The value of experiential retail environments and in-store experience: Gaining a better understanding of the phenomenon in order to better design for it

Abstract

The past couple decades have seen major developments in technology which have greatly influenced how we shop. Whereas before we HAD to go to a physical store, we now have many more options. This width of alternatives has impacted our expectations regarding physical retail spaces. In practical terms, nowadays, if we make the effort of going to a physical store, we (somewhat naturally) expect it to offer more than what would be available from the comfort of our own home (on a digital platform). To address these shifting customer expectations, retailers invest important resources to offer valuable experiences in their physical outlets. This has led to the development of what the industry at times refers to as ‘experiential stores’. Think of the Apple and Nike flagships or Starbucks roasteries for instance. This context has brought new challenges for those traditionally tasked with designing physical retail spaces: retail designers. Given the heightened competition of the retail market, there is also growing pressure on them to design the above mentioned valuable customer in-store experiences. This brings forward many questions, surrounding the value of ‘experiential retail design’ (e.g. is it truly valuable to design an ‘experiential store’? For whom?) and the ‘best’ ways to go about this task. Although the evolution of ‘experiential retailing’ has gathered growing interest in academic research, to date little seems to have been done to explore this from the retail designer’s perspective. This PhD addresses this research gap by exploring a retail design field specific view on what a ‘valuable customer in-store experience’ is and how it is and should ideally be designed. As it aims to bring support to retail design practice, the doctoral thesis takes a civic approach anchored in the practicing retail designer’s perspective. This positioning in turn means that the research project addresses a practitioner audience. However, since it is a doctoral thesis, it also applies academic research methods addressed at an academic audience. This ‘double audience’ and their individual specificities greatly impacted the research process. This represents one of two aspects making the PhD somewhat ‘unusual’. The second aspect lies in the linear manner in which it was conducted. The research process formalized in three steps, each building on the previous. Since it reports on the above, this dissertation also takes a rather ‘unconventional’ format. The introduction chapter serves to prepare the reader in approaching both the PhD and dissertation, and their particularities. It begins by detailing the context which served to define the PhD’s problem statement. It then provides an overview of the PhD research process and how this was reported upon in this dissertation. It closes with information on my background and how this impacted my approach to the project. Part 1 describes the framework initially set for the overall PhD. It thus provides this PhD’s own view on retail design and conducting academic research in this discipline. Part 2 begins to report on the research project specifically and provides more details on its first step. This research step 1 comprised an explorative study into the topic of the research. To gather as comprehensive a view as possible, the study combined knowledge from academic marketing and retail design sources, retail design practice-based sources and the view from the field. This last set of insight was collected through interviews with representatives of the field’s three key stakeholder groups: retail designers, retailers and customers. The study’s findings helped to (1) set a glossary of key terms for the PhD project and (2) identify a research opportunity for the subsequent research steps. This identified opportunity can be summarized as follows: research step 1 showed that triggering valuable customer in-store experiences is a key consideration for the main stakeholders concerned with retail design projects. However, current practices do not adequately integrate this aspect. Retail professionals may therefore need to update their current ways of working to integrate a more comprehensive reflection exercise at the analysis phase of their retail design process (i.e. before the store concept is developed). This exercise should consider the following: “a valuable in-store experience is one which combines offer, service, physical environment and an ‘unexpected factor’ (i.e. something going beyond what the customer expects) in a brand and (target) customer relevant manner”. Valuable information on these individual elements (i.e. brand, customer, offer/service, physical space, ‘unexpected factor’) already exists in literature, but in practice this is rarely or only partially used (and especially not in combination at the analysis phase of the design process). By combining this existing insight with the knowledge collected through the empirical study from research step 1, there is an opportunity to propose a new way of working for retail professionals to better approach the design of ‘valuable customer in-store experiences.’ This dissertation’s Part 3 reports on research steps 2 & 3 which both addressed this opportunity. In combination, they aimed to (1) challenge current ways of working in terms of how customer value and experience are managed in the retail design process, particularly at the analysis phase; and (2) provide practical design support to retail professionals, and more specifically retail designers, in this process. In more practical terms, through these two steps, I looked to research, develop and then test design support tools for application in practice. In research step 2, two tools were researched and developed. First, an existing informative visualization of current retail design practices called the ‘Retail Design Process Model’ was transformed into a more prescriptive tool. By translating the findings from research step 1, the new model illustrates a more ‘ideal’ way of working. This first tool served as the foundation to build the second: the ‘Retail Design Kick-off Platform’ (this PhD’s main contribution). This second tool provides an in-depth comprehensive view into all the topics a retail designer and his/ her retailer client should ideally consider at the analysis phase of the retail design process in order to design an in-store experience which has (the most) potential to trigger customer value. It takes the form of an online questionnaire which the two partners complete together at a pre-design ‘kick-off’ type meeting. The first step in the research and development process for this tool was to identify the topics to incorporate in the questionnaire. This list of topics was generated through the combination of insight from the empirical study conducted in research step 1, alongside the view from a set of literature sources specifically selected to reflect the holistic retail designer positioning of the PhD project. This allowed for the topic list to be grounded in the field’s view. Each individual topic was then more thoroughly researched to combine all relevant existing knowledge available and develop a specific question to ask for the purpose of the tool. The complete questionnaire was then prototyped in different rounds on the target audience for verification and refining. These prototypes (1) provided support for the tool’s content and (2) confirmed the tool’s ability to deliver on its objectives. In research step 3, the ‘Retail Design Kick-off Platform’ was used in a small exploratory experiment to also test its potential beyond its initial scope. The objectives were (1) to test the tool’s potential impact on the design process beyond the analysis phase and (2) to also investigate its impact on customer perceptions. Though limited in scale, the results from this study provide a first positive indication of the tool’s potential in both regards. Finally, the conclusions chapter reflects on the overall PhD journey. It begins by reviewing its contributions as well as limitations. It then reflects on the contributions also in comparison to latest developments in the field. In the last sections it provides my personal post-PhD view on retail design practice, academia and education.