Is experiential retail overhyped and misunderstood?

Discussion
Image: zauo-newyork.com
Jan 30, 2019

Through a special arrangement, presented here for discussion is a summary of a current article from the Doug Garnett’s blog.

In New York City, an “experiential” restaurant enables customers to catch trout or salmon in a countertop “river” then have it prepared for dinner. The food had better be superb to support the extraordinary prices needed to maintain catchable, edible live fish.

Still, the question of experience in the store is critical because a group of “experiencer” consultants recommend turning stores into bad amusement parks.

In advertising, agencies work hard to create ads which might win Academy Awards, but don’t say anything important for the consumers who care about the product.

Retail experience suffers a similar problem. Adding a cafe at Tiffany’s to have “Breakfast at Tiffany’s” is showered with adulation by experiencers. It’s a nice, small PR idea, but nothing new.

Similar hype claims Apple’s stores are “gathering places.” This may be a warning sign of impending Apple problems. And praise arrives for Samsung’s Manhattan store, “which isn’t a retailer at all.” (Where do I begin?).

Retailers should pay attention to important truths about experience and retail:

  • Experience has always been very important: When retailers fail, the experience of shopping in their store generally no longer delivers the value shoppers expect or need.
  •  Retail’s purpose is to connect consumers to products: Products must be the focal point. Experiencer ideas build from the outside in – and leave out product as a result.
  •  Experience as an element cannot be separated from the entire store mix: The overall experience of shopping at your store includes everything from curation of product to pricing, customer service and cleanliness. This determines your brand no matter what your advertising says.

Strong stores already deliver excellent experience. When we visit an REI store we find products which help us anticipate or remember our experiences outdoors (the rock wall reminds us of our joy being outside).

Only when the right products are stocked in a store people want to visit with prices that fit expectations and customer service that wraps it all up can retailers thrive. So, can we please leave the extreme experience talk where it belongs — with Six Flags, Disney and Universal Studios?

DISCUSSION QUESTIONS: Do you agree that the focus on delivering experiential retail often come at the expense of product and the broader shopping experience? What are some key signals that a store has overdone its experiential slant?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Customer engagement is always good, but when overdone entertainment diminishes the overall customer experience and it can become a detractor."
"Consumers are both wary and weary of retail stunts. Hire and pay great people, invest in better back-end tech..."
"The role of concept stores is to help attract your core customer by leading with your brand story, not your product line."

Join the Discussion!

31 Comments on "Is experiential retail overhyped and misunderstood?"


Sort by:   newest | oldest | most voted
Ben Ball
BrainTrust

Retail has mistakenly equated “experience” with entertainment. (We even phrased it “retailtainment” for a while.) They are not the same. Entertainment is temporal and wonderful when sampled occasionally. We satisfy our need to be entertained frequently with variety. The experience we need to deliver at retail is more consistent, more product focused and more service oriented. For a great example, see L.L. Bean in the 1990s.

Bethany Allee
Guest

Totally agree with this sentiment. I want an experience when I shop. I want that experience to be a friction-less “get me the hell outta dodge” experience. Adding seemingly entertaining gates or distractions (especially if my kids are with me) is not the experience I want.

My current favorite retail experience is clicking “reorder” on my virtual grocery cart, having my assistant pick up my groceries on Wednesday mornings, and enjoying the time I get back so I can watch my kids practice karate.

Don’t entertain me. Facilitate my life experience.

Mark Ryski
BrainTrust

I agree that the blind pursuit of creating a new “store experience” can cause some retailers to take their eye off the executional ball and ultimately compromise the store experience. As Doug rightly points out in the post, turning retail stores into a circus won’t likely produce the desired outcome retailers or shoppers want. I believe that, to a great extent, retailers have forgotten that executing the basics effectively (e.g. fast check-out, knowledgeable and available staff, a good product assortment and in-stock inventory, etc.) greatly influence the store experience. Do things well before you hire the clowns and order balloons.

