Welcome to this episode of The Road to Online Retail.
I’m Nigel Miller.
According to international retail and sales marketing expert, Kevin Moore, we’re now entering the second age of online retail, but what does Kevin mean by the second age?
Well, basically, it’s the accelerated migration of shoppers to digital retailing of all goods and services.
So if you’re a retailer, either with a physical and or an online presence, are you actually ready for this second age?
And what can you do to prepare?
Well, a great starting point is to understand the shopper needs, and that’s what this episode is about today.
And to help us with that, I have Kevin Moore.
Kevin Moore: Thank you, Nigel.
Nigel Miller: Now let’s get going.
Tell us why is it so vital for all retailers to understand the shopper needs.
Kevin Moore: Well, it’s worth going back and recapping on the conversation we had at the end of the last podcast, which was the difference between customers and shoppers and how the whole word “customer” was around a customary behaviour, where shoppers would shop in their own postcodes, they’d shop at a corner store, they’d go back to whatever stores were close to them, and as time has gone by, they have greater and greater choice.
Now, shoppers’ needs a just as important in the physical world as they are in the digital world.
But I’m going to give you the reason why shoppers are most important in the digital world because of the changes that have happened in the whole of the ecosystem, the ability to support people.
So let me go back to shopper’s needs. The shopper’s needs inside a physical store.
If you entertain shoppers in a physical store, you have to have great sounds and smells.
The store staff are entertaining, they’re knowledgeable, they’re engaging, uh, beautiful stores.
Um, great choice, then shoppers will linger longer.
The dwell time we call it the dwell time will be longer in your store.
If they linger longer when they are in your store, generally speaking, they put more things in their basket because they’re there.
It’s convenient for them to do that, they are on a high.
When they leave that store, they tell more people about what a great experience they had and people come to that store.
So that’s in the, in the, in the realm of the physical, it never goes away.
Nothing within the online world that hasn’t come in some shape or form out of physical experiences within stores.
And that’s why we’re going to talk about phygital physical and digital coming together.
So if the shopping needs are so important in the, in the physical world, if we go into the digital world, the great thing that’s happened in the digital world is almost everything that’s around us to allow us to be a business person, to be a retailer has got easier.
We now have code and we have AI and we have platforms and we have reach, and we have data in a way that physical store owners never had.
So you can now set up a Shopify site in hours.
You can set up your Facebook account, you can get on Instagram, and you can set up your MailChimp.
You can do everything very, very quickly, at very, very low cost to allow you to focus on two key things that you have as a great retailer.
Number one is you’re a curator, the curator, you go out and you find things around the world.
The best merchants in the world have gone out and found things for a hundred of years, and they brought them back to their shops in the cities and the towns.
They brought them back to their warehouse in their go-downs in the harbour sides, in their port sides, and they brought back things that were entertaining, not the same things as everybody else was bringing back.
They weren’t just dealing in commodities.
They wanted to bring back things that were entertaining.
So as you, as you’re curating for your online store, you’re bringing back things that you think people like you would want.
So shoppers will come to you cause they’re like you and they want to buy things that are like you, that things that you would bring, that you would buy.
Because of that, if you focus on their needs and curating, almost everything else has become a level playing field.
You know, the layout of your site, you can be clever and we’ll talk about the layout and navigation on sites later down the podcasts.
But the key thing is that the playing field has gotten much leveller, much higher by the way.
The calibre is way, way better than it ever has been.
But the point of difference is how you cater for and deliver great shopper experience and look after the curation of great things for your shoppers.
The shopper needs, and fulfilling those shopper needs is going to be your point of difference.
Nigel Miller: And I guess the other point here is that in order to become a retailer in the online world, you’ve got far more tools and you’ve got far more reach than just opening the shop in your local shopping strip.
Kevin Moore: Absolutely, but again, we kind of touched on this.
So the whole point about going online should not be with the objective I want to reach the world”.
The objective should be, “I want to entertain shoppers. I want to attract shoppers to me. I want to make them aware of me, engage with them, entertain them and then transact with them.”
