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What does it mean to be a store of the future?

By Sarah Shi | November 05, 2020 | 0 Comments

Retail Digital Transformation and InnovationmarketingCustomer Acquisition and RetentionDigital Marketing Strategy and Execution

Stores aren’t dead, but they are in a state of flux. COVID-19 catalyzed an e-commerce boom that led consumers to alter their shopping behaviors, loyalties and values. In response, we’ve seen fast-paced innovations from brands – driven by need. 

A Year In Chaos – A Case Study On Who Navigated It Well

The Home Depot and Walmart – Genius brands in the Digital IQ Index: Big Box, U.S., 2020 – are just two leaders that are redefining what it means to be a store of the future. As they strive to compete in the face of disruption from COVID-19 and subsequent shifts in consumer spending patterns, they are reinventing the role of stores for consumer fulfillment.

The Home Depot

The Home Depot capitalized on the growing do-it-yourself (DIY) trend during COVID-19 by launching curbside pickup, expanding delivery options and extending its return policy to 180 days. These changes helped adjust to their almost 200% increase in mobile app downloads from January 2020 to April 2020, which aligned to when it reported an 80% increase in digital sales that quarter. 

Walmart

Similarly, Walmart unified its e-commerce general merchandise app with its popular grocery app, launched its loyalty program Walmart + that focuses on free delivery and discount prices on gas, and added a next-day delivery/pick up toggle across all digital assets. Walmart’s e-commerce sales grew 97% in the period ending July 2020, in large part driven by the retailer’s focus on expanding omnichannel services like curbside pickup.

The Key Differentiator – A Well-Executed Omnichannel Experience

Well-executed omnichannel capabilities available on website, mobile app, and in-store, are what set apart the Genius and Gifted class of big box retailers from the rest of the pack. Contrary to Amazon, the success of those retailers can be attributed, in part, to their same-day, one-stop shopping advantage — both in person and online. It allows budget-conscious shoppers to pick up groceries, clothing, electronics and home goods at the same time, on the same day. These advantages have won the stores new customers who might have previously preferred local grocers or hardware stores without omnichannel options. For example, Target added 10 million new digital customers in the first half of this year.

Next Steps For CMOs and Digital Marketing Leaders

CMOs should drive alignment of the marketing and supply chain organizations as a mechanism to achieve company growth objectives. Strategically, this means that company leadership needs to harmonize the omnichannel experience across all channels, so they can support and publicize each other. To help focus your organization’s efforts and prioritize investments, see Digital IQ Index: Big Box, U.S., 2020 — Key Findings.

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