A recent report from CBRE shows that retailers will seek to cap a strong year this holiday season by doubling down on strategies to draw online shoppers into stores, reward their loyalty in new ways, and ensure that the gifts they seek are available at every turn.
In a release from a representative of the firm, Jeff Moore, CBRE’s senior managing director for the Orange County region and head of retail services for Southern California, is quoted as saying, “Brick-and-mortar retailers here in Southern California and across the nation have made tremendous advances over the past few years adapting to e-commerce.”
Moore adds that in SoCal, these retailers are right-sizing their store footprints and creating an effective omnichannel approach for the different needs and wants of their customers. “I predict a very good shopping holiday season as both retailers and consumers are getting on the same page.”
SoCal Real Estate spoke with Moore about how SoCal retailers are reaching their omnichannel goals this season and how the relationship between brick-and-mortar stores and online shopping will continue to evolve in this market.
SoCal Real Estate: How are SoCal retailers synergizing their brick-and-mortar stores with their digital presence to enhance sales and customer experience for holiday shopping?
Moore: Many stores with an online presence have utilized a “buy online, pick up in store” model, but this approach relies on a store’s current stock to fulfill orders. To adapt to this issue, some are now fulling the online order from a warehouse and offering customers free shipping to the store for pick up. This gets the customer into the store, where an opportunity exists for additional purchases. It also allows the retailer to streamline the inventory that is carried within the store and improve efficiency. Retailers can also incentivize their customers by offering discounts and rewards to use for in-store purchases and create customer loyalty.
The focus with retailers has shifted to in-store digital experiences in bridging the gap between shopping online and shopping in the store. The customer experience needs to be seamless and easy.
In addition, many in-store sales are now announced online through social media rather than depending only on foot traffic. This leads to more people visiting the store who otherwise would not have known about the sale or promotion.
How will this relationship between brick-and-mortar and digital continue to evolve?
Convenience is key to the omnichannel evolution, and it is being fueled by advances in technology: automated delivery vehicles; drones and robotics in warehouses to process orders quicker; smart AI that can study consumer preferences and recommend items in the store to buy; cashier check-outs that can identify what the customer is carrying out and charge their account automatically. They are all examples of the dramatic technology evolution in retail. In addition, retailers are trying to push sales online and reduce their retail store size footprint, converting them to more of a “showroom.” The days of shopping only online or in store are fading; it is all about omnichannel.
What are the pitfalls to avoid when using omnichannel retailing?
Balance is everything. In order to survive, a retailer can be neither purely brick-and-mortar nor solely online. They need to play in both worlds. This applies to everything from the shopping experience to trying on or seeing the product to picking up or returning the merchandise to having their questions answered and overall customer service. It needs to be a good experience or the customer will go elsewhere where it is more convenient or easier to shop.
What else should our readers know about this topic?
This is an exciting time for retail. The media sometimes portrays a picture of the “retail apocalypse,” but it is not an accurate portrayal, especially here in Southern California. Yes, some older brands are dying or going bankrupt because either their model or concept is not current or they are over-leveraged or have not adapted to changes and technology quickly enough. On the other hand, space is being backfilled by new concepts or existing brands that have learned to evolve and innovate to changing consumer preferences. The online ecosystem provides a unique challenge and opportunity for all retailers to focus on making the marriage with the physical store seamless and easy for the customer to shop.