You know, wellness, engagement, entertainment, transaction.
If we can do those things, those four steps, it’s a self-fulfilling cycle.
It will go round and round again.
So Nigel, one of the great things that we have about this podcast and the online courses is that we have had feedback from two and a half thousand people, two and a half thousand business owners and students around the world, 100 countries, who’ve done our online courses focused at the shopper experience within physical retail.
I mean, there’s a quote here from a guy called Waduge Dinush Darshanika Fernando, “I believe this is one of the most important courses in retail business. I get a much clearer idea about the shopper experience within my business”.
Michelle Stanner talks about “Amazing, helps me to understand deeper the shopper journey”.
The shopper journey’s, the most important thing.
We don’t have people come onto these courses saying, “I want to better understand inventory term. I want to better understand
They’re not saying that, what they’re saying is, “I want to be a better retailer.
The infrastructure is around me” and we must address those things.
But the centre of everything that you do as a retail online or offline is to do with fulfilling the shopper needs.
Nigel Miller: Yeah, and I guess that’s a point to emphasise, with our online courses for retail, they’re not about the, you know, the technical nitty-gritty of code, et cetera, et cetera.
We’re really about the emotion, the shopper needs, the shopper experience and that’s our key focus.
Kevin Moore: Absolutely, and again, the four things we talked about, time and time again, it becomes a mantra.
And if you think about it, everything has steps so every business model has steps.
That’s why it’s a model, so we talk about awareness, creating awareness online in the ether to allow people to become aware of you.
And if, if they’re aware of you and it’s a strong enough awareness, they will engage with you.
They’ll get the next level and they will engage.
They will lean forward with their finger and they’ll touch their phone.
They will, they’ll take the cursor on the mouse and they will click on a link into, into you.
They’re then engaged with you. They’re physically engaged with through bits and bytes all the way down cabling and satellites around the world, but they’re connected with you, they’re engaged.
And that point, we then take the next step further where we say, okay, you’re now engaged.
If we entertain you and we bring this alive for you, you actually take a physical step.
You start then to say, I’m going to surf around more.
I’m going to shop something.
I’m going to share with you my payment terms.
I’m going to allow something from your business to come into my home.
So we talked about awareness, engagement, entertainment, meeting shopper needs, and then the transaction.
Nigel Miller: I guess that’s quite a major point because having looked at your business that you’re involved in, Toys R Us, Australia, NewZealand, it’s not just a shopping catalogue it’s got emotion, it’s got theatre, it’s got all sorts of stuff.
And obviously, that’s not accidental.
Kevin Moore: No, we’ll talk on about ToysRUs.
But there, there are a number of businesses I’m involved in.
So, and each one of those steps, I talk about those steps.
So awareness, engagement entertainment and transaction.
I’m also involved in a FinTech, a financial technology company.
I’m a director of a financial technology company, and one of the first things
we do is put faces back into things because finance isn’t very sexy.
You know, it’s not very emotive.
So we put faces in and we took people on the stages of the journey to understand it.
So the awareness there was being able to get people, in the ether, on their phone, on a train, and at home in the evening to be able to say, that relates to me.
There’s something about me in that.
And on that one, it’s Awareness, engagement, conversation and transaction.
They’re actually in financial services.
It’s very difficult to get people to invest for their future with a cursor, with their finger.
They actually have to talk to somebody.
So on that one, we know that we have to create such compelling engagement that once they’ve looked at the product offerings and looked at their investment needs, they talk to somebody.
So that one’s awareness, engagement, conversation, transaction.
If you go to the online world of music, if you go to Spotify, follow is a massive part of that whole model.
So as you listen to your music, if you start to follow an artist, that becomes crucial because generally speaking, what happens is it goes awareness, engagement, follow, transaction and transaction in the online music world means that you listen to a stream for more than 30 seconds.
You don’t get royalties unless you have a stream, somebody listens to your music for more than 30 seconds.
So the important thing about all this, we’re dealing with awareness, engagement, something and transaction in all the online models.
