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These companies are defying the retail apocalypse. Here's how.

3/27/2019

Tales of doom and gloom in the retail arena are easy to find - rumors that Amazon and similar online marketplaces will bring on a revolution, that soon no one will go to physical stores to shop. These doomsayers are right that there’s a change happening in retail--but as we’ve written before--we do not believe that the retail apocalypse means the death of physical retail, just the death of boring retail. As some stores close, a number of retailers have expanded their brick-and-mortar operations by hundreds of stores. So what is it about these companies that keeps customers flowing? How are they surviving the apocalypse?
Avoiding the “boring middle”
Retail strategy advisor Steven Dennis writes that the “boring middle,” a purgatory of purpose between discount/convenience-based shopping and a novel, exciting, experience-based shopping experience, spells death for retailers. For brands like Dollar General, who’re opening 975 stores this year, this means committing to bargains. Their stores feature items at unbeatable low prices, made possible by their simple store design and minimal labor costs (they usually only have two to four employees in a store at a given time). The stores aren’t fancy, but their products are inexpensive and easy to find. They capture a market invested in quick and easy shopping.
Retailers with similar business models, such as Walmart, Aldi, and Dollar Tree, have all expanded their brick-and-mortar operations this year, speaking to the success of the low-cost, low-prices operations.
Making an experience
The other side of the “boring middle” is the experience-based shopping experience that will keep customers coming back. Exciting storefronts, attentive staff, and special events all help bring customers into brick-and-mortar operations. Makeup giants Sephora and Ulta have mastered this form of retail, allowing the stores to grow while selling middle-luxury items that could otherwise be sold by Amazon. Sephora and Ulta’s stores both feature bright, exciting displays, which are particularly appealing when shopping for beauty products. The stores are known for attentive customer support, also uniquely important in beauty to assist less knowledgeable shoppers. They also feature makeover stations with in-store beauticians, as well as other special events where shoppers can try on products or leave with samples. By making their stores an experience, Ulta and Sephora keep shoppers who would otherwise opt for the convenience of online shopping.

While it’s true that retail is changing, there is certainly not an apocalypse. Retailers will have to adjust to the demands of consumers whose interests are moving towards convenience or excitement. In either case, looking to these brands can serve as an optimistic guide to surviving this so called retail apocalypse.

Flash Retailing: What it is and why you should care.

3/13/2019

Author:
Greg Cuccinello
In-Store Experience

What retail trend is projected to turn $10 billion in 2019? The answer is temporary retail - also known as flash retailing, or “pop-up stores”.
So what is flash retailing, and what’s driving its success? Here, we take a look at where this trend came from, and what you need to know about the rising trend of “Pop up” stores.

Flash retailing is a type of physical retail that relies on temporary locations, such as storefronts, stalls, or trucks, to sell wares. The first “pop-up shop” is attributed to 13th century Vienna, where a series of temporary storefronts opened for Christmas celebrations. The practicality and ease of the Christmas pop-up lead flash retail to take Europe by storm, and by the 20th century, pop-ups such as farmers markets, food carts, and holiday-themed stores were commonplace.

While we’re all familiar with the transient farmers market and Spirit Halloween store, the trend in single-retailer pop-up shops is relatively recent. The modern pop-up retailer is said to have been birthed by Patrick Courrielche, an American entrepreneur, in 1997, with the establishment of The Ritual Expo. The so-called “expo” was a travelling mall of sorts, touring six cities in two months and featuring designer clothing, accessories, electronics, and cultural events. The press release stated that the expo was an “opportunity to soak up a unique environment while shopping for hard-to-find, cutting-edge merchandise.” The appeal was obvious--the hard-to-find wares, combined with the exclusivity of a only a few days’ opportunity, lead to the perfect high-fashion cultural event. Soon, pop-up shops exploded across the market.
Now, in 2019, the flash retail market is exceeding expectations for growth, and projected to bring in $10 billion. What’s granted pop-up shops their success? Their transience appeals to shoppers, and their low overhead allows for greater profits.

