Let’s get phygital: embracing the hybrid retail world

It may be hard to imagine now in a world of clicks and cardboard packages, but before the pandemic, many retailers were confused about who the digital shoppers were.

“Many brands treated digital and in-store as two separate channels with different KPIs,” explains Ricardas Montvila, vice president of global strategy at customer insight platform Mapp. “There was an opinion that physical customers were different from those using e-commerce. Some even thought they were online avatars buying their sofas and dresses!

A digital change

However, the Covid lockdowns changed this perspective as physical stores were largely closed and everyone moved online. It led to retailers increasing their e-commerce services, physical retailers rapidly adopting online for the first time, and pure digital brands expanding their capacity.

This included more online delivery slots, click-and-collect services, mail-in product samples, and digital payment options. “The pandemic caused the shift to digital retail to accelerate much faster than previously anticipated. Customers had to switch to e-commerce, even those who weren’t tech-savvy or preferred the in-store experience. To a great extent they enjoyed it and accepted it”, says Montvila.

As closures were relaxed and stores reopened, albeit with social distancing rules still in place, retailers adopted additional services, such as pre-booked wardrobe spaces and expanded mobile/online apps to include product catalogues. This allowed customers in the store to browse online and shop using contactless or contactless self-service terminals, or wait until they returned home.

“After confinement, if you sold cosmetics, it was still not possible for people to try on makeup at the counter,” explains Montvila. “But consumers adapted very well. They understood that they couldn’t use a fitting room or try on lipstick, but they could still buy and then return the item if they weren’t satisfied.”

phygital growth

As such, there has been an expansion of so-called hybrid, ‘phygital’ shoppers, those who shop not only in store but also online.

According to a report on primary shopping methods in 2021 from the National Retail Federation and the IBM Institute for Business Value, about a fifth of baby boomers and a third of Gen Z now shop hybrid.

“Retailers now realize that the person browsing online and watching YouTube videos and the person walking into the store are the same person,” says Montvila. “They have not transformed from that avatar to a physical being. People are buying through both channels. Perhaps some retailers thought that things would return to normal after the pandemic, in the sense that we would all return to stores, but many of the changes we have seen will remain and evolve. That means digital, physical and hybrid.”

It also means, he adds, that those in the C-suite have a greater desire to speed up their omnichannel services. “They are more aggressive in spending their money on innovative and exciting technologies,” says Montvila.

This includes contactless payments, as seen at clothing retailer Zara and Amazon Fresh grocery stores. “Using the Zara example, you simply place your items at the self-service checkout, an RFID scanner calculates how much you owe, and you pay,” explains Montvila. “For those of you who don’t like to twiddle your thumbs while the assistant folds your clothes, that’s very welcome!”

Another example is magic mirrors, which have been used by firms such as Charlotte Tilbury to take advantage of virtual reality and allow customers to try on makeup digitally in-store.

A need for more information

According to a recent Mapp report, ‘Retail of the Future’, customers simply want to maintain the ‘convenience and ease of shopping online, but long to see, touch and inspect before they buy’. They want a seamless experience that blends their online and in-store experiences, from deals to product selection to ease of payment.

They also want to not just shop, but enjoy a communal shopping experience, such as in-store drinks or food tastings, or more individual experiences, including personalized styling. Fun is also on the agenda as retailers try to turn customers into fans, not just shoppers. Toy store The Entertainer, for example, sends PDF coloring pages of their favorite characters to parents via email to build buzz around the brand.

For retailers and their marketing departments to take full advantage of this change, they need to know more about the hybrid customer. They need to conduct a thorough analysis of not only their growing digital customer base, but also omnichannel to optimize their strategies. Data collection, both online and in physical stores, needs to be improved and combined into a comprehensive customer profile.

Marketers have been scratching their heads over how to truly understand the cross-channel customer journey.

By doing so, they will understand the cross-channel journey and how customers engage with your brand to engage them with the right content, campaigns, and marketing offers, at the right time, and in the right place.

“Marketers have been scratching their heads about how to really understand the cross-channel customer journey. They had assumed that their entire digital consumer footprint was whatever people clicked on their apps or websites. Now those transactions and interactions in the store must also coincide and be linked with digital data”, explains Montvila. “It’s very difficult for a single marketing department to look at their dashboards and understand what the hell is going on.”

Fix data confusion

In fact, less than a third of eCommerce businesses can identify more than 21% of visitors to their website. That’s because of data silos, fragmented data, and not having software to tie it all together.

Montvila says this is an advantage for Martech solutions like Mapp, which can provide the necessary information about customers in both online and offline channels. Mapp’s cloud platform offers a 360-degree view of a customer using multiple sources of accurate, real-time data, including historical purchases and browsing, and behavioral data such as in-store interactions and demographics.

“As a result, marketers no longer need to make decisions based on gut or gut feeling,” he states. “Through Mapp, they get actionable insights powered by AI that leads to more personalized and effective campaigns.”

In fact, one of Mapp’s key clients, fashion company Vivienne Westwood, has used real-time offline store purchase data and all e-commerce transactions to now identify a third of all visitors to its website. website. This has led to more personalized marketing campaigns and increased customer engagement.

Montvila says that Martech solutions like Mapp can also predict future customer behavior. For example, “By looking at a person’s data in a unified way, we can predict that if they order one type of floor sample, they will buy in the next 13 days and spend £1,500, but if they order another type, they will convert in two months spending £800.” sterling,” he explains. “That information totally transforms the way you talk to the customer. Certainly, you won’t offer 50% off incentives for those looking to buy in 13 days, but you might consider an offer for the other customer. You can be smarter in your messaging and make sure you have a higher chance of conversion.”

Montvila believes that hybrid retail will continue its growth spurt. “We will see more self-checkouts and click-and-collect with digital aisles in all stores,” she says. “Mobile apps will evolve from simple product catalogs to helping customers design their new kitchen or find the best makeup. We could also see more real-time marketing messages to deliver deals to customers walking through the store. It is a phygital future.”

Learn more about how Mapp can help you navigate the future of retail

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