Nigel Miller: Now, getting practical quickly here, what are the top three online shopper needs?
Is it price?
Kevin Moore: You’re leading the witness here.
It’s absolutely crazy because if you talk to the majority of people, generally speaking, so remember this whole thing about us being shoppers, when we’re shoppers, we
don’t think about being shoppers.
So when I walk stores or I look at online sites, I make myself a shopper, I think
like a shopper because if I don’t, what I do is I shop and it’s a subconscious process and I come out with something and a great feeling, or I come out with nothing and a bad feeling, but I’ve not been able to slow the process down and understand.
So when I’m in shopping mode and I’m doing research, I think like a shopper.
So generally speaking, you speak to somebody who’s not in a shopping mode, they’ll say,
“Oh, well, the main reason I shop online is price!”
And every bit of research that’s been done, when you take people out of that, say “No”.
In fact, price isn’t at number one, number two, number three, or number four.
So number one is for online shoppers, is the widest range possible, that’s in stock.
That’s in stock.
The widest range possible, that’s in stock, because there’s nothing more frustrating for a shopper, in any environment, physical or digital, to go to someone with great
expectations and it not be there.
Back in the day, we had something called “bait advertising” where a retailer would say, “Come and get your bright blue phone”, and you got to the store
“I’ve come to buy a bright blue phone.”
“Oh, we haven’t got them, they’re out of stock!”
They’d never had them.
And they’d use that to create footfall.
It’s called bait advertising.
So we have to be very, very careful that if we’re being honest with the guys that we’re setting up a whole shopping environment for and we’re curating for people
like us, we don’t let them down.
Number one, the widest range possible, that’s in stock.
Number two is convenience and convenience is saying, I can shop you easily with my thumb from anywhere.
It’s the convenience of being able to transact.
I want it as seamless as possible.
I want as many self-populated forms, and there’s a lot of clever work that’s been done by a lot of the custom online sites to make sure that we don’t put the barrier of collecting data about you before the shopping cart.
And so, again, historically we’ve been a bit heavy-handed with this.
We said, thanks Kevin.
Thanks for being on the site.
Before you transact and buy that thing you’re desperate to buy because you’re short of time because you’re two stops
from your home station, please tell us this information, and you abandon the cart.
So now people are saying, do you want to check out now?
I’ll give you my details next time.
So number two is convenience.
Now convenience also overlaps into great service.
So number one’s wide ranges in stock.
Number two is convenience.
And number three is great service, including feedback on reviews.
So don’t think you’re giving me a great service.
Let me as a shopper, be able to talk and look at reviews of other
people who shop with you to give me that confidence that you’re good.
When I have that great service, I’ll tell other people too.
But right now, you’ve got my awareness, you’ve got my engagement, you’re entertaining
me cause I’m buying, you know, I’ll, I’ll come back to you once I’ve had a great experience by shopping with you.
So number one, wide range, number two, convenience, number three is great service.
The next two in order Nige, are number four payment terms.
Nigel Miller: What’d you mean by that?
Kevin Moore: So in the last 18 months, worldwide, there has been a boom in payment facilities for shoppers non-credit.
So part-payments, there are a thousand terms for it, none of it is referred to as pure credit. So these include brands that you’ll know.
So AfterPay, SplitIt, Lay-by, Openpay, Hum, Trig.
All around the world, these things are crucial.
In some cases, the transactions for some retailers are as low as 6%, that’s a lot.
So 6% of all your sales is paid through some form of payment term.
Some of them it’s up to 30%.
Nigel Miller: So this is more than just PayPal and credit card…
Kevin Moore: Oh yeah.
It’s own category, so up to 30%, you can go to some jewellery stores where you have young shoppers
and jewellery online, where they want to buy the best possible jewellery they can for their partner.
They can’t afford it.
They will use AfterPay, Splitit, Layby…
Up to 30%, one-third of all shoppers!
That’s how important it’s become.
Now we’re going to touch on that in greater detail going forward, because one thing it isn’t is cheap!
So number one’s wide range.
Number two is convenience.
Number three is great service.
