Hudson Yards, the game-changing neighborhood development/mall/Instagrammable playground, has swiftly established itself as the new must-see space for New Yorkers and tourists alike. The 28-acre, $25 billion development has been home to concerts, art shows, galas, and recently, a Met Costume Gala after-party hosted by Ryan Murphey and Janet Mock. Not only is the space revolutionizing New York City culture--with a 7-storey mall, numerous office buildings, a public garden, art installations, residential buildings, and the first-ever Equinox hotel, Hudson Yards is changing the retail game by bringing entertainment, art, culture, and even home to a retail space. If the name of the game in contemporary brick-and-mortar retail is innovative experiences, then Hudson Yards is the ultimate poster-child.
Found between 10th and 12th Avenues from West 30th to West 34th Street, Hudson Yards sprung from a former train yard near Manhattan’s meatpacking district. The area has seen a revitalization in recent years, from the chic Chelsea storefronts to the tourist-swarmed highline, and while Hudson Yards is certainly radical in form, in many ways it feels like a natural addition to the neighborhood. The space provides art, nature, retail, and housing to a part of the city riddled with old train tracks and warehouses.
So how does Hudson Yards draw in visitors and even residents to an old warehouse district? With experiences you can’t get anywhere else in the city, of course. The 4-block-long space houses what their website calls a “transformable multi-arts center” dubbed The Shed, designed to host concerts, art installations, conventions, and other special events. Meanwhile, Hudson Yards has its own permanent art installation to draw in the Instagram crowd--Vessel, a 150-foot tall structure designed by Thomas Hetherwick, is a hive-like, walkable structure featuring 154 interconnected flights of stairs along which visitors can see unique views of the city and the Yard.
Of course, the key to Hudson Yards’s retail success comes from its exceptional shopping along with its revolutionary structures. 20 Hudson Yards, also known as the Shops and Restaurants at Hudson Yards, features 100 stores that run the gamut from Dior to H&M to specialized boutiques--variant in price, but all sufficiently chic to align with Hudson Yards’s image. The mall, too, has an impressive restaurant selection (including a tea room boasting Bouchon Bakery pastries), a meditation room, and sleep pods for the weary. The line between rest and play is blurred here, bringing wellness experiences and even residences to a retail experience that can’t be beat.
New York is a city that values experience above all else. A town built on entertainment, fast-movers and the Next Big Thing needs a retail experience that can keep up. Hudson Yards meets that demand. It’s unconventional, it’s risky, and it’s exactly what retail needs in order to stay current in a changing market.
Instore Deep Dive: Adidas’s Customer-Centric “Playground,” SpeedFactories and how it’s Driving Sales in retail.
With the recent rise in demand for athleisure wear, companies traditionally relegated to the sportswear arena are seeing a pulse in sales. The sneaker fad of the last few years has meant an increase in sales for a variety of athletic-focused brands, including Nike, Puma, and Adidas. Adidas had a particular surge as the trendy shoe brand of 2016/2017--their revenues increased by 18% in 2016, setting a record for the company. But as time wears on and trends shift, Adidas has had to work to make the most of their popularity and stay relevant. The company boasts innovative marketing tactics, a strong omnichannel strategy, and a stunning in-store experience that are keeping Adidas in fashion in 2019.
The central focus on Adidas’s store strategy is quality over quantity. At the same time as closing a number of stores over the course of 2018, the company has also invested a great deal in updating stores in major cities and building new stores in a few key markets. They also recognize the importance of their online experience - calling it their “most important store,” where they can focus on providing an efficient, user-friendly customer experience.
What keeps their physical stores relevant and engaging is a fusion of the ease of online shopping and the thrill of a unique in-store experience. Adidas stores are oriented toward building brand loyalty just as much as they are about selling products--connecting the Adidas brand with fun, hip, athletic-oriented experiences.
The company’s 5th Avenue flagship in New York City is a great example of Adidas’s renewed focus on in-store experience. The 4-story flagship boasts a collection curated by consumer data; athletic wear, sneakers, and more fashion-oriented street clothing for men, women, and children,. What sets the store apart, though, is its abundance of in-store games, activities, and product-based tech to improve the consumer experience. There are bleachers facing their all-glass front wall, letting shoppers look out onto the thick of 5th Ave. There’s a screen showing sporting events so shoppers don’t miss the game. There’s a pinball machine, glowing neon lights, and even a juice bar - a trend usually saved for gym locations. Perhaps most impressively, there’s an in-store track, along which shoppers can test sneakers and even meet with a trainer who will use an in-shoe device to determine which sneakers best work with their stride. The in-store experience is unparalleled, creating a sense that Adidas isn’t just a shoe or a t-shirt--it’s a lifestyle.
