The road to online retail
Episode 3

Let's get "Phygital"

In our previous two podcasts, we’ve been exploring the belief of Kevin Moore, an international retail and sales marketing expert, that we are now entering “the second age of online retail”.

This second age is the accelerated migration of shoppers to digital retailing of all goods and services. In our podcast, we’re exploring ways that both physical and digital retailers can ensure they’re ready for this second age. And an important part of that readiness is a retailer’s “phygital” offering.

What’s a “phygital” offering and why is it an important thing for online retailers to be across? Listen on…

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The Road to Online Retail Podcast 3 - Phygital
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Kevin Moore

Kevin Moore

International Retail Marketing and Sales Expert and The Road to Retail co-founder

Nigel Miller

Nigel Miller

The Road to Retail co-founder and video producer/director

The Road to Online Retail Podcast

Episode 3 transcription

30th May, 2020

The Retailer’s Phygital Offering.

Nigel Miller: [00:00:00] Welcome to this episode of The Road to Online Retail. I’m Nigel Miller.

In our previous two podcasts, we’ve been exploring the belief of Kevin Moore, an international retail and sales marketing expert, that we are now entering “the second age of online retail” .

This second age is the accelerated migration of shoppers to digital retailing of all goods and services.

In our podcast, we’re exploring ways that both physical and digital retailers can ensure they’re ready for this second age.

And today we’ll be discussing the retailers phygital offering, phygital offering, phy-gi-tal offering, Phygital Offering. How am I doing? 

Kevin. Welcome, welcome. Welcome.

Kevin Moore: [00:00:42] Thank you.

Nigel Miller: [00:00:42] Mr. Moore, you know how much I hate made up words. Is phygital something you’ve come up with just to wind me up? And if not, what is it?

Kevin Moore: [00:00:50] No, it’s not made up by me. So again, when we were working through a number of digital companies, and certainly the phoenixing of the Toys R Us brand, it was clear that there’s so much heritage in a brand that’s traditionally been in retail, physical retailers. So many experiences of parents and children and grandparents walking around stores in their childhood that we needed to be able to connect with that.

If we were to go pure online, being pure online in certain categories, you lose the emotion. So we clearly sat down and says, “how do we get this physical experience that we can remember as children? How do we capture what happens in Hamley’s and FAO Schwartz, the physical and how we get into digital world?”

And we kept going “physical, digital, physical, digital, physical, digital phygital.”

And it came around from just batting it backwards and forwards. But it’s important because it is that whole basis of storytelling, conveying the narrative visually with real people connecting with whatever they’re buying and building strong emotional connections with the community through, through digital, through social media channels, exploring, experimenting with a combination of physical and digital. But it’s gone beyond that now because we’re seeing people clearly combining the digital element and being able to, you know, surf online, shop online, engage online with the physical elements of taking possession of the products or engaging with the products. And we ought to go through a few examples of those that people kind of know, but they don’t sort of realize that it’s a phygital interface. It’s a connection of digital/physical.

Nigel Miller: [00:02:17] So Kevin, you’ve talked about “phygital” in overall terms, so using storytelling, high quality video and imagery to let online shoppers feel the same emotions as if they were in a physical store.

But can you give me a real-world example that people can maybe relate to?

Kevin Moore: [00:02:34] Yeah. What I’ll do is I’ll do a couple of creative ones and then take it into the things that we’re actually all experiencing and don’t realize it. So there’s some very clever stuff that’s now actually coming to fruition. And you mentioned something, you told me a story about a wine region Australia some years ago.

Nigel Miller: [00:02:52] Yeah. So, a few years ago I was doing some videos for the body that was rolling out broadband over here in Australia. The NBN. And we did an interview with a guy called Chester, who is sort of the head of a lovely winery down in Adelaide, or near Adelaide, down in the McLaren Vale called D’Arenberg. And he was using the internet to basically do wine tastings internationally.

So he was sending over boxes and boxes of wines to distributors in places like Russia. And then those distributors were organizing events and they were getting people to come in and do a wine-tasting with Chester linking in and telling them all about the wines, telling them about the winery, and basically also showing them around.

So showing them into the barrel rooms and all sorts of stuff, all on the internet.  This must be six, seven years ago, so a long time ago. That’s just one example.

