As retail undergoes dramatic changes, stores are struggling to figure out how to quickly turn things around. The decline in traffic and rise in e-commerce are putting the pinch on traditional brick-and-mortar and the strategy most luxury retailers are adopting is the idea of creating experiences for customers.
This “experience” is manifesting in a myriad of ways from remodeled interior spaces to engaging promotions to integration of other lifestyle categories into fashion such as fitness and wellness classes to customized products. As consumer spending habits change and shift toward the consumption of experiences rather than things, particularly among the Millennial Generation, this focus is on track.
Yet most luxury retailers are not pushing the envelope enough when it comes to overall customer experience.
Traditional luxury retail focuses the in-store experience on high-touch, high-service, with well-versed selling associates that have extensive product knowledge and an advanced sense of style that speaks to the brand identity. This focus on a high level of service will remain essential in the future but the integration of technology and the reimagining of store merchandising will be key to delivering the experience shoppers expect.
How does the store of the future look and how does it cater to the changing needs of the customer? It is smaller and merchandised differently.
The customer today does not want a huge shopping area to traverse, taking so much time and energy to explore. Rather, they want something more convenient, easy to navigate and that packs a punch. This smaller space will not house full size runs of merchandise on the selling floor but rather will feature curated collections of merchandise that reflect a certain mood, feel, and lifestyle, arranged together.
The customer experience is curated to provide a streamlined, pleasing, and memorable occasion. This concept is not new, but, according to retail experts, it is gaining in relevancy because retailers are able to do more with less. Better curated collections can lead to more personalization and brand relevancy with consumers.
Here are two forward-thinking luxury brands that are already implementing this strategy into their stores, along with enhanced technology to facilitate this.
First, Reformation opened its concept store in San Francisco which features curated displays of merchandise at the front of the store, touchscreen monitors for selecting outfits to try-on, and larger, more comfortable fitting rooms. A customer can select the items they want to try on and selling associates retrieve the items from the back and arrange the fitting room. The associate is then available to offer personalized styling advice and engage more fully with the customer at the critical point of decision-making, in the fitting room.
Then there’s Rebecca Minkoff, another brand focusing on the integration of technology into the shopping experience, particularly by thinking about how to leverage e-commerce strategies in the store.
These strategies not only speak to the changing customer, they also provide brands with a critical advantage – more points of data to better understand their customer’s wants. Having more data means having better inventory management in order to achieve better gross margins. Multi-brand retailers, particularly in the luxury sector, should take note and consider how these strategies could turn their business around.
Author: Keila Tyner, PhD
Ms. Tyner is Selling Director – Women’s Designer Shoes at Saks Fifth Avenue, New York. She also teaches and writes about everything from the industry, to the psychology of fashion.