How In-Store Merchandising Builds The Connected Store

By Joe Holley, Vice President New Business Development, Frank Mayer and Associates, Inc

Click here for the first part of this series.

The importance of connecting channels and crafting digital experiences for shoppers is irrefutable. In the retail industry it should be consuming a greater portion of everyone’s workday as we seize the challenge of appealing to an emerging segment of connected consumers.

The spaces where consumers shop are distributed and no longer linear. They encompass online, in-store and mobile channels in no specific order. Incorporating all of these channels into a physical shopping experience will position retailers to compete for valuable segments of consumers.

 In-store merchandising factors squarely into plans for delivering connected experiences that appeal to prolific segments of shoppers. We’re paying attention to some compelling information on the significance of connected consumers and connected stores.

Forrester Research periodically samples the behavior of the U.S. online population, i.e. connected consumers. A 2012 sampling revealed that 17 percent of shoppers are “Super Buyers” who like to buy from online, offline and mobile channels, and 24 percent are “Connected Traditionalists” who may own mobile devices but prefer to shop online and offline. These two segments are driving efforts to provide connected store experiences.

A full 59 percent of shoppers in Forrester’s survey still cling to traditional brick and mortar shopping, eschewing online and mobile purchasing, but this slice of the pie will continue to shrink. Online activity is growing, and more people use their mobile devices in-store than they do in their own living rooms and kitchens.

The focus on connected consumers (The Super Buyers and Connected Traditionalists that Forrester identified) promises a significant return. These segments are the most valuable shoppers.

Walgreens, for example, found that customers who shop in-store and online spend an average of 3.5 times more than store-only shoppers. Add mobile shopping into the mix, and average spending at the chain is six times more.

The discovery of connected shoppers’ power will fuel innovation. The National Retail Federation commissioned a study (2012 Global Cross Channel Retail Report) focused on the concept of the connected store and concluded that we are in the early stages of making it a reality. NRF’s partner, the Ebeltoft  Group, identified four types of connected store initiatives:

• Brand Image/Buzz/Excitement – e.g., interactive windows or digital walls
• Rich Content – e.g., QR codes, touchscreens, product reviews
• Product Assortment Extension – e.g., buy online from self-serve or associate device
• Customization and In-store CRM – e.g., mobile loyalty programs “push” to store or in store

What do some of these initiatives look like when they’re translated into in-store merchandising programs? Retailer Sport Chek has opened two retail lab stores that provide working examples and may make you want to schedule a trip to Canada.

The digital display wall