Brick-and-Mortar Retail’s Innovative, Customer-Focused Rebound

Economies, communities, industries – even our daily lives – are adapting and showing humankind’s resilience in the face of the COVID-19 pandemic’s extended stay. And, like most industries, retail has been no exception. But what does the “new normal” mean for retail? What will the “new retail” be?

The long and the short of it: brick-and-mortar retail isn’t withering away. In fact, it’s spurring innovations in the customer experience that are likely to stick around for a long time.

The good news: a lot of these innovations in the “new retail” are really exciting!

Many consumers have been hesitant to visit physical store locations. When they do go to brick-and-mortars, they often spend less time inside and strictly limit their interactions with other people. Brands and retailers alike have responded by doubling down on digital solutions and adjusting their in-store (and online) shopping experiences. One thing’s for sure, the death of brick-and-mortar has been over-reported. Now more than ever, we all long for the return to the simple pleasure of walking into a store to re-connect with a brand and a retailer we have long admired.

 Pop-ups – a trend that began before the pandemic – have continued to drive retail and customer experiences in a big way. With real estate retail space currently a buyer’s market (Appear Here, the online marketplace for retail space in the US and parts of Europe, reported an increase of 125% in available retail space between June and August of 2020), smart retailers are looking to pop-ups -- short term immersive experiences which are low in cost and quick to install.

 And pop-ups are a great way to push the boundaries of both experiential retail and innovative engagement strategies.

 New York designer Todd Snyder opened temporary stores in the Hamptons last summer, where he reached his customer base as well as attracted new fans. He told Vogue Business that 50% of his customers were first-timers.

 With people temporarily leaving cities in mass last year, Todd Snyder tapped into an innovative strategy that several luxury fashion houses have employed during COVID-19 – following the customer. In Europe last summer, Dior launched “Dioriviera” pop-ups across the Mediterranean. And local neighborhoods are beating out downtown locations for pop-ups. According to Appear Here, some of the hottest pop-up spots in London and Paris last year were Westbourne Grove, Neal Street, Curtain Road and de Turenne, rue Pierre Lescot, rue du Roi de Sicile, respectively.

 Speaking of smaller spaces, we are seeing the footprint of traditional brick-and-mortars shrinking with the continued rise of ecommerce. With the front and back of house colliding, some retailers are turning parts of their stores into fulfillment centers (this is becoming increasingly common in grocery, as micro-fulfillment centers are helping satisfy curbside pickup and delivery demand). A smaller footprint will also help brands and retailers keep costs lower. But will consumers feel comfortable entering smaller footprint stores until the pandemic flattens?

 On a related note, integrated drive-throughs – built right into the physical store – that allow customers to collect orders without even leaving their vehicles are likely to see an increase. The explosion of “click-and-collect,” or “buy online, pick up in store,” is sure to see to that.

 One of the most interesting trends in retail may be showrooms. Experiential showrooms (think Ikea) are a way for retailers to link their physical and ecommerce stores. They offer customers a way to see, feel and experience products in a space before grabbing what they need – or simply ordering it online. Not to mention, showrooms allow customers a heightened level of personalization and customization as they can visualize, in person, what their purchases will look like at home.

 Herman Miller, the design and furnishings retailer, opened its first experiential retail concept store late last year in Los Angeles, and has since expanded to New York and other cities. As the pandemic has moved the office to the home, the stores are a way for remote workers to try out new chairs and desks before purchasing for their home offices.

 While not a showroom per se, Payless – the discount shoe store – is planning a comeback. Payless, which has already opened an online store, is planning to open 300-400 U.S. stores with an updated look. The stores will offer a seamless customer experience with smart mirrors, touchscreen wall panels and AR foot comparison charts.

 Some other exciting innovations in customer experience that have the potential to stick in the future include: appointment retailing, where customers set specific times to meet specialists in store, which Verizon and Suitsupply have embraced with success; autonomous stores, where cashier-less shopping allows customers to grab products while avoiding high-touch areas; and outdoor retail spaces, like walking malls, which allow customers more space to peruse goods from multiple brands and stores.

 I’d be remiss not to mention innovations in the online shopping customer experience. But, while there’s an uptick in online sales, customers will always want to return to the store. That said, this past holiday season really shined a light on what digital can do for the customer experience. For example, Allure included QR codes in its shopping issue that allowed readers to virtually try on (and purchase) products, and Macy’s introduced virtual appointments, in addition to in-store ones, to guide consumers through purchases (for curbside or in-store pickup).

 In what can only be described as rock star-level shopping, The Rolling Stones launched a fully immersive, 360-degree virtual shopping experience following the opening of their flagship store in London, RS No. 9 Carnaby. Customers can see both floors of the store, and even enter the sound booth room, which houses collaboration pieces. Those that can get to the store in person are in for the full experience, as the store features a bespoke t-shirt customization station, exclusive collections and collaborations and lyrics and album artwork across its glass floor and dressing rooms.

 The purpose and idea behind brick-and-mortar retail is beginning to transform. Physical stores are moving past simple product pushes to a space where customer experience is king. Unique experiences and interactions serve to entangle the consumer with the brand, increasing the likelihood they’ll return – and bring friends. While the global COVID-19 pandemic has accelerated transformations across industries, there have been some really fascinating developments in retail customer experience.

We’re excited to see how retail continues to evolve in the future!

 Stay tuned for part two, where we examine the latest innovations in experiences, restaurants and travel!

If you are interested in reading more thought leadership by the Beanstalk executive team and me, please visit www.beanstalk.com/beantalk. To learn more about Beanstalk and our services, please email me at beanstalk@beanstalk.com or visit www.beanstalk.com.