In the initial stages of the 90s, with globalization, the internet gained traction, and the digital universe gained more and more importance.
However, the difference and distance in context between the digital and physical worlds seemed to be existent. The smartphone played a major role in the transformation of the digital age into what we call today the digital era.
Since then, all the utility and comfort provided by these connections have come to show the way, which is known as the offline routine of consumers. Simply put, this is how the Phygital journey arose.
The decade gone by has seen exponential growth in digital adoption, more so under the restrictions imposed by the COVID pandemic. Indeed, the pandemic has seen people inculcate digital shopping habits. It has led to a re-evaluation of the physical experience. A combination of these two opposite poles has given rise to a new phenomenon called the Phygital phenomenon.
Let’s relate this experience with the help of an example. We go to a store to see, touch, and try out a product and do not buy it there but order it online. Often, we have also surfed the web before making a purchase at the physical store to make a decision. Relatable, no?
The fact is that millennials today hardly differentiate between physical and digital experiences as they expect more unified and personalized experiences. The habits and expectations of today’s customers are increasingly directed toward a hybrid and fluid shopping experience, where the advantages of both the physical and the digital environment merge. A Phygital approach, thus, combines the best of the physical and digital worlds unite to offer a complete and satisfying customer experience. It increases customer consideration, degree of appreciation, and loyalty toward the companies that favor this experience.
What is Phygital technology?
Phygital is about building an ecosystem that acts as a bridge between the brand and consumer across physical and digital spaces and then drawing on the best of the two to go well beyond one-dimensional brand communication. QR codes, Augmented Reality, Google Glass, Apple Watch, 3D, Sixth Sense are among the many technology-driven Phygital devices that are already present in the market.
Customers have already become phygital, meaning they have inhabited both the physical and digital worlds. Hence, marketers and retailers, too, must embrace this space between these physical and digital worlds and meet the consumers there.
Simply defined: Phygital = Physical Digital.
Need for Phygital technology
Imagine the coming together of the sensory and human connection of visiting a store with an ultra-personalized digital layer. This is what is Phygital technology is all about.
The word ‘Phygital’ sounds odd and is used to describe a trend of elevating a physical brand experience in a combination of a digital component, or it could be the other way around. Despite the odds with the name, Phygital technology is here to stay.
The term was introduced to describe omnichannel marketing, a method where all marketing channels work together to present shoppers with a completely seamless experience.
The major goal behind combining the physical and digital experience is to draw the best of both worlds. The ulterior goal is to give customers a unique, highly-personalized experience that will leave a lasting impression.
With time, the digital world has established itself in the physical lives of humans. Think about the impact of smartphones and how we expect them to give a personalized, digital dimension that complements our day-to-day lives, for example, via Google maps.
Online shopping experiences allow online retailers to personalize offers and suggested products. Apps with customer loyalty programs allow stores to offer customers personalized discounts and benefit them with extra convenience when using their reward app.
Thus, Phygital technology plays a significant role in the consumer experience. However, it also helps brands seamlessly integrate their physical and digital marketing efforts to gain more opportunities to sell their products.
Even though the world is increasingly dependent on digital technology, humans will simultaneously crave physical experiences. Connecting with consumers where they are at ease is the ultimate motto of Phygital technology.
Strategies to adopt phygital technology
It is important to treat customers well to retain them when browsing the website or applying customer experience techniques. Irrespective of its size or sector, companies push hard to win loyal and engaged customers. Companies who want to achieve this goal must take note of everything that can go wrong in the customer experience and enforce measures to avoid recurring problems.
Imagine how much loss companies will have to bear due to poor service in physical stores or lack of contact in the brand’s digital channels. This is where Phygital strategies can help deliver a better user experience.
1. Building omnichannel strategy
Implementing an omnichannel strategy in all of your communication channels can help brands integrate customers across channels with a focus on one objective: To engage your audience. An omnichannel strategy focused on Phygital experience must see the customer as the center of attention and offer a unique journey of excellence.
2. Bring together online and offline worlds
Marketing actions, when integrated, can do wonders. No matter the difference between the two platforms, successful initiatives can be promoted with creativity and planning.
Following are the main objectives of integrated marketing actions:
- Showcase qualitative experiences to create a bond between the brand and the customer;
- Sales stimulation;
- Expanding customer relations.
For this to happen, brands must be aware of the different types of channels that can be explored to relate with the customers better. They must understand their preferences and behaviors, and utilize technologies that can contribute to this process.
Implementing these aspects will facilitate the development of integrated marketing and sales actions that will grab customers’ attention.
3. Make technology your ally
Devices such as Smartphones, QR codes, and technologies such as Artificial Intelligence foster the connection between the physical and the digital world. They also promote the immersion required to keep customers engaged in purchasing from the company.
One would be mistaken to think that a Phygital strategy will work only when the company invests a huge capital or has inaccessible technologies. Taking note of every small detail will help firms provide a better consumer experience, such as designing company websites in a mobile-friendly mode.
It is possible to implement the above strategies through the intelligent and strategic use of technology.
4. Creating out of the world experiences
Perhaps, creating unforgettable experiences will mark one of the most influential trends in the coming years. Experience marketing, or sensory marketing, aims to surprise consumers in fields where they are not used to receiving marketing information.
A well-executed action plan will bring excitement and interest in the consumers, making them feel like an important part of the brand.
In this competitive world, it’s more about sensations and experiences than just buying products or services. Businesses that meet these expectations will be able to sustain and stay in the long run.
Live examples of phygital experiences
Today, there are more than 20 Amazon Go supermarket stores in the US. Here, customers can enter the store by scanning a code using their smartphones and buy products directly without passing through traditional checkout counters. An electronic bill is automatically generated and sent to the user. A virtual cart is connected to the customer’s Amazon account, where customers and products are automatically identified. The charged amount is automatically deducted from the account when they leave. This leads to totally contactless and automatic payment, giving customers a fast and comfortable shopping experience.
In February 2019, Nike opened a pop-up store in Atlanta specifically for those users registered to its Nike SNKRS application.
Using geolocation data from its user database, Nike sent a push notification to all its users within a 25-mile radius of Atlanta about the store’s opening using its geolocation data.
As an incentive, they launched a limited-edition product only available in the new physical store. The store was provided with a vending machine for free accessories, which can be activated using a QR code generated by the application. This way, customers used their personal devices to activate the code and collect the free gadgets.
Although digital technologies are rapidly providing dynamic and stimulating customer experiences, consumers do not appear to be keen on giving up on the benefits of the physical world. The Phygital phenomenon is the best answer to meet the public’s competing wants and create a more personalized user journey.
Phygital is all about bridging the gap between a user (human) and an activity (business) and making that experience so seamless that users hardly notice that their lives have been made easier. The border between physical and digital encounters will be so blurred in the post-COVID era that people will not be able to figure out the difference.