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Blurring digital with bricks-and-mortar

Last week, I attended the Centre for Retailing Excellence conference near Walmart’s headquarters in Arkansas.

Doug McMillon,Walmart’s CEO, Judith McKenna, chief operator of Walmart U.S., and SVP of marketing Andy Murray were among the speakers.

A common theme across their presentations was the importance of digital technology in retail, with McKenna asserting that “the future is the integration of digital and physical.”

Murray talked about how online pickup lets shoppers “time shift” their tasks, giving them more flexibility over how they shop. Explaining how Walmart sees their mobile app as a tool to help shoppers navigate the store faster, he alluded to a pilot where items on a shopper’s list are overlaid on the store’s map to help the shopper save time as she completes her trip.

However, thorough blurring of the store with digital and transformation of the experience was broadly referenced as a more futuristic vision. In fact, McMillon commented that in five years Walmart stores “won’t look that much different.”

In the wider retail landscape, this isn’t the case.

To benchmark how we see the integration of physical and digital coming to life in Mass, it is worth looking at Canadian Tire’s latest prototype.

Last week, the retailer opened its Showcase location in Edmonton, Alberta, which is a good illustration of how the store presentation will evolve and what digital will enable.

Notably, this new Canadian Tire leans in its physical ability to offer services, a sense of community, and theatre around the product. In terms of services, it features 19 full-service, drive-up bays in its auto centre. In addition to honing its store-in-store areas to local demands, the Playing department includes a custom Hockey Canada Museum with a rotating collection.

This adds a sense of excitement and asserts Canadian Tire’s distinctive brand and cultural connection. Facilitating engagement, the aisles are wider and better lit, surrounded by mannequins and showcase displays to highlight the merchandise. Product interaction and shopper connection is driven throughout the box.

Layered on this, digital provides shoppers trip flexibility, ease, and an enhanced experience. The store has more than 50,000 square feet of backroom space dedicated to fulfilling online orders, alongside a dedicated drive-in area to serve pickup orders. More than 100 touchscreens help shoppers navigate the store and product options. In addition to using digital to save time, shoppers can use various kiosks to let them experience items, such as the store’s 3D “Canada’s Dream Backyard and Patio Builder” to envision planned outdoor furniture designs and a driving simulator to test tires under varied weather conditions.

Instead of merely tacking screens onto a traditional box, the store reconsiders its digital proposition more broadly. As the store experience evolves to assert both experience and ease, this will usher in implications for manufactures’ go-to market approaches as well.

Considering a category’s store presentation in terms of its linear shelf set and pallet displays looks antiquated in this more responsive environment. The store becomes the place to curate and showcase classic, new, and immediate-need items. Shopper marketing will also take on a more advisory role, targeting solutions to each shopper’s particular needs. This will mean leaning in on mobile, digital, social, and more event-based marketing.

To discuss in detail the implications of digital on retailers’ strategies and reach with shoppers, join us at Kantar Retail’s Canadian Retailing Forum in Richmond Hill, Ontario, on Sept. 10, 2015.

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