We are in the midst of a retail revolution – and while we’re all a little too familiar with how this time of great change is impacting our sector right now – the true impact it will have on retailers in years to come is still largely uncertain.
To provide some inspiration to retail leaders eager to think outside the box, we hosted our The Future of Retail retail leaders’ breakfast at the ground-breaking Samsung KX space in London’s King’s Cross on Wednesday morning alongside our very special guest Crispin Lowery, Managing Director at Google.
Check out the highlights below:
Produced by: Cecil Agyemang, Co-founder of Create UK.
After a delicious breakfast, we gathered in the auditorium space in front of an unbelievably large screen to hear from two retail experts.
Imogen Wethered on the New Retail Landscape
First up was Qudini’s CEO and Co-Founder, Imogen Wethered, who started by sharing some key statistics on why the brick and mortar store is alive and well:
- In the first quarter of 2022, about 1,600 stores closed while roughly 3,700 opened across the US
- 80% of sales still occur in-store
- 55% of GenZ consumers say they prefer in-store shopping
- 7 out of 10 GenZ consumers will shop at stores with tech that enhances their experience
She then explained how and why brands are transforming their shops away from what the dictionary defines as a “shop” (a place to buy goods or services), into what we at Qudini refer to as “Brand Interaction Hubs”. In other words, spaces for brands to provide customers with brand experiences, a sense of community and tailored inspiration.
This was perfectly epitomized by the very space we stood in. Samsung KX classes itself as a Not A Shop but a space for experiences, communities, events etc.
While she was quick to point out that stores will continue to be important for driving sales, Imogen noted the importance of investing in new spaces that act as magical and exciting playgrounds to increase brand relevance through building more powerful and lasting relationships with modern customers. According to Imogen, here are the reasons why:
1. Customers want to have a great experience
To appeal to modern customers, brands need to offer more novel and engaging experiences. However, to do this well, retailers are realizing that they need to accurately understand who their customers are and adapt their stores to deliver powerful experiences to them specifically.
Imogen cited Ellis Brigham’s Covent Garden store as a great example of experiential retail in action. The store offers a great experience for outdoor enthusiasts–there’s enough space to try out tents and running shoes. The real showstopper is that they have the only ice climbing wall in London.
2. The right services and activities drive engagement
Her second insight was that in a retail world driven by experiences, retailers need to offer services and activities to better engage with their customers.
She used digitally-native sports apparel retailer Gymshark as an example. They recently announced that they’ll soon be opening their first permanent brick-and-mortar store on Regent Street. Customers will be able to book as many as 30 classes every week, free 1-2-1 sessions with Gymshark fitness experts, personal styling sessions and even use their hub for community events.
She also touched upon Bonobos “guideshops”, which only carry samples. By redirecting their store associates’ attention back onto the customer (as opposed to stock management, they’ve been able to create a high-intimacy store experience. This approach has even boosted conversion–Bonobos consumers spend an average of 60% more in-store than they do online.
3. Convenience is more important than ever
Imogen’s third observation was that how much customers enjoy their time in your stores ultimately depends on how convenient the customer journey is.
Take Tesco’s superfast home delivery “Whoosh” service, for example. Tesco’s customers can top-up on their groceries by making an online order and expect delivery within less than 60 minutes. It’s been so successful because the British grocery retailer understands that today’s consumer doesn’t want to wait for products. They want highly convenient interactions with brands.
This also confirms what we’ve found in the past. When Qudini sent a survey out to thousands of US consumers, over a fifth of respondents told us that they would walk out of your stores if they had to wait over 3 minutes.
Essentially, today’s consumer really does want a frictionless, often contactless store experience. As customers become accustomed to increasingly more efficient store experiences, this expectation is only going to grow and become a greater competitive differentiator.
4. Omnichannel retail is now the norm
Gartner once predicted that ecommerce platforms would be commonplace in the retail marketplace by 2023–although Imogen acknowledges that this was quite a conservative estimation. It’s already difficult to think of a retailer who doesn’t have an ecommerce platform.
Startups and digitally-native brands are no longer particularly unique for using online shopping. Major retailers are utilizing digital channels–whether that’s by enhancing their online channels with virtual services or by investing in tech solutions.
Enterprise brands really have caught onto the fact that the younger generations engage more with brands that are leveraging technology in physical and online spaces.
