The New Digital Age of Retail Branding

The New Digital Age of Retail Branding

14.12.2021 Off By manager_1

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The traditional retail industry has experienced significant disruption. The industry is still being shaken by the rapid rise of e-commerce as well as the evolution of social media platforms into digital shopfronts. Retail branding has taken on a new meaning amid all the changes. The concept and principles behind retail branding have been redefined by three factors: the emergence of online as an influential channel (both in terms generating awareness and earning revenue capabilities), the importance of branded experiences over brands, and the blurring between the digital and physical worlds in the brand funnel journey.

Retail branding was established five years ago using the same principles as other industries. This included creating and establishing a distinctive brand positioning. This positioning is then shared across all physical stores. The branding can also be used to positively impact brand equity. These principles have not changed. Instead, it is more difficult and more complex to get the desired results today.

Although retail branding is a discipline, it borrows heavily from branding overarchingly. However, there are fundamental differences. Ambitious retailers want to be recognized as the preferred destination for shoppers in a sea of competition. A proposition is a key factor in positioning. The proposition may be defined at one or more levels.

  • Price
  • Value
  • Qualitative
  • Exclusion
  • Premiumness
  • Specialty
  • Legacy
  • Expertise

Retail branding is complex

Due to the dual objectives of retail branding, it is complicated. Firstly, the retailer must establish a distinct positioning and sell its own products. Secondly, the positioning must be attractive enough to attract other manufacturers brands. Luxury retail presents a more difficult challenge because the physical store is still the main point of contact for the brand’s customers.

E-commerce has made retail branding more important than ever. It is now about consistency across channels around visual identity, creating perceptions, communicating positioning and improving the customer experience. Since the days when similar colour palettes were used on the primary nameboard and internal branded materials, retail branding has advanced a lot. Retailers must ensure consistency and quality across all channels and engagement points, as the consumer’s decision journey crosses online and offline. Poor customer service on an online retailer’s channel can have a negative impact on sales and equity.

Retail branding: Key challenges

Retail branding today means addressing these two key issues:

  1. Expectations of brands when they interact with them online and offline: There are vastly different expectations from consumers. The same applies to retailers. Consumers are looking for convenience and ease of research when researching or purchasing a product online. Reviews and the ability of easily accessing a variety of products in order to make a value-driven purchase decision. A physical store is an offline channel. The primary needs of the consumer are to touch and feel the product to fulfill a shopping occasion or to gain a deeper understanding of the product. It is essential that branding be consistent across all channels and needs in order to meet these diverse consumer needs.
  2. Technology and sensory driven expectations: Consumers expect seamless transitions between platforms and technologies when engaging with brands via online channels. Consumers expect superior functionality and easy use of online channels. This leads to the requirement for visually striking features. Consumers expect to be impressed with brand experiences in the physical world. This is what has led to retail stores becoming experience centers, such as Samsung Experience Stores. These are places where you can only experience brands and not have to purchase them.

These varied and sometimes contradicting needs have shaped the evolution of retail branding. Retail experiences are what have made brands such as Apple, Samsung, Hermes, Samsung, and Disney so successful. Luxury and premium brands create physical retail experiences that can promote the same exclusivity that their brands are known for. This applies not only to single-brand retailers, as shown in the examples, but also to multi-brand retailers.

Multi-brand retail, which encompasses all grocery and supermarket chains, is a huge segment. Although branding in this segment has advanced beyond the ordinary, there are still significant opportunities for improvement. Multi-brand retail is a segment that is primarily based on price. However, those who have succeeded have diversified their branding beyond price-based positioning. With the increasing cost of physical presence and pressure from ecommerce, opening more stores is no longer a viable strategy to grow. Now, the focus is shifting to trust, community and sustainable sourcing.

Retail branding best practices

No matter if it’s single-brand or multibrand retail, strong branding is essential in the retail industry. This requires an understanding and appreciation for the following key elements:

  • Understanding the evolution in consumer decision journeys

Branding is about presenting a distinct positioning at key points of the consumer journey. In the past few years, there has been a significant shift in how consumers interact with retailers. The decision-making process is complex and non-linear. There are many points of infraction. Brands can also enter or exit any stage of the journey. An in-depth understanding and appreciation of the decision journeys is essential for retail branding. The brand must be consistent and strong across all touch points. It should convey a distinct positioning and keep the consumer in its universe (i.e. Online and offline).

  • Staying on top of global trends

Our lives are more affected by people and events thousands of miles from us than our next-door neighbors. Social media platforms have accelerated the rate at which comments become opinions, thoughts become thought-pieces and thought-pieces become voice, and voices become trends. To be useful shopping destinations, retailers must keep up to date with these trends. Startups are threatening Zara’s status as the leader in fast fashion. The lines a retailer should sell will change with the changing trends. These changes will impact the brand and help keep it relevant.

