Over the next 10 years, Millennials are predicted to become the biggest spenders when it comes to groceries and food service. So it makes sense that they should be a prime target for retailers.
Here, we take a look at some retail strategies that can help appeal to the Millennial market.
Investigate new store formats
When it comes to Food and Beverage, new retail formats are seeing success. Grocery-restaurants combinations (the ‘Grocerant’), kitchen-only outlets and delivery services are all experiencing growth and grabbing the attention of Millenials. Take a look at ‘The Drug Story’―an innovative new concept where anyone can walk in, grab a $10 activated-charcoal drink and leave. But the drinks are not free―paying is based on an ‘honor’ system. The company has made a bet that customers will pay the same way they order the drinks for home delivery―by sending the company a text message, receiving a link to pay from a representative, and then paying by their phone (though there are a few safety precautions including cameras, a heat map tracker and RFID tracker to see what products are taken out of the refrigerator). The space is small―and can fit inside other retail stores. It features a large, selfie friendly mirror, and stark black-and-white striped penny tiles. This radically different format has attracted a lot of attention (with mostly women as its customers). The lesson for retailers? Think outside the traditional retail placements, explore new formats, and new purchase options. They will help you get the attention you deserve.
Tell the story behind the ingredients
Millenials are increasingly health and nutrition conscious. They are very interested in what they put in their body―and the impact of products on animal welfare and the planet at large. As Richard Hall of Zenith Global and FoodBev Media Chairman says “Beverages have always been about taste, convenience, value and identity. The two new dimensions over the past 20 years have been added benefits and ethical values. Not only do more of us want to know what a product will do for us, we also want it to represent our point of view. It’s almost a new form of consumerism democracy.”
This presents an opportunity for retailers to focus on telling the story behind the ingredients in their products in clever, creative ways. Take a look at Juice Press―a juicing company that boasts natural and organic, healthy juice options for customers. Online, it’s easy to see and read about all of the nutrition and product information―from where products are sourced, all the way through to the detailed health benefits of each ingredient. But how do they take this instore? Through the use of digital displays at the point of sale. With beautiful, colorful moving storyboards, the story behind products is brought to life for customers, right at the point of purchase in-store.
Convenience and adventure.
We know millennials are driven by experience, but they are also motivated by convenience. As evidence, they allocate the highest share of their food budget to prepared food (7.5% vs 6.6-6.9% for the other generations), and unlike other age groups, they continue to eat prepared foods even as they grow richer. They are also highly experimental.
What does this mean? Retailers can use technology to bring in the convenience of online ordering into stores, allow shoppers to order using kiosks in-store, provide delivery services, and allow shoppers to browse many menu suggestions on their mobile, while they are in-store.
But they are also experimental and will partake in increased food experimentation. A study found that nearly 8 in 10 millennials consider themselves adventurous eaters, and half believe ‘interesting and exotic foods’ are a must-have at their local grocery stores. How can retailers make the most of this? Offering interesting examples of adventurous recipes or wildly creative combinations is one sure-fire way to get millenial's attention.
Omnichannel retail, the fusion of virtual and physical retail, is lauded as the key to success in our tech-heavy economy. This strategic blend has met its ultimate form in AR and VR. AR, or Augmented Reality, and VR, or Virtual Reality, use tech to superimpose a virtual world onto the user’s surroundings. Retailers from IKEA to Macy’s are adopting AR and VR platforms to create an all-new shopping experience that fuses the virtual and the physical. Imagine a virtual department store, accessible from your living room, or a phone app that lets you see what that new couch you’re considering looks like in your own living room. The possibilities are endless and thrilling.
Nonetheless, there are plenty of challenges with the growth in popularity of AR and VR. Many consumers are not fully comfortable or familiar with the technology, suggesting that accidents are inevitable. AR and VR, too, could easily become a short-lived gimmick or novelty if it’s employed carelessly. As with any new technology, retailers will have to move carefully and intentionally in order to reap the rewards―and avoid the pitfalls―of AR and VR.
Here’s how to make your AR and VR integration seamless, effective, and relevant.
AR and VR allow for a radical departure from the limitations of traditional retail. Long dressing room lines, an unwelcome makeover, online purchases that don’t quite work in person--all can be resolved using the right AR technology. IKEA, for instance, has developed an in-store AR app that allows customers to preview furniture in their own home. For example, a shopper can know for sure if their bright red couch will clash with orange drapes, without the commitment of a purchase . Online clothing retailer ASOS is developing tech to let customers see how clothes will fit on their body, saving time and money on returns. Similarly, Sephoras across the country have debuted “magic mirrors” in-store that let customers see what a certain makeup will look like on them without the need for samples or makeup remover. The problem-solving possibilities are endless.
When it comes to VR, the world of retail is expanding exponentially. As VR headsets become more common (there are expected to be 100 million headset users by 2022, according to the PYMNTS Virtual Reality in Retail Report), businesses are considering how they can create even more immersive shopping experiences. This is perhaps best used to communicate information in a radically experiential way. Take the partnership between London’s One Aldwych Hotel and Dalmore Whisky—by using a VR headset, any willing participant can enjoy a “VR whiskey cocktail”, an experience that transports the drinker straight to the distillery where the whiskey was aged. Imagine, then, a clothing store equipped with VR masks to whisk you away to Paris Fashion Week, or a candy store that takes you to Willy Wonka’s Chocolate Factory. The potential for radical new experiential retail is huge.
But Not Too New
The danger of AR and VR lies in the uncanny valley--meaning that the photo-realism achieved by computer generated imaging creates a disconnect as audiences find themselves asking, “why doesn’t it look more real?”
