Points of sales transform to adapt to new shopping habits

         

Over the last 18 months, the COVID-19 pandemic has massively affected the retail industry, and retailers are now reinventing themselves to recover and thrive again. 

In this first article of a two-part series, we review some examples of leading brands rethinking their retail presence through innovative store formats, partnerships, and immersive customer experience. 

The many forms of the high-street store transformation

As the high street opens up, we are seeing many brands test and introduce new retail formats to be more relevant to our current times.

The biggest shift is the acceptance of the omnichannel approach in retail that retail must be omnichannel. If more people are buying online or buying online to collect in-store, the role of the shop needs to change. For example, in the US, Best Buy is currently transforming some of its stores to halve the shop space and devote more space to digital shopping, allowing staff to work behind the scenes fulfilling digital orders to be sent out or picked up.

Another interesting shift is the idea of stores within stores. The idea of a brand space within a bigger store is not new, but it is being revived by more types of retailers. Where once it was mainly seen with cosmetics and beauty brands, more are now seeing the advantage of opening a small unit within an existing high footfall space. Again, this fits with the idea of omnichannel retail - the small store provides a physical presence and can be used for click and collect and easy returns, as well as functioning as a store in its own right.

For instance, Target has signed a deal to put small Apple stores into 17 of its sites across the US. It is a win for both brands - Apple gets access to more shoppers at a lower cost than opening their own sites, and given that nearly 50% of American smartphone users have an iPhone, it gives Target access to a huge audience who may also buy other things when they visit the store.

In the UK, the department store John Lewis has designed some smaller versions of its department store and is putting them into its food chain Waitrose. (Traditionally, it put small versions of Waitrose into its department stores). This means that when people do their regular grocery shopping, they can also see a small range of homewares and other goods (and get reminded that they can see the full range online).

Another example of this is H&M’s Arket store concept. Arket is a modern reinvention of the department store that offers quality clothing, shoes and accessories, and a selection of homeware and stationery items all within one site but curated by a trusted brand. You can even see this trend in Amazon’s placement of its lockers in Whole Foods stores, where online shoppers can go to collect their purchases. 

Pop-up shops also work well in the current climate. Temporary retail allows brands the opportunity to trade where and when they want, either going after a key audience or a specific time of year. Pop-ups are also a good way of letting DTC brands appear in physical spaces. Raye is a pop-up grocery store in London that stocks about 300 products from a limited number of brands, selling on a commission or affiliate basis. Raye hires a store for a week or more, then offsets this cost with payments from brands, whose online fans get to see the products in the real world. 

A unique customer experience as the reason to visit

Another trend is that shopping is becoming more about customer experience experiential. This had started before the pandemic, but with the shift to online shopping, and the realisation that shopping isn’t entirely about buying what you need, there are more stores and malls looking at the experience of shopping.

Luxury has always played on the experience of visiting a store, and making customers feel special. The new Stella McCartney store in London takes this to the next level with a members club feel, sections that only some customers can access, as well as events, exhibitions and activations that change regularly.

The experiential retail approach is also getting traction in other areas. Sportswear stores have often featured experiential elements, especially as flagship stores, and Dick’s Sporting Goods’ new store in Victor, New York takes this a step further with a 17,000 square-foot outdoor turf field and track, a rock-climbing wall, a batting cage, simulated golf-hitting bays, and a putting green.

Malls are also bringing in more experiential elements to make visiting more memorable, and more of a day out. The Bluewater mall outside London has just opened a new attraction called the Hangloose Adventure, described as England’s longest and fastest zipline.

These inspiring examples are only a glimpse of the profound transformation happening right in the retail industry, where experiential and omnichannel shopping is paramount. 

In the next article of this two-part series, we will discuss how brands can make the most of media to create more immersive and convenient experiences for shoppers.

Download Shopper DNA: The Future of Retail here.