  • Technology driven capabilities

It is crucial that retailers embrace technology as a way to build strong brands. Although digital signage is commonplace in retail stores, there are even more possibilities. Arty images can be projected onto walls in Starbucks Reserve stores. Every Starbucks Reserve store around the globe is unique and offers a unique “coffee theater” experience. Hermes, the luxury brand, created a virtual store to display its silk squares and shawls, scarves, twills, scarves, and stoles collection. Retailers need to incorporate technology more into their brand strategies. Technology is now a key element in branded experiences.

  • There are no political boundaries in retail

It is a global phenomenon that transcends borders. E-commerce has quickly removed the barriers to purchasing and experiencing global brands. Amazon and Alibaba have changed the rules of global retail business models. Any retail branding initiative must embrace a global mindset from the beginning. It is crucial to recognize that online retail does not have the same limitations as physical retail when traditional retailers create and implement channels online. Alibaba is an example of an online retailer that has the potential to expand into any market worldwide thanks to its platform’s scalability. Amazon is expanding rapidly globally with a consistent strategy that includes a strong brand name, expert in local logistics and operational challenges, and significant investment in emotional and functional brand building. It is still not possible to see the same success for traditional physical retailers. This highlights the challenges associated with managing infrastructure globally.

  • Personalization is the new strategic differentiation

Consumers today have more choices than ever and are more in control of when and where they choose to make these choices. Retail brands that don’t invest in individual experiences may be pushed down or out of the consideration list. Even when shopping at discount or value-priced retailers, consumers expect personalised experiences. These experiences must be provided at every touch point by successful branding strategies. Although the retail industry has adopted big data analytics to create these experiences, the connection between branding and data analytics remains weak. It is possible to overhaul loyalty card programs, which offer tremendous potential to increase brand equity.

Digital is a force that can be powerful and disruptive, but retailers need to see beyond the digital glitz and glamour. Not every branding campaign should have a digital component. The brand should highlight the strengths of the retailer in a distinctive way that is hard to replicate. Any branding effort should focus on strengthening the physical assets of the retailer, and not too heavily on online channels. Online retailers are exploring high-end technology-enabled fulfilment and delivery mechanisms that can be used to differentiate themselves from their competitors (in the absence any product line-up differences). Traditional retailers need to be cautious not to copy positioning platforms that aren’t a good fit for their brand. This will cause brand equity to suffer. Traditional retailers need to be aware of one dynamic: the entry of online retailers into mass market product lines (e.g. groceries, FMCG / CPG etc. ).

Personalization is now the strategic differentiator. Consistency in engagement and service levels are the new activation mechanism. These two factors are crucial for retailers when it comes to branding strategies. Without the other, a retailer cannot fully realize the potential opportunities available.

A sustainable retail branding strategy is key

Modern retail branding strategies must maintain consistency in positioning and communication across all touch points. The number of touch points has increased from just physical stores to include online purchasing channels that are available on multiple platforms and devices (desktops and laptops, tablets, smartphones, and tablets). Retailers need to be online for visibility and reinforcement of key positioning factors. The fragmentation and growth of media channels and the emergence social media platforms as e-commerce platforms (Twitter. Instagram. Pinterest. Snapchat. Tumblr. etc.) has led to a decrease in media outlets and increased media traffic. Retailers now have many touch points to manage. Retailers have more touch points to manage, making it harder for them to maintain a consistent brand identity and image.

The digital age demands that retail branding be grounded in deep consumer understanding and the ability identify disruptive trends rather than fads. A higher consciousness about health and wellbeing is a trend. However, the fact that everyone wants pink headphones is not a trend. Strong retail brands that have stood the test of time have been carefully built using a set of principles. These principles are the foundation of the brand’s vision and can withstand the impact of digital commerce platforms. Even if a small-scale positioning update is required (not a major brand transformation), retailers must remain true to their vision.

Conclusion: It is crucial to make a significant change in retail branding

The retail industry has seen rapid changes in categories, consumer behavior and needs. Technology (retail platforms) is influencing consumer engagement in retail. One thing remains constant: strong retail brands have been able to withstand disruptive changes and will continue doing so. There are many similarities between the brand building strategies used to establish Walmart and those used to create Amazon. These key characteristics of strong retail branding strategies include shared strategy that demonstrates patience and continuous investment in brand identity and image building, keeping close to the brand’s purpose, adapting with the times, and establishing core equity.

If a retailer wants to build or strengthen its brand, it must look beyond its number of stores, its product range, its online capabilities and its price points to see the bigger picture.