Kevin Moore: [00:03:48] So that triggered, when you tell me that story, there’s a piece of work, one of my agencies is doing at the moment in Japan, and I think it’s brilliant work, and it’s client-driven, so brilliant work. So this is a one company, but it’s a very, very premium wine company. So you may have heard of a company called Domain Romanee-Conti.

People talk about DRC as being the ultimate wine in the world. The bottles set you back about $18,000. Yeah. It’s not DRC that are doing this, but it’s another premium wine company. I’m not going to name them because the work’s going on, but effectively, exactly as you’ve described with the digital environment, what is happening is premium select micro bottles of very old, very expensive wine has been shipped in the mail, in courier, to about 700 very high net-worth Japanese who love  their wine and there is then the head winemaker, on a micro site, in real time talking to 700 people – facilitated conversation – so there are translators, facilitate a conversation about the wine, about the attributes of the wine, about the cellaring and  because it’s built into a micro-site, which is two way audio video. So this isn’t a Zoom call. This is full conference facility with a producer being able to bring up different questions and bring them onto a screen to interface and to react in the digital world with the wine maker whilst tasting the wine, understanding the tasting notes and built into the micro- site, because it’s a micro- site just for those 700 people is the order process for them to click and have the actual bottles and cases of the premiere wine shipped to them.  Now that is for me, one of the most beautiful physical, digital, “phygital”, that I’ve heard of an experience in a long time. It really is coming of age.

Nigel Miller: [00:05:32] That sounds amazing, but you know, we’re talking there about very expensive products. Are there things that, you know, in a more mass market way of being done that you can think of?

Kevin Moore: [00:05:44] Yes, there are, and I’ll touch on some of those, but it’s important to remember that whenever we have a shift in behavior, it always starts at the top end of a marketplace. You know, we all want to save the planet and buy electric cars and the $100,000 a pop. We can’t do it. But then 10 years later, everybody has electric cars and they’re $32,000 a pop.

So it always starts, the innovation will always start at the top because that’s where the margin is. That’s where the early adopters go. So as we see this cascading down, we’re seeing it in many ways. Some of the key phygital, we don’t even think of as being phygital: click and collect is a classic phygital.

So I go online, I buy what I want to do, I’m saving myself time. Remember, number two is convenience, online shoppers want convenience.

Nigel Miller: [00:06:25] Just before you go there, can you just quickly remind us what are the top five things that online shoppers are looking for?

Kevin Moore: [00:06:30] Yep. So the number one is range. People want the broadest range of products in stock that they can have. So we talked about don’t put things up, pretending you’ve got them in stock. They must be in stock. So the widest range possible in stock. Number two is convenience that everything I want is on your site. It’s easy to shop. I have options of where I send things to. I can click and collect if I choose to. Service, so that it is easy to shop with you and there’s follow-up, there are plenty of supports, if it’s a technical product, on your site for people to have that or there are people out in the community that can help you with the product if it’s technical.

Number four is payment terms, but payment terms, not just credit card, but PayPal and the ability to have AfterPay. So part payments is huge.

And then the fifth one is pricing and promotion. So price is right down at number five.

Nigel Miller: [00:07:18] Yup.   So just a quick aside on that one, so on the Click and Collect, I know a lot of physical retailers who have probably not put an awful lot of attention into their online selling ability have suddenly discovered that Click and Collect is an incredibly powerful thing to be offering in these difficult times.

I was reading about a very large hardware store over here that their CEO had been getting flack for their move towards online shopping, but now is laughing his head off with what’s been going on. And particularly with the “click n collect” aspect of it.

Are these sort of changes the major parts of this “phygital “change that’s going on and the second age?

Kevin Moore: [00:07:53] Yes it is. It is. And it’s being adopted mainstream. So it’s that whole convenience thing. The reason click and collect works is cause of convenience. So that’s the digital to physical, Nige, and I’m not going to do “digiphys”, but it’s digital interface. You…

Nigel Miller: [00:08:06] Thank goodness for that!

Kevin Moore: [00:08:07] You start the journey digitally and you finish it physically. On the other end, you can start physically and end it digitally. So, and again, in premium stores, in the middle of cities where people don’t want to carry things around, certainly bulky items, I can pay and choose instore and ship to home. So my interface starts in a physical environment. I get all the support I want all the engagement from, you know, very knowledgeable shop assistants and amazing stores with a range of items I can touch, taste, smell, and I say, that’s beautiful. Here’s the payment for it, and please have it delivered to my home and all my details on online.

