The writer speaks on the hybrid form of enhancing customer experience and interacting with them
Phygital is the new way of connecting with customers and enhancing their experience and it is here to stay. The future of marketing and CRM would be largely influenced by the phygital way of engaging with customers. The word phygital is a combination of two words – physical and digital, and it means giving a customer the convenience of digital experiences along with fulfilling the need to physically feel, touch and engage with the required products. In the true sense, this is the hybrid form of enhancing customer experience and interacting with them. Here, technology is being used to bridge the digital world with the physical world with the purpose of providing customer convenience and unique interactive experiences. On one side, the pandemic has encouraged more digital interactions and online shopping habits and on the other, it has led to re-evaluation of the physical experiences. Many people are reliant on technology and addicted to their touchscreens, but what everyone actually craves for is the physical interactions and human relationships. Research shows that today about 49% customers still prefer to shop in physical stores. Therefore, many times, customers experiment with both the approaches, physical as well as digital. Often customers go to a physical store to see, touch, feel and try out a product and then leave without purchase, only to order it online. Alternately, before buying a product in a physical store, customers often browse through the websites, compare brands, consult e-com companies reps, read hundreds of reviews online before making a decision and go and buy from physical store – say hello to the ‘Hop on, hop off’ customers. Phygital is the way to meet these types of customers’ needs without much effort, providing the feel of both the worlds under one roof.
Customers in the age groups of 18 to 36 years, who are born in a technologically advanced world, are the ones who would be disturbed and their shopping experience marred if any one of the two components, physical or digital, is missing. Therefore, the phygital experience is one that caters to the needs of all these types of customers. The younger customers, especially the millennial and Gen Z will expect and enjoy engagement digitally with your business, whereas the older generations would still want the physical experience and human warmth in dealings. That is why creating phygital experiences, which will cater to everyone’s needs, would serve as a better marketing and customer service tool than the traditional channels.
Phygital is an omni-channel marketing approach where various marketing channels work together to provide consumers a seamless shopping experience that is unique and highly personalised, leaving a lasting impression on them. The younger generations especially, want to play, experience excitement, connect and get entertained, all while shopping. In reality, the physical store becomes a playground for customers offering sensory, emotional and digital experiences where products and brands are pushed onto customers. These customers expect the advantage of both physical as well as digital experiences in a single shopping transaction, thereby indicating their inclination for a hybrid shopping experience offered by the phygital approach.
Success of Phygital approach is based on fulfilling a mix of four important needs of customers, which are catered to by three components derived from the digital world – Immersion, Immediacy, and Information, and from the physical world – the Interaction.
Examples of Phygital Approach
‘Amazon Go’ a chain of convenience stores, also known as the ‘checkout – less Supermarket’ are completely free from cashiers, cash registers and self-service checkout stands. These stores use latest computer vision, AI, deep-learning and sensor fusion technologies to maximise customer shopping experiences. Customers are automatically detected once they enter the geo-fencing area of the store, or customers are required to scan a code with their smart phone. They shop for all the products they want and once done, walk out straight of the store without going through the traditional checkout counters. A lot of time saved indeed for the fast-paced customer. An electronic invoice is generated and sent to the customer and the payment goes automatically via the customer’s Amazon account that is linked to their bank account. This provides a fast and comfortable shopping experience, with convenience for busy customers. ‘The NikeLive Stores’ provides customers the convenience of online shopping along with the much craved human connection and physical product exploration. These stores would cater products curated to customers’ taste, based on data from the NikePlus app. Member customers are recognised as soon as they enter the geo-fencing area, their mobile phone opens QR code enabled smart lockers, operates product vending machines, scans products, requests colours and sizes, etc.
Other examples of phygital use include retail stores that use smart or interactive mirrors that assist customers in trying out various products without actually wearing them once a tag is scanned. They can try out various colours, sizes, patterns, different products etc., and see how it looks and fits on them.
Any retail store or convenience store operator can create a mobile app for his store in assisting customers to ‘walk the aisles’ and make the shopping experience exciting and hassle free the phygital way.
Kiosks or pop-up stores, backed by technology, are a great example of phygital initiative. Kiosks set up at airports, railway stations, restaurants etc. would activate regular customers’ phones the minute the customer enters the geo-fencing area of the kiosk and send greetings to the customer to welcome them. It would match past data records of customers and recommend items based on purchase history, guide on dietary restrictions, if any, recommend new products etc. ‘Buy online pick up in store’ is yet another way to engage phygitally with customers. Customer places the order online and pick up items from the store. This saves time, avoids crowded places, no waiting in queues, easy on the go pickups, and at the same time provides the experience of a physical store interaction, the feel, the aroma etc.
Connecting with customers and enhancing customer experience are two strong pillars of marketing and CRM. Companies that adopt phygital approach are satisfied with it and continue offering better experiences in this space. It is worthwhile for business to get phygital for future growth and sustainability. That’s the way forward.
The writer is Founder Director, Saldots Academy; corporate trainer and facilitator; past chairman of Goa Management Association.
