Physical retail traditionally exists in a vortex of information, which doesn’t make sense for brands these days, says Matt Alexander, co-founder and CEO of new department store Neighborhood Goods, on the latest episode of the Innovators podcast.
The company’s inaugural space, which launched in Plano, Texas, in late 2018, carries a selection of new and established brands in an environment that is hyper relevant to both its location, and its customer, through the use of data.
Alexander’s view? Success lies in information. “If you’re a direct-to-consumer, digital-native brand, you’re going to look at this world, and you’re going to say: ‘We should be able to capture a certain amount of informative data to dictate how we should run that store, and how we should merchandise [it]’.” he explains. “That’s what they do on the web all day long. The moment you land on any of their websites, they know a huge amount about you, and exactly how you’re interacting with that site. And they optimize around it.”
His brilliant phrase: it’s all about operating in an economy of relevance.
It’s for this reason many legacy retailers are otherwise struggling, he explains. In a basic sense it comes down to them not creating the goods, services and experiences that they know for fact the consumer wants. There is therefore a lot for them to learn from D2C incumbents – from Everlane to Casper – who have placed this front and centre in their strategies.
Join us for this episode as we also explore why experiential retail needs to go beyond just putting a ball pit in the store, how modern brands are using the physical space for entirely new reasons, and why Alexander believes legacy retailers may still have the ability to play catch up after years of ignoring consumer needs after all.
With sustainability an increasing priority on the agenda for fashion and retail businesses around the globe today, attention is also turning to their brick-and-mortar stores – how they’re resourced, designed and constructed.
According to Schneider Electric, retail buildings are the largest consumers of energy among non-residential buildings in Europe, contributing $20 billion each year. Factors such as electricity, air conditioning and lighting all contribute to a brand’s carbon footprint and emissions.
The interesting thing is that going green is proven to not only help retailers reduce their impact on the planet, but significantly save them money. A 20% cut in energy costs can represent the same bottom line benefit as a 5% increase in sales, according to Carbon Trust.
Investing in sustainable store design, therefore, has a positive effect on profit, people and the planet. From locally-sourced materials, to energy saving light bulbs, and even the removal of any plastic packaging, there is an incredibly wide range of ways retailers can make their stores more environmentally friendly.
Here we highlight some of the best examples of brands going above and beyond with their stores in order to do so:
Last year Stella McCartney opened a new flagship store in London that expands four floors and embodies sustainability throughout. The outposts of the store are lined with recycled foam and card that were made from waste paper from the London offices. The space is also the first to use biodegradable mannequins, made from 72% sugarcane bioplastic, which significantly reduces CO2 emissions. To help combat air pollution, the store has a hidden ventilation systems that removes 95% of air pollutants and harmful gases, such as nitrogen dioxide. At launch, Stella herself said: “The store really tells the story of the world of Stella McCartney, seamlessly incorporating sustainability, fashion and luxury.”
Ikea opened a sustainable store in London’s Greenwich, built from a range of renewable materials in 2019. The roof is covered with 75% solar panels, which power the store, and rainwater is harvested to help reduce the store’s water consumption by 50%. The store not only helps the environment, but is also working towards improving the community around it. Ikea holds an array of classes such as bunting making, which utilizes off-cuts of IKEA fabric, helping spread the message of full utilization. The design of the store has been awarded an ‘Outstanding’ BREEAM certification, which is the highest award for sustainable construction, covering areas such as energy, land use and materials. Efforts to incorporate geothermal heating, 100% LED lighting and textile recycling, have also elevated it to become the most sustainable retail store in the UK.
Patagonia is not only leading the way with sustainability in manufacturing, but is going above and beyond with its store design strategy. Each outpost is uniquely designed to reflect the history and culture of its location, while simultaneously keeping the planet in mind. The Victoria store in Canada, which opened several years ago now, for instance, had three main goals when it was being designed: to use sustainable construction methods, utilize reclaimed materials and become the best retail space for outdoor activities in the area. It features a range of wooden details throughout, from wall decorations to shelving units, giving it a grounded earthy feel. The wood was wastage retrieved from the Pacific Ocean and leftover material from the local yacht club.
Australian fashion retailer Country Road opened its flagship store in Melbourne this summer also with sustainability in mind. The space is made from recycled materials such as yoghurt containers, fishing nets and recycled paper. It is the first to receive a 5-star Green Design review from the Green Building Council of Australia. It also includes details like fitting room hooks that have been made using ocean plastic and tables from recycled plastic. The brand hopes this store design will be the first of many, as it continues to expand in the country.