While the potential is endless and often thrilling, it is easy for AR and VR to come across a little awkward for users, particularly when it comes to shopping experiences. Perhaps the best (or worst?) example of this was Alibaba’s 2016 debut of their Buy+ platform--a phone app-cum-VR experience where users can enter a virtual mall to buy products from stores like Costco, Macy’s, and Target. Users look at an item for a few seconds to “select” it, and then entera screen with a rotating product image and details. Another motion of the head and the product is added to your virtual cart, or even purchased using pre-saved shopping information. It sounds like a dream fusion between physical and brick-and-mortar retail--a mall wherever your phone goes--but the app was met with a relatively negative response. The “mall” was deemed too empty, too impersonal, and too hard to navigate-- lacking all the joy of brick-and-mortar shopping and the ease of online shopping. As retail expert Nikki Baird said, “why go to a clunky, lonely virtual store, when you can go to a smoothly functioning store (you don’t have to navigate a joystick and some buttons to pick up an item) that is vibrant and doesn’t feel like you’re the last human left after the apocalypse?”
The key is to avoid using AR and VR as a gimmick, and think critically about how it can be used as a problem-solving tool or an exciting and easily-integrated attraction. Shoppers want something intuitive, easy, and interesting. AR and VR can be, and likely will be, essential in navigating the demands of an increasingly tech-based retail environment. Keeping it fresh without complicating a system that already works will be the trick to making retail current, and AR and VR are no exception.
Today, technology isn’t limited to fun gadgets or specialized tools―it has become a part of our daily lives, used to control everything from our transportation to our cooking and in-home security systems. As tech expands, our homes are becoming smarter and more connected, enhanced by innovations that ease or improve domestic life. With the rise in smart home innovations has come an entirely new category of consumer electronics retailing: Smart and Connected Home devices and appliances. The US is leading the way when it comes to sales―with reports showing that the smart home market in the US bringing in close to $5 billion in 2018 alone―and has the potential to grow much further.
While selling smart home technology might seem like a breeze (who wouldn’t want a virtual assistant to change the thermostat and play your favorite music?), this new exciting product category also comes with many retail challenges. Analysts, such as McKinsey, found that many consumers still don’t understand connected device value propositions.
Our own user-research uncovered that consumers were finding it hard to understand the range of choices, and had some skepticism of the benefits these new smart products could bring to their lives. After all, who wants to make life more complicated?
Our recent work with introducing the Smart Home Category to PC Richard & Son stores gave us many insights which were relevant to retailers across the board. Here, we look at those insights, and share what we believe retailers need to know to come out on top:
An opportunity to bring order to the chaos
Smart home technology is a new product category, which means its definition remains relatively loose. Some consumers might think of smart home tech as being a central air unit―others, a virtual assistant device. Many consumers don’t even know what their options are, as new technologies are being put on the market every day. What retailers can do, then, is to bring order to the chaos.
A simple way to do this is to have a clearly designated “smart home technology” section, which places the products within a home-like environment. The consumer is invited to imagine how the products will look within their own home. This environment also positions each product as a lifestyle solution, by presenting consumers with a big picture view of how all the different products could work together as an ecosystem ―which is the way smart products should work.
Ultimately, this format demonstrates clearly what smart home technology can mean for consumers in their own homes, and helps encourage shoppers to interact with unfamiliar technology.
Hierarchy of information
Once the shopper is comfortable with the big picture, you then have the opportunity to provide the details they are looking for in order to make the final purchase.
Small retail touches can work to deliver this detailed information at the right time, and at the right place. We used interactive digital screens to allow shoppers to learn more about product information including features, pricing specifications and customer reviews - all at the right time and place.
Remember to diversify
The home is personal, and so too is smart home technology. Consumers have varying needs and desires, and that is especially true when it comes to homewares. A Gen Z shopper designing their first home might want a smart thermostat for when they leave the patio door open and forget to turn off the A/C; a working parent might want a smart security device that can let them keep an eye on their home even when they’re at the office. People with limited mobility might want voice-activated lights or even doors to allow them to move more easily through their home. Diversity is the key in smart home solutions―know who your consumers are, what they want, and then curate a product selection that meets their needs.
Smart home technology is on the rise, with an expected 1.3 billion devices to be in use by 2022. The key to getting in on the ground floor is to provide an inviting, easy-to-understand retail experience for shoppers that can expand and change as the technology grows.
Hailed as the key to surviving the retail apocalypse, the approach to deliver experiential retail is being adopted by an increasing number of stores that want to draw in customers and get an edge over online shopping. The idea is that physical retail should provide an experience―a destination―customers will come to a store because there’s something there worth coming to. And so we’ve seen a boom in in-store tech, Instagrammable store layouts, and special events or activities for shoppers in-stores across the world.
But experiential retail isn’t as simple as throwing a hashtag on a wall and a VR headset on a counter. An effective experiential retail strategy considers the unique demands and desires of its target consumers. And since revamping stores doesn’t come cheap, the stakes are high in ensuring you’re moving in the right direction.
Here’s what your experiential retail strategy needs in order to rise above the rest:
A Consumer-Based Experience
It goes without saying that experiential retail requires, well, an experience. Stores are bringing everything from indoor golf simulators to wine bars into stores in order to bring shoppers in and keep them coming back. But an experience doesn’t mean much if it’s not an experience consumers want. The best experiential retail and implementation of retail technology is oriented around problem-solving. Take Sephora’s “magic mirrors,” which use AR to show consumers what they’d look like using various products without actual makeup application―it saves the consumer the hassle of removing makeup, and saves the store the expense of tester merchandise which can’t be sold.
