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Anyone who says that Steve Jobs' legacy resides in the products he created has clearly never visited the flagship store of Apple on Fifth Avenue in Manhattan, New York. The store is a mecca for technology geeks and a tourist trap in equal part, judging by the mixed lot you'd notice waiting in the queues snaking around the block, just to enter the store. Once inside, whether an Apple fan or critic, a wow moment is guaranteed.
In a world that is increasingly finding its boundaries redefined based on mobile operating software loyalties, what draws even the staunchest critic into an Apple store and shuts him up, albeit momentarily? One word: experience. The long tables with neat displays of the length and breadth of the Apple portfolio, including different tables for different colours of the same product, the staffers in their blue t-shirts, not just selling a product but sharing your enthusiasm for technology, the wide open white space that is the store. And of course, the Genius Bars, where Apple users can bring their products and sort out any query or issue they have with the product. Seasoned users will tell you that there are really no such earth shattering issues that can't be fixed with some initiative and a simple Google search. But coming down to the store and getting your query answered is probably a feeling akin to that of returning to your own tribe from unfamiliar foreign lands. (....AND THE FUTURE STORE)
The operative word here is experience. Products are available everywhere today, with little or no difference between two offerings. Why should I shop at one store and not at another is therefore a decision no longer led by the product. It is all about the experience around buying the product, led by the service and environment in which it resides.
There's one more reason why organised large-format retailers seem to be working overtime to improve the in-store experience. With same store sales crashing due to the overall economic slowdown, they are forced to explore new strategies to drive footfalls. So they are focusing on store events as well as new loyalty schemes, while some are even using the shop floor to sample private labels or new launches from established FMGC and durables companies. In short, the new store is morphing into an experience zone.
Experience is key
Homegrown menswear brand Blackberrys recently launched a new concept store in Mumbai spread over 35,000 square feet. The store has a welcome zone, trial areas with lounge seating to accommodate people accompanying the shopper, trial rooms with dual lighting, white plus yellow and even a customised playlist on the Blackberrys radio channel, Style Stream, to set the mood. On select days, the brand also offers customers a chance to seek advice from specially trained stylists at no extra costs. Nikhil Mohan, MD, Blackberrys, says that with international brands crowding the retail space and bringing with them the 'international' experience, Indian retailers have no choice but to step up to give the customer what she wants.
Mohan's insight that the shopper is looking for an entertainment filled shopping experience finds an echo in the a recent study titled 'Shop Talk' by IIM-A, TNS, KiE Square and Ogilvy Action. The study found that the youth of India usually visits hypermarkets as part of a casual outing or on an impulse. Piyush Kumar Sinha, professor in retailing and marketing, and chairperson, Centre for Retailing at IIM Ahmedabad, calls them "fun shoppers". This group of shoppers goes to the market with the objective of deriving maximum value from shopping in terms of bargains, information and enjoyment. For them shopping is another form of entertainment. Such shoppers use shopping as a "therapy".
But does promoting your store as a great hangout spot ensure higher spends from a significant section of the store traffic? Apparently it does. The same study goes on to say that shopping in groups encourages greater spends among shoppers compared to those individuals who visit a store on their own. "In general when a shopping group swells in size, the collective array of shopper needs and motivations begins to increase, eventually leading to a larger shopping basket," says the study. It adds, "The shopping floor also becomes a discussion platform for shoppers as they experiment with new brands/products, identify new possible usage occasions etc. Ultimately, what goes into a shopping basket ends up being the outcome of a joint decision process. Encouraging the hypermarket as a destination where families and friends can commune is a sure-shot way of ensuring greater footfalls and higher spends from existing as well as new shoppers," the study concludes.
There are mainly two kinds of experiences. One, a very stylish, very 'international' feeling, like the one offered by the so-called modern chains like Hypercity or Spencers, with their neat displays, product mixes and brands, entertainment zones like spas, cafes etc. The other is a more fun experience - for instance,
Big Bazaar with product demos, trials and samplings, upbeat music, announcements, exchange offers and so on. A simple indicator of the sort of experience a chain purports to offer lies in the choice of foods. Where a Hypercity and Spencer will have a quaint cafe with their coffee and sandwiches, the flagship Big Bazaar store in Phoenix Mills, Mumbai, has a range of street foods, such as chaat and pav bhaji, being sold just outside the store.
The experience is often defined by the format, says Rima Gupta, ED, TNS Consult. She gives the example of Godrej's Nature's Basket, known for its gourmet offerings, which offers the consumer a certain level of 'comfort' with its smaller and more intimate setting. Hence the occasional tea being served in a corner or something to eat, says Gupta.
The samplings and product demonstrations serve a dual purpose for retail stores. They up the activity quotient in the store, serving as a draw for consumers and also help them cash in on any vacant floor space. The captive audience at the store comes at a price for the brands. There is, however, no strict rule book that will be followed while ascertaining the price to be charged. A number of factors are considered - how much space will be needed, for how long, how many people to man the counter, will there be a floating representative. There are other considerations too: how much sales traction can the store expect post the promotion, the relevance of the activity to the store's shopper profile. And yet, despite all things being equal, a known brand will not be charged as much as a nondescript one. It is relationship driven after all.
Mind you, this trend of mixing business with pleasure is not limited to the metros. Blackberrys' Mohan says in time the company will take the new concept store to all the cities it is present in, including the tier II and tier III towns. Reason: the penchant for looking good and owning good brands is common across consumer segments. Plus, with limited entertainment options, apparel gets a higher share of people's wallet in smaller towns and cities. "If I take this store to tier II and tier III cities, it has the potential to become a talking point in the community, a place to be seen and to be seen at, an experience to share," says Mohan.