Ray Riley
BrainTrust

The article I’ve been waiting for! “Experience” in the retail context is a post-“omnichannel” buzzword that causes me a nearly involuntary eye-roll. How can one craft a physical retail “experience” without crafting a team member “experience” that is aligned and drives similar outcomes? Engaged team members will create engaged shoppers, and isn’t that an experience worth crafting? I absolutely agree that the focus on smoke and mirrors, the bells and whistles, and ultimately retail silver bullets come not only at the expense of the product and shopping experience, but also at the expense of the most important people in the store: the front-line team members. If they aren’t considered a high-priority in crafting “experience,” why not just convert your shop to a vending machine?

Georganne Bender
BrainTrust

As Doug succinctly points out, the in-store experience doesn’t have to be an EXPERIENCE to please shoppers. Catching a fish at your dinner table might be fun the first time, but who needs to do it more than once?

In-store events aside, the real experience lies in how shoppers are treated while they are there, how they interact with product and associates. Consistency is what’s memorable, not the circus.

Bob Amster
BrainTrust

Product should come first, service should be right up there and some unusual experience ranks third. Let’s remember folks, that experiential retail was here long before it had a name. FAO Schwartz single-handedly invented it in the toy business in the U.S. Haute couture stores have been offering super-plush environments with coffee, champagne, etc. for decades and that too is experiential. Putting in digital displays in certain stores for “his” entertainment is not brand new either. The Cabela’s, Bass Pro Shops and others have been offering experiential retailing since they opened their doors. Retailers rush to embrace some of these new concepts and soundbites, sometimes pushing the envelope of practicality (like who needs this?).

Chris Petersen, PhD.
Guest

Doug Garnett makes some excellent points. I would expand the list with one more critical element – customer experience cannot be separated from the entire customer journey. People enjoy surprises and the unexpected, but what brings them back is excellence in an end-to-end experience from search to purchase to post purchase. The challenge for today’s retailers is that customers keep moving the goal posts with ever higher expectations for choice and personalization. Customer engagement is always good, but when overdone entertainment diminishes the overall customer experience and it can become a detractor. And Doug raises the best question of all – will customers pay the extraordinary prices to catch their dinner in a restaurant more than once?

Ralph Jacobson
Guest

As I think about the examples in the article, the majority refer to NYC locations where the density of retailers almost demands theater in order to differentiate. If the experience drives not just traffic, but also revenue, then something’s working. However, don’t be impressed by a crowded, trendy store where few people are walking out with paid products.

Jeff Sward
BrainTrust

Explore + Experiment = Experience. Or “treasure hunt.” Or the really old-fashioned “retail = theater.” Gap ought to be able to provide an experience without devoting a corner of the store to a latte bar or tarot card readings. Well-edited assortments with good color management (ok, curated if you must) has always been the assignment. Malls are working hard on food and entertainment. Empty space is high incentive. Individual mall stores need to nail the basics first. Product = first. Then come all the right path-to-purchase components that make sense for that store. AI and VR do not solve basic product content and presentation issues. And yes, the basics are different today than they were five, 10 and 20 years ago.

Ken Lonyai
BrainTrust

A jaded article indeed.

Absolutely — the focus on delivering experiential retail often comes at the expense of product and the broader shopping experience. That, however, is not an indictment of delightful or amazing experiential retail, rather, it’s a commentary on poor management.

Any store has to get the basics right every time, all the time, or certainly, experiential retail is doomed to fail — that’s obvious to me. Even as simple an element as insufficient parking will bring down any experience if shoppers struggle before they even enter the store. If leadership thinks they can ignore that basic premise and try cover with an over-the-top experience, sooner or later reality will teach them otherwise.

Doug seems to favor well-managed/stocked utilitarian retail experiences. They have their place, but no brand is going to thrive with that approach, maybe just survive. Maybe.

Ananda Chakravarty
BrainTrust

Yes. Ken, well said. There is a basic flavor that is mistaken for experience and delight. But these are just standard operating procedures. The best brands and retailers are certainly not ordinary.