This applies to special events and attractions, too. After all, what are in-store attractions if not problem-solving tools for boredom or retail delirium? Stores like Uniqlo and Aritzia have done this well, by bringing in in-store coffee shops to help customers recharge while shopping. Another key is keeping it local―what do consumers in one region need that they won’t need in another? Just as stores in California will stock more bathing suits than winter coats, your stores should base experience on local culture while maintaining brand consistency. Stores like Foot Locker’s “Power Store” and Nike Live are looking to local artists and culture when determining store design, while athletics stores like REI will feature sports lessons based on local geography. Experiential retail works best when that experience is relevant to the consumer as opposed to just a novelty.
Thoughtful store design
Brand-building happens just as much in-store as it does through advertising. Consumers will associate your brand with the kind of image it presents in physical shops., So, keeping your stores beautiful and comfortable, or fun and chic, is key in keeping consumers interested. That’s why more and more stores are featuring home-like fixtures, places to sit and rest, as well as beautiful interiors with soft lighting and thoughtful shelving. The idea is to make your space feel as comfortable, or even more comfortable, as staying home with a laptop―or making your space as beautiful as going to a museum. The best stores are focusing on a multi-sensory experience that goes beyond just visuals: stores like Anthropologie have been incorporating sensory branding into their store design for decades, featuring artful wooden fixtures, cozy textiles, and lit candles that you can buy in-store. And with the growth of the Instagram generation, it’s become even more essential to provide an in-store environment worth sharing.
Balance between tech and the “human element”
While in-store tech is great, it isn’t everything. Retail technology can solve a lot of problems that are becoming more and more prominent as online shopping gains popularity, but nothing can replace the human element in a personal shopping experience. Trained and attentive store clerks are essential for customers to feel cared for and comfortable while shopping. One of the main focuses of B8ta, a revolutionary tech marketplace, is to have trained and informative staff that can demonstrate how devices are used and assist customers in finding new products. But it’s not just about know-how: customers also want to feel like they have a connection with a brand, and friendly employees can be the perfect representative. Women’s clothing stores are a great place to look for this; in many stores, sales staff will encourage shoppers to try on clothes and give compliments and even suggestions for other outfits. The idea is for women to feel like they’re out shopping with a friend, or in their own closet at home. While tech is exciting and new, it’s important to remember what your store can provide in experience beyond a screen.
Whether a big or small initiative―just get started!
We often hear about stories of big initiatives in experiential retailing.For example,the flagship stores that are designed to only showcase and demo products, but don’t sell anything, the large scale layouts that host big events and more. You don’t need to always think big as long as youtkeep the ‘experience’ at the forefront in category management.
For example, we recently used the creation of a pole topper for Reese’s as an opportunity to provide a memorable moment. We designed and manufactured a large scale ‘Reese’s Peanut Butter Cup’ bowl, while capturing the playful nature of the brand, which is reflected in the fun shoppers experience at the Point of Sale.
With all the conversation about experiential retail, it can be tempting to revamp your entire store to feature floor-to-ceiling screens and an in-store wine bar. Unfortunately, though, a radical multi-store renovation plan isn’t particularly cost or time-effective for most businesses. Enter flash retail―a model based on small-scale, temporary physical retail spaces like pop-up shops, trucks, or stalls. Flash retail has seen a boom in recent years, as businesses look for innovative ways to approach the retail experience. From installations in mall, to small storefronts in big cities, to stores-in-stores, flash retail can take many forms and allow for all kinds of diverse retail experiences.
Here, we take a look at what you need to know in order to make your flash retail initiative work for you.
Think about your audience
The kind of flash retail model you choose should be based on the shopping habits of your target audience. A storefront in SoHo will speak to those with leisure time―people strolling by, looking for a unique experience. A store-in-store, like B8ta or STORY in Macy’s department stores, will capture the attention of people on a routine shopping trip who are excited to stumble upon something new. A storefront model makes sense for known brands, and many online-only retailers will start their physical retail initiative using pop-up shops.Fenty X Savage, Birchbox, and Kylie Cosmetics all developed pop-up shops in major cities to have a short-term physical retail space without a long-term commitment. Meanwhile, store-in-store models work well with small businesses looking to get their name out, like West Elm’s store-in-store initiative “West Elm Local”, in which local businesses can display their products in-store on weekends. Think about which model will speak best to your target audience and run with it.
Flash retail means limited space and mobility, so have a thoughtful plan about which products you’ll feature. Obviously think about featuring best-sellers, but also consider the structure of flash-retail. It’s about an impulse buy, not a convenience purchase. While flash retail is, of course, an opportunity to sell products, it’s more about building brand recognition than it is about revenues. Fun, flashy products that will bring people off the street and into your store is the key to an effective flash retail strategy.
Don’t neglect experience in your pop-up shop. Flash retail is all about experience, but it’s not enough to just exist as a short-term but otherwise typical store. Flash retail is the opportunity to try out retail technology and in-store entertainment that is otherwise too expensive or risky to make a long-term store plan. Think about how to feature your products in a new and innovative way. Dolby’s SoHo pop-up featured movie-themed rooms that displayed Dolby’s sound systems in a totally-immersive environment. STORY, meanwhile, has a store-in-store style that changes every few months, keeping customers invested in the store and its displays. ―our pop-up shop doesn’t have to be static. The beauty of flash retail is its mobility and flexibility, so take advantage.
How to survive the radically different landscape for Food and Beverage retailers (hint: it’s all about the experience).
