What would a retailer need to do to convince you to pay to visit their store? Some consumers are lining up to hand over thousands of dollars in membership and entrance fees for premium brick-and-mortar experiences they feel are worth their time. Because shoppers can often get products more conveniently and faster online, they are seeking differentiated and exclusive offline experiences.
Stores are already charging admission fees. Depending on the brand, "retailtainment" is viewed as comparable to going to the movies, a night out, or a spa day. For example, the Winky Lux Experience pop-up charged a $10 fee to walk through seven rooms inspired by their cosmetic products, such as a “matcha Zen garden” to promote their Matcha lip balm.The entrance fee was credited toward purchases. If department stores expand from partnering with services such as coffee shops and fitness classes to these kinds of features, their business model may need to change to stay sustainable. While paid memberships have proven successful for retailers such as Amazon, Costco and Sam’s Club, luxury menswear retailer Wingtip in San Francisco is raising the bar by charging monthly membership dues of $125 to $200 and initiation fees of $2,000 to $3,000. Members and their guests can indulge in food, sip on drinks in the whisky corner or wine cave, and enjoy a skyline view from the rooftop.
Invite-only and themed events better connect with loyal customers. Few businesses have truly figured out how to establish loyal relationships. A global shopper survey found that 64% of people feel retailers “don’t truly know them.” Connecting with more focused target audiences outside of the typical retail environment and recognizing advocacy could help combat this notion. Brands such as Apple, Victoria's Secret PINK, and Sephora recognize customers or loyalty members by hosting exclusive in-store events. Lululemon tested a loyalty program that costs $128 a year and includes curated events, workout classes and free expedited shipping. Such offerings are likely to increase in the future: While just 9% of shoppers have taken advantage of invitations to exclusive events, 74% were somewhat or very interested in doing it again.
Whether retailers charge admission or provide invite-only or themed events, shoppers are more likely to visit physical locations that create experiences worth their time.
Contributed By: Nina Bresseau, Integer Dallas
Image Source: Unsplash