Brandon Rael
BrainTrust

We have seen the emergence of the Instagrammable experiential showrooms which attract both prominent social media influencers and aspirational influencers. According to Doug Stephens, The new retail format is essentially leveraging the store as media, a way to connect with the local community, drive stronger relationships and ultimately customer loyalty.

Experiential retail is hard to get right. Fundamentally, it’s not a physical or cultural switch you can just turn on, and suddenly everyone will be at your store posting selfies. The purpose of a physical retail store is migrating from being a distribution center to a multi-sensory media experience. To get this right, and to differentiate the store of the future from the pureplay e-commerce giants, companies have to make the right investments to elevate the role of the retail store associate into brand ambassadors.

In addition, as evidenced at the NRF, if you weave in the right amount of value-added technologies as well, you can drive optimized customer experiences.

Paula Rosenblum
BrainTrust

Experience cannot be separated from the entire store mix. It’s true online as well as stores, but the expectations are different.

Some basic retail truths:

  • Rule #1, sell things people want to buy;
  • Rule #2, make the experience fun (not frictionless … that word is meaningless, really);
  • Rule #3, love your customers (apologies to Jack Mitchell who wrote the book!);
  • Rule #4, be fair to your employees;
  • Rule #5, be a positive force in your communities.

This is a winning retail strategy. You can get away without following a couple of these rules for a little while, but not for so long.

For what it’s worth, Apple stores aren’t what I’d call “gathering places.” They are “try our stuff” places. The geniuses aren’t as bright as they used to be and unless you really, really love big crowds, there’s not a lot of fun to be had there once you’ve taken a look at what they have to sell. Don’t be Apple. As they say, “You, be you.” The best you.

Brandon Rael
BrainTrust

So much truth here Paula! The Apple Stores are given credit for reinventing what the retail showroom could be, However, it’s more about media and a try stuff out and play model than authentic experiential retail.

Ricardo Belmar
BrainTrust
Ricardo Belmar
Retail Transformation Thought Leader, Advisor, & Strategist
2 years 7 months ago

There is some absolute truth in the statement, “don’t be Apple. You, be you!” It’s true, only Apple can be Apple. You can learn from their “experiences” but you cannot just copy them and expect it to work in your store. Each retailer has to find their own brand identity to share with their customers, otherwise, any experience they try to create will fall flat, and merely be a me-too experience. Uniqueness is important!

Laura Davis-Taylor
BrainTrust
Laura Davis-Taylor
Founder, Branded Ground
2 years 7 months ago

Amen Ricardo … and Paula! This entire conversation boils down to who the brand is, what they represent and what the expectations are accordingly. Disney Store? It had better be hyper-experiential! Drug store? Tread carefully on what you should do versus could do. You get the point.

Regardless, I am happy to see this POV hit today. As Lee points out, the Nike store on 5th was astounding from a technical and “wow factor” perspective, but it was overwhelming. People were buying, yes, but was it all necessary? Or was it about being the most over-the-top store in the world? We all shared the fear that it would spark a copycat trend of building the craziest store out there — rather than the smartest stores.

*Strategically that is.

Lee Peterson
BrainTrust
This is a great topic in that I think you have to be careful not to overdo it when it comes to CX. Example: I went to the Nike “Innovation Lab” on 52nd and 5th in NYC during NRF and found the first floor and the “tech tower” to be overbearing. Like, what is that? At the same time, the customer service was off the charts so, that made up for, I guess you would call it, “The Show.” (P.S.: no one was interacting with The Lab when I was there) I find their store in Soho to be much more spot on, where you can play basketball, have it filmed and sent to you within minutes: selling and doing. Opposite of Nike’s over-the-top swing at CX is Space 24, Urban Outfitter’s “store(?)” in Austin, TX. There, they have an open space where you can hang out, sit by a fire pit, watch a band, get a beer/food/coffee and oh BTW, shop in one of the smaller stores they have attached to the space. To… Read more »
David Weinand
BrainTrust

I think it depends on the brand and/or category. There is reason, say, for an apparel/fashion retailer to create experiences that create affinity for the brand that leads to long-term loyalty. Take the Roots store in Boston — yes, they are selling goods but they have built it out to tell the Roots story (which is very cool) that gets customers really excited about the brand (which leads to greater sales of $80 sweatshirts and $25 socks…). Experience doesn’t have to mean entertainment and in stores like, say, CVS — the experience is enhanced by quicker checkout or more associates that can help a customer find what they’re looking for.

