What is the most effective store model of the future?
The store is evolving from a purely transactional space to one that serves many functions, acting as everything from an online collection point to a space for events.
Yulia O’Mahony, vice-president at consultancy AlixPartners, says this change creates opportunities as well as challenges.
O’Mahony says: “Knowledge of how your customers buy is becoming more important.” It’s important to know, for instance, which of your products must be available in store and what are more considered purchases that might be bought at a later date.
With products more commoditised than ever, the store environment and service levels have become more of a differentiator. Dixons for instance has successfully incorporated a service element to its offer with its Know How desks.
Staff skills need to evolve to deal with the changes, O’Mahony adds. “Tasks beyond traditional stock handling and manning the tills are coming to the fore. Staff now need to know the products well and be able to provide advice to customers.” This will often mean retraining and even rethinking pay levels.
Customers also like to see what others think. O’Mahony says a recent AlixPartners survey found 40% of customers buy online because other customers’ reviews are important for their decisions. She says incorporating reviews into the store might help reduce leakage to competitors’ websites.
O’Mahony says the key is to think strategically about where the business is heading. “There is no one-size-fits-all solution,” she says. “Some shops might gravitate toward more entertainment and technology, while others will focus on minimising costs and investing only in price as a key differentiator.
However, the room for innovation makes it a very exciting space.”
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