Stores of the Future
It’s 2020, and our shopper is ready to relax after a busy and productive Saturday. She started off the day at Kohl’s, where she tried on several cocktail dresses a store associate had texted her about earlier. The associate knew from past purchases that our shopper favored animal prints and a-line cuts.
She opted for a sleeveless, leopard-patterned dress that she accented with a nylon collar personalized with an Andy Warhol silkscreen. (Kohl’s 3-D printing department created the collar.) She checked out in a flash with a biometric scanner — traditional cash registers being largely a thing of the past in the stores she shopped.
Next up was Kroger, where she scanned the product bar codes with her cell phone on 17 items — from paper towels to skim milk. The items were charged to her credit card in real time and delivered to her home within an hour.
At Bed Bath & Beyond, our shopper sat in on a holiday-themed decorating class. Adjacent digital signs noted the in-store location of the featured items.
Finally, she stopped at CVS to pick up some items featured in the chain’s weekly ad circular, which had been delivered online, of course, with select ads customized just for her.
Retailers don’t need a crystal ball to see that, in the future, America’s shopping emporiums will resemble the scenarios outlined here. The fact is the transformation is already under way. Stores are becoming more efficient, more interactive, more immersive, more personalized and more convenient as the brick-and-mortar experience evolves to accommodate an increasingly digital world.
Going forward, look for stores to play up the advantage of letting customers touch and feel the merchandise, with less attention focused on maintaining inventory. Goods will be ordered and shipped to the customer, the store or a pick-up depot.
“In the future, stores will become a library of products. They will be more informative and with more options. They will double as showrooms — a way to learn new things, buy intelligently and improve your existence,” said Christopher Studach, creative director, King Retail Solutions (KRS), Eugene, Ore.
Checkout areas will be transformed as cash registers are streamlined to integrate mobile devices. Location-based services and the growing adoption of near field communication (NFC) will allow smartphones to act as stand-ins for credit, debit and loyalty cards.
Digital signage will be even more prevalent than it already is, keeping store interiors fresh and exciting. Digital enhancements will more seamlessly link retailers’ in-store environments with their offline ones.
“Stores will become nimble and spry,” Studach said, “changelings — in a good way.”
Savvy merchants will play up the personal aspect of physical retailing.
“Stores of the future will be social — engaging, intimate, designed for contact and conversation, educational in every way and filled with associates who love to talk to people,” predicted Lee Peterson, executive VP creative services, WD Partners, Columbus, Ohio.
What’s more, they will be captivating and inspirational, and more than just a store.
“The store of the future will rival night life venues in its ability to transform customers to an experience they cannot have online,” Peterson said.
Across the retail spectrum, merchants large and small are testing digitally enhanced stores that extend the click-and-buy convenience of the Web. They are reimagining the store from a mostly transactional environment to one that offers consumers an interactive, communal and even educational experience, with a sales staff that anticipates their preferences ahead of time and a layer of customized merchandise.
“In the future, the stores people shop are going to become an extension of their daily life,” said KRS’ Studach. They will reflect the way a person lives and their values, which means stores will feel more personal. They will be more local in look, feel and in the merchandising.”
Experts say that retailers also need to craft stores to accommodate digitally wired Generation Y, or the Millennials, a group that will outnumber baby boomers in size and buying power by 2020.
“Everyone is at risk of overlooking Gen Y, which will mature into the largest single cohort during the next few years,” said John Rand, senior VP retail insights, Kantar Retail.
Showrooming is also lighting a fire under merchants to affect change. In February, Best Buy revamped its price-matching policy to match the prices of major online competitors, as well as other brick-and-mortar retailers.
The rise of big data is also changing the in-store experience.
“Stores will continue to use more and more individually calibrated data to personalize the shopping experience across the board,” said retail consultant Jeff Green of Jeff Green Partners. “Rather than fear the customer who is looking up prices online while browsing in a brick-and-mortar location, chains will build more interactivity and provide more targeted information to further enhance the in-store buying experience.”
Community Hubs, Lifestyle Centers
The stores of the future will feature interactive bells-and-whistles that take a cue from the best of online retailing, while entertaining and engaging shoppers in ways that can’t be duplicated on the Web, experts predict.
Retailers will also tap into how shoppers interact with their favorite retailers on social networks, such as Facebook, said Scott Lachut, head of research and strategy at PSFK Labs, a content provider with such retail clients as Target and Best Buy.
“Retailers have created online communities. Now they are working to translate that offline, and have shoppers congregate in new ways,” Lachut added.
In a bid to connect with its core audience of small business owners, Staples and Office Max, for example, are experimenting with offering co-working spaces and renting out office space. And Lululemon Athletica has already amassed a cult-like following with experiential offerings, such as free yoga classes.
Retailers are ushering in a new definition of “one-stop shopping for time-poor consumers,” said Paco Underhill, founder of Envirosell, the consumer behavior research and consulting firm. Next, Underhill predicted, look for big-box chains to reallocate space to services, be it a dry cleaner or salon, which is commonplace at overseas merchants, such as France’s Carrefour.
Customized, Crowdsourced Merchandise
Amid the proliferation of choice available to shoppers online, one-size-fits-all retailing just doesn’t cut it anymore. In turn, retailers will tap technology to offer shoppers customized merchandise and a hand in the product development process.
“Appealing in a personal way is something shoppers are starting to require, and for stores that means more unique elements, more personality and a lot less of the one-size-fits-all approach,” said KRS’ Studach.
Traditional brick-and-mortar retailers are beginning to mimic scrappy online sites like Threadless, which lets shoppers design their own T-shirts, and Shapeways, where consumers design everything from jewelry to home decor.
At Converse’s new flagship in San Francisco, customers can screen-print their own designs and graphics to make one-of-a-kind items, culling from the retailer’