In Asia-Pacific retail, everything is a storefront and the door sign is never turned ‘closed’. This is the reality of commerce and marketing today whereby consumers can shop for over 24 hours without leaving their homes. However, this is not to say the brick-and-mortar experience is dead; far from it in fact, but is ripe for significant transformation.
Despite the mass explosion of digital and social media commerce, APAC consumers still enjoy the physical shopping experience. Indeed, the majority of consumers prefer to mix both online and offline shopping. Indeed, many consumers no longer even see them as separate pillars. Brick-and-mortar, e-commerce and social commerce are, in fact, just commerce. The question is, however, how do brands and marketers merge them to provide a seamless omnichannel experience to consumers?
Over the past decade, e-commerce and social commerce have exploded, with many traditional stores pivoting rapidly to meet online demand. However, the COVID-19 pandemic laid bare humans’ fundamental need for sensory experiences, especially touch. Indeed, according to a report from IBM, touch and product interaction influence the purchase decisions of over half of consumers. As a result, retailers are now increasingly re-embracing the physical shopping experience – albeit with a digital twist.
Notably, RPG Commerce Group, a direct-to-consumer (DTC) startup home to drinkware and cookware brands Montigo and Cosmic Cookware, began purely online business at the height of the pandemic lockdowns but has since ventured into physical retail. Today, it has physical stores in Malaysia and Singapore that feature interactive displays, demonstrations, personalised customer service and customised products such as engravings and hand-drawn limited editions by Malaysian artist Fawwaz Sukri.
Bistro Bytes, meanwhile, has perfected the omnichannel experience by allowing customers to mix and match orders from either in-person at various kiosks in the mall or through a single mobile application – KLIK by Keppel.
Any retail vertical can benefit from these kinds of hybrid experiences. The trick is to find the right model that fits both the needs and interests of your target demographic and meets them at their convenience.
The rise of ‘retailtainment’
Traditionally, storefronts have aimed to entice visitors through lavish, eye-catching window displays. But anyone who has gone and bought a bag of cookies after passing a Famous Amos store knows that humans are a highly multisensory species. Gone are the days when visual merchandising was enough to stimulate shoppers. Now, according to recent research, almost two-thirds of consumers want brands to immerse them in experiences that hit all senses.
However, for many consumers, the physical shopping experience largely falls flat. As many as 70% of shoppers admit that they can’t recall the last time a brand excited them. That is not to say consumers no longer want to shop physically — they just want more from these spaces.
Marketers should not be surprised by these sentiments. Nobel Prize-winning economist and philosopher Daniel Kahneman famously researched that 95% of human decisions are made emotionally. A brand cannot expect to have an emotional impact on a customer without appealing to their senses.
There are multiple ways to achieve this, whether through music, decoration or signature scent. Brands like Nike notably took this to another level with the creation of its Air Max Listening Room, an immersive listening experience designed to capture the music that inspired the product.
Temporary pop-up shops are a hugely powerful tool for digital-only brands or for retailers looking to experiment with new concepts or create a buzz. Pop-up shops and augmented reality experiences can be used to deliver product information, reviews and virtual try-ons.
Marketers can achieve this by creating AR window displays in busy areas where passersby can use their smartphones to interact with products displayed, get detailed information and make purchases without entering the store. To drive conversions, marketers can pair these with an RFID tag for customers to scan to add products to their online cart and buy within a matter of clicks.
Experimenting with this type of experience can have significant brand benefits. Around 80% of retailers that set up a popup said it was a success and nearly 60% intend to do it again.
The AI revolution
Generative AI exploded into our lives less than two years ago and today it remains a top talking point for marketing leaders. Yet, most are still figuring out exactly how to use it. Marketers, technology and business leaders are still to create tangible business cases for building effective GenAI models. Moreover, many are still grappling with its safety implications.
Nevertheless, 67% of marketers feel positive about the possibilities of GenAI and more than half of marketers are looking to invest heavily in developing A and machine learning capabilities in their business verticals.
Although still in its infancy, retail marketers can still begin exploring genAI and machine learning technology for product discovery and personalisation for consumers based on user history and first-party data.
Marketers can begin exploring using AI-driven content creation tools to automate product descriptions and marketing copy, but at this stage, will still require a significant degree of human oversight.
Other uses include introducing AI-powered visual search functionality that allows customers to upload images and find similar products on your platform. These can sit alongside voice-activated ads for smart speakers where users can ask questions, hear detailed product descriptions and make purchases through simple voice commands.
Last, but by no means least, marketers can combine AI with AR to provide an immersive shopping experience such as using AR to try on clothes and AI to suggest other recommendations.
Culturally purposeful
Due to the proliferation of information available today, people are hyper-aware of the world around them. As such, brands and companies are held to higher standards and consumers want brands to be purposeful within their cultural context. Globally, 80% of consumers say they make an effort to buy from companies that support causes important to them. However, consumers are also discerning whether a brand is showing genuine support or is simply capitalising on a cause.
Brands are now walking a tightrope of being called out for staying silent on issues and for speaking out and appearing disingenuous. Learning how to navigate this tightrope is still a work in progress.
However, these are some tactics that can help brands take a genuine stand on social causes that matter to them. One is to create dedicated sections for products that support social causes, such as Australian retailer The Iconic’s ‘Consider’ clothing section. Marketers can track these sections with real-time impact tracking to show customers the direct results of their purchases.
Brands can also create transparency reports on sustainability efforts and social impact directly on e-commerce platforms. They can also partner with artists and community leaders to create exclusive product lines that reflect cultural heritage, offering unique stories behind each product.
Staying ahead of the competition is challenging for retailers in 2024 as new retail providers emerge regularly and attempt to undercut the market. Marketers indeed may find themselves in a heated battle between rivals, e-commerce players and even social media influencers.
However, it is evident that consumers no longer want to simply scroll and click when they shop. The demand for physical experiences is real and marketers are now in a position to use technology to take these to the next level.
This thought leadership is written by Keith Ho, Strategy Lead at NP Digital Malaysia
MARKETECH APAC is leading the conversation on the future of e-commerce marketing strategies this 2024 and beyond with the E-Commerce Marketing in Malaysia 2024 conference on July 25, 2024 at Sheraton Petaling Jaya and the E-Commerce Marketing in the Philippines 2024 conference on August 14, 2024 at Crowne Plaza Manila Galleria. Join us and become an integral part of a dynamic community committed to pushing the boundaries of innovation and fostering unparalleled growth in the e-commerce domain.
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