Phil Masiello
Guest

This is dead on point. Many retailers go over the top trying to create the experience and not enough on the fundamentals of retail.

Several years ago, there was a push for “eatertainment” restaurants. Some stayed in business for a few years, but at the end of the day, customers wanted good food and good prices. Yes, the decor is important in the selling and marketing process. But I agree with the author. No one wants to shop in an amusement park.

Focus on solving a customers need with the product you sell and that is the most important concept.

Bob Amster
BrainTrust

Except shopping for cotton candy, candied apples, pop corn, etc.

Dr. Stephen Needel
BrainTrust

Experience doesn’t have to be catching your own fish or butchering your own cow. It can be as simple as walking into Walmart, quickly finding the category you want to shop, easily seeing a good selection of products, and checking out with no wait. That’s a great experience. Throw in some food to taste at Costco and a minimalist experience becomes a good one. It’s not the show, it’s the products that will keep shoppers coming back regularly.

Shep Hyken
BrainTrust

Experience can be something that brings customers back again and again, as in an amazing and personalized customer experience (CX). An “attraction” is what this article seems to be focused on. How many times can you go to the restaurant that lets you catch the fish you are going to eat before the novelty grows old? I love the concept of experiential retail, but recognize the stores, malls and restaurants offering experiential attractions could become a destination for tourists and special occasions versus something that draws the frequent repeat customer. Does the location of the experiential attraction support that type of traffic? It’s great for larger markets like New York and Chicago and tourist destinations like Orlando and Las Vegas. Back to the old real estate saying — location, location, location.

Mohamed Amer
BrainTrust
Mohamed Amer
Independent Board Member, Investor and Startup Advisor
2 years 7 months ago

Experiential retail, framed here as bad amusement park, small PR, nothing new or gathering places detracts from an otherwise excellent argument that strong stores deliver excellent experiences.

Total customer experience is the emerging battle ground that separates winners from laggards in any business, especially consumer-facing ones. That entails product, pricing, services, shopping and browsing environment, as well as identifying the right brand promises and delivering on them. It translates to a level of trust that engenders more confidence in the brand, products, and services offered. When experience is accentuated with something fun and perhaps a bit unique and exciting, it serves to enhance the feel-good bond between consumer and brand or retailer.

No reason to go to extremes here, but if I have to err, I’d rather do it on the side of “experiential” rather than having a sterile undifferentiated store with products readily available from Amazon. It need not be a zero-sum game or of either/or.

Ricardo Belmar
BrainTrust
Ricardo Belmar
Retail Transformation Thought Leader, Advisor, & Strategist
2 years 7 months ago

There is no doubt that a balance must be struck for every retailer around how experiential their stores need to be. Sometimes this takes the form of curated merchandise (Story), sometimes it’s a brand story, (Roots in Boston), other times it’s about unique engagement styles (Nike House of Innovation). It will be different for each retailer. Doug is right — it’s easy to go overboard and hit an extreme that will backfire on the retailer and cause customers to turn away. In some cases, this carries a hefty cost for the retailer as well and ultimately, as a business, retailers have to sell products. That’s not a total condemnation of experiential retail per se, but again it means a balance must be found and this will be different and ideally unique for each brand.

Joanna Rutter
Guest
2 years 7 months ago

My favorite writer on this topic, Elizabeth Segran at Fast Company, says it better than I could here: “All these Instagrammable stores are blending into one another, and consumers are getting bored with the concept. In 2019, brands will need to think of other ways to get consumers into stores. Like, you know, developing great products, or having great customer service.” Consumers are both wary and weary of retail stunts. Hire and pay great people, invest in better back-end tech so you can tell the truth when your website says something’s in stock, and you’d be surprised how much more profitable your marketing spend can become!