The Connected Store - How Malls Can Help Their Retailers
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Malls are now inefficient marketplaces that focus on asset appreciation. Digital marketplaces are highly efficient, focusing on customer value appreciation. Why are customers more aligned with digital and how do malls win them back? This presentation, given at a Denton's law firm event in Sep. 2016 to a room of retailers and malls, was designed to help introduce malls to the fundamentals of what's happening out there and show some changes in behavior/approach they could adopt to add more value to their retailers and shoppers
The Connected Store - How Malls Can Help Their Retailers
- 1. WE NOW LIVE IN A DIGITAL MARKETPLACE ECONOMY SHOPPERS are increasingly engaging in multiple digital marketplaces via multiple digital tools and services before choosing how to transact and RETAILERS are increasingly discovering how to distribute and engage in places and ways other than the mall and store @bricksandmatter @lfreudenberg @robgorrie
- 2. the original marketplace digital marketplaces expensive: square footage + right inventory + right time + right location + high service levels + scaled traf鍖c asset appreciation focus ef鍖cient: scale + all inventory + right time + low service levels + solve problems + distribution customer value appreciation focus
- 3. I N A W O R L D O F T H I S W H Y I S T H I S T H E S H O P P I N G E X P E R I E N C E W E A R E P R E S E R V I N G ?
- 4. I N A D I G I TA L W O R L D O F W H Y I S T H I S E N V I R O N M E N T S O A N A LO G ?
- 5. customer focused Canadian startups are solving your shopper problems at your expense nibbling away at the edges at the expense of the mall and retailers by using or creating digital marketplaces, the same way FinTech startups are eating the banks.
- 6. WE ARE LIVING IN A VERY DIFFERENT RETAIL WORLD The Lux+Food Mall Community mall The Mega-mall The Digital Mall The Digital Marketplace The Lux Digital Marketplace 1950s 1980s 2000s Today Tomorrow
- 7. DIGITAL MARKETPLACE PARTICIPANTS 35% increase in stock price over 5 years West鍖eld labs Big bets on tech Solving problems with partners (partner strategy) to create their own marketplace Top 50 most innovative companies (Fast Company) 85% increase in stock price over 5 years Simon Ventures Investing in technology companies to solve problems (鍖nancial strategy) to enable a marketplace 120% increase in stock price over 5 years Open marketplace to answer business velocity challenge Non-organic growth via developer community Highest in Customer Satisfaction with Home Improvement Retail Stores by J.D. Power eight years in a row heavy emphasis on digital data collection overweight on mobile driven innovation to/in the store use marketplaces for content distribution
- 8. THE COMMON THREAD? beyond the silod tactics of contests, campaigns, coupons, wi鍖, digital signage, beacons, email, etc (low value, disconnected efforts not tied to solving shopper problems, eliminating friction or improving the experience)
- 9. SHOPPERS & RETAILERS NOW EXPECT A DIGITAL MARKETPLACE EXPERIENCE a loyal relationship a true value exchange connecting on my terms memorable experiences personalized moments
- 10. increasing value propositions and effectiveness by playing in (or being) a digital marketplace know your best customer - intimately be able to connect with your best customer enable, empower & engage your retailers/brands the connected store/mall shotgun approaches dont work. know and spend money on those spending money on you integrate the data in real time and implement the right tools to create and integrate with digital marketplaces use the data and tools to provide distribution channels and cheap digital traf鍖c to your tenants or brands while letting them plug in to your marketplace efforts its all about personalization but not all malls/stores are created equal HOW TO GET THERE 1 2 3 4
- 11. Lux & Frequency Shoppers Infrequent & Convenience Campaigns, Coupons & Contests Value & Non-mall / non-store shoppers WHO IS YOUR BEST CUSTOMER? CAN YOU TALK TO THEM? DO YOU SPEAK TO THEM AND PROVIDE VALUE THE SAME WAY YOU WOULD A WAL-MART SHOPPER? Why are so many traditional retailers still so far behind at creating digital experiences that customers really want?: because retailers have focused exclusively outwards at their competitorsat the expense of paying closer attention to the cues their customers were giving them about what they really want. This has dramatically widened the digital divide Deloitte: The New Digital Divide #1. know your best customer #1
- 12. stitching together new tracking tools to create more shopper value traditional trade area digital behaviour exact trade area digital activity store visit+store path in-store product demand to a transaction basic store segments who are my real customers and what do they do exact/enhanced store segments via mobile in store identi鍖cation and tracking product interest who are my BEST customers #1. know your best customer
- 13. connect with your best customer: digital traf鍖c IS physical traf鍖c: 60-80% of shoppers research and are in鍖uenced digitally 鍖rst. You have to GET THERE 鍖rst. #2. tools to connect with your best customer #2
- 14. digital traf鍖c generation tools #2. tools to connect with your best customer
- 15. 10% of shoe sales in Canada are online90% of鍖ine Town Shoes competitors are intercepting them before they even get to their website OR their stores use the tools to understand who is reaching shoppers via digital marketplaces before you #2. tools to connect with your best customer
- 16. who is investing in digital tools & marketplaces?: home hardware vs. the competition #2. tools to connect with your best customer
- 17. malls MUST take a leadership role in demand generation. use their scale and data & share the tools of demand not suf鍖cient to expect/hope retailers to drive their own demand and margins. Its a team problem and retailers need help and your resources (cash, human, knowledge) to succeed in your spaces #2. tools to connect with your best customer
- 18. landlord/retailer as a strategic partner with a plan (and the data, tools + marketplace) complete value proposition enhancement: using all of this consumer knowledge, data, tech and infrastructure to enable your retailers or brands: #3 1 + 1 = 5#3. empower your partners
- 19. sharing digital marketplaces require open door sharing and actioning of data malls need to mature their efforts retailers need to open up data is the new oil #3. empower your partners
- 20. Amazon mall vs. physical mall - Reports + Coaching: $29.99 / mo + % of sales #3. empower your partners
- 21. retailer knowledge base (I know my customers!) 3rd party knowledge base new shopper data, tools and services potential mall knowledge base & marketplace creation brand knowledge base #3. empower your partners
- 22. changing the leasing terms / relationships based on new digital marketplace models. changing the relationship with the data and tools digital pureplay to retail online suiting experiential popup 400,000 merchants in a popup subscriptions meet stores #3. empower your partners
- 23. a d v a n c i n g d i g i t a l r e t a i l data + tools + partnerships > physical customer experiences extending marketplaces into the mall to create experiences to engage brands and delight customers #4. the connected store the connected store /mall#4
- 24. the data-driven store becomes (and integrates with) the digital marketplaces and malls. Its all about store personalization and your Customer of 1 #4. the connected store
- 25. the connected store and customer experiences retailer / brand engagement The Amazon Effect (retailer friction elimination) shopper problem solving automation analytics sources transactional sources data aggregation data analysis data visualization data distribution tactics data demand generation engagement experiential connect with consumers change customer expectations
- 26. THE DIGITAL MARKETPLACE ECONOMY IS HEREthe ways malls and retailers can participate has fundamentally changed Laurie Freudenberg laurie@bricksandmatter.com Rob Gorrie rob@bricksandmatter.com