Nespresso are doing it. Nespresso have beautifully segued out of their physical store locations into their already online offering, and they’ve been able to almost not miss a beat in being able to provide coffee to Nespresso drinkers all around the world.

They’ve done it beautifully.

Nigel Miller: [00:08:55] Well, I have to say carpet sellers in Morocco and India have been doing it for many, many decades too. So…

Kevin Moore: [00:09:02] So if your details are there, you’ve got an online account, it’s easy to do. 

Nigel Miller: [00:09:06] I guess the other thing that’s going on between the digital and physical at the moment, particularly with the COVID-19 situation in so many countries, , is that businesses and even non retail businesses, but service businesses are suddenly discovering that if they explore digital and experiment, people like karate lessons online, yoga lessons online , selling your clothes via lessons, even. So, I know manufacturers are doing lots of entertainment that gets people watching their product. There’s a lot of exploring, experimenting, going on that seems to be paying dividends for a lot of them.

Kevin Moore: [00:09:43] Yeah. Necessity is the mother of invention, it makes us focus on things. A crisis makes us do things we were gonna do and we hadn’t got round to it. So the exploring, experimenting is great. You can see people doing it and over time what they will do is they will commercialize it.

And remember, we started this, this whole process by saying, we want to help people to go online, because we’ve been around retail for many years, we’ve helped retailers run their businesses better. How do we translate those things into online world? And that’s what we’ve said we wanted to do and continue to do.

The important thing about this is that those who’ve been doing it for some time, so those are 18 even over 18 months, even six months into the journey, those who had their online offerings six months before COVID, like the CEO of that hardware store that you talked about, you know, the fact they were prepared, the fact that Nespresso could do it, the fact that Bose had their direct to shop it and this came along just accelerated that process to the second age. It just became eponymous. It became normal, but sometimes this exploring and experimenting takes us back the future.  I love the fact that in a number of communities around the world, there are dairy producers that can’t get out to the metropolitan areas anymore, and they’ve gone to going back to online delivery of dairy produce. So that’s milk and cheese and butter and they’re finding ways in hotter climates to chill it and make sure there’s a chiller-box. Now, this is back to having a milk run back to having a milkman. So that we were able to use the digital environment to reconnect with people in the postcode.

A gain, it doesn’t have to be the other side of the planet. Online shopping is as much to do with our postcode and our community as it is to exporting the world. And we, one of your mates were saying , Miranda…

Nigel Miller: [00:11:17] Yeah. I’ve got a friend, Miranda Bond. She is a digital marketing expert, and she was saying that, yes, it’s great to start off trying to reach your local postcode, but the fantastic thing is that you suddenly find that people you would never expect to find you, from all over the world, might dip-in and make contact and love what you’re curating, and your business expands in ways you never thought.

Kevin Moore: [00:11:41] You start the process, you take one step and all of a sudden people, so you create awareness. That’s the first thing you do. You create awareness, you then get engagement, and then more and more people come.

So Hobby Warehouse has a Japanese site. We didn’t expect to have a Japanese site, but Japanese shoppers like the remote control, they like the radio-control , they like the models and more and more Japanese shoppers were finding the site, which at that time was a “” site. So we now have a Japanese site in Japanese to look after them. We didn’t mean to do that. It just happened because you start to get there. So this going out to the postcode and going out to your community naturally opens up the world to you. So I love that. I love that, that creativity and that exploring, experimenting is delivering lots of things that were old that are becoming new again.

Nigel Miller: [00:12:24] So just going back to where you started this telling us about when you were doing your initial research for Toys R Us Australia and New Zealand. How concerned were you about not having physical and what surprises have you found along the way?

Kevin Moore: [00:12:39] It’s funny, we as the party launching it, were not concerned at all. We would have been more concerned about signing 20 year leases and 12 year leases with landlords with CPI increases. So cost of living increases built into those contracts that would have chewed up so much working capital, we couldn’t have possibly have got the business off the ground and grown as fast as we have done, if our monies were tied up in storefronts.

It was a challenge to be able to convince, to begin with, the global CEO of Toys R Us and his team, that this was the way to go, and they had the option of choosing companies that had physical storefronts, but they said, you know what, what you’re saying, every bit of research you’re discussing, every bit of work that’s been done by every researcher, Nielsen, GFK, everybody in the world is saying the same thing. This sector will have up to 50% of its sales online by 2023. Now we’ve had Covid, it’ll be 50% of sales by 2021. So it’s a mindset. I go back to that thing, if it’s been your paradigm, if you’ve been in physical retail all your lives, it’s very difficult to have that shift.

