Stores aren’t just for selling: innovative formats around the world

Nov 29, 2016

Innovation Researcher Fraser Scarlett on how retailers across several sectors are showcasing their products in non-traditional store environments.

Like any other fashion store, shoppers can browse and try on clothes at Reformation’s new pop-up in Covent Garden. There’s one crucial difference: the customers carry out the transaction themselves, ordering the clothes they want online on the in-store touch-screens, which are then shipped from the US free of shipping charges and import duties. In controlling the sale themselves, customers can avoid being slowed down by the long queues that can arise in this high-footfall area, and there is, of course, little danger of the dreaded ‘hard sell.’ This is in line with recent research about the concerns of shoppers. For example, Retail Week’s 2016 white paper ‘Smart Checkout in a Digital World’ found that 80% of customers would rather shop elsewhere than wait in a queue for longer than five minutes. With this in mind, Reformation aims to draw in in-a-hurry shoppers and make it effortless for them to view its e-commerce offering.

Tech-focused brands can make even greater use of the exhibition format. Made By Google, a pop-up in New York from the search giant, didn’t sell anything. Instead, the shop displayed their latest hardware, such as the Daydream VR headset or the Pixel smartphone, for visitors to try out free of charge. If they wanted to buy the products, they could do so online – like Reformation, the space is completely non-transactional. Similarly, Samsung 837, a three-storey “digital playground,” acts as a showcase for the technology company. Alongside the more traditional retail elements, it has a ‘VR tunnel,’ a recording studio and an auditorium for live streams, demos and demonstrations of the South Korean brand’s product slate.

In a retail showroom customers can experience the quality and craftsmanship of the product first-hand, which can be important at premium ends of the market. The British company Dyson, amongst others, has opened a range of showrooms around the world where those interested can learn about the engineering behind their high-end consumer goods: learning and marketing opportunities existing simultaneously in the same offering. Alternatively, the issue might be that the new technology is unfamiliar to the average consumer. The experience of virtual reality, for example, is notoriously difficult to put into words; Google’s pop-up in New York allows people to experience it for themselves, in so doing familiarising themselves with novel tech that will be become increasingly central in our lives at home and at work. It’s an extension of the shop window idea – into the entire shop.

Razer's story in San Francisco, which functions as both a retailer and space where digital communities can come together in real life.

Razer’s store in San Francisco, which functions as both a retailer and space where digital communities can come together in real life.

Also, stores can retain the traditional retail model but still offer additional services under their roof. Gaming hardware maker Razer encourages visitors to sit down and use their high-end PC ‘rigs’ in their store in San Francisco, with no restrictions on time spent enjoying them. Combined with regular tournaments and a futuristic interior tailored to its target market, the space is designed to house and foster a community. CEO of Razer Min-Lang Tan told Forbes: “It’s really about the experience. We asked ourselves, what kind of store would we enjoy going to? So the staff are trained to get gamers comfortable – we hire gamers – and ensure that the focus is on giving gamers a great place to use our products and play games and talk about them. We encourage people to hang out.” By employing fellow enthusiasts and encouraging conversation, Razer can foster more brand loyalty than a more traditional store offering could – whatever the convenience of e-commerce, consumers appreciate being made part of a cohort of like-minded individuals.

Outside the technology sector, we can see the same tactic played out in home appliance brand Pirch’s flagship store. Customers can use the appliances (within reason) in their New York showroom and can even book private sessions to test the in-store spa, sauna or showers. This hands-on shopping experience led to an increase in customer dwell time to over two hours – and the longer they’re there, the more likely they are to spend. In October this year, Bloomberg reported that the Pirch store manages $3000 in annual sales per square foot of store. Ultimately, of course, the motivation behind these retailers’ operations would be familiar to any shopkeeper in history: to convert customers into sales.

Brands are exploring ways of innovating the traditional store in order to engage and entice consumers, but there is no one-size-fits-all strategy. Some brands, like Reformation, are trying to streamline the shopping experience- others, such as Razer and Pirch want customers to spend time with them and enjoy themselves. It’s not surprising that technological innovators invest in ‘show-off’ stores – they are often trying to push products that the public don’t necessarily need or might not even be aware of. But all retailers should be asking themselves: can we innovate our retail spaces to meet the concerns of consumers whilst also responding to the growing dominance of e-commerce?

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