alexa Retailers pursue new designs as customer needs get complex - Daily Nation

Retailers pursue new designs as customer needs get complex

Tuesday July 30 2019

 supermarket shopper

A shopper at a supermarket in Nairobi. Research shows that today's customer is becoming more complex and will not hesitate to change loyalty at the blink of an eye. FILE PHOTO | NMG 

ANNIE NJANJA
By ANNIE NJANJA
More by this Author

The Kenyan retail market is fast-evolving with supermarkets opening up sporadically in towns around the country leaving shoppers spoilt for choice.

For retailers, however, overcrowding of players demands constant reinvention for sustainability. Local merchandisers are slowly waking up to the reality that the real differentiator in the modern-day retail industry is neither the size of floor space nor the variety of commodities on shelves but the shopping experience.

E-COMMERCE

Customers now demand that retail stores be more than just transactional venues but also avenues in, which they can have special and in-person experiences that cannot be replicated in the e-commerce environment.

“Shopper experience can no longer be ignored, and this explains the investment some of the retailers are making. When a supermarket has a great ambience, nice and spacious aisles, and a good display of products, it catches the eye of shoppers and grows sales,” said Wambui Mbarire, chief executive officer Retail Trade Association of Kenya.

“It also makes the customer feel important, and they are more likely to shop more and come by often,” she added.

This explains the growing number of outlets that are now foregoing the tired supermarket layouts, which often maximise on space at the expense of customer comfort, to embrace modern designs that ensure a pleasant visit to the store.

Emerging marts are spacious, well-lit and attractively-designed, factors that are increasingly important in ensuring a complete sensory experience during shopping.

“To keep their stores relevant, retailers need to make the most of the stores built-in sensory advantages over e-commerce — they need to tout the experience of touching, smelling and trying on products, and they must ensure that the in-store experience is enjoyable and convenient. Otherwise, customers will simply not bother making the trip,” said Consultancy firm McKinsey in The Ever Changing Store report published in April 2019.

'PLEASANT AMBIENCE'

International consumer insights firm Nielsen in a report released a fortnight ago also noted that 74 per cent of Kenyan shoppers prefer patronising outlets that are attractively organised and have a pleasant ambience.

Experts say with the fast-changing consumer preferences, retailers should be fast to change their store formats if they are to keep customers interested.

Creating a distinctively compelling customer experience requires retailers to redesign their store formats in most cases, said McKinsey.

“And there is no time to lose; competitors are moving fast. Even companies that started as pure-play online retailers — such as Amazon — are opening brick-and-mortar stores so that they, too, can offer sensory experiences,” McKinsey added.

“So, for traditional retailers (supermarkets and kiosks), the pressure is on; the time to invest in format redesign is now. Yet many retailers still only refresh their store formats in three- to five-year cycles. That’s an eternity in today’s world, where consumer demands and behaviour are changing rapidly.”

Noteworthy is that in the crowded retail market space, the experience per square foot is becoming an important matrix for success, according to consulting and audit firm KPMG's 2018 global retail trends.

Supermarket format redesign done well, for instance to accommodate a wide selection of goods within eye’s reach, can potentially boost sales by 10 to 15 per cent, and customer satisfaction by 20 per cent, all within a year or less, McKinsey noted.

A few retail firms have learnt this trick and are already setting resources aside for revamping their retail spaces.

Naivas Supermarket, for instance, is remodelling their Capital Centre outlet barely a year after launch, moving away from the past practice when retailers made renovation efforts only when their structures were at the brink of collapse.

“We always keep reinventing to make sure that we are up to speed with competitors. We are striving to give our customers a better shopping experience and these changes are being informed by them,” said Naivas Supermarket Chief Commercial Officer Willy Kimani.

Several second tier supermarkets (those that cater to the more price-conscious customer) such as Quickmart, Tumaini and Cleanshelf have also embarked on a facelift of their facilities to wade off competitors.

The outcome of such updates presents in well thought-out store architecture and friendlier retail designs, arising from deliberate consultations with specialised design and planning firms. Cleanshelf said during the launch of their overhauled Kayole branch, that they had sought the help of a local design and fittings firm Renova Limited, to craft its chic look and a fresh foods consulting company, Professional Vision Group to draw up their menu.

Similarly, Quickmart who are set to unveil two new branches — one on Waiyaki Way and another in Rongai — confirmed entrenching international best practices in their structuring a path charted by its managing director Duncan Kinuthia.

“We are benchmarking on visual merchandising, and so we are investing in quality equipment and interior finishes to ensure that the products are beautifully displayed. Our focal point is the customer and in all our branches we want them to have it fresh and easy,” said Quickmart’s Head of Marketing Betty Wamaitha.

Yet facility design alone will not make one a better seller. Retailers also have to contend with the buying patterns of local shoppers who are known to be experimental and passionate about trying out new products. Kenyan buyers have been branded disloyal and addicted to “newism”, to mean that they are more likely to settle on a product that is fresh on the shelves for the perceived notion that it must be better.

Nielsen revealed that disloyalty was the new norm and that retailers should keenly pay attention to customers who are becoming highly conscious of quality. The researcher recognised that 88 per cent of shoppers are ready to defect and opt for brands they perceive as better at any time.

Only 12 per cent of those interviewed remained firm loyalists to brands. The research also found out that 45 per cent of local consumers loved trying out new things.

According to the report, shoppers are ready to try new products owing to brand trust, quality assurance, experience, convenience, and for ethical reasons like the manufacturer’s labour practices or environmental impact.

Interestingly, the report also noted that 70 per cent of shoppers were price conscious and 95 per cent noticed price changes, explaining why six out of 10 buyers were more influenced by promotions in stores.

The findings indicate that experience and brand value continue to be great influencers when consumers are making buying decisions.

“It is important to understand the consumer nuances in Kenya when offering products and services to them. Consumers are price conscious and are looking for value but are willing to pay more for quality products, if they see perceived value in it. It is not just a pricing game anymore,” said Nielsen’s Consumer Insights Lead, East Africa Pauline Achayo.

“Factors like convenience, availability, ease of shopping are some of the parameters that consumers are using to make shopping decisions. Marketers need to understand the different aspects that shape consumer attitudes and that impact spend,” she said.

Advertisement