 I take my hat off the CEO of the hardware company because he would have had to fight tooth and nail with his shareholders to say, we’re going to put money into this thing that isn’t going to pay today, but it will do one day and that day’s come.

Nigel Miller: [00:13:55] Hmm. And then the other thing is that obviously when you dive into the digital world, you don’t really know how it’s going to go, and you’ve got so much to learn. I seem to remember that come Christmas time, you guys were a little bit surprised about the volumes you were getting, which you were pleasantly surprised. Is that correct?

Kevin Moore: [00:14:15] Oh, absolutely. Yeah. And that was again, because the brand was well known and recognized and once you re-engage with people, it came alive again.

So we’re recording these podcasts, Nige, a week apart. Since the last time we met when you played John, Bob and my single, “Dreams” by Finding Cadence. So have a guess how many people that has been served up to, they haven’t seen it, what market number of people has that been served up to.

Nigel Miller: [00:14:44] Oh, well, look, I mean, it was an amazing piece of music, so it must be in the like 30 people?

Kevin Moore: [00:14:50] 400 million.

Nigel Miller: [00:14:52] Oh, served to?

Kevin Moore: [00:14:54] Served up. It is available to 400 million people on 150 platforms, including YouTube.

Nigel Miller: [00:15:01] Yeah.

Kevin Moore: [00:15:01] So this is singer-songwriters, in a particular market, and it’s been served up potentially to 400 million people. Now you can’t get 400 million television viewers. You can’t get 400 million radio listeners. It’s not possible.

So this whole digital world is such a mind-shift for people to get their heads around. That’s why go into it, step into it. The worst that can happen is nothing. The next worst thing that can happen is the demand’s so incredible, you’ve got to get people to help you.

Nigel Miller: [00:15:32] Yeah. Okay. And that’s not necessarily the worst problem to have…

Kevin Moore: [00:15:35] Uh, no,

Nigel Miller: [00:15:37] Okay. Okay.

So Kevin, going back to the top five things that online shoppers are looking for, and number five being price and promotion. From the actual digital retailer’s point of view, where should promotion be in their top five?

Kevin Moore: [00:15:53] Uh, on five. So it sits there at number five, because you make sure you’re getting your ranging rights. You make sure that you are offering that convenience your shoppers want, great service. The payment terms are there, you’re looking after all of the people who’ve come to the site who are aware of you that you have a relationship with.

So it stays at number five, but then what you do is you bring it up at key times. So at key seasonal times, you cannot possibly be in a seasonal market whenever your season is. You cannot be in a seasonal part of the market time of the year and not be promoting actively because you’re uncompetitive.

Now, that doesn’t mean you’re the cheapest price. It means that you’re offering something. We’ve talked about freight. How important is it? It’s a great promotional item. I’ll offer free freight on any orders over $50. I’ll offer free freight for the next week. I’ll offer free freight if this particular item is chosen, the basket of things you have. I’ll promote to certain percentages because that’s the norm in the marketplace at that point in time.

So we talk about Black Friday and Cyber Monday, you have to be price competitive because people are spending the money that they have. And once it’s gone, it’s gone. Does that make sense? Key seasonal times. People come to the day, they come to the week, they come to that seasonal point of time with $1,000 and that’s all they’ve got. I don’t mean they’ve got a $1,000 cash, I mean they’ve got $1,000. So on their credit cards, in cash, borrowing for their mate, whatever it may be, that’s what they’ve got. And if you don’t get your share of that at that time, through pricing and through promotion, you lose that season for three months, six months, nine months, 12 months, depending on what type of season it is.

Nigel Miller: [00:17:22] Okay. And then sort of more creative promotions. I have to say, I was amused by one that you guys did at Toys R Us in Australia and New Zealand, with your recent “toilet roll challenge”. I can put a photo up of this on the website, but can you tell us a little bit about that?


Toys R Us toilet roll surprise gift!

Kevin Moore: [00:17:37] Yeah, we were knocking around ideas and say, look, it’s crazy what the world is doing with toilet-rolls.

One of the guys in the business, his wife is a psychologist and she said the psychology behind what happened with toilet rolls is the whole concept of “fear of missing out”, which we understand, that drives so much of society.