Starbucks is leading the way in the coffee sphere by building LEED-certified stores, which stands for ‘leadership in energy and environmental design’. These green stores use LED lighting, recycled flooring tiles and wood products that are certified by the Forest Stewardship council. They are 25% more energy efficient and 30% more water efficient. In countries with solar and wind projects, the stores are run on 100% renewable energy. Starbucks already has 1,612 LEED-certified stores, but is intending to extend the framework to 10,000 by 2025, which could save $50m in utility costs over the next 10 years alongside reducing impact on the planet.
Sustainable accessories brand, Bottletop, opened the world’s first 3D printed store, created by robots using upcycled plastic, in London. Based on Regent Street, it is zero waste and home to the brand’s sustainable handcrafted collection of leather goods. The space embodies the company’s core mission to empower people through sustainable design and creative culture. The flooring of the store is made from reworked rubber tyres and the interior is made from 60,000 upcycled plastic bottles. Overall, the store aims to re-imagine the future of ecologically responsible construction through zero waste design.
Danish fashion brand Ganni recently opened its new London store following a number of doors in Copenhagen and Stockholm. While it features bubblegum pink walls fit for every Instagrammer’s dream, it is also underpinned with a green strategy in mind. The store incorporates sustainable features such as recycled plastic displays made from old plastic bottles, plant pots, food packaging and coffee grounds. Decorations throughout are either vintage pieces or upcycled products, including rugs that have been remade from old Ganni collections. The company also uses renewable energy across all of its stores, with the aim to have 100% green sources by the end of 2019.
As one of the sustainability leaders in beauty, Lush recently stepped up its game by stripping back several of its stores in Berlin, Milan and Manchester, in a bid to go entirely plastic free. The ‘Naked’ stores, as they’re called, are part of the brand’s initiative to tackle the plastic waste problem in the cosmetic industry. They all feature products like the brand’s solid shampoos, which don’t necessitate any packaging. Each of them further serve as an open space for NGOs and activist groups to educate and increase consumer awareness on the topics of zero waste and ocean plastics.
Cult fashion brand Reformation puts sustainability at the core of everything it does, from local manufacturing and sustainable dyeing to green buildings and fabrics. Its Los Angeles stores and headquarters are all Green Business certified, meaning they implement strategies to save energy, improve water efficiency and reduce CO2 emissions. Reformation offsets its store build by 100%, by calculating the construction footprint. The materials in store are also sustainable with LED fixtures, recycled fabric insulations and natural rammed earth materials.
How are you thinking about sustainable innovations? The Current Global is a transformation consultancy driving growth within fashion, luxury and retail. Our mission is to solve challenges and facilitate change. We are thinkers and builders delivering innovative solutions and experiences. Each of the rules referenced above is matched by one of our products and services. Interested in how? Get in touch to learn more.
Department store Neiman Marcus is claiming a stake of the $25bn Hudson Yards development opening in lower Manhattan in NYC this week with a megastore that merges traditional and omnichannel retail.
The space, which takes up five out of seven floors of the retail complex, is the retailer’s latest play at engaging with a new luxury consumer that is not only seeking products, but experiences and education alongside.
On the lower floor, for example, the retailer is hosting a kitchen for live demonstrations, while Neiman Marcus Live is a space on the middle floor that can hold up to 100 people for events like talks and Q&As with fashion designers and industry pioneers. The store also features a bar, named Stanley, which overlooks the Thomas Heatherwick-designed Vessel structure, a larger-than-life center piece for the Hudson Yards complex.
Technology is being blended into the space in order to give the luxury customer a one-to-one, tailored interaction with sales staff.
The Current Global’s CTO, Scott Emmons, who is the former head of the Neiman Marcus iLab, and was responsible for the technology execution in the new store before his departure, said: “We applied creative approaches and partnerships so that the consumer-facing technology was both useful to the shopper, and fit naturally into a very luxurious retail environment.”
This includes a smart fitting room where customers can ‘check in’ upon entering, which will then act as a communication tool between shopper and sales associate. The customer can request new items, different sizing and even signal they are ready to check out through a personal screen, which is then communicated to the associate’s mobile POS system.
The fitting room experience was designed to easily be updated with new capabilities in the future, such as self-checkout or recommendation technologies, as well as enhance the ever-important role of the associate.
