Food retail: digital brings new opportunities to brick-and-mortar
On June 6, 2016, Amazon launched a full online supermarket service in the UK. With other major players, such as Ocado, already influencing the market, the brick-and-mortar food retailers feel a growing pressure. While many of them are also getting into the online retail game, it is very hard to compete with the logistical and marketing assets of the digital giants like Amazon. At the design agency CampbellRigg, we recognise the challenges our clients face but also see a lot of new opportunities for traditional retailers in the digital age. And here is why:
Brick-and-mortar food shopping is an experience that will never cease to exist.
While 29% of UK customers have confirmed that they shopped more online in 2016 than in previous years, only 10% do most of their shopping “from the couch”. People do and always will resort to brick-and-mortar shops - and not just because sometimes you need to buy food “right now” without waiting for the Amazon delivery. For most people shopping for food involves the experiential component that can never be replaced by clicking buttons on the website. It is all about seeing and smelling fresh produce, walking around the store for impulse food shopping and connecting with the local community. That is why creating customer journeys, clear focal points in the store and other aspects of shop design are as crucial now as they have never been before. When we designed Tesco Superstore at Welshpool we did exactly that. There we have created points of interaction with the customers, designed a new Tesco community and event space and created the natural store landscape with a “softer”, more welcoming feel in-store.
Brick-and-mortar can grow revenues with an omnichannel approach.
Digital marketing is not just a way to make people buy more food online - it is a way to increase your basket value when a customer is in the store. The customer journey today may start on a social media page, continue in the store and end with a purchase from your webshop. While working with our clients we at marketing agency CambellRigg emphasize the necessity to integrate various channels and keep your digital efforts in mind when you are designing a physical store.
From QR-codes on the shelves leading to web pages with nutritional information, to open wi-fi in stores and digital displays that let people order food in-store but have it delivered to their homes - you can always make sure your client's connectivity makes him spend more when he is on your premises.
Developing markets are embracing the supermarket and hypermarket concepts.
While shopping for food online has an appeal of novelty in the First World, for the shoppers in many territories the supermarket is still a fresh and appealing concept in itself. In countries like Turkey, customers are migrating from legacy shopping in small local shops to contemporary supermarket-style food retail which offers better quality, prices and service. There the retailers have an opportunity to introduce digital to their customers early on and plan for the future while creating new shop concepts and formats.
When the management team of Migros, Turkey invested in our store design and format planning services, their like for like sales increased by 25%. Then the team decided to invest in a large 40 store refurbishment programme within 12 months of the prototype opening. For details see the Migros case study.