Recent years have seen a boom in service-based technology. Apps and websites like Uber, Taskrabbit, and Grubhub have taken over the market as time- and effort -saving tools for the modern consumer. Naturally, the advent of service-based tech has brought new challenges for traditional retailers―--and food and beverage retailers have been hit particularly hard. A proliferation of delivery-based apps and online grocery services have meant a radical new retail landscape for restaurants and grocery stores alike. Consumer expectations for food and beverage retailers are shifting towards an increasingly powerful duality between uber-convenience on the one hand, and hyper-experiential on the other.
Here, we take a look at some key areas that consumers expect when it comes to F&B retailing, and how retailers are meeting these demands.
First, let’s talk about convenience
As consumers become accustomed to the ease of online or app-based food shopping, grocery stores and quick-service restaurants will have to adjust to an increased demand for quick-and-easy food service solutions. This means an emphasis on prepared foods and meal kits―--take the “grocerant” trend―--as well as a focus on food delivery and pick-up sites. Whole Foods, for instance, has debuted a locker-based order pick-up system which includes, with refrigerated food lockers located near store entrances― so customers can order online and pick up in-store without having to navigate aisles or crowds. Restaurants, too, are beginning to focus on providing intuitive pick-up locations for online orders to ease customer transactions.
Convenience also means a streamlined store design with clear signage and informed staff. Trader Joe’s staff are encouraged to chat with customers about their products and provide suggestions based on consumer preferences. And, even at fast casual restaurants, servers are expected to be equipped with information about food preparation and source. In order to compete with online food services, grocery stores and restaurants alike will have to provide a comprehensive and intuitive shopping experience.
A Focus on Fun
What the online grocer can’t provide, though, is a personal, pleasurable, and fun dining or shopping experience. While grocery stores and restaurants should keep things streamlined and efficient, they certainly shouldn’t neglect the experience-based shopping experience that brings customers off their couch and into stores. This is, again, where the grocerant trend comes in―--more and more grocery stores are emphasizing a pleasant and even chic in-store dining experience for shoppers who want to grab a meal before picking up groceries, or even as a stand-alone as an independent dining experience. Some grocery stores have begun incorporating high-end coffee and even wine bars into stores to make for an enjoyable and unique shopping experience.
Meanwhile, restaurants need to focus on a pleasurable and engaging dining experience. More and more restaurants are providing a unique dining experience, from innovative plating, to more engaging and personable waitstaff. Even quick-service restaurants are featuring pleasant store design, including hip fixtures and art installations in order to appeal to the demands of the Instagram generation. Special events, too, can bring customers in, for everything from wine tastings to pasta-making lessons. Keeping it fresh and interesting will require providing what online services can’t―--a fun, personable dining experience.
The food and beverage retail landscape is changing rapidly. In order to keep up, retailers will have to think hard about what they can provide to keep customers interested. Both radical innovation and simple solutions will be key to moving forward with intuitive, quick, and fun food and beverage retail experiences.
Amazon just beat Best Buy for the top spot in Consumer Electronics Retail. What this means, and how retailers can adapt.
Perhaps the longest hold-out of the move from in-store to online retail has been in the consumer electronics sector. For the last decade, Best Buy has held out as the top consumer electronics retailer, despite a concurrent push towards online retail in most other retail categories. Signs would indicate that when it comes to consumer electronics, consumers still prefer an opportunity to see, test, and learn about products in person rather than wholly relying on online guides and reviews.
That is, until this year. Dealerscope’s Top 101 Consumer Electronics Retailers Report of 2018 found that online retail giant Amazon has officially beaten out Best Buy for the top spot in consumer electronics retail. And it’s been a long time coming--while Best Buy has held out in total sales, Amazon has seen significant growth in the last decade— while Best Buy’s growth remained relatively minimal. The convenience of online retail, as well as its increasing ubiquitousness, has meant a defeat for Best Buy and a victory for digitally native consumer electronics retailers.
What does this mean for brick-and-mortar stores? It could be a wakeup call. While there’s been a clear shift in preference for consumers in the last few years from physical to online retai, there’s been a marked increase in physical consumer electronics retailers--over ninety thousand stores operated by retailers according to Dealerscope’s list. Even the brick-and-mortar stalwarts are starting to fall to the digital era. What can stores learn to keep current in Amazon’s wake?
Explore New Category Solutions and Formats
Innovative consumer electronics retailers like b8ta and Soda Says are popping up across the country to fill a gap in consumer electronics retail. As Soda Says CEO Grace Gould stated, “you have these brands--Apple stores, Microsoft stores, Samsung stores--that sell a very limited number of products. And then you have big-box retailers like Best Buy. No one is doing an interesting lifestyle business within consumer electronics.”
By bringing a carefully curated product range to the floor and filling their stores and outposts with color and design detail, b8ta and Soda Says are providing an all-new consumer electronics experience that bucks the stuffy big-box stores and the impersonal online shop. B8ta has also brought it’s successful format to bigger department stores, with a shop-in-shop in Macy’s. It allows people to explore products they may not have found online, try them in-person, and be hand held through the experience by an informed, friendly sales associate. Formats like these can elevate the in-store experience and create a compelling reason to visit a store.
Consider New Store Design Solutions
It’s helpful for consumers to experience how the product will fit into their lifestyle or home environment.
For example, consider the complex product category of ‘Smart Home’. Browsing products sitting on a shelf, consumers may find it difficult to navigate the complex choices and even more difficult to understand how they all work together.
To solve this challenge, we recently created a ‘store-in-store’ experience for the Smart Home Category for PC Richard & Son,which placed products within a home-like environment within the store. This allows customers to imagine how each product would fit in their home environment. This context let them become more familiar with this complex category. The result? A doubling of saless.