“Technology in this instance, is being used to not only deliver an optimal customer experience but act as a digital exoskeleton to supercharge the capabilities of the sales associates,” Emmons added.
It’s for this reason he believes this store is an example of what retail needs to look like in the future. “New York is one of the toughest places in the world to be a retailer and stand out from very capable competitors. Technology is not the only answer but when combined with the visual aspects, the right merchandise, experiential aspects and so forth, it can put you over the top.”
“This is how we think about things at the Current Global – removing technology from its vacuum and into the wider context of creative innovation in order to meet pressing consumer demands. At the end of the day, traditional retail must be weaved together with modern tech to enable customers to be seen and treated like individuals, and not market segments. Technology for the sake of it will never respond to basic human needs of having emotional connections when purchasing luxury.
“At a time when so many department stores are failing, what Neiman Marcus has pulled off is an inspiring example of what luxury retail should be. It’s a combination of great experience, great staffing, great environment and the right tech.”
How are you thinking about retail innovation? We’re all about finding you the perfect partners to do so. The Current Global is a consultancy transforming how fashion, beauty and consumer retail brands intersect with technology. We deliver innovative integrations and experiences, powered by a network of top technologies and startups. Get in touch to learn more.
NRF’s Big Show landed in New York this week and featured innovations across the spectrum increasingly focusing on seamless and personalized experiences.
In this sense, technologies such as artificial intelligence and the use of data are becoming essential tools to serve the customer tomorrow. Conversations on stage echoed the tech on display on the startup floor, looking at how brands are striving to meet those needs.
Data needs to strike a balance
On an exhibition floor stacked with companies that are leveraging data to better serve the customer, conversations naturally turned to how brands can use it successfully but most importantly, responsibly. Following the Facebook and Cambridge Analytica scandal and the new GDPR regulations in Europe, it is incumbent on brands that want to deploy data to be transparent and clear with how they will use it.
From executives at Ralph Lauren, through to smaller names like LA-based accessories label Hammit, tracking behavior can bring enormous benefits, speakers said. From helping choose product assortment to how to better serve customers online, brands shouldn’t be shy about talking to their methods. If the consumer sees they are getting a service that is relevant and saves them time, they will appreciate it, they noted.
For Aaron Sanandres, co-founder and CEO of menswear label UNTUCK.it, the challenge is how to use that data to serve the customer in-store without sounding too intrusive or, in his own words, “creepy”. While online a “Welcome back, Aaron” greeting might seem like a pleasant surprise, in person, the customer might have an entirely adverse reaction, he said. Getting the balance right is tricky: “Doing that in a way that’s inviting and not off-putting is the challenge.”
Physical retail still rules
Retailers and brands are deploying physical retail in increasingly creative and flexible ways, showing naysayers that the channel is far from dead. Arguably one of its biggest cheerleaders is Story founder, and now Macy’s brand experience officer, Rachel Shechtman, who took to the stage with Macy’s CEO Jeff Gennette, to explain how she is thinking like a media company to deliver content – and merchandise – that is relevant to the consumer up-to-the-minute through retail.
For smaller brands, the brick and mortar experience is now an invaluable tool to allow them to become more granular in their approach. While a brand’s retail experience always has to have an overarching layer of consistency, it is by building small moments that are relevant to a specific demographic, at a specific location, that creates a stronger sense of community and loyalty.
For John Frierson, president at LA-based retailer Fred Segal, brands born digitally do this well because they have already worked out all of the kinks of providing a frictionless experience online. They can therefore take a fresh approach when venturing into physical. “When they come down to the real world they are not looking at traditional retail metrics, but rather at storytelling. It then becomes a much more interesting experience,” he said.
Customers and employees sit at equal measure
There is a lot of conversation on how to be customer-centric, but the employee satisfaction piece is more important than ever – both to attract the best talent in an increasingly competitive market, but also to create an internal environment that lives and breathes the company’s mission, speakers commented.
In a conversation about building leadership, Levi’s CEO Chip Bergh believes the company taking a stand is not only important for the consumer it serves, but also because it is what his employees expect of him. CEOs, he said, have the responsibility to themselves and to others to give back.
Brandless founder Tina Sharkey agreed, saying its DNA to be purposeful not only helps repeat customers – wherein those who understand their social mission shop 80% more frequently than those who don’t – but employee retention too. “Employees want to work at a place where they feel they have movement and meaning in their work,” she explained.