You know, I need to get it cause it may not be there.

Nigel Miller: [00:17:55] But why toilet-roll?

Kevin Moore: [00:17:56] Because of the size.

 So, if you walk into a grocery store with 20,000 items, 20,000 SKUs, if you’re out of stock of every single salt and pepper in that store, it’s about 12 centimetres, four inches wide. If you’re out of stock of all of the toilet paper, because of its bulk size, there is a 20 foot, you know, there’s a a 10 metre run, eight metre run that’s empty.

And once that starts, then the other bulk item start to go to.

Anyway, we’re knocking this around, going isn’t this crazy, and somebody said “Why don’t we just put in a gift-wrapped toilet roll, totally randomly, into orders for the next week?” So , we’ve got all these orders flowing through the pick-pack lines, why don’t we just gift wrap them and just drop them in? Don’t tell anybody, just drop them in.

Anyway, the first orders ship, there’s about a day shipment time. So 24 hours later, the first person takes a photograph, put it up on Facebook and says, “Guys, thank you for this, very funny. We love this. Great.”

And it just went from there. It built. So then we said, “okay, if we’ve captured the imagination and we are now storytelling, so people are telling their own stories. So remember going back to this whole thing where people go, “Oh, that’s crazy. Look inside my home, a toilet roll gift wrapped in Toys R Us paper” by the way. We’re not skimping on this…

Nigel Miller: [00:19:08] Yeah, that was, that was a funny bit.

Kevin Moore: [00:19:10] Gift-wrapped with, Toys R Us wrapping paper. It started to go viral and people started to talk about it. So they said, okay, so how do we get kids involved in this? We said, well, let’s try and build something where their arts and crafts, we’re big believers in play being an important part of the child’s development. Why don’t we take all the empty toilet roll holders and get them to create things? And they did. And we ran “The toilet roll challenge” and kids all around the country were building these amazing things and painting them and crazy things, and we gave away prizes supported by a lot of the suppliers, and it’s that, being true to your brand,  doing things that are entertaining, engaging, storytelling. They’re telling their own stories. It just came alive. That type of creativity you can do in a physical environment with difficulty, in an online environment it is so fast to do.

You don’t have to line up, you know, 50 or a hundred stores and say “On this date a box is going to arrive in store. Please put this out. This is the point of…”, you don’t need to, you just seed the product or you seed the internet or you email with links that people can see and hear and play with. And you can bring alive so fast. It’s such a dynamic environment. Do I sound excited? I love this…

Nigel Miller: [00:20:21] I do, and I have to say what was amusing me is that you were the chairman, I think you maybe even still are the chairman of a digital agency that has the people that go out to the stores and set up those retail displays and check the stocks on the shelves, et cetera, et cetera. What you’re saying is in the digital world, we can all do that creating, that displaying, that playing, that whatever, and see what effect it has!

Kevin Moore: [00:20:46] Yeah, absolutely. So again, we send people to stores  to enhance the shopper experience, to either pass on product knowledge to retail store staff in certain environments, to be able to create displays, to be able to create noise and buzz and colour inside stores. 

We should adopt exactly the same process and thought processes with an online business.  That’s why you and I together Nige, you’re a top producer, you understand production and how to get messaging over and you’ve taken me down this path of saying “Well all those things are happening. How do we bring them alive so people can take them out of the traditional retail environment and bring them alive online?” And that’s what I find exciting.

Nigel Miller: [00:21:22] Well, I think from my point of view as a non-retailer, I mean, you’ve always said that good physical retail is really about theatre. And I used to do a lot of industrial theatre in London many years ago, so I get that.  I think that’s what I quite like about looking in on this world is that there are so many opportunities for people to be creative whereas, traditionally, you thought of retail as being a bit boring.

Kevin Moore: [00:21:44] That’s a judgment of a lot of the people that got lazy in retail. Not everybody did that. So there some outstanding retailers who still keep it alive, but it is very difficult when the business gets to a certain size and you’re looking at inventory turns and you’re looking at your, you know, labour rates in stores and you’re looking at your lease negotiation.

The things get so big that people lose the ability to be creative and fun. That’s why I love small businesses. I’ve huge respect, there are much cleverer men and women than me that run big companies that, God bless them, I couldn’t do it. I love small businesses, you know, sub $100 million, you know, five to five to $10 million, you know, two to $5 million. They’re great businesses, they turn quickly, people can get them to grow fast, you can bring your friends into them. I love small businesses, so that’s where I get the greatest buzz from. They move quickly. You can do things. And never more so now than with online with all the infrastructures around you.

