STORE SPACES

Starbucks makes big green store push

BY Marianne Wilson

Starbucks is extending its commitment to sustainability with an ambitious initiative expected to reduce utilities expenses by $50 million during the next 10 years.

The coffee giant’s new “Greener Stores” framework is designed to set a new standard for designing, building and operating Starbucks stores. Over the next year, Starbucks will develop an accredited program to audit all existing company-operated stores in the U.S. and Canada against the framework criteria, which will result in the chain operating 10,000 “greener stores” globally by 2025, (encompassing existing locations, new builds and renovations.)

The program includes a focus on using responsibly-sourced materials, energy efficiency, as well as lighting, air and noise improvements. It will employ energy-efficient technologies that will reduce energy consumption by 25% compared to prior store designs.

Starbucks expects the new standards will save an incremental $50 million in utility costs over the next 10 years, building on its 10-year legacy of utility savings generated from its existing eco-friendly practices. To date, those savings have equated to $30 million in annual operating costs.

“We know that designing and building green stores is not only responsible, it is cost effective as well,” said Kevin Johnson, president and CEO, Starbucks. “The energy and passion of our green apron partners has inspired us to find ways to operate a greener store that will generate even greater cost savings while reducing impact.”

With performance-based standards that incorporate design and extend throughout the life of a store, “Starbucks Greener Stores” will focus on the following:

Energy efficiency & water stewardship: Deploying technologies and practices that ultimately deliver 30% water savings and 25% avoided energy over historic store design practices;

Renewable energy: Powering stores by 100% renewable energy through investments in country-specific solar and wind projects;

Responsible materials: Ensuring materials and products for stores are responsibly and sustainably sourced;

Waste diversion: Designing and operating stores to reduce waste;

Healthy environment: Designing and operating stores to create a comfortable experience that promotes wellness for partners and customers, including lighting, noise, air quality and temperature; and

• Inspiring a culture of sustainability and empowering partners to take action, be informed, and engage in sustainability issues and practices.

The new framework will be co-developed by leading experts including World Wildlife Fund (WWF) and will be audited and verified by SCS Global Services, a third-party verification organization that also oversees Starbucks Coffee and Farmer Equity (C.A.F.E.) Practices. It will be open-sourced to allow other retailers to benefit.

Starbucks has been a trailblazer in the development and implementation of scalable green building and operations. In 2001, the retailer joined with the U.S. Green Building Council to develop the LEED for Retail program, and in 2005, Starbucks opened its first LEED-certified store. Currently, the company operates more than 1,500 LEED-certified stores globally across 20 countries – including all 50 states and Puerto Rico – more than any other retailer in the world.

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STORE SPACES

Kirkland’s opens new prototype

BY Marianne Wilson

Kirkland’s is testing a new shopping experience.

The home décor and gifts retailer has revamped its store in Brentwood, Tennessee. The new, reimagined store design features an improved layout that groups trends and style stories up front, enabling shoppers to easily find the latest, on-trend home accents and gifts.

Kirkland’s has also introduced styled vignettes to illustrate design combinations and spark inspiration as customers shop the space. A centrally located “Creation Station” provides a blank canvas where shoppers can bring items from around the store to see how they work together before deciding to buy.

In addition, the store’s overall interior look has been completely refreshed, with an open ceiling, exposed white brick and concrete-finish flooring. Updated white oak fixtures featuring metal accents display merchandise throughout the store.

“From the finishes to the floor plan, we made every decision for this redesign with the goal of creating the very best in-store experience for our Kirkland’s shoppers,” said Mike Cairnes, acting CEO, Kirkland’s, which operates 400 stores in 37 states. “The Brentwood location is in our backyard and often serves as our test lab, so we’re using this store as a prototype, gathering feedback from our local shoppers to redefine the future of the Kirkland’s retail experience nationwide.”

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In-store retail remains key—particularly when it comes to returns

BY Marianne Wilson

Rumors of the death of brick-and-mortar retail are still greatly exaggerated.