How are you thinking about retail innovation? We’re all about finding you the perfect partners for your innovation strategy. TheCurrent Global is a consultancy transforming how fashion, beauty and consumer retail brands intersect with technology. We deliver innovative integrations and experiences, powered by a network of top technologies and startups. Get in touch to learn more.
In a bid to make money beyond ad revenue while raising brand awareness, editorial companies including Buzzfeed, New York Magazine and Good Housekeeping all recently launched physical retail stores in the US.
Merging content and commerce has long been a topic of discussion within the industry, both from how brands are thinking about their editorial voice, and – in this instance – how media businesses are monetizing their content prowess.
That’s meant all manner of e-commerce entities especially, but numerous experiments in the space have been met with mixed results. NET-A-PORTER may have nailed how to do content both online and offline, for instance, but Style.com in return flopped at the first hurdle when it shifted to a commerce model.
Others however have steamed ahead and found legs in this space balancing both angles. Marie Claire’s beauty store, Fabled, launched in 2016 and continues with a successful online and brick-and-mortar store in London.
Read on to find out how Buzzfeed, New York Magazine and Good Housekeeping are similarly thinking about physical retail experiences in order to capture consumer attention.
Online news and media outlet Buzzfeed opened a toy shop called Camp in December. Located in the Flatiron District of New York, the space also has an experiential area that’s ready for Instagram-worthy photos. With rotating decor that changes every few months, ‘Summer camp’ is the first theme chosen for the store. Think of a “campitheater”: a sports field, a dance hall, some real bunks, a radio lab, and even s’mores ice cream sundaes by Milk Bar.
Good Housekeeping ‘s GH Lab pop-up
Good Housekeeping magazine opened a three-month pop-up at the Mall of America in Minneapolis that capitalized on the busy holiday shopping period by running until December 30. Called “GH Lab”, the store offered only one item per product category. Unlike regular retailers that sell several brands of the same item, each pick was tested and recommended by experts from the GH Institute. The shoppable showroom had more than 40 curated products, and most of them had earned the Good Housekeeping Seal, which provides buyers with a two-year limited warranty guaranteed by the magazine.
The store was cashless, with all merchandise shoppable through Amazon’s app and its SmileCode scanner. Shoppers used their smartphone’s camera to scan a code that went straight to Good Housekeeping’s Amazon seller page where they could place an order for home delivery.
New York Magazine’s The Strategist
The Strategist, New York Magazine’s product recommendation site, also opened its first pop-up for the month of December, this time in Soho, New York. The store curated beauty brands and products, including haircare, bed sheets, and self-care products. The space also hosted events, including a beauty panel with The Cut’s beauty director Kathleen Hou, and offered workshops and free blowouts.
With so many other publishers playing in the product review and recommendation field, Camila Cho, General Manager of e-commerce for New York Media, said the pop-up was an opportunity to raise brand awareness. “Offline allows more flexibility to showcase our brand personality and how we are different,” said Cho in an interview for Fipp.
How are you thinking about interactive retail experiences? We’re all about finding you the perfect partners to do so. TheCurrent is a consultancy transforming how fashion, beauty and consumer retail brands intersect with technology. We deliver innovative integrations and experiences, powered by a network of top technologies and startups. Get in touch to learn more.
Successful retail experience today is about trial, service and entertainment, says Eleanor Morgan, chief experience officer of direct-to-consumer mattress brand Casper, on the latest episode of The Innovators podcast by TheCurrent.
Speaking to Liz Bacelar at The Lead Summit in New York, she says the company really focuses on designing experiences that are optimized for those three things rather than inventory availability and convenience. What’s key is giving customers the ability to try out products, get consultation from experts in house and enjoy moments with the brand.
Casper has grown from an online retailer to a brick-and-mortar business with 20 stores across the US, along with an innovative sleep bar. The Dreamery, as it’s called, is a new napping space in New York built around experiential aims. It offers nap pods in a peaceful lounge along with a Casper mattress where consumers can pay $25 for a 45-minute snooze.
It also serves as an extension of the brand’s aim to drive a cultural change around sleep. “The Dreamery is a provocation and a way to essentially say, it’s not only acceptable to take a nap during the day and take a break, but it’s celebrated, and we can actually build a community of people that really value this and feel like it’s a socially fun behavior,” Morgan explains.
Casper was founded in 2014 with the mission of bringing great sleep to more people. With the diet and exercise industries booming, the founders saw a gap where sleep was completely ignored. Today, Casper is worth over $750m and has plans to open 200 store locations within the next three years.