You know, it’s almost paint by numbers. You can set up a business, Shopify site, Facebook. We haven’t touched much on, on Facebook, Instagram, and YouTube, but you know, unbelievable broadcast networks. That’s what they are. I mean, we think all the social media that broadcast networks.

Nigel Miller: [00:22:52] Well, Amazon as well, really, you can tap into Amazon if you’re a retailer and, obviously, the eBay’s and all the other bits and pieces…

Kevin Moore: [00:22:58] And Alibaba and everybody else, yeah.

Nigel Miller: [00:23:00] not sure if it’s still the case, but I remember when I used to do this small business show many years ago, we were doing a programme about a physical model aircraft retailer, and he was saying at the time that often he’d end up with old stock and he’d pop it onto eBay and people would fight online and end up paying more to buy it through eBay than they would if they’d come into the shop. And he just found that baffling. I don’t know if that still happens.

Kevin Moore: [00:23:25] There’s the whole thing about if it’s a limited edition, if it’s going to run out of stock, we’ll have it at any price. Toilet paper. It’s exactly that, that mentality, but the great thing about that, so let me just play that through that for me, that’s a classic case study, and we are going to do more case studies. What he did is he started early in the marketplaces and he had the humility to say, I can’t wash this stock through in my own store fast enough. Remember when we discount stock through a store, and we’re doing it for a really clear reason because we don’t want it in the store ever again.

Yeah. And the amount of guys in retail who wash this thing out. It hasn’t moved for months. They discount it. It washes out, they said “That went great. Let’s get some more!” and they re-order and it sticks again! And the only reason it went out through the door was because you’re making no money in it. We call it trading dollars.

 It costs you a dollar and you sell it for a dollar – trading dollars. Let’s go can sell dollar notes for a dollar. And the other thing it does, it kind of infects your business.  So department stores, luxury departments stores around the world, over the last three or four years maximum, they’ve taken a discounted product at the end of the year out of the stores. Gallery Lafayette in Europe has done this really well and they’ve taken them out of their stores and in the same shopping mall or quite close by lease line, another shop close by, they’ve put all their clearance items so it doesn’t infect the feel of the store.

Does that make sense?

Nigel Miller: [00:24:35] That makes perfect

Kevin Moore: [00:24:36] So when you’re doing that in retail, you don’t want the store to infect it. Cause when you walk into a store and there’s nothing but tickets, marked down tickets, you think, “oh, something’s not good here”. 

So going back to the guy with the model airplanes, what he did is he said, “I need to wash out some skews that aren’t selling, some product lines aren’t selling. I’ll go to eBay in the early days”. Put them up on the eBay site as clearance and people took them. What it is he started, for the first time, to go into the marketplaces and unwittingly what he did is he built up a comfort with online, with pricing, with supply, with how we promoted, with his brand going up onto that site. And unwittingly what he did is he started to advertise on broadcast media. Now I’m going to guess he couldn’t afford to buy Channel Nine, Seven, 10, any broadcast, he couldn’t do any free-to-air, he couldn’t do anything.

Nigel Miller: [00:25:23] Local radio, possibly

Kevin Moore: [00:25:24] So what happened is little by little, his brand got impressions from people on eBay who saw it on eBay and said, “Well, if he’s good enough to buy on eBay, he must be quite big. And he’s trustworthy.” And the brand grew.

So these have now become significant broadcast media where, the same way as we used to run a 30 second television commercial, or we’d run a 15 second voiceover for radio, what we’re now doing is we’re using this media to get messages over and anybody can do it. Just by being there, you’re doing it.

Nigel Miller: [00:25:51] So are you saying even, what are relatively large online businesses like you guys with Hobby Warehouse and Toys R Us, would you use marketplaces?

Kevin Moore: [00:26:01] Absolutely.  So go back to price and promotion.  So two, three times a year, we will price promote specific skews on the major marketplaces because our brand is on that marketplace. And if with eBay and Amazon, we choose to pay extra to be on banner advertising, or we choose to pay extra for, to be on an email feed, then our brand impressions go through the roof.