Another example is the Sonos store in Soho, New York, which provides different lounge-room environments for customers to explore the Sonos sound system. Each booth features comfortable couches, or an office-like desk and chair, to allow the consumer to go on a journey to experience how the Sonos system could work if installed in their own home.
Using sound, light, space and carefully thought out design and display fixtures, you can create an environment that communicates so much more than just the benefits in a bulleted list or detailed illustration on a website.
Provide Omnichannel experiences
What makes online shopping so compelling? The ability to shop for the best price, read hundreds of reviews, study comparison charts, and then have the product delivered to your doorstep, all while sitting on your couch in your pajamas.
These are all factors that can be brought into the in-store experience (minus the pajamas!). Here is where retail technology such as interactive digital displays, and AR and VR have a role.
Consider replacing status pricing signage with digital options that can provide real-time price updates. These same digital displays could also allow customers to read through product reviews and comparison tables. If the customer wants the option of home delivery for bulky items, a store associate could arrange this at checkout. Worried about the checkout queue on a busy day? If each store associate is equipped with a tablet, they are easily able to check customers out throughout the store. Item not in stock? Customer’s should be able to order it for home delivery in-store.
New technologies such as AR and VR can also provide opportunities to help by making the shopper’s life easier within the store. For example, using AR, Topshop used motion sensing technology to create a virtual fitting room for customers in their Moscow store. By standing in front of the camera, customers could see how the item looked on their body without having to line up and wait to try things on.
In our design process, we often ask the question ‘“How can we bring this online benefit into the store” rather than seeing online retail as a separate channel with separate features. While retail channels (online, retail, mobile) are often managed separately, we prefer to think of the brand wholistically--and design to meet the customer where they are. They may start researching online (and statistics say they often do), but then visit a store to complete their purchase. And so we often ask the question “How can we help bridge the gap between the in-store and online experience? How can we meet the customer where they are or want to be?”
While no physical store can compete with the endless product options of the internet, it’s important to provide as many services as possible to remain competitive as consumer expectations change. Retail norms are changing--stores have to change with them, or get left behind.
Provide What Online Can’t
While it’s important to meet the expectations as set by online retail, the in-store experience is filled with opportunities to exceed them and delight and surprise customers.
One of the strengths of physical retail is the ability to make an event out of a shopping trip —- turn the store into a destination. How can you do this? You can borrow from other brands who are leading in experiential retailing.
Nike, for example, has a full size basketball court for consumers to experience their shoes on the court. They also run live events, and offer product customization on-site in the store. Sales associates are athletes themselves, and always speak from experience.
If you’re not already doing this, expand your product release strategy to include in-store only exclusive events. Organize special interest parties, or demonstration days. Anything that will work to bring customers off the couch and into the store. Make it a destination— - keep it relevant and interesting.
A final word. At In-Store Experience, we have a motto— - “Retail is not dying— - boring retail is!” Keeping things fresh, relevant, and staying on top of the latest trends gives us insight into what consumers expect. While the Amazons of the world are growing— - nothing can replace the power of the in-store experience.
It’s no surprise that the message of ‘Convenience’ or ‘one-stop-shopping’ is not particularly compelling to shoppers when it comes to department stores. With the advent of online shopping and its infinite expanse of product options, department stores seemed to lose their raison d’etre. And what they have always provided in convenience, they have long since lost in experience--department stores have a reputation of stuffiness, old-school goods and services in old-school buildings that can’t compete with the expansiveness of the internet’s stockrooms, nor the thrill of small boutiques. It’s no wonder that experts and consumers alike were predicting the imminent downfall of department store shopping.
Enter STORY, an immersive, Instagram-friendly department-style store focused on bringing the fun back into department store shopping. Founded by entrepreneur Rachel Shechtman, STORY was birthed in an effort to bring the needs of the modern consumer into one 6-story structure. As the STORY website explains, Shechtman “wanted to create a different type of store,” one where “you could take a yoga class and discover the best water bottle from a small business in Brooklyn.” A department store for the modern age, indeed. STORY, too, would operate on an editorial theme that changed every few months--one month was “Love STORY,” one month “Remember When,” each with unique products, events, store design, and interactive features. The store became a must-visit for New York City tourists and locals alike, and with its frequent redesigns, there was always a reason to stop back in.
Seven years and over 40 redesigns later, STORY has been acquired by Macy’s in an effort to revive the department store’s brand. Macy’s has struggled to transition into the age of digital shopping, with frequent store closings and layoffs over the last few years. STORY could be the key to bringing the fun back into Macy’s stores--and, in turn, the customers. Macy’s has brought STORY as a shop-in-shop to 36 of their storefronts across the country, from Los Vegas to Los Angeles. The average STORY shop is about 1,500 square feet and features products and displays aligned with the theme of the flagship STORY in Herald Square.
The Herald Square STORY, in turn, is the true headquarters of novel experiential retail. The biggest of the locations by far at 7,500 square feet, the Herald Square STORY features special events, Instagram-friendly corridors, and, of course, curated products that serve both theme and customer demand. The current STORY theme is “Color STORY,” a vibrant collaboration with Crayola, Levi’s, and MAC Cosmetics that features products sorted by color across the expansive floor. The color theme means exciting displays, including a rainbow tunnel and a giant interactive Lite-Brite installation frequently used as a backdrop for selfies. The floor design means that just walking through the store is an experience--and one that highlights specialty products.
The collaboration allows for special interactive shopping opportunities, including a “Make Your Own” makeup palette from MAC Cosmetics and the Crayola Create It Yourself network, which promises to be “a platform that inspires viewers to create with Crayola products in new ways,” including designing a personalized patch for your Levi’s jean jacket. Along with STORY’s product features, chosen with a special focus on local small businesses and businesses owned by women and people of color, the store has struck the perfect balance between leveraging big name brands to bring customers in and promoting small businesses to keep products fresh and unique.