Number four are payment terms, and then down at number five, coming
in at number five, price and promotion.
Nigel Miller: Right?
So price is now the last one of those five different online shopper seeks.
Kevin Moore: Most people think about the top three and everything, and then the others flow.
Nigel Miller: But does that depend upon the type of product?
So does it depend on how much you’re spending as to where price actually sits?
Kevin Moore: Well, the best way to think about it is how the marketplaces position themselves, so Amazon and eBay and Alibaba position themselves on number five.
So an awful lot of the work they do is around price and very deep promotion.
And there are very good metrics as to why the marketplaces do what they do.
20% is a magic number on the marketplaces, so you only see 20% off.
It drives an awful lot of engagement with the website and I’m going to
touch on the difference between engagement and transaction.
So when people actually get there, the tiny percentage of that actually transact.
So they drive it that way, but people go there because it’s a moment in time and they want something cheaply.
But generally speaking, when we’re looking for normal shopping experiences, it’s number five.
Nigel Miller: Okay, great.
Kevin Moore: Oh, so we talked about them being promiscuous.
So they will shop across the, um, across five platforms before buying something.
So don’t believe that they’ve come to you and that they landed on you, they think this is the best thing ever and they’ve shopped from you.
They’ll shop across five platforms, six platforms, depending on what it is and they’re checking all sorts of things that, that range, the convenience, the service.
So when you look at your stats, your engagement stats, your Google stats, you see how many people have come.
You can see that a hundred came to your site, but only three bought.
Don’t worry about that.
That’s more normal than not.
So a hundred visits to your website, three to four, will buy
Nigel Miller: Which I guess is a good thing to know when you first start out in online retail, if you’re seeing all this traffic coming and everyone’s going away, you’d be thinking,
I’ve got it wrong, but actually…
Kevin Moore: You’re more normal.
And again, one of the things about doing this, having all this research, being able to sit with, you know, a number
of business owners across different channels and a lot of work in retail.
You get an understanding of the numbers.
And we’re going to go through, you know, gross margins later on, we’re going to talk about overheads, we’re going to go through all these
things that seem a bit boring, but it’ll give you comfort as a, either somebody who’s running an online business or who’s starting on a business
to say, I’m in the right sort of place.
So let’s go back to that.
So three or four, we’ll buy for a hundred visits when we get to key shopping times, especially on Black Friday, Cyber Monday, it’ll gain eight to 10.
Now that’s actually a big jump.
So what does that mean?
It means that you have people who are coming to your website on a normal day, you may have promoted, you may have said,
we’ve got a back to school, we’ve got an end of holiday promotion but we’ve done some form of promotion, so we can look at the flow into our website, look at the numbers
we’ve got to pick, pack and dispatch, you know, look at our inventory levels.
All those logical things and we can say, that’s great.
Now have that had me absolutely flat out.
All my team were flat out for seven days.
We were back for a period of time.
You need to realize that when we get into that key time,
your volume’s going to be three, four times higher than that, sometimes five times higher than that.
So it’s a great thing to understand
that way into go into full online mode at the key seasonal parts where you’re not driving the agenda, the global population is driving the agenda.
The global online community is driving the agenda.
That’s the volumes you’re gonna have three, four, five, six times higher.
Nigel Miller: I remember you’ve always talked about curating ranges of products.
Does that apply, and you’ve talked about it in the physical world, does that apply equally to the online world?
Kevin Moore: Yeah, it applies in a really artisan kind of way.
So a lot of people will be starting a website, starting an online store to do a very limited number of things really, really well.
So we’ve seen a move back to handcrafted, customized items, the true artisan, I mean, somebody who is an excellent woodworker, somebody who is a beautiful silversmith, not a jeweller, they’re a silversmith.
They trained as a silversmith.
They’re able to curate the most amazing leatherwork on saddlery.
Now they’re not looking to have a massive range.
They just want to move a range of beautiful product that they
believe is the best they possibly can to likeminded people.
They tend to be higher transaction values for those items because people are searching them out.
They’re looking for them.
They particularly want them.
