated into the shopping spaces through the adoption of various immersive experiences such as virtual reality and artificial intelligence (Mathur & Chhibber, 2016).
Experiential retail is also incorporated in brand-marketing. While brand-marketing in the past only involved events such as press launches, product launches, and roadshows, modern brand-marketing involves more social and consumer-oriented events. Brand-sponsored festivals, PR stunts, as well as interactive mall installations, are some of the new ways of brand-marketing meant to create an emotional connection with the consumer.
Impact of Experiential Retail on The Market
While adverts on the television and pop-ups on the internet can easily put one off, the same cannot be said regarding a physical store that stands out to the consumer. This is the major benefit of experiential retailing. It helps create a special connection with the consumer; a connection that the other modes of marketing can barely achieve. The greater focus on creating a form of interaction between the consumer and the brand helps creates a sense of ownership of the brand in the consumer. This also helps create customer loyalty. Increased brand loyalty leads to a stable flow of revenue. The involvement of different senses also helps direct the attention of the buyer to a certain product or service. The ultimate effect of these factors is increased sales and traffic to the store which generally leads to increased profitability (Foster & McLelland, 2015).
The retail market has become increasingly competitive. Standing out from the rest of the pact is one of the most effective ways of beating off competition. Experiential retailing therefore comes in handy. By personalizing the shopping experience of the buyers, they connect and relate more to your store. They are bound to choose the store over the rivals. One of the strategies for implementing experiential retail is the strategic placement of staff to interact with and help the consumers during the shopping process. Through this, the staff can get valuable feedback from the consumers, which can be used to improve the shopping experience within the stores further.
Generally, experiential retailing has largely transformed the retail market, and more changes are expected as brick-and-mortar stores strive to beat off competition from online retailers and respond to the ever-changing customer needs. It has also led to the animation of brand personality as well as increased retention and recall of consumers. Due to improved customer service, customer satisfaction and brand loyalty have been successfully built. Sales have increased and returns on investments risen. As more online stores sprout up, experiential retailing will be the only saving grace of the brick-and-mortar stores.
However, experiential retailing also carries various drawbacks. Compared to the traditional modes of marketing, experiential marketing has a much narrower reach. While traditional marketing may reach thousands of consumers at the same time, experiential marketing can only be targeted to a limited number of consumers at any gi...