Morgan attributes much of the brand’s growth to staying customer centered and focused on data. The company opened 18 pop-up stores in four months to test consumer engagement before opening its first permanent location, for instance. Through feedback and reviews from its consumers, it has been able to understand what their needs are, how they purchase their products, and how to improve their shopping experience.
During the conversation, Morgan also talks about the secret sauce to creating successful pop-up stores, what a modern sleep community looks like, and where Casper will be headed in the future.
Catch up with all of our episodes of the Current Innovators here. The series is a weekly conversation with visionaries, executives and entrepreneurs. It’s backed by the Current Global, a consultancy transforming how consumer retail brands intersect with technology. We deliver innovative integrations and experiences, powered by a network of top technologies and startups. Get in touch to learn more.
Amazon is opening a new retail store in New York today featuring a selection of products that have a minimum of 4-stars in their customer reviews.
Unceremoniously dubbed “Amazon 4-Star”, the items sold are specifically selected on the precedent of being top sellers, or new and trending on the site. Collectively the items currently on display have 1.8 million 5-star customer reviews, with an average product rating of 4.4 stars.
“We created Amazon 4-star to be a place where customers can discover products they will love. Amazon 4-star’s selection is a direct reflection of our customers—what they’re buying and what they’re loving,” Amazon shared in a blog post.
The brick-and-mortar location will feature devices, consumer electronics, toys, books and games – as well as a range of items for the kitchen and home. Items that were particularly well received will also display quotes from online reviews on small paper cards.
Mirroring the structure of the Amazon website, the shop will also feature areas with product bundles, such as “Trending Around NYC”, “Frequently Bought Together” and “Amazon Exclusives”.
Digital price tags in-store will ensure that the pricing will stay exactly the same as on the Amazon website, with Prime members getting a special membership discount.
Another clever integration by Amazon is that customers have the opportunity to trial its Alexa voice assistant while in store, thanks to the presence of the best-selling Echo Dot, which has an average customer review of 4.5 stars, with 5,600 customer reviews. This also follow the launch of a range of new Alexa-enabled devices last week, including a smart plug and a microwave.
Amazon’s continued push into physical retail is a great example of how data from e-commerce can shape the product selection in-store. By further gather data specifically to the neighborhood, or in this case, city location, it is further personalizing the customer experience and incentivizing in-store visits.
How are you thinking about retail innovation? We’re all about helping you build innovative integrations and experiences. TheCurrent is a consultancy transforming how fashion, beauty and consumer retail brands intersect with technology, powered by a network of top startups. Get in touch to learn more.
The environment’s new clothes: biodegradable textiles grown from live organisms [Scientific American]
More than ever, our clothes are made of plastic. Just washing them can pollute the oceans [Vox]
Skechers delivers 15,000 pairs of shoes to children still in need in Puerto Rico [Businesswire]
Where Burberry waste goes now label isn’t burning clothes any more [SCMP]
Is certification the answer to fashion’s ethical issues? [LS:N Global]
New study shows that Gen Z will strengthen sustainability trend [FashionUnited]
RETAIL & E-COMMERCE
Amazon Storefronts is a new retail hub exclusively for US small businesses [TheVerge]
Container Store tracks appointments with voice tech [RetailDive]
Italy’s first Starbucks serves cocktails, ice cream, and a side of augmented reality [Mashable]
The future of airport retail is hyper-personalization [LS:N Global]
MARKETING & SOCIAL MEDIA
Victoria’s Secret’s Pink revamps loyalty with mobile app [RetailDive]
Gucci’s surprise new Instagram account truly revitalizes its beauty offering [i-D]
How Nordstrom reinvented its retail loyalty program [Digiday]
The epic ‘Game of Go’: a real-time experience showcasing Nike’s latest React technology [TheDrum]
Bespoke tailoring in the athleisure age: how China changed Savile Row [SCMP]
How De Beers learned to love lab-grown diamonds [BoF]
Walmart is borrowing luxury’s playbook to gain an edge on Amazon in fashion [Quartz]
Store investment pays off as Harvey Nichols profits soar [TheIndustry]
How are you thinking about innovation? We’re all about finding you the perfect partners to do so. TheCurrent is a consultancy transforming how fashion, beauty and consumer retail brands intersect with technology. We deliver innovative integrations and experiences, powered by a network of top technologies and startups. Get in touch to learn more.