It’s clear that STORY is ahead of the game when it comes to a unique and exciting retail experience. Special events, interactive displays, and local and personalized products are all drawing in customers interested in a shopping experience that you can’t get online. With Macy’s taking the lead on bringing it to department stores across the country, it’s clear that a department store revolution is on the horizon.
There are many examples of digitally native brands taking the leap into experimenting with physical retail - and doing it successfully. Leading the charge in the transition from online to physical retail is b8ta, a retail-as-a-service startup that brings small online-only brands to physical stores. Founded in 2015 by three tech entrepreneurs, b8ta bridges the gap between online and physical retail for nascent tech brands, bringing a wide variety of innovative, otherwise online-only products to their 79 locations across the country.
Physical retail presence doesn’t mean much, though, without an exciting retail experience, and b8ta certainly provides. A b8ta store is a tech-lover’s playground, a sea of tables with gadgets and gear unboxed and ready to test. Drawing tablets equipped with styluses lie next to VR headsets, smart wallets sit next to Quip toothbrushes. And each product station comes equipped with a digital display listing product information provided by the product’s makers. The display operates as a product guide, explaining how the product works and encouraging consumers to test the product effectively. The stores, too, have knowledgeable salespeople or “b8ta testers,” as they are officially known, to help customers better understand the tech and provide guidance.
And their innovative system seems to be working. Since 2015, they’ve grown from a single store in Palo Alto to 79 unique storefronts in major cities across the U.S. They’ve also begun a partnership with Lowe’s, bringing their setup to over 70 stores, and in 2018, Macy’s bought a minority stake in the company and began using their model in the company’s experiential retail concept called The Market. Paired with Macy’s STORY, b8ta has become a part of the department store’s mission to bring their retail model into the tech age.
b8ta provides a much-needed service to small brands in a fun, modern package. It’s clear that b8ta is a harbinger of the modern retail model--fusing online and in-store retail, with an engaging, tech-heavy twist. Malls, take note.
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.
You may have read that online retailers have usurped the throne of retail convenience, rendering department stores a relic of the pre-internet age. And with former retail giants like Sears declaring bankruptcy, you may think that the department store is a thing of the past. Here are a few department stores that are shaking up their operations, bringing in new tech and experience-based store design - keeping things fresh and relevant in today’s retail landscape.
Nordstrom’s reputation as a high-end department store is supported not only by products but also by a focus on an exceptional in-store experience. Stores are organized and elegant, with attentive customer support. In order to stay relevant, then, Nordstrom’s main focus has been on integrating convenience-based technology to keep customers coming. The store nails omnichannel marketing and retail with innovations on their social media pages and an app that facilitates shopping. Their Instagram and Pinterest pages feature links to items that take shoppers directly to their website to make for easy purchasing, and their app even features a scheduling page for personal shopping and online ordering. Their fusion of tech and brick-and-mortar operations has kept them competitive with online companies who prioritize convenience over a personal shopping experience.
The department store has thrived in recent years, keeping stores open as malls close and even renovating their NYC flagship store in 2018. Their secret? Much like Nordstrom and Macy’s, Bloomingdale’s has developed a successful omnichannel marketing strategy and maintained an excellent in-store experience. Their stores are oriented around customer service, with attentive staff available for consultation and suggestion. Meanwhile, their app is not only attractive and user-friendly; it also features special promotions for app users and a scanner that helps customers find products that are not available in-store. Along with an attractive store design, the company has perfected their recipe for a modern, elegant department store experience.
With the changing retail landscape, Macy’s department stores have struggled to stay afloat. But their stores outperformed expectations in 2018, and continued success shows that this isn’t just a fluke; it’s because of a deliberate strategy to update stores to meet the needs of the modern consumer. Leaving behind heavy-discounting initiatives, the store has focused on creating an in-store experience that makes an outing out of a trip to Macy’s. This initiative means in-store tech, like AI that lets customers view a piece of furniture in their virtual living room, and a renewed focus on store design and layout. Macy’s, too, has recently acquired STORY, an NYC concept store oriented around regular reinvention. STORY’s stock changes every six-to-eight weeks, meaning there’s always something new for customers to see. And the changes are paying off--their 2018 earnings outperformed Wall Street analysts’ expectations, and their stock grew about 25% in the last fiscal year.
Driving loyalty has long been a challenge for retailers. And now that loyalty programs are becoming more ubiquitous, companies are once again innovating to stand out of the crowd. Here are some of the changes we’re seeing in customer loyalty programs in 2019:
Technology = Personalization
Advances in technology mean that rewards programs can be ever-more personal. With the advent of online shopping, app-based shopping, and even just a centralized electronic system for in-store shopping, stores have more data than ever on what individual customers buy, and what they want. This means that loyalty programs can be used to create a personalized shopping experience for customers that only gets more accurate the more the customer buys. A number of stores have done this with quizzes that determine a customer’s “personal style,” or even personal data sections where customers can list their size, skin tone, and other measurements to inform product suggestions. A personalized shopping experience, in turn, leads to greater ease of shopping and a sense of “belonging” that fosters loyalty.
More Rewards, More Often
Most customer loyalty programs are oriented around point-based spending incentives--spend money, earn points, get rewards. But with more rewards programs entering the market, and consumers losing interest in sale-based shopping incentives, businesses are turning towards revamping their points systems to reward loyal customers better and more often. The Kohl’s loyalty program now offers 10% Kohl’s Cash on every purchase when you pay with a Kohl’s card, and 5% Kohl’s Cash for non-members in order to encourage return customers. Meanwhile, the Starbucks rewards program has done away with its 300-point Gold Membership system in favor of a point system that allows customers to get rewards with every purchase, right away (albeit with some miscommunication to customers that caused pushback). It’s clear that when it comes to building loyalty, customers are more interested in special perks than in discounts.