So the curation doesn’t go away.
Even when you get into a wider range of products in a category, the curation, the thought you put into
buying, matters and people can see it when they come to your site, they’ll go, I’ve not seen that before.
Now the things I came here for are here, and I’m going to get the blue mobile phone, but you know what?
I actually want that thing as well because that’s different and I’ve not seen that before.
So curation is still very, very important.
Nigel Miller: Okay.
And going back to dwell time, I mean, you’ve talked about it being so important in a physical store.
How do you ramp up dwell time in the online world?
What are you doing?
What sort of things other than just having more product that keeps them there?
Kevin Moore: So it goes all the way back into the first time you engage with them.
People are drawn to you because, and those of you who’ve done advertising and the marketing courses, know AIDA: A-I-D-A. attention, interest, desire, action.
These things don’t go away.
They just get applied in new business models.
So AIDA attention, interest, desire, action.
That’s the same as awareness and engagement.
And what we’re doing was getting people to think about what’s in your store before they even get to your store.
So this physical, digital thing, you have the best possible link with people to be able to experience or pre-experience what’s in your stores in the digital environment.
So they have found you in social media.
They found you on search engines.
They’ve seen YouTube of your products.
They’ve seen YouTube put up by manufacturers of the product you sell.
Remember, the collaboration is a key part of this.They’re building up almost a physical experience, having never met you.
And then they come into your site and there is a plethora of really good imagery and words and feedback from third party reviews or feedback from other shoppers, when you get down to the product, there’s really great detail around, I feel like I’m inside a store.
I feel like I’m immersing myself emotionally in what’s going on.
And as they’re doing that, they’re happy to spend more time there.
And they’ll go for different categories and you’re assisting them
because you give popups and say, other shoppers thought about this.
Other shoppers also bought this and you spend more and more time there, and each time you’re doing that, go back to convenience, number two.
I’m here, I’m here.
So I’m going to get a box to my door anyway.
So actually I will take that one.
It’s only another $10 more or it will take down it’s $60 more and your basket size builds because I’m dwelling longer.
Now once you get used to something in exactly the same way as we do in the physical world, once I like a particular department store, grocery store, pharmacy store, I will go back to it because I like the way they do it.
It’s the same online.
So as you’re giving them a great experience in your digital realm, and making it as physical as possible all the way through to when the product arrives back in their home,
they will dwell longer and they will spend more money with you and they will tell people on your own feedback mechanisms, whether it’s Trustpilot or any other review mechanism, or on their own social media or in conversations in the real-world with their friends and family.
Nigel Miller: Just a quick aside there, you’ve touched on it, but postage, how important is that in the buyer decision as to whether they buy more or get put off?
Tell me about that.
Kevin Moore: So freight is a promotional element.
So free freight is a promotional element to allow people to say, I’d like to shop with you.
I’d like to look at what you have on offer.
It’s not a definer.
All of us believe that we need to pay something for freight.
And most of us understand that if we live in a big city somewhere on the planet to go somewhere, steals an
hour of our life, now forget we have a great shopping experience but getting to and from the shopping experience will steal an hour of our life.
That’s a minimum.
We know it will cost us in parking.
It will cost us in public transport, it will cost us in fuel costs, whatever it may be.
It’s costing us, costing us, costing us.
So we’re happy to pay an amount of money for freight.
And the numbers vary depending on what you’re shipping, but people are happy to pay $10, $20, $30 for freight doesn’t bother them.
They’ve got no worries about that if they’re spending $60, $80, $90, $100.
As you get lower down to the transaction price two things are happening, it’s not worth it for the shopper to spend $5 with $10 freight.
It’s not worth it for the online retailer to ship you a $5 item with $10 freight cause nobody has a good experience.
So an online retailer can’t make money at $5.
And an online shopper doesn’t really feel they’ve got any value for money, forget price, any value for money by spending so much of a portion on freight.
So it is merely a promotional activity and it’s become almost a, a norm.
Most people, if they charge zero freight, are building the freight into the price anyway.
They’re just discounting less deeply.
