The UK home entertainment retailer HMV called in the administrators earlier this week after nearly 100 years of operations. A little time before Christmas I clicked on a mobile banner campaign for a new release DVD, behind it was a serviceable microsite with an ‘order now’ button – clicking led to the HMV website, the full fat PC version! A very poor experience, but not that unusual for the home entertainment industry (check out Play.com, the challenger brand and their complete lack of mobile site).
Given that that warning signs were already there for HMV, I wondered what else they might have overlooked in terms of technology and keeping up with consumer habits. As regards the mobile consumer, they clearly didn’t even get the basics right, but I started thinking how else could they have leveraged smartphones – which are seemingly so central to a modern consumer’s music experience?
HMV partnered with 7Digital in 2012 to provide a catalogue of 20m tracks under the HMV Digital Brand . A pretty much vanilla reskin of 7Digital’s platform, but compatible across devices and with iTunes. A sensible move, considering that digital downloads had grown to 25% of all music sales in 2012, while physical product had dropped by 17% (but still accounted for 75% of a shrinking market).
If Amazon, other retailers and download providers were winning on range, convenience and price, then couldn’t HMV have made more of its retail, venue space and online presence and moved away from their reliance on shifting physical product on the high-street?
There is much talk about the disruptive use of smartphones in a retail environment. Both offline and online retailers have experimented with virtual stores (mostly gimmicky) and consumers have been using smartphones for some time to research products and shop around for a better online deal while in-store (‘show-rooming’ which is part of a consistent and sizeable trend). However, the concept of the virtual and real store combined actually starts to make a lot of sense when you consider the instant and portable nature of digital downloads.
HMV’s venues and stores are exactly the place where smartphones can perform their amazing party trick – combining the real with the digital – which I believe has great scope to create experience, drive footfall, dwell times, loyalty and realise sales.Built on a digital music streaming and download platform, HMV could have put wifi into its stores and venues and created a smartphone and tablet captured portal, with a partner app, that would have let shoppers;
• Scan any barcoded product and stream the tracks, watch the trailer or see video of the computer game (the ultimate personal listening post)
• Search by lyrics, artist, genre, charts etc and either be directed to physical product or to downloads (the helpful and knowledgeable assistant you can never find)
• See staff reviews, online reviews, customer reviews, and ‘people who liked this also liked this’ and other social discovery (all the editorial and social shopping content you can get online, but delivered at the point of purchase at the moment of need and decision)
• Buy downloads while at gigs, when the music consumer is exhibiting perhaps the most engaged state of mind you’re likely to find
And that’s just the digital experience that you lay over what had become faceless rows of product. Throw in a coffee shop, a ticket booth and a decent merchandise concession, and you’ve got shopping experience that is augmented, not threatened, by mobile and web technology.
Over time you get to know your customer, and you drive repeat footfall with special retail only offers and in-store events. But at the end of the day you don’t care if the consumer buys in-store physical or digital product, or uses your app or web service to buy at home, or anywhere they choose. The important thing is that you use the retail environment as a point of differentiation and build brand affinity by providing real service and experience that clicks with digital natives. You don’t take Amazon head on , you emulate the independent record shop successes.
Getting personal with everyone through smartphone augmentation of the bricks and mortar shopping experience can then continue across persistent digital channels. Your shop is everywhere, but you are loved like only a high-street brand can be loved. You are omni-present, but you still have a face.
Could HMV have kept its retail presence alive purely through activating their stores (and venues) for digital discovery and download, probably not – they would have had to be operating a superlative online music experience as well. But at least it would have been a step towards meeting the changing patterns of consumption.
In the end they sank because they were too slow to realise the threat from online and digital downloads, and didn’t leverage their high-street and venue assets. There are many more high-street operations that need to realise that digital must be fully and creatively embraced, and that doesn’t just mean a website. The corporate vision? Retail leaders must smash down the notion of off-line and on-line being separate businesses, and turn digitally activated off-line retail experiences into the main ‘brand-led’ shopper gateways for truly omni-channel sales.
And while smartphones won’t save the highstreet as we know it, they might just help transition bricks and mortar brands into the future facing consumer focussed connected businesses that they need to become.