A little retail magic

This past holiday season, my family and I spent a couple of days at Disneyland. If you've never done so, the holidays are a wonderful time to visit the "happiest place on earth." What makes it especially enjoyable are the magical touches that Disney employs to transform its parks for the holidays, which include altering some of the attractions just for the season.

Entire libraries full of business books expound on the rationale behind Disneyland—how employees are cast members putting on a show for guests and how every detail is planned to emotionally transport visitors to new and fanciful worlds. I won't go into all of that here. Suffice it to say that from the very beginning, Walt Disney deliberately chose to build more than just an amusement park; he planned to create an experience.

This past February, I attended the annual conference of the Retail Industry Leaders Association (RILA), where I heard a similar theme from many of the speakers. For retailers to survive, they can't simply sell products anymore. Instead, they must create experiences for their customers.

How would this change retail as we know it? First, as with Disneyland, the customer must feel as if the shopping experience was created just for them. Stores themselves need to become more than just a place to pick up necessities. The everyday things that don't require evaluation can and will be more easily delivered directly to the home, or at least gathered for easy customer pickup.

For other items, brick-and-mortar stores need to transform into places of discovery, where shoppers are encouraged to try new products tailored to their individual wants and needs. Store employees will work to understand each customer's journey. As one speaker at the RILA conference put it, "Customer data is the new commerce."

Estimates are that e-commerce will account for 70 percent of retail transactions by 2025. So, in addition to the in-store experience, retailers also have to enhance the delivery experience. Retailers must provide a wider online assortment with ease of ordering. They need to understand their customers well enough to offer related or alternative products.

The package itself should also enhance the shopping experience. It must arrive on time—or better yet, earlier than expected—with some unexpected surprises thrown in. Customers should open the package with the same enthusiasm as opening a present. And the entire process must be repeatable every time but with new twists and surprises.

Retailers can survive into the future. But those that do will think first of the customer experience. And a little pixie dust wouldn't hurt either.