Shakespeare said: “All the world’s a stage.” Today, he’d be just as correct saying: “All the world’s a store.” Thanks to technology, every minute of every day is a shopping moment. When you can buy just about anything you want, from anywhere, anytime, the verb ‘to shop’ takes on a whole new meaning. In order to stay relevant in today’s paradoxical marketplace, retailers must constantly rethink their business propositions, and many are doing just that.
Department stores are working furiously, (and in JCP’s case, against the clock) to drastically modernize their physical spaces in a bid to re-establish their relevance in the digital era, (after already transforming from ‘brick and mortar’ to ‘click and mortar.’) As a countertrend, previously on-line only brands (Everlane and Piperlime to name two) are now adding a physical presence to their digital empires. Etsy, the popular on-line site where artisans and craftspeople sell handmade wares, opened a pop-up store in Soho last Christmas. And there have long been rumors that Amazon will eventually open a physical store. In the meantime, big box retailers like Target and Best Buy have committed to meeting Amazon’s on-line prices in a desperate bid to circumvent show-rooming.
Big box stores are launching smaller store concepts to increase market share. Suburban superstores are going urban—Target recently launched a new concept called City Target in downtown Seattle, Chicago, and LA. This past holiday Toys-R-Us opened pop-up stores in temporary mall spaces, stocked with the most-wanted toys of the season. Best Buy is closing big stores while concentrating on Best Buy Mobile—smaller, more focused product offerings in traditional mall locations, as well as stocking vending machines in airports with the latest electronic gear to rescue desperate travelers that forgot their cellphone chargers at home.
Savvy world travelers have long held knowledge of that fabulous one-of-a-kind boutique in that ‘secret location’ very close to their fashionable vests. Knowledge of these retail gems is priceless fashion capital among the ultra stylish. No longer. Farfetch.com unites exclusive independent boutiques around the world into a fashionable global hub for stylish stay-at-homes. It’s a whole new Retailocracy. Anyone can shop the most exclusive boutiques on the Farfetch network. There’s just one checkout process, no matter how many boutiques you shop from, purchases are delivered directly to their door, anywhere in the world, AND they offer free returns globally on all orders.
Malls are getting facelifts too, adding concierge services and lifestyle amenities. Developers are getting very creative soliciting tenants that will contribute to a relaxed and lingering shopping experience. Nespresso is opening boutiques to sell their popular pods (previously only available on-line) as well as piping hot cups of complimentary Nespresso coffee to linger over. Destination restaurants and spas, as well as drycleaners and post offices, doctors and dentists, are signing up to fill mall spaces left empty as a result of the recession.
Fast Co. reports on a bold new London urban retail development project called Strand East. Swedish home furnishings retailer Ikea is developing a city within a city, based on their intimate understanding of how people live. The project features shops, schools, restaurants, theaters, a hotel, and as many as 6,000 apartment residences. Hmmm, any guess where the cabinets, fixtures, and furnishings will come from?
Grocers aren’t immune from the reinvention revolution either. Top end grocery stores that make it their mission to feature exotic fare from around the world now find themselves competing with local farmers markets as consumers flock to open air stalls offering organic foods grown within a radius of 30 miles. It’s the ultimate irony that some of their customers are out in the woods foraging, searching for the freshest of the fresh offered free from Mother Nature. (But that’s a subject for another newsletter.)
It’s a mixed up, multi-channel, fabulous, frantic, cutthroat, contradictory, mind-blowing, soul-searching retail arena out there, and the revolution has just begun. And if that weren’t enough of a challenge, consumer values are shifting dramatically. Tim Jackson, a UK economist, said this about consumers in a recent TED talk: “For too long they’ve been persuaded that to stay in the game they have to spend money they don’t have on things they don’t need to create impressions that won’t last on people they don’t care about.” Ouch. Not a good reason to shop, is it?
Today’s NY Times (3/10/13) had a fascinating piece in the Opinion section titled “Living with Less. A Lot Less.” The author, Graham Hill, a multi-millionaire by age 30, discourses on how “the many things I consumed ended up consuming me.”
People aren’t going to stop shopping. But they are going to shop differently, and for different reasons. It’s definitely time to rethink retail.