Big-box stores this holiday season are setting up hot chocolate bars, installing festive photo booths and taking toys out of the box for play dates as they look to offer something to shoppers that they can't find online.
It is a shift in thinking for stores like Target, Walmart and Toys 'R' Us, which historically haven't offered many perks in stores to keep prices down. But as more sales shift online, they are willing to spend more and step up their game.
"Physical retailers know that to differentiate themselves from the Amazons and Wayfairs of the world, they need to connect from an emotional perspective," said Matt Sargent, senior vice president with consulting firm Magid. "That is their primary advantage over e-commerce."
Offering hot chocolate in and of itself is probably not enough to drive people to a store, he acknowledged. But the idea is that if the shopping experience is more pleasant when they're there, shoppers are more likely to come back and to come back more often.
It also shifts the idea of shopping in a store as simply being a task — something that Amazon can compete quite well on — to being more about inspiration and discovery, Sargent said.
The move hearkens back to why people came to downtown department stores.
Still, it won't be easy to slow the momentum of Amazon, which by some projections is expected to pick up half of all the growth in holiday sales this year.
In addition to tripling the number of products it sells online this holiday, Walmart is holding more than 20,000 holiday parties and more than 165,000 product demonstrations in its supercenters.
The in-store parties are a first for Walmart. The first, held in early November, focused on toys. The second one, held on Saturday, featured free samples of cake and cobbler as well tips for holiday entertaining. The final event in mid-December will highlight popular gifts.
"We're doubling down on our in-store experience," Tony Rogers, Walmart's chief marketing officer recently told reporters. "I've been doing this for 10 years. This is definitely the most that we've done in stores."
Meanwhile, Minneapolis-based Target Corp. hosted a scavenger hunt as well as a toy event in many stores last month. Next weekend, it will hand out cocoa, cookies and milk in stores. The following weekend it will give out Star Wars sticker sheets to coincide with the release of the newest movie in the franchise, "The Last Jedi."
It also recently put up holiday photo booths in most stores featuring a Lego-themed backdrop of a chimney with Target mascot Bullseye and Santa. Kids and parents can take their pictures in it. When they rotate the picture on their phone, it will look like they are coming down the chimney.
"We're really trying to create excitement and joy in what at times can be a somewhat stressful season," Rick Gomez, Target's marketing chief, said at the retailer's holiday briefing in New York.
He added that Target is "leaning into" enhancing that store experience this holiday more so than it ever has before.
"We truly believe the 1,800 stores we have are our competitive advantage," he said. The retailer has boosted holiday hiring and taken other steps to improve customer service in stores.
Dawn Eber, a retail leader with PwC, said consumers will shop in stores if they find the experience enjoyable, which means shorter lines and feeling welcomed.
Her firm's research has found that younger shoppers, aged 13 to 16, while quite adept at online shopping, prefer shopping in stores more so than any other age group because of the experiential piece.
The big-box retailers are joining some specialty stores that have been flexing their muscles to engage shoppers for awhile now. Beauty chains such as Sephora and Ulta offer makeovers. Athleisure apparel chains such as Lululemon and Athleta hold fitness classes in stores.
"They're all taking these strategies to enhance their brand and engage with that customer at a very different level than the old days of that brick-and-mortar store just being a repository of inventory," said Eber.
Richfield-based Best Buy recently added 700 displays to better showcase how Amazon Echo and Google Home devices can be connected to other smart home products. It also does a number of product demonstrations of newer items such as virtual reality headsets and electronic toys such as droids.
Toys 'R' Us hosted parents' night out parties for the first time in recent weeks where parents could munch on refreshments, see toy demonstrations and sign up for giveaways. It also recently launched a PlayChaser app that includes various augmented reality experiences in stores such as fishing in a virtual pond near the entrance of stores.
The stakes are high for Toys 'R' Us, which is trying to recover after filing for bankruptcy this fall.
Interactivity has always been a key element of the toy chain's stores, with kids often jumping onto bikes or other ride-on toys in its aisles. But now the company is taking it further in the hopes that taking toys out of the box can help it stand apart from other retailers, provide some inspiration for shoppers, and lead to more sales.
"We are really working hard to bring hands-on play into our stores in a much more significant way," said Richard Barry, the retailer's chief merchandising officer. "Bringing our stores to life is a core strategy for us as a company."
Kavita Kumar • 612-673-4113