It’s no mystery why consumers love pop-up shops. Specialization, exclusivity, and the opportunity to try products usually only available online contribute to their appeal. In one survey, 61% of consumers stated that seasonal shopping was their primary reason for going to pop-up shops: from farmers markets to Christmas markets, pop-up shopping is the best way to get in-season products otherwise unavailable the rest of the year. Meanwhile, 30% of shoppers attributed their shopping at pop-ups to the fun of the experience. The transience of flash retail grants a sense of adventure to your shopping trip, aligning with changing trends in how consumers spend their money--looking more for experiences than products.

Low costs of putting up a pop-up, is another factor driving the growth in the flash retail market. Stores are only around for weeks or even days at a time, saving huge sums of money on maintaining a storefront, and allowing brands to experiment with physical retail. And many shops operate out of low-cost, temporary structures: stalls, trucks, carts, even sidewalk sales. The flexibility of a pop-up, too, keeps prices low and revenue high. Because a shop can hop from neighborhood to neighborhood or city to city, retailers can determine how to best reach their market without investing in long-term contracts or buildings. This also allows shops to have some location-based product availability, avoiding redundancies in their market.

Pop-up shops are running the market in 2019. Their flexibility and novelty guarantee a shopping experience to remember for customers, ,an inexpensive model for business owners and a relatively low risk way for online only brands to experiment with physical retail. With all these benefits, we suspect this trend will be around for a long time.

3 Essential Factors to Implement a Successful Omnichannel Strategy.

3/8/2019

Author: Chris Anderson, Founder & CEO, In-Store Experience

With increasing options for shoppers to browse and transact, the ability to move smoothly between online and in-store retail becomes even more important in determining the success and longevity of a retailers business.

Thinking across channels, rather than focusing on individual channels separately presents an opportunity to engage customers however they find you - and can make the entire brand experience more pleasant and engaging. This approach is called omnichannel retail, and it has become an essential part of any contemporary retail business strategy.

Here are 3 factors to consider to get omnichannel retail right:

Integration: Omnichannel retail is a step away from the “multichannel” mentality, whereby businesses have online and brick-and-mortar retail options but keep the two relatively separate. In order to have a successful Omnichannel strategy, businesses have to integrate their online and in-store retail experiences to facilitate the operation of both. A good example of this is REI: because outdoors and sports products often require a degree of research before purchasing, REI has implemented in-store wifi and equipped their sales team with tablets, encouraging customers to use their in-store experience like a live search bar. Meanwhile, a number of clothing stores including Lucky Brand have implemented order-online, pickup in-store programs that encourage online shoppers to visit their stores, and facilitates in-store shoppers’ switch to online.

Data: It’s impossible to have a successful retail strategy if you don’t know how your customers are shopping. The most successful businesses now are keeping current with their customers’ demands. The push for omnichannel retail, after all, grows from consumers’ shift from single-channel retail to the integration of online and in-store shopping. In order to use tech to its greatest advantage, stores are beginning to track their customers’ shopping habits and adjusting their business practices accordingly. Supermarket giant Kroger, for instance, has been using consumer data to provide new products and adjust their stock to optimize sales. Data means information on what customers want; it’s in the retailers best interest to use it.

Consistency: It might sound simple, but moving between different retail channels leaves a lot of room for error. It’s important to use a consistent message, provide the same products, and utilize uniform graphics to maintain a company image that compels rather than confuses consumers. If a company’s online presence doesn’t match their in-store branding, that can not only turn-off customers but also lead them to assume that the company or website isn’t legitimate. And if a customer arrives at a store expecting products available online, they will be disappointed if the store has a severely limited stock or otherwise lacks the utility of their website. Consistency in branding and products is essential in order to maintain a successful omnichannel presence.

In-Store In-Sights

These companies are defying the retail apocalypse. Here's how.

Flash Retailing: What it is and why you should care.

3 Essential Factors to Implement a Successful Omnichannel Strategy.

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