Of course, none of the thrill of shopping would matter without excellent customer service and a thorough catalogue of products. Adidas has developed a reputation for responsive customer service, hiring professional trainers to advise on product use, as well as generally setting high standards for customer engagement.
Meanwhile, they’ve also developed an initiative to provide more products, faster; their ‘Speed’ initiative focuses on keeping up with demand, never running out of stock. Adidas opened two Speedfactories in 2018--factories that use machine technology including 3D printing to make their products faster and to minimize human labor. The factories let Adidas make products more quickly, which means a broader reach.
It also means increased flexibility--the Speedfactories are the site of production for Adidas’s AM4 line, which feature sneakers designed for the challenges of training in specific cities around the world. The AM4NYC running shoes, then, are designed with the sharp corners of New York City’s grid in mind, while the Los Angeles shoes are made with extra cushioning to protect against hard sidewalks. This location-based design is possible because of the flexibility provided by Adidas’s Speedfactories.
This emphasis on location specificity, then, translates into a personalized in-store experience. Adidas is using data collected from their app, website, and loyalty program to determine regional demand, and then align their stores with the shopping habits of their consumer base. This means that it’s easier to find what you want, where you want it--no wading through Tokyo AM4 sneakers in Atlanta--which in turn translates into less waste--of man-power, and of shipping. It’s a win-win for consumers and the brand.
The Adidas in-store experience is a lesson in innovative brand-building and efficiency. The stores are a fusion of technical know-how and stylish world-building, just as their shoes are both athletic and chic. As its global director of digital and retail marketing Swave Szymczyk said, “We’re looking to win with experience, telling a genuine Adidas story from start to finish – that’s our playground and that’s where we need to win.” And they’re building a playground for the rest of us along the way.
Few places scream “childhood” like the once-ubiquitous, warehouse-meets-Santa’s Workshop toy emporium Toys “R” Us. Geoffrey the Giraffe, the brand’s mascot, is synonymous with “fun” for generations of kids. But as Amazon and other online retailers, as well as big-box stores like Walmart and Target, picked up toy retail, Toys “R” Us floundered until it famously shuttered its doors in 2018. The public mourned its downfall--its brand power is strong--and now the toy giant is being reborn as its parent company, Tru Kids Brands, reopens its doors. But in order to succeed, the company will have to make some changes. Here’s what the store will need to keep in mind to stay afloat in a changing kids’ retail market:
A Shifting Focus
While purchasing decisions ultimately come from the grown-ups, brand loyalty in kids’ retail is most powerful among the kids for whom the toys are being bought. If a kid doesn’t like a toy, the parent is less likely to go back to the place the toy was bought. And if a kid doesn’t like a store, a parent will be uninclined to drag their kid through a shopping experience that’s nominally for the kid themselves. A focus on what kids will like, then, is just as important as marketing towards the people who will buy the toys. If Toys “R” Us wants to succeed in reclaiming the market from big-box stores, they will have to build brand loyalty among the “4-foot-and-under” crowd. This can be done by providing a stellar in-store experience oriented towards kids’ fun, as well as marketing and displaying toys such that kids can better connect with the products--rather than leaving them packaged and shelved for parents to buy.
We all know that the in-store experience is the key to competing with online retail; emphasizing the assets of physical retail and focusing on what online can’t provide is essential in our changing marketplace. In a toy store, this is even more pronounced--kids value fun, and parents value wholesome entertainment for their kids. Where Toys “R” Us may have gone wrong in the past was their emphasis on quantity of products over space for play--shelves and shelves of packaged toys mean a broad selection, but it also means little room for toy demonstrations or on-the-ground playplaces. As Tru Kids Brands moves to reopen Toys “R” Us’s doors, they will need to focus on the play element of their stores in order to draw in parents and kids, making a shopping trip into an outing and building a connection between kids and the store’s products. A shift towards smaller stores with bigger play areas will be key in getting kids to want to visit. It will also let parents see toys in action, helping them buy more confidently. While experience-based retail can be a fun and flashy way to get consumer attention, it’s particularly important in children's’ retail--kids love fun, and parents love their kids. If Toys “R” Us wants to stay afloat, they will need to leverage their potential for fun.
Technology and Convenience
While it’s impossible to compete with the convenience of online-shopping, it’s still essential that stores optimize their stores with convenience in mind; customer expectations are changing, and the demand for a quick-and-easy shopping experience is high. With that in mind, stores like Toys “R” Us are falling behind because of outdated checkout processes and slow or limited in-store technology. A key to rebooting Toys “R” Us effectively will be using innovations in retail technology to keep checkout and in-store product searches quick and easy. A mobile-equipped staff member, for instance, can help a customer find a toy, demonstrate how to use it, and then let the parents check out right on the sales floor. And, just like with experiential retail, convenience is particularly key in kids’ retail--no long lines means no bored kids, no tantrums, and no exhausted parents.