Retail is in crisis, we hear – but the truth is more complex. Retail is changing and certain brands are reaping the rewards of that change. The future of retail is less but better says Andy Thomas, executive creative director of Sydney design agency Re.
In 1994, German industrial designer Dieter Rams published his now iconic manual 'Less, But Better,' a manifesto for the kind of rationalist design thinking that was his hallmark in an increasingly noisy, commercialised and wasteful world. In it, he espouses the virtues of simplicity in design (and life in general), where beauty and functionality come together to create modern products that stand the test of time. For consumers, that vision means less but better and more meaningful choices.
Twenty-five years on, his thinking retains its force. It is particularly worth exploring the notion in relation to the retail sector and the types of experiences being created by brands. Increasingly, "less" means fewer but "better" means much more, at least as far as retail experiences go.
Physical retail is not dying, it's evolving. Its shape is changing dramatically, driven largely by the confluence of technology and retail – both online and physical – and rising expectations amongst increasingly demanding (millennial) consumers. Retail-as-usual simply won't cut it anymore for many consumers. The future is likely about much more than sales with PSFK reporting that 84% of consumers are likely to visit a store that offers services above and beyond the core offering.
Many of the world's biggest brands are taking up the challenge. Brands that were once fixated almost exclusively on product R&D are now investing billions in major retail experiences and asking some (major) questions about the role retail plays in the lives of consumers and society in general.
Take, for example, Nike’s new House of Innovation 000 flagship in New York City. Essentially an enormous six-storey acquisition tool for its NikePlus ecosystem, masquerading as a museum to Nike innovation, it's incredible. A temple of worship for sneaker-heads, Nike fangirls and boys, or regular punters alike, the space is designed less for shopping, and more for total brand immersion.
Nike’s approach to hyper-personalised customer service is evident from self-service apps that allows customers to navigate a store and order shoes to try on, to its NIKE BY YOU customisation lab that allows customers to create and walk away with entirely unique and personalised trainers. But, ultimately, creating and peddling products in the store is much less important to Nike than the experience a customer has there. And it’s paying off. At a concept store in Los Angeles, Nike discovered that members who had visited the store in person would later spend as much as 30% more online compared to those that hadn't.
Another brand rethinking retail experiences is Apple. The brand’s recent highly-anticipated ‘product launch’ saw the business move away from selling hardware with Fast Company’s Mark Sullivan noting: “under CEO Tim Cook, is becoming a services company”. This isn’t entirely new for Apple. In 2017, the business reimagined its retail concepts around the much vaunted 'Today At Apple' program which dedicates a third of its floor space, usually in the most visible ground floor areas, to free daily learning sessions for the community. Some 16,000 learning sessions are held weekly in more than 500 Apple stores globally that help consumers to invest in the brand without even realising they are doing it.
Apple’s former senior vice president of retail, Angela Ahrendts, said at last year’s Cannes Lions International Festival of Creativity: “Retail is not dying, but it has to evolve. It has to continue to move and it has to serve a bigger purpose than selling because anybody can do that faster, cheaper.”
While it’s useful to chart the success of mega-brands such as Nike and Apple, with mega-budgets to match, it is perhaps more interesting to take notice of digital-native disruptors such as Bonobos, Warby Parker, Farfetch and Mecca Cosmetica who are now causing more than their fair share of disruption in the physical retail space as they add that critical final piece to their omni-channel ecosystems.
Alongside these brands sits the fascinating millennial beauty brand, Glossier. With permanent fixtures already established in New York and Los Angeles, the brand has established pop-up, experimental concepts in cities from Copenhagen to London and Chicago. Glossier prides itself on building retail experiences that are specific to – and inspired by – its location. In LA, for example, Glossier built an immersive custom-designed “selfie canyon” (#glossiercanyon) inspired by Arizona’s Antelope Canyon. This attention to detail and drive for creative expression positions the brand as a must-visit destination and, more importantly, extremely instagrammable. As Melanie Masarin, Glossier’s director of retail and offline experiences, explains. “It still feels very much a part of the Glossier universe but with its own engaging aspects that feel unique and new. We played around with some brand staples like the colour, the mirrors, and the florals to make them feel distinctly L.A.”
But making instagrammable experiences is not an end unto itself. By doing this, Glossier is building meaningful relationships with its customers on a one-to-one basis and the physical experiences are a critical conduit for that personal relationship. As Emily Weiss, Glossier founder and CEO, explains, the success of Glossier ultimately comes down to one true core belief: listen to customers. “We are just obsessed with customers. We communicate with them… We are obsessed with including her. We have co-created products with her…” It’s all part of Glossier’s singular core purpose: To allow women to look like the best version of themselves, not an aspirational version of someone else.
A lesser known retailer, Neighbourhood Goods, from Plano in Texas, aims to disrupt the traditional department store model using data and smart technology, such as sensors and cameras, to track customer behaviour as they browse the store. This data is then freely handed over to brands who seek to optimise their co-branded spaces to differentiate from or adapt to their competition. In essence, this allows the brands the freedom to behave like pop-up retailers with all the benefits that entail and very few of the risks. As CEO Matt Alexander explains: “It’s a much different relationship. For them it’s ostensibly like opening a pop-up except we're staffing it, we are helping drive a huge amount of data and insight for them as to how they are performing and where the opportunities reside around the business.”
Closer to home, and as we eagerly await David Jones’ new revamped flagship in Sydney, the opportunity to differentiate (and remain relevant) in the minds of consumers is clear.
Brands with purpose understand that while bricks-and-mortar retail remains critical, the role it plays within the retail ecosystem is changing dramatically. Brands will ask themselves: What is the benefit my retail experience brings to a consumer above and beyond the merely transactional? Will it add value to their lives and the lives of their families? Does it solve a unique problem for them? Does it leave a lasting impression even if they leave empty-handed?
In 2019, less might mean fewer but better means much more, at least as far as retail experiences go.