The Store of the Future is there when my wife suggests one fine day (in a sweet and casual tone) that we should “update the floor tile in the bathroom.” It is there as I begin to visualize how the new bathroom will look. It is there when I have to pick out paint, fixtures, cabinets, countertops, shower doors and oh yeah, tile. More importantly, it is there long before I have to decide where to shop for these products for my now full-scale bathroom renovation.

The Store of the Future is a convergence of technology and possibility that materializes exactly when you need it.

Today we live in a world of consumer co-creation. Retailers can’t wait till the shopper hits the store to see what’s available. It is now all about being there at the moment the consumer realizes a need, and shepherding them along an adaptive path to the store, all while keeping the wolves from luring the them off into the forest of competing brands. Today, more than ever, retailers need to find creative ways to keep shoppers—even their brand loyalists—engaged all the way through the transactional process. That is the power and the risk of digital touchpoints in retailing.

If retailers are willing and able, they can invest in effective digitally-based methods for reaching further into the shopper’s path to purchase, closer to that decision point of “should I or shouldn’t I?” and influence the decision to buy. Keep in mind, however, that it’s the brand strategy behind the digital touchpoints that will drive more transactional traffic—not the digital tools themselves.

It continues to amaze me. Every morning when I get my daily Groupon—no matter what brand the deal is for—every offer sounds exactly the same. Even when the offer is upscale, like custom tailoring or fine dining, its description is written in nearly unintelligible dude-speak. There is no alignment between the marketing piece (the coupon) and the brand that is being offered.

Why are retailers big and small so willing to give up control of their brand? Especially to a company that doesn’t take their client’s brand images into consideration. Some would argue that these deep discounts are harmful to brands, training consumers to expect the kinds of deals that eat into a retailer’s margins. I think the strategy is sound, but it’s the message and tone that are off.

In light of the recent Groupon Super Bowl ad fiasco it seems that this callousness might run even deeper. I wouldn’t be surprised to see significant pullback from Groupon. At least until the company figures out how to present its clients in their best light.

Put your customer first. Period!

I’ve never been a big consumer of sweet carbonated drinks. We didn’t keep any at our house, because it’s not that healthy. But something happened last year that changed all that. PEPSI THROWBACK! Not only is it healthier for the planet because it isn’t made with high fructose corn syrup, the fact that it’s made with real sugar makes it taste better.

Pepsi Throwback was initially available as a limited time offer product, so whenever we could find some we would stock up like we were trying to fill a bomb shelter. Well, pretty soon it was discontinued and we were left without our beloved PT.

What’s crazy is that for me to switch to and then seek out Pepsi is a BIG DEAL. My whole life I have only ever purchased Coca-Cola. And then Pepsi discontinues it! Why would the company mess with a strategy that got me to switch/commit to their product? Isn’t that the holy grail?

Recently, I saw an online series called Jack and Suzy Welch’s “It’s Everybody’s Business.” It’s a series of business webisodes that brings together Jack Welch (former CEO of GE) and his business-book author wife with top executives of companies to solve a certain business issue the company is struggling with. In one episode, the Welch’s met with Pepsi, to discuss how to rejuvenate growth in a declining category (soda). The company explained that Pepsi Throwback was a huge success compared to other product launches, but was discontinued. When Jack asked, very plainly, “If it was such a success, why isn’t it a part of the regular product line?” he got a series of excuses around supply chain and money. His reaction to this “forest for the trees” thinking was, “Figure out how to make it happen. It’s clearly what your consumers want!”

Sunday mornings usually find me sitting on the sofa with the Sunday paper, digging into my favorite section—the ads. While most people throw them away without even looking at them, I eagerly page through the paper with baited breath in search of ads and coupons. Seeing all the great deals is the motivation I need to start my weekend shopping.

Like most people, I clip out the coupons with good intention of using them, but usually end up forgetting them at home or in my purse. Nonetheless, I really like to see what’s new. While flipping through the coupons last Sunday, I was a bit surprised to see this Campbell’s Soup ad:

As soon as I spotted the phrase “Browse our 4 easy segments” I recognized the fingerprints of a brand manager—the word “segments” gave them away. Farther down the ad you see how they break out the segments into “healthy kids,” “classic favorites,” etc. This ad is a perfect example of how we understand our shopper, but it takes things too far.

