Innovation is the key to success in traditional retail

Online retailers are currently flying high, while their high-street counterparts are struggling to get people into their stores. However, the days of traditional retail are far from over.

The reason many well-known bricks-and-mortar names have gone under recently is due to a lack of innovation. This means both in store and online. It has been widely reported that this was the case with House of Fraser. And particularly in terms of the department store giant’s online presence.

Signs of the enduring value of traditional retail has spurred the trend for purely online retailers to set up physical stores. The biggest online retailer of them all, Amazon, again opened pop-ups in major cities, including London, over Christmas. It also invested in a traditional retailer when it snapped up Whole Foods in 2018. Other retailers born online, like cosmetics mail order business Birchbox, have also begun opening physical stores.

Going physical

So why is this happening? It enables customers to gain a deeper experience of their brand and this helps retailers to differentiate themselves in an increasingly competitive market.

Traditional retail stores already have this physical element along with an online presence. So you could argue that they have an edge over their rivals if they approach ecommerce in the right way. And they can learn a lot from their virtual competitors.

First, traditional retailers’ online store experiences must be up to the standard of leading ecommerce sites. This is the benchmark customers expect, and traditional retailers should not disappoint on this front. Second, they need to innovate in store, creating much more of an experience for their customers. This could include, for example, providing ways for customers to shop online, in store. This gives access to a wider range of products – clothes can be ordered that are not stocked in the right size, of example.

Online retailers should give their customers the opportunity to shop online in store.

Meet the scale-ups

However, innovating can be tough for traditional retail stores. This is particularly the case for the larger ones. It can take time for big retailers to get key decisions made, at which point the trend will probably have been missed. Building innovation teams in house can be expensive, and there is no guarantee that the results will work. An alternative approach is to look outside for inspiration in the growing community of creative late stage startups (also known as scale-ups).

Many of these businesses are innovating in retail. This gives traditional retailers access to relatively low risk innovation by forging partnerships with relevant companies to trial their ideas. Those that work can be adopted and used to create a better shopping experience, both in store and online.

Beyond the checkout

Another area in which traditional retailers can boost customer experience is once they have a shopper’s money in their bank account. But what exactly could that experience be if the sale has been made? And this is the same question many traditional retailers would ask. However, if you run an ecommerce website, the customer journey does not stop at the point of purchase. How customers are treated during the shipping process directly affects their impression of the retailer.

Beyond simply offering product tracking details, retailers can guide customers through the shipping process with regular personalised messages, while keeping a close check on the delivery to pre-empt any issues by giving shoppers advanced warning. This post-purchase phase, new to traditional retailers, also maintains engagement with customers, allowing brand reinforcement. It also presents the opportunity to share offers with customers and suggest complementary purchases, boosting both awareness and sales.

The great news is that many online retailers haven’t woken up to the full potential of the post-purchase experience, so it gives smart traditional retailers the chance to steal a march on their ecommerce rivals.

Traditional retailers still have a key part to play in the changing world of shopping and can compete with their online rivals. They just need to ensure their online presence is up to speed and keep innovating on both sides of the retail divide. In fact, the truly successful ones will be those that bridge this gap to deliver a seamless online and offline experience.