Nigel Miller: Okay.
What about community?
How do you build a community and why is it important for a retailer to build a community?
Kevin Moore: It goes back to the whole thing about curation.
So you’re creating for people like you, generally speaking, people who work in fashion deal with
people in stores who love fashion.
It’s what they do.
You know, guys love to go to tool stores and tool shops because they want to talk to other guys about the latest tools or a project I’ve got.
You’re with like-minded people.
It’s no different in the, in the digital world, but you have to build that community around you.
So one of the best ways, and Toys R Us and Hobby Warehouse did this beautifully, from the first
launch of Hobby Warehouse in 2015, the decision to shoot very, very high-quality video stories of people and their hobbies.
So remote-controlled yacht sailors and remote-control airplane fliers and painters.
And we got stories about these guys.
Now they were happy to share them because they knew they’re going to be shared with like-minded people.
You know, grandparents with their grandchildren are making model airplanes.
Grand mums with the granddaughters, promoting STEM in the granddaughter’s mind with Meccano Eiffel Towers.
You build this community in a video world and it feels like it’s the real world.
You then come into the online store and that’s reinforced over and over again.
All the values you experienced there are reinforced and people can swap views good and bad.
They can swap views good and bad, on how they feel about shopping in an environment, about your range, about your choice, about your service.
So my involvement with Toys R us in Australia, New Zealand and
Hobby Warehouse, when we did that, we did that with understanding that it was our responsibility, the retailer’s responsibility, the online retailer’s responsibility to prompt and
chaperone shoppers to become part of that community and then stay involved.
It’s the quality of work that we do as an online retailer to create great content to bring you in.
And then keep you in there in a good way.
Not to trap you in there, to chaperone you and keep you moving along in a way that’s entertaining to you, that’s relevant to you.
And you can feel it when people get it wrong, and sometimes you’ll see it in promotional activity where the whole value set of an online business or a store has been compromised by a promotion where you go, “Whoa, that’s not for me!”
And if you’re going, “Whoa, that’s not for me” 90% of people who shop that store have gone, “Whoa, that’s not for me”.
Nigel Miller: Okay.
Chaperoning, what do you mean?
Kevin Moore: Do you like chaperoning?
Nigel Miller: I don’t need a chaperone these days. I don’t go on dates!
Kevin Moore: Chaperoning is the idea that you’re helping somebody through.
So it may sound a bit flippant, but, being involved in toys, chaperoning is an important part of it.
So you have young children and there’s a whole lot of things that you need to do to make sure that they are safe in an environment.
So a chaperone is somebody who keep somebody safe in an environment.
It’s also somebody who looks after and thinks about what people need.
You’re helping them through to see things that you think they’d like to see.
You’re helping them experience things you think they’d like to experience.
Just being around them, just gently guiding them, not dominating them, not telling them, you’re not grabbing them on the sidewalk and saying, come into my store.
Just helping along.
Nigel Miller: So is this like hardware stores having, you know “how to do it” videos and stuff like that?
Is that what you’re talking about here?
Kevin Moore: That’s one element of it.
It’s a much richer tapestry than that because it’s everything you do.
You’re trying to get them, people to, to say, these guys have thought about most of my needs.
They actually understand me.
They’re serving up to me videos of things that are relevant to me and people around me.
I’ve got a whole resource that I can use anytime that convenience thing: 24/7, any device, agnostic.
I am able to be engaged with that online store.
Yes, with “how to videos”, with feedback, with tips, but it’s every single thing.
And as we go through this, I hope you’ll start to see that, you know, God is in the detail.
The good things are there.
We keep on finding good things that layer after layer after layer, mille-feuille – a thousand leaves – that’s fine pastry, mille-feuille, a thousand leaves.
These beautiful layers are built up in a business that gives people a great experience and it takes great thought and commitment to the value of that business for it to be able to remain that way.
Nigel Miller: Fascinating information, but where do I go to see this in action?
You walk over a thousand stores a year to understand shopper trends and things, and you look at thousands of stores online.