Experience over Products
While perks like free samples and discounts are appealing, the way to really stand out in 2019 is to offer experiences over product-based rewards. This can mean private parties, consultations with professionals, even lessons with activity-based products. Sephora and Ulta lead the way with loyalty programs offering makeovers with in-store makeup artists, and clothing stores like Nordstrom are offering similar rewards with in-store stylists and personal shoppers. Meanwhile, companies are offering access to sales or special products--Footlocker announced a loyalty program that grants early access to sneaker releases, and Fenty Savage, Rihanna’s lingerie line, offers a loyalty program based in first-access to monthly product drops. In a marketplace where cheaper products are always available, discounts aren’t nearly as attractive to customers as exclusivity--and retailers should take note.
We talk a lot about how in-store technology can help keep the retail experience competitive in an increasingly virtualized economy. There are many examples of brands introducing leading technologies intro their retail experience - everything from Sephora and Ulta with virtual mirror technology and golf brands who have created virtual golf courses so customers can work on their swing in-store. While these programs are exciting and innovative, not every brand needs to adopt cutting edge technologies to stay competitive. Introducing retail technology for technology’s sake won’t help in creating a winning retail experience. It’s important to start with and stay focused on your shopper and their experience. Think about what could make their lives easier? Their experience more engaging and memorable?
A relatively easy win is to work on the factors that could make their instore experience more convenient. That’s where self-service retail can play a part. Self Service retail is an avenue to bringing the convenience of online shopping into your brick-and-mortar storefront.
Here are some of the benefits of introducing self service retail in your stores:
Self-service kiosks allow customers to shop their way, and at their pace. Self-service ordering at McDonald’s, for instance, gives customers the option of ordering curbside, ordering through their phones, or ordering for a traditional in-store dining experience, easing customer flow and creating more convenient options for busy customers. McDonald’s CEO Steve Esterbrook said that self-service kiosks provide more options for customers, give them more options for how to engage with their store--and easy sales means happy customers!
Kiosks let customers choose exactly what they want, exactly how they want it. Tablets and other ordering devices can let customers select for dietary restrictions and allergies more easily, and even create more flexibility in preferences. Because kiosk ordering can deliver orders straight to the kitchen without a middleman, there’s more flexibility in ordering which means more options for personalization.
To date, the biggest leg up that online merchants have over in-store sales is the ease with which they can collect consumer data. Every sale is automatically in their online system, allowing for streamlined data collection that can then inform their marketing and merchandising. Self-service technology in brick-and-mortar stores, then, is a great way for businesses to easily collect consumer data without the hassle of multi-step inventory tracking and other consumer data efforts. Kiosks automatically collect information about sales and browsing habits, making it that much easier for brick-and-mortar retailers to know how their consumers are shopping.
In a marketplace oriented towards time-saving solutions, one of the biggest innovations in food retail has been the meal kit. Meal kits, consisting of a recipe and all the ingredients for a two-serving meal, have taken the market by storm as an easy, efficient way to cook fresh and innovative meals. Subscription services such as Blue Apron, Hello Fresh, and Chef’d grew rapidly as meal kits entered the market.
But as the market expands, companies are having a hard time maintaining their growth. For example, market leader Blue Apron’s subscription base dropped by about a quarter in 2018, and its market shares dropped by about 60%. Chef’d, meanwhile, closed shop in August of 2018, only to be revived by packaged food consultancy True Food Innovations. Experts say that the drop is due to an expanding market paired with a relatively limited consumer base; not all consumers are open to such a radical shift in their cooking habits, and the price tag per meal is generally higher than the average shopper’s budget allows. A subscription-based service, meanwhile, requires a commitment that not all shoppers are willing to make, particularly with a product that they may not know how to incorporate into their cooking habits.
In an effort to keep profits up, many formerly subscription-only services are moving to physical retail, entering the grocery store as a meal solution for busy shoppers. The move is intuitive--subscription services are an investment not all consumers are willing to make, and bringing meal kits to physical retail gives consumers the option to buy single kits without the long-term commitment of a subscription service. Stop & Shop, Walmart, Costco, and Kroger have all either made deals with existing meal kit companies or developed their own meal kits in order to capture a market previously limited only to delivery services.
That said, there are challenges to bringing meal kits into the grocery aisle.
First there’s a question of demand: subscription-based services appealed to the busy shopper who doesn’t have time to go to the store, so what will it mean to bring the products to grocery stores? Consumers might be reluctant to change their habits, especially in a routine as essential as cooking dinner. But the meal kits do provide a niche between ingredients distributed throughout a store and pre-made hot foods provided by “grocerants,” and by selling meal kits in brick-and-mortar stores, shoppers have the opportunity to test a single kit without committing to a lifestyle change.
There’s also a question of perishability. Meal kits sold via subscription services don’t need a shelf-life; they’re made to order. In the move to grocery stores, meal kits need to be able to sit on a shelf for far longer than they’d sit on a doorstep. How are companies tackling this challenge? True Food Innovations, which now owns Chef’d, has been working with high-pressure processing technology to preserve food without any artificial additives. The technology is a form of cold-pasteurization that can extend shelf life to up to 55 days.
It’s clear that meal kits will need to keep innovating in order to survive the changing market. A move to grocery stores provides great potential for growth, but also allows for new risks and challenges. The meal kit industry will need to think outside the box in order to meet these risks.
