The role of the physical store in the digital era

Considering the changing role of stores in a digital-dominated era, Geiger underlined the continued importance of creating customer experiences, including through human interaction. “The way retail is evolving is to have our beauty assistants (BAs) and our sales people at the centre of the retail experience. We are social animals and we need this interaction. In digital we can have a lot of things but the real human connection if something that you can never get anywhere other than in the store.” L’Occitane’s vision, he said, is to maintain the interaction – “the bond that people really need so strongly” – and to enhance that with digital.

Geiger considered logistical problems around the efficient delivery of online orders, noting that in the US, L’Occitane introduced changes to ensure that its network of stores could support delivery and enhance its digital performance. “That’s a different story to the human approach but super important too,” he added. Asked if L’Occitane was considering major changes to its store network – with stores acting as destinations and with the majority of sales online – Geiger said: “When I started with L’Occitane in 2014 I remember saying that our sustainable competitive advantage is our stores. “We have 3,000 stores around the world; that was a strength we needed to leverage. Today I would say that our sustainable competitive advantage is our 10,000 employees, our 10,000 BAs.”

He noted the recent closure of some stores in the US but emphasised that L’Occitane was able to retain most of its staff members who use a clienteling app sales to maintain interaction with customers. “Being a retailer takes years of experience; it’s difficult. But L’Occitane is in ecommerce for 20 years; it accounts for more than 20% of our business and is huge. So being on those two legs, and being able to link them, is key,” he added. He noted new sales touchpoints, including social media and influencers, which L’Occitane uses to ensure new opportunities are not missed. He also underlined the need for brands to have updated information on locality and closing times available for search engines and the rise of voice-over tools such as Amazon Alexa. Geiger said L’Occitane’s development of video interaction between its BAs and customers is proving successful. “It offers the extra connection people want and don’t really have in digital,” he said, adding that it also offers BAs the ability to link both online and offline experiences. Asked how close L’Occitane is to creating a frictionless experience inside stores, Geiger said: “At the end of the day 80% of the experience is the interaction with the BA so that’s what matters the most. For us now digital is how we can reduce the burden that the BA has in order to make the store functional; how she can spend more time with the customer because that is what matters.” On digital learnings related to the Chinese market, Geiger noted the heavy use of social media and WeChat to strengthen BAs’ interaction with customers and the “superfast” development of live streaming. Geiger added that L’Occitane has already included live streaming facilities in stores in Japan and Korea.

Addressing L’Occitane’s significant sustainability efforts, Geiger said the brand was considering the heavy impact of ecommerce on its carbon footprint plus its internal processes including hardware use, and is assessing how to minimise this impact. The company is also reviewing its distribution and delivery strategies, he added. “What struck me a few years ago was that 40% of the CO2 emitted in Paris over Christmas time was coming from ecommerce delivery. What we don’t want is to have waste, ensuring we hit our delivery time but doing it with a half empty truck,” said Geiger. ”So how do you maximise your fulfilment from the point of view of carbon footprint? We are looking at this footprint all the time. We have also banned our supply via airfreight now and have improved our logistics to the point where we use other channels through correct planning.” On taking sustainability to the next level, initiatives include accelerating the drive towards refillable bottles. “We can really change things quite dramatically if we do this. And we can use digital too. We cannot have a refill station in every one of 3,000 stores, but we can use digital to serve them. In Paris for instance that could be someone on a bicycle who collects your empty bottle and gives you a full bottle in return, all managed through digitalisation. We will expand this idea.”