Where would you point us to, to understand what you’ve been talking about today in action?
Kevin Moore: Two things on that.
One is the physical, and then there’s the online.
So I’m going to use that example because I’ve lived it.
So when we were bringing back to life Toys R Us in Australia and New Zealand, Dr. Louis Mattoni and I went to different parts of the world and we physically shopped the stores that we thought would be relevant to creating a shopper experience for us.
We wanted to experience them physically and then be able to deconstruct them and recreate them as best as we possibly could digitally.
Does that make sense?
Nigel Miller: Yup.
Kevin Moore: So we know that algorithms, which are things that we hear about online, are all about data being analyzed and a process being followed and output being delivered.
So I searched for three different words.
The algorithm says, what you’re looking for, Kevin, is this, and it serves it up.
Well, we are all algorithms, so within our body, within our minds, we’ve got new neurons.
We’ve got thought patterns, we’ve got experiences, we’ve got feelings, got emotions.
And the name of the game for us is to say, okay, if I walk into an environment when all of those algorithms start to buzz around and take me down a process, a set of
steps, what do I leave that store with?
So because we’re in the toy business, we believed there were two of the best toy shops in the world, one is in New York City and one is in London, but also in Prague.
There’s a few more around, but fundamentally there’s one in New York City and it’s called FAO Schwarz, and there’ one in London and it’s called Hamley’s.
Louis went to the one in Prague.
I went to one in London.
I did FAO Schwartz in New York, and we walked, talked, photographed, videoed, talked to shop assistants, talked to shoppers in the stores talked to suppliers after the fact as to why they were doing what they were doing.
Talked to the people promoting and bringing alive, the people who were dressed in full Hogwarts outfits.
People who were throwing gliders around the inside of a store, who were making play-dough models.
We talked to all these people and we tried to understand what was happening with the shopper, watching the shopper, watching people stream into stores from the sidewalk, being drawn in from the sidewalk by the most beautifully dressed giant toy soldier in FAO Schwartz.
I’m standing outside, I’m in beautiful sunlight.
These things were, how do we get this?
How do we bring alive?
We then came back and said, okay, how do we make connections with them?
How do we take imagery and video and storytelling, Nigel, how do we bring that in?
And that’s what we did.
We tried to recreate those physical reactions, those emotional reactions, but in the digital world.
So the reason I did it that way, Nige, is because we were able to do that work, and having described that as I’ve described it, if you go to Toys R Us Australia/New Zealand, and you go to Hobby Warehouse, you should see and experience the things that I’m describing in a digital form.
So you will see stories, you will see imagery, you will see play.
So remember, in FAO Schwartz and in Hamley’s kids play, they play with product.
There are guys demonstrating different products that they engage with, they’re playing with them.
So that whole theme of play and learning and real people being inside that digital store is there.
Sure, there’s product.
That’s not what it’s about.
It’s about the whole entertainment, about the shopper loving what’s there, and then they’ll buy the product.
Otherwise go to a marketplace.
There’s not a lot of emotion in the marketplace.
They do good transactions.
Don’t get me wrong.
But it’s the emotion we’re trying to bring alive here.
Nigel Miller: That’s another interesting point.
So when should you be building a marketplace and when should you be building a curated online theatre experience?
Kevin Moore: So those two things are neither exclusive nor follow a specific chronology.
Nigel Miller: Most people when they first start with online retail, they buy, in effect, a shopping template where they just put the photos up, write a description, open the doors, back-end has got a shopping cart. We’re there, we’re done.
That’s not what you’re saying?
Kevin Moore: No.
They’re neither exclusive, nor is there a chronology, nor is there a right step.
There’s not a first step and a second step.
Some people, over many years have gone on the marketplaces, the early days of eBay and the early days of Amazon when they became marketplaces and they’ve sold items there from their home and their garage.
Then what they’ve done, as you said, I’m now going to open my own store.
I’ve got a Shopify store.
Before Shopify, they paid somebody $10,000, and they build them a new site and they’re able then to take those products and a wider range of products over time, while still keeping their marketplace.
