The Retail Experience Economy: In an Age of Abundance, Shoppers Crave Experiences From Retailers
Retailers need to offer a more multifunctional, experience-based environment in order to inspire, win and retain the loyalty of customers, according to a new report by Retail Economics and global law firm Squire Patton Boggs.At a Glance• The Retail Experience Economy identifies four key factors determining a customer’s shopping experience: (1) Environment, (2) Education, (3) Escapism and (4) Entertainment • 24 per cent of 2,000 respondents said they would willingly pay more for the same product if it meant they would receive a meaningful experience when purchasing it• 43 per cent of shoppers said that they are likely to spend more money in the future with a retailer who offered a meaningful shopping experience in-store• Entertainment ranked the highest for younger consumers: 35 per cent of respondents aged between 18-24 years old, compared with just 13 per cent for the 65+ age group.• Environment was the most important element of a meaningful shopping experience, selected by almost half (46 per cent) of 35-44 year olds• Almost two thirds of consumers are more inclined to shop at destinations that house cafes, restaurants and bars as they place a multipurpose environment with social meeting points as a high priorityUK retail is undergoing significant structural change. A behavioural revolution is taking place through a transformational shift in what people value most — experiences. Evolutionary processes have guided economic value from commodities, to goods, to services and in this new paradigm, experiences are taking prominence over products. The genesis of an emerging era of retail is rearing its head – The Retail Experience Economy. Retailers must engineer seamless experiences that envelope the consumer in beautiful retail environments that entertain, provide escapism and relevant education.Research conducted by Retail Economics and Squire Patton Boggs found that almost a quarter of consumers said they would willingly pay more for the same product if it meant they would receive a meaningful experience when purchasing it. Furthermore, 43 per cent of shoppers said that they are likely to spend more money in the future with a retailer who offered a meaningful shopping experience in-store.Retailers’ abilities to predict, analyse and adapt to forthcoming waves of these behavioural shifts will stand as the differentiating factor from their competitors.