While our annual 2010 State of the Retail Industry report delineates the challenge for retail brought about by consumer behavior changes in reaction to the great recession and the rapid adaption of mobile technology—many of those challenges will take several years to address. To find seven things that retailers can do right now, we asked our experts.

Scott Jeffrey, Chief Creative Officer

Push for differentiation. There is no time to rest on your laurels. Realize that innovation isn’t a stage, it’s an ingrained brand behavior. In fact, stop thinking of innovation as a “next step” all together–”step” as in a phase of something that stops and starts, or merely cycles through.

My ideal retail brand would be one that never completes a store design prototype. The “never done” mentality is always asking, “What else? What else can we do to make it better?” That type of thinking requires courage. Belief in the importance of change. Granted, not every one of your new ideas will be a game changer, but once you entertain doubt and back off, you pretty much lose momentum. Particularly now, when the customer expectations are so far ahead of what most retailers are delivering in terms of the brand experience.

The minute you rest on your laurels and let your brand and your stores get outdated, you have a really big, hardest-to-do maneuver on your hands: a turnaround. If you have a fleet of any size, you’re in danger of being too big and too rigid to manage a turnaround. But if you’re a constant seeker, a brand that remains loose and nimble, the maneuvers are much smaller and easier to manage. Your creative adjustments and transitions will be happening all the time. Knock down any silos in your way and get to that mindset as soon as you can.

Bill Chidley, Senior Vice President, Shopper Sciences

Consumers’ rapid adoption of the smartphone means it’s time to start thinking about connecting and communicating through that little screen. To make the most of the opportunity to drive demand, mobile optimization should be a top priority for your brand. It’s all about being in the game. Don’t try to justify mobile initiatives with ROI. Move forward with a reasonable hypothesis and prepare to learn and adapt.

Don Rethman, Senior Vice President, Architecture

Consider doing a site survey. Do your shoppers expect to share their shopping experience instantly? Do you plan to make fast calls to action in the store? Your building needs a wireless-based backbone to support that, with wireless connectivity that allows for transitions. This goes even beyond the creation of mobile hot-spots. Buildings must have a distributed, robust and flexible IT infrastructure which will allow technical access to all spaces. It helps if you’re working with architects who are aware there is such a thing as a path to purchase so they can help create a store that increases productivity and doesn’t skimp on the brand experience.

Amanda Yates, Vice President, Strategy & Analytics

It’s vital to map the “customer journey” to understand where best to make the wireless investments, as well as other investments that help your brand drive choice. Mapping will provide the insights that will help you gain advantage and protect sales by offering shoppers what they want in the modes they desire. Not every retailer will need a full-blown program, but each must understand the needs of its customers, what information and access they are looking for and where or how they want to access it. Once these insights are known, the appropriate level of investment and how to spend it will become much clearer.

Dave Nixon, Executive Director, Digital Strategy

The multi-channel ideal is a seamless transition from the physical shopping experience to the virtual experience through every digital touchpoint–one that’s painless for the shopper and profitable for the retailer. However, for most retailers that’s not the first thing you can do. There will be silos to take down, brand strategy work and brand engagement initiatives to adopt before that nirvana is reachable. I’d like to elucidate further on what Bill says (above)—“Get in the game.”

Companies that spend too much time planning their next technology steps will find themselves playing catch up to those that are already moving. One of the main benefits of digital is the ability to deploy it quickly and then modify or adapt the solution depending on the performance metrics for success. In that respect, adopting new digital platforms into your channel strategy is less expensive and presents less risk than physical channels. The time is now to leverage digital technologies for increasing revenue, efficiency and customer loyalty.

Kris Medford, Ph.D., Director of Shopper Sciences

Get to know your shoppers again. Segmentation that is a few years old is downright archaic so make sure your insights are recent and actionable. Who are your shoppers—both those in your store today and those you want in the future? What’s important to them from a digital perspective, and how can you use digital help to make your brand be more relevant to their lifestyle?

