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  • Andrew Smith

The Experience Evolution has already begun, and Digitally Native Vertical Brands are leading it.

Updated: Apr 24, 2019


The window of opportunity for retailers to maximise the advantage of their biggest strength is closing fast. Big footprints of stores, like those owned by big incumbent brands such as Walgreens or Walmart, provide endless opportunities to innovate experiences. However, the digitally native brands are making a lot of progress here. Allbirds, Amazon, Warby Parker, even the big tech companies like Google with their pop up retailing experiences are all out-retailing retailers. As more and more disruptors enter the market, incumbent retailers need to have a strong strategy for how they are going to be adjusting their physical stores to match the experiences being created by these new players. 




However, it’s not a doom and gloom story. I actually believe that the foundations of physical retailers are more than enough to compete and win in the world of new retail. Native online brands are naturally better equipped to offer a better utility proposition (simplicity, speed) because they are not constrained by anything physical.  Incumbent retailers are more naturally equipped to offer human engagement and experiences because it has been the primary principle of retail for generations (even if we have dropped off recently). 



The digital trend being the ‘death of retail’ is far from it, I believe it to be a corrective blip in the evolution of retail culture that has enabled us to learn how to make the most efficient processes that meets customers convenience needs. However, the result won’t be solely that. Somewhere in the middle where incredible physical experiences are met with efficient, simple and fast operations is clearly where the industry is heading. That is a level playing field, and perhaps the most interesting to watch is the Amazon v Walmart battle.    


My thoughts on the characteristics of those retailers nailing the experience evolution:

1.  They have a culture built around being freely creative

2.  They have adjusted their scorecards to redefine expectations of stores as a marketing media that acquires new customers, then a process that moves them to the lower cost management and fulfillment of digital channels

3.   They know their customers better, and use a blend of behavioural and data analysis to produce experiences customers want that constantly evolve

4.   They are courageous and willing to try something that other brands may consider to be too far from tradition


As I said, it isn’t doom and gloom, unless you let it be. There are countless examples of incumbent retailers making the change, just as there are mistakes being made by those disrupting when they enter physical retailing for the first time. It just needs an articulate, well executed strategy to adjust the culture of the brand to be constantly innovating. To be constantly bringing the humans that matter into the process.  From narrowing down the opportunity area, to the design, testing and implementation, being thoughtful and deliberate. The trick is not to look at innovation or human-centered design as a dark art that only those start-ups full of hipsters from Brooklyn can do. It’s a process that is able to be scaled and repeated. You just need to choose to implement it.  

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