Others go straight online.
They build their own stores, but for promotional reasons, to create greater footfall into their digital stores, they promote on the marketplaces.
So in, in the marketplaces, if we take Australia specifically, I mean eBay and Amazon, if they send out one email, they will probably touch, ah, 70% of Australian households in one day.
Now, if you’re featured as a banner in that email, or you’re featured as a banner on the landing page that’s unbelievable awareness.
I mean, that’s Seven, Nine, Ten, ABC, SBS, that’s every radio station and TV station in the country.
So the reach is unbelievable.
So people do that to get a shopper to come and buy online in a marketplace.
Branded their own store.
And the hope is that that shop will come back and look in greater detail at the rest of the items in their store.
So they’re not exclusive.
And even the largest physical retailers, who have been around a long time, the liquor stores will run their own physical retailing, their own online stores, and they’ll be in the marketplaces.
So you can be in all those places, but the core of it, the essence is you’ve got something that is special and curatorible, not just like everybody else.
Nigel Miller: Yeah, and I suppose the other amazing thing nowadays is that if you create content to promote your enthusiasm for products or whatever it is, you’ve
got social channels to distribute through to then get people to come to your site.
They’ve not got to come to your site first-off to find you, you can reach them in so many other ways.
Kevin Moore: So that’s a whole area we’re going to go into in greater detail and that whole awareness and engagement, you know, the how you use Facebook, how you use Facebook Boost, what you do with Instagram.
Instagram’s become more powerful as a deliverer of imagery than Facebook.
Just run a big campaign with a company, and we had more impressions on Instagram than we had on Facebook.
So Instagram’s become very, very powerful.
YouTube is a thing of rare beauty if you can get it right.
They’re all parts of your mix, they’re all parts of your communication mix.
Nigel Miller: So, Kevin, how do we sum up what we’ve talked about today?
Kevin Moore: So hopefully you’re not driving.
And, but the three things I’d write down is if you want to be a top online retailer, you think about
your business as, number one, having the widest range of items that’s in stock that you possibly can.
That number two, there is great convenience to your site and to your delivery terms.
So it’s an easy to navigate site.
It’s easy to pay, and the product will arrive in one to three days.
And the third thing that everything you do, you’re providing great service.
You’re getting people to tell others about your great service.
Beyond that payment terms, whether you like it or not, you’re going to have to pay for an AfterPay, SplitIt, Layby, Openpay.
And number five, if you want to boost it up, if you want to amp up the number of people, get more than 100 people to visit your website, more than three to four to buy, then you need to play with the price and promotion at key times.
Not all the time.
Nigel Miller: Great.
Well, thank you for that, Kevin.
That’s all from us for this episode.
Please give us a review and a rating on your podcast app.
In the next episode, we’ll be talking about, and Kevin I have been practising this, the retailer’s phygical offering.
Don’t like the word Kevin, but I’m thinking I’m getting better.
Kevin Moore: Phygital
Nigel Miller: Phygital?
Well, uh, I’ll practice some more.
If you’d like to find out more about Kevin’s thoughts on ways to improve the retail customer experience in both the physical and online worlds, please go to our website: theroadtoretail.com, that’s the-road-to-retail-dot-com.
On the site, you can send in any questions you might have about thetopics we’ve covered in these podcasts.
You’ll also find links to our various retail marketing and sales courses, and our social media channels where we can keep the discussion going.
And finally, if you want to learn how to improve the shopper experience for your online retail business, well you’ll be pleased to hear that we’re about to launch our first dedicated course to the online shopper experience!
There’s a link on the site where you can register your interest and by registering, you’ll be entitled to a 50% early bird discount.
Until next time, thank you for listening.
Now, just before we go, you probably have no idea about this, but Kevin is actually part of a very popular up-and-coming band and Kevin, are you ready?
He has the members of his band with him today, so Kevin, play us out.
Kevin Moore: Thank you, Nigel.
This is a track written by Bob and John.
Two brilliant musicians and songwriters.
The band is called Finding Cadence, and this song is called “Dreams”.