Justin Wartell, Senior Consultant, Brand Strategy

The physical store needs to evolve from its position as the “jewel in the crown” to a “tool in the arsenal.” For retailers, the most important thing that can be done right now is to (re)examine the relationship between the physical brand experience and all of the other expressions of the brand. Brand experiences are inter-connected organisms that create an overall customer feeling about the brand. By understanding the role that retail plays in the context of the other touchpoints that are, or can be, deployed, retailers can drive loyalty, reputation, efficiency and value across their organizations.

Forty-two. This answer to the question of life, the universe and everything from Douglas Adam’s The Hitchhiker’s Guide to the Galaxy is a classic illustration of the disappointing results that arise when a project is not sufficiently defined.

Business questions are the key to defining business problems so that they can be understood and solved in ways that are actionable and beneficial. An example business question is, “Which of these store designs will most increase store visits by current customers?” When well drafted, they deliver guidance to successful strategy, design, research, analytics and operations problem solving. Business questions do these things by aligning resources to needs, making sure everyone has similar understanding of what is to be accomplished, and ensuring that the work to be done will solve the problem at hand. It is easy, however, to run into problems while developing these questions.

Common problems in business question development are:

• Not creating or communicating the business questions.

• Using absolutes as goals for the solution.

• Failing to prioritize success criteria.

• Being ambiguous.

Companies under pressure to stem margin erosion may jump headfirst into shopper marketing before they are ready. In doing so, they could overlook the need to solve fundamental problems in the shopping experience and end up with unpredictable results in the store.

The urge to dive in is understandably tempting. Brands that invest in shopper marketing are seeing three times the return as compared to traditional marketing disciplines. But the discussion revolves around a very small percentage of brands, such as CVS/pharmacy and Mars Snackfoods, ShopRite and Kellogg’s, Walgreens which just announced it will engage in a shopper marketing pilot with The Hershey Company, and of course the eminence of shopper marketing, Procter & Gamble. All have been working on shopper marketing for years and have an extremely high level of expertise.

Carpenter to focus on Interbrand North America

Retailers looking for great examples of wirelessly connecting with their shoppers have three great brands to look to: American Eagle Outfitters, Netflix and Amazon.com. The continue to differentiate their shopping experiences with intimacy, responsiveness and relevance.

Even with millions of items for sale, Amazon connects intimately with customers, from its one-click ordering to its ability to become more relevant with each visit. The result is a “barrier to exit” that other brands envy.

American Eagle excels at aggressively integrating multi-channel marketing tactics into both its traditional and digital campaigns. It connects at all the right touchpoints, which goes a long way towards achieving brand loyalty. This year, AE included a mobile filed in its loyalty program, and used mobile as a point of entry into sweepstakes as well as an alerts program. Calls to action were posted on social networking sites, such as Facebook and Twitter in the form of banner ads, status updates and tweets.

While we can all agree that price matters more to the consumer than ever, it’s not the be-all, end-all of shopping. At some point, the hunt for best price has to stop. And why it stops is up to the retail brand.

Shoppers attach to brand, not price. Brand—the distinct way you do business—needs to provide a reason to activate the purchase, a reason beyond price. It can be trust, convenience, fun, effortlessness, time savings, fashion or many other factors a brand makes itself known for.

Many retailers have learned the hard way that price-based competition is simply not sustainable. To survive, they need a balanced value proposition unique to the brand that makes the shopper confident she has found the right choice among similar offerings of the product or solution she seeks.

This year, retailers have made headway in the battle against “sameness” by negotiating exclusive famous name brands, making sure their private labels stand for something besides “cheaper” and by infusing the shopping experience with emotional appeal. One brand that renewed its value-plus-reason image is Old Navy. After veering off into fast fashion inspired by the designer runway, it has returned to bright basic family apparel surrounded and supported by its kitschy sense of humor. Shoppers are returning to the store and business is on the upswing.

Have you ever seen a client celebrate as if they’d just won Wimbledon? I got to experience that last night at the Association for Retail Environments awards dinner. The Burger King Whopper Bar took first place in the fast food restaurant category. We were thrilled to see a client who embraces innovation be rewarded for

Interbrand Design Forum Ranks the Most Valuable U.S. Retail Brands; Walmart Remains the Top Retailer, Target Leaps to Second Report shows that the strong brands got stronger, while the bottom 25 fell.