Embracing experiential retail amid an increasingly e-commerce-minded world
Much is made these days about the decline of the brick-and-mortar retailer.
Online retail platforms have grown and multiplied exponentially over the course of the past two decades, and the coincident boom in smart technology has meant that this buying option has been embraced by an increasingly tech-savvy public.
The digital sales floor offers some clear advantages over traditional retail spaces, both for the retailers themselves – who enjoy significant reductions in operating costs, among many other perks – and for the customers, for whom these innovations have meant unprecedented convenience, choice and a freer relationship with the free market.
Yet, rumors of the death of physical retail appear to be greatly exaggerated. While it’s true that one doesn’t need to look far for cautionary tales of once-mighty brick-and-mortar establishments, many legacy retailers have been able to maintain stability and even growth. Additionally, new retailers have found a viable place for themselves by exploiting an area of brick-and-mortar sales that virtual platforms simply can’t compete with—experiential retail.
Where previously, the brick-and-mortar marketing concept was organized around maximizing sales-per-square foot, the need to find new ways of competing has driven retailers to reorient their focus toward singular, event-based strategies. In an experiential model, retailers seek to create trend-setting, in-store experiences to create an individual and unique brand identity that appeals to customers.
Examples of successful, experience-facing re-imaginings abound; ranging from smaller-scale incorporation to top-down reconceptualization. On one end of the spectrum, retailers are looking to resources like social media for cues, and bringing customers into their stores with events like amateur competitive video gaming “e-sport” tournaments.
The casual wear chain Vineyard Vines has developed an experiential shop-in-shop for creating Instagrammable moments with a space where customers can make up their own NFL-style touchdown dances, resulting in more social media impressions for the brand.
Stores like Macy’s are using their market presence to attract on-trend brands, offering shelf-space as a service, which provides smaller brands with a valuable venue and Macy’s with vital relevance. Similarly, DSW Shoes has opened several in-store nail salons for VIP customers, leveraging their store space to provide another service that adds a sense of greater value for their customers and creates a unique point of interest to draw new ones. Likewise, Bass Pro Shops offer events like live fishing demonstrations taking place at in-store water features.
One of the most complete experiential transformations can be seen in the newly renovated Jos. A. Bank Madison Avenue flagship. Gina Lonestar and her team at Tailored Brands embarked on a journey to merge traditional and modern men’s style with an emphasis on customization. The team’s vision was brought to life by utilizing a mix of luxe décor, traditional, and digital elements evoking a bespoke customer experience leveraging all five senses for a personalized experience.
One of the main features include an on-site glass enclosed tailoring space. This allows consumers to have a personal connection as they view their tailor working on real-time alterations. Every detail of your “tailored” customer journey has been well thought-out—from dedicated custom shops to one-on-one personalized services creating a truly immersive experience.
The appeal of experiential models extends beyond the confines of individual retailers as well. As the Virginian-Pilot recently reported, many malls are adapting to the changing environment and pivoting to embrace smaller, specialized stores in lieu of larger, all-encompassing retailers; Furthering this, as The CoStar Group reports, retail leases are increasingly beginning to require more detailed descriptions – not just of layout and offerings, but of concept – for the express purpose of encouraging experiential marketing components in their tenants’ stores.
More and more of these property owners are looking to pop-up style retail as well, which makes retail a limited-time event. This is a technique that is sometimes even used by e-commerce or larger traditional retailers – Macy’s has invested here as well – to capture new audiences in new ways.
Large or small, old or new, the writing is on the wall for brick-and-mortar retailers. If you want to stay competitive in an increasingly virtual marketplace, experiential is the way to go.
Joseph Scaretta is co-CEO of CS Hudson.
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