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.
Golf innovators are increasingly finding novel ways of bringing in and engaging shoppers in brick and mortar retail. Golf stores across the country are updating their retail operations, bringing in golf simulations, putting greens, and even backyard golf courses to draw shoppers and provide experiences that online retailers can’t. In-store technology, paired with Instagram-friendly store design, are bringing golf retail to the forefront of marketing innovation.
Here are some of the best innovations in golf retail right now:
PGA Tour Superstore: with over 30 locations across the country and 23% sales growth in the last year, the PGA Tour Superstore has demonstrated the success of innovative in-store retail. Stores boast hitting bays, golf simulations, and even lessons, and provide services including fitting and gripping clubs. The opportunity to test products before purchasing, advice and services from knowledgeable staff, and a golf playground to use products after purchase can’t be beat by online retail. It’s a surefire way to attract avid golfers who otherwise shop online, and it works--while brick-and-mortar sports retail has seen a sharp decline in the last few years, PGA Tour Superstore has tripled its store count and intends to reach 50 stores by 2020.
Malbon Golf: Nestled on Los Angeles’s stylish Fairfax Avenue, Malbon Golf is bringing the game to California’s hippest residents. Founded in 2017 by Erica and Joseph Malbon, she a designer and he the founder of street-style magazine and creative agency Frank151, the Malbon Golf store fuses old-school game with new-school design. The store features sleek white walls, mirrored shelves, and carefully-curated displays that can be found scattered across Instagram with the hashtag #malbongolf, sometimes under the face of a celebrity like Justin Bieber or Steph Curry. A putting-range stretches across the middle of the concrete floor, past chic succulents and a glassed-in watch display. An open doorway leads to a so-called Swing Studio, where golfers can take lessons or play an 18-hole game. Their back patio looks out on their “Celebrity Green,” a curated green which has seen the likes of Bieber and Curry as well as Travis Scott, Schoolboy Q, and others of the Los Angeles fashion set. Malbon’s sense of cool, paired with in-store toys and visual treats, brings golf to the Instagram generation--and into its supremely chic storefront.
In-Store Experience chosen to provide an innovative way to manage the category across chain of stores.
Read the announcement on BusinessWire
In-Store Experience was recently chosen by P.C. Richard & Son to design and manufacture their smart and connected product category in-store, with an immersive, interactive retail category solution that brings together 32 products across a number of brands.
Recognizing the challenges of merchandising the complex category of Smart / IoT solutions, P.C. Richard & Son turned to In-Store Experience to rethink the shopping experience in-store. The resulting retail experience was designed to get products out of their boxes and educate customers through a compelling interactive experience, demonstrating the total smart home story.
The solution was a unique modular “store-in-store” digital experience, with a warm home-like fixture aesthetic, to invite shoppers in and educate them on the many benefits of smart home products. 32 smart home products are each merchandised next to digital touchscreens, providing detailed product information and benefits, along with dynamic pricing information and customer ratings. The focal point of this environment offers an immersive experience for shoppers by contextually simulating how smart home devices can enrich their lives by saving time, adding convenience or providing more safety and security.
The Smart Home implementation has resulted in an exponential increase in sales, according to P.C. Richard & Son. The program is now rolling out across 50 locations with plans to expand the product assortment and display modules as the category continues to grow.
“We wanted to build something that would attract customers to explore smart solutions,” said Chris Anderson, Founder and CEO, In-Store Experience. “We know people often learn about smart home solutions by experiencing them in someone else’s home, so we brought that experience in-store. It’s warm and inviting and allows customers to experience the benefits in a way you can’t online.”
“We are on a mission to become a market leader in the smart home category” said Steve Miller, Smart Home Category Manager at P.C. Richard & Son. “This immersive shop-in-shop environment is a key step to getting there.”
As the end of the 2018 calendar year approaches, I’d like to take this opportunity to reflect on the ever-changing retail industry, and to share my appreciation for all of our clients who have trusted us to deliver innovative solutions for their programs.
The world of retail is alive and evolving. 2018 saw rising consumer expectations in retail and a growing desire for ‘experiences’. Shoppers are now demanding more convenience, more options, total relevance, and more reasons to visit physical stores. When today’s consumers purchase tangible products, they place a lot more value on how it fits into their lifestyle. Retailers will need to adapt to the needs of their customers by creating a more personal in-store experience. They will need to know their customers better than their customers know themselves. To meet this new era, we are now delivering more innovative and experiential retail initiatives by finding new ways to engage with shoppers in this ever-changing retail landscape.
Retail isn’t dying…BORING retail is! We firmly believe that brick-and-mortar retail will continue to flourish. In fact, for every company that closes a store, 2.7 companies are opening stores, according to the National Retail Federation. Our team is driving innovation for the in-store experience at every stage of the process - not only for the shopper, but in the engineering and manufacturing techniques we use to deliver end-to-end programs that get results. We create everything from simple experiential in-store merchandising displays to complete store-in-store immersive digitally interactive connected environments which educate consumers on complex products, while providing key analytics. The point is that it doesn't have to be an elaborate digitally based solution to be experiential, sometimes it just has to be be fun and engaging.
We are excited about the future of retail, and hope you are too! We are blessed with a humbling level of opportunity and would like to express our most sincere appreciation to our valued clients and associates, and hope to work with you in the coming year.
On behalf of the team at In-Store Experience, I wish you and your families a very Happy Holidays and a bright start to 2019 and beyond.
Founder & CEO
Once again, Black Friday is upon us! Here are 5 interesting statistics around Black Friday and what they mean for retail.