In-store remains the most popular shopping experience in the majority of countries surveyed by JDA Software and Centiro in the just-released “2018 Global Consumer Survey. (One big exception was China, where online shopping is the preferred option.)

Respondents said that having the right product in stock is the most important aspect of their in-store shopping experience (34%), followed by having a variety of products to choose from (29%).

Globally, the majority of respondents who shop in brick-and-mortar stores have used some form of emerging technology while shopping, whether it is mobile coupons or discounts (49%) or individual recognition and personalized service based on loyalty programs (26%).

The convenience factor of returning items bought online to the store continues to be a primary driver for consumers. Forty-nine percent of global respondents have used buy-online-return-in-store service (BORIS), with half saying they do so because it was easier or faster, or because they would get a refund or store credit faster than by mail.

Thirty-six percent of those who have used BORIS in the past 12 months chose this option because the item purchased online was not what they expected, while 27% said that they bought multiple sizes or options for convenience and returned what they didn’t want or need.

“The volume of returns is increasing for a variety of reasons,” said Lee Gill, group VP, global retail strategy, JDA. “As well as customers ordering multiple sizes, more than a third said they returned items in-store in the past 12 months because an item they purchased online was not what they expected. This reverse logistics trend continues to cause problems for retailers, who are seeing repeat, serial returners.”

However, tangible rewards can come from a good returns process: The survey showed that 71% of respondents claimed that they frequently or sometimes buy additional items when returning things to stores. This means that “returns can actually provide an opportunity to secure a sale by offering alternative items,” Gill said.

However, the ease of returns doesn’t just apply to retailers that offer brick-and-mortar return services. According to the survey, 81% of those who shop for products online said that following a poor returns service from an online retailer, they were likely to switch to a different vendor for future purchases.

“We’ve now reached the point where people would choose a retailer based on the quality of delivery and returns it offers,” said Niklas Hedin, CEO of Centiro. “Almost nine in 10 (87% of those in the U.S. or EMEA who shop for products online said the ability to track orders from checkout to front door would influence who they would shop with. Retailers need to keep pace with evolving consumer habits and provide greater delivery transparency to shoppers, otherwise they risk losing future customers.”

Other highlights from the report include:

• Sixty-nine percent of those who shop for products online have used a buy-online-pick-up-in store (BOPIS) option. Respondents used BOPIS in the last 12 months to avoid home delivery charges (42% ), get the product sooner than it would be shipped (36%) and for added convenience over home delivery (33%(.

In addition, 66% of those who used a BOPIS service said they either frequently or sometimes make additional purchases while picking up items in-store, underscoring an opportunity for add-on sales.

• Regardless of where transactions ultimately occur, according to the survey, online is the first stop on the shopper journey for clothes (46%), home goods (48%) and electronics (63%). Younger consumers (ages 18-34) are more likely than average to begin their shopping journeys for each of the categories with recommendations from friends or family.

• Forty percent of respondents have used voice-controlled devices or services for some aspect of their shopping journey (ex: Siri, Alexa, Google Home, Tmall Genie, etc.), with 23% of those using them to make purchases.

• While global consumers continue to embrace new technology for both research and transactions, they are somewhat hesitant about how their personal data is being used. Overall, 75% of respondents said they’re concerned about their online and in-store shopping history, such as transaction history and online searches, being used to provide better, more-personalized service.

• When asked about the potential of augmented reality (AR), 60% of global respondents said they would be more likely to make a purchase if they could use AR to preview products.

“This notion that stores are dying or there is a ‘retail apocalypse’ is exaggerated,” said JDA’s Gill. “Instead, this is a time for a retail rebirth. While the industry may refer to it as ‘omnichannel’ retailing, consumers across the globe no longer strongly distinguish between online and in-store channels.”

Gill noted that all retailers are struggling with balancing the personalization traditionally offered through e-commerce shopping with the convenience of an in-store experience.

“We see this time and again as more e-commerce retailers are opening brick-and-mortar shops, and traditional retailers are looking to strengthen their digital and direct-to-home fulfillment,” he said.

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