We get a massive spike of people buying the product through the marketplace, and two weeks, four weeks, two months, three months later, a large number of those people that bought in the marketplace, we’ll come back to ourselves directly to the website to buy another skew that isn’t on the marketplace.

Nigel Miller: [00:26:41] So you’re not so concerned if you’re not making a good margin on those. You’re really doing that for promotion rather than for profit.

Kevin Moore: [00:26:47] Yeah. Yep. So there are times where you’re putting different leavers in the business to decide where you’re going to make money and you’re investing in awareness. So effectively being on a marketplace with a limited number of your skews at key times of the year is building awareness. You’re paying for awareness.

That’s fundamentally what you’re doing.

Nigel Miller: [00:27:04] Basically, the old equivalent of banner advertising, but somewhere else.

Kevin Moore: [00:27:07] Yeah. It’s catalogue advertising. It’s a form of awareness, digital awareness.

Nigel Miller: [00:27:11] Yeah. Okay, great. Social.  How important is social to the “phygital’?

Kevin Moore: [00:27:17] Yeah. It’s everything. So, if for a second you believe that you can have an online business without some form of social media? Forget. It’s just not going to happen. You need that awareness and the only logical place for somebody to become aware of you. So remember, we’re going awareness, engagement, something and transaction.

So Toys R Us/Hobby Warehouse, we do awareness, engagement, entertainment, and transaction. They come to the site. It’s amazing. It’s beautiful.

In FinTech and financial services, we go, awareness, engagement, conversation, transactions. So people have to talk to a financial advisor before they can make investment.

And if we talk of the music I talked about reaching 400 million people, if you go to to Spotify, it’s awareness, engagement, follow, and there’s a follow button, follow and transaction. People stream for over 30 seconds, you get royalties. So every one of these online models has some form of four steps and it all starts with awareness. Number two is always engagement. Number four is always transaction and in the middle, the third one, is unique to your particular industry.

So, you cannot possibly get that awareness and the natural engagement into your site without using the social media platforms.

Nigel Miller: [00:28:19] Okay. Well, I think we’re going to touch on social a lot more, particularly with some of the case- studies we’re going to have in the future episodes, but, very, very quickly, what are the key take-homes that people should be consideri ng with the “retailer’s phygital offering”?

Kevin Moore: [00:28:31] Nigel, if you can say it, I can recap it. Well done. Well done. What you don’t know, listeners, is that took him four takes so, so, so the key thing about phygital it is that combination of physical and digital. It may start in a physical environment and follow through into a digital environment.

You may start in a store having a great experience and buy in the store and have the product shipped to you.

You may start in your home with click and collect where you ordered the item and physically go to the store and collect it and, and bring it home. It may be because you put gift-wrapped toilet paper in packaging that bought, and it’s a physical, interface with the shopper.

It’s that blending in any way you possibly can to make sure that you’re bringing alive something that may only have been previously a digital engagement, a digital experience. You’re embedding in it, imbuing it, as much at the emotions that we have in the real world, in your digital offering.

Nigel Miller: [00:29:25] Okay. Great. Well, I think that’s a good place for us to wrap up this episode, so please give us a review and a rating on your podcast app.

 In the next episode, we’ll be taking a look at some real-world case studies, and I won’t have to tackle any words that I can’t get my head around. And we’ll be doing that to help you better understand how to capitalise on this second age of online retail.

Now, if you’d like to find out more about Kevin’s thoughts on ways to improve the retail customer experience in both the physical and online worlds, please go to our website, the road to, that’s the road to On the site, you can send in any questions you might have about the topics we’re covering in these podcasts.

You’ll also find links to our various retail marketing and sales courses and links to our social media channels where we can keep the discussion going.

And finally, if you want to learn how to improve the shopper experience for your online retail business, then as we’ve mentioned before, you’ll be pleased to hear that we’re about to launch our first course dedicated to the online shopper experience.

There’s a link on the site where you can register your interest, and by registering, you’ll be entitled to a 50% early bird discount.

Until next time, thank you for listening, but before we go, after last episode’s amazing exit by Kevin and his band, Kevin, I gather you guys are all there again today. What have you got for us this week?

Kevin Moore: [00:30:43] Oh, this is a beautiful song. So Bob Cleversley is our lyricist. He writes beautiful songs, and John Leahey the most beautiful melodies. So Bob wrote this for his wife, Kim, and the song is called, “Say you love me”.

Nigel Miller: [00:30:54] Take it away, Kevin.


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