Imogen drew particular attention to Beauty brand Nars who took omnichannel retail to a new level with the launch of their global virtual store. A hybrid of the in-store and online shopping experience, customers can walk around the virtual shop on their mobile. They can also use virtual try-on technology to test different products or even book 1-2-1 sessions with beauty experts.
5. Consumers want to do good
Imogen rounded up her presentation by talking about how consumers want to do some god in the world.
Modern consumers are hungry for new experiences, but they’re also prepared to pay a premium for products or services that reflect their values.
For instance, fast fashion is something that’s playing heavily on the minds of today’s ethically conscious consumers. As a result, there’s a strong demand for greater transparency and accountability from big brands.
Shoe retailers Nike and Dr Martens are leading the way when it comes to aligning their values with the modern consumer. Nike’s By You service enables customers to revitalize their shoes with colorful customizations. Similarly, Dr Martens recently launched the ReSouled scheme in collaboration with Depop. Consumers can use the service to restore their shoes to their former glory with new soles, laces and heels before selling them on Depop’s online marketplace.
Crispin Lowery Shares Three Retail Insights
Next up was the ManagingDirector of Google, Crispin Lowery who shared his top three predictions for the future retail.
Crispin tells Samsung KX Retail Leaders’ Breakfast attendees that “Covid didn’t slow down business. I was doing a presentation a few years ago and I predicted that in five years time online shopping and appointment booking would be a trend. Well, funnily enough, they’re already here and that’s not slowing down. If you haven’t got that nailed in your business today, you’re going to need to do it in the next 12 months.”
1. Data is key to innovation
Crispin began by asking one key question: Do retailers have the data systems and the platforms to be able to innovate quickly enough?
Take Amazon, who are the undisputable leaders of transactional shopping at the moment. Crispin praised them for innovating the order delivery experience–services like Next-Day and Same-Day delivery were unheard of a few years ago. However, Amazon is now setting the benchmarks for every business. Retailers need the latest technology and Business Intelligence tools to be able to keep up with Amazon, less they run the risk of losing revenue.
Crispin pointed out that retailers need to have the right data analytics systems in place to answer key questions like:
- How many of my customers have shopped here before?
- What percentage of your customers are loyal?
- Are your customers actually having great interactions or bad interactions?
He explained that retailers need to capitalize on tools that give them key insights to better plan from the future. You need to be able to actually forecast traffic levels in your stores to sufficiently stock them to deliver great service. This is something retailers need to know before service, not afterwards.
Ultimately, by syncing their software tools and collecting data about store activities, retailers can strengthen their customer offering and streamline their operations.
2. The global youth will always influence retail
Crispin also made an interesting point about the influence that the global youth have on retail. He argued that parents do not influence their children’s shopping habits so much as the other way around. For example, the younger generations were quicker to adopt the internet, smartphones and social media. The older generations soon followed suit.
With this in mind, retailers need to constantly observe the younger generations and find out what the latest trends are.
He went on to equate social media platforms to “walled gardens” which Gen Z and the under 30s use for many purposes. Younger shoppers form their opinions through social media articles, decide what to buy because of influencer videos and even make the final purchase through social media.
As such, if retailers are going to connect with these consumers, they need to do more than simply market their products on social media. They need to offer services through these platforms. For instance, retailers should add an appointment booking button onto their Facebook Business page.
If retailers can find a way to harness social media and influence the younger consumers, they’ll achieve long-lasting brand relevance and thrive into the future of retail.
3. China is leading in retail innovation
Crispin’s final observation was that China is leaps and bounds ahead of the rest and the world when it comes to experiential retail.
Chinese retailers have reinvented the concept of selling goods through video, which was first popularized in the 1980s thanks to television channels like QVC. In its newest form, Chinese consumers can watch influencers give short product demos and click a link to visit an online store to buy the products mentioned in the video.
This is something that every major ecommerce app from Taobao Live to Pinduoduo offers live video shopping as a key feature. Meanwhile, US retailers are only now realizing the potential of video selling.
Crispin ended by encouraging business leaders who want an insight into the future of retail to visit Chinese stores and get a sense of what’s popular.
Touring the Samsung KX playground
After our two fabulous speakers had wrapped things up, our guests were treated to a fully-immersive tour of the Samsung KX space, which included a F1 simulator, high-tech gaming bus, the bespoke AI Family Hub refrigerator and much, much more.
We’d like to say a huge thank you to everyone who came along to our event, and especially to Crispin Lowery and the incredible team at Samsung KX for letting us tour their fantastic space.
Qudini powers Samsung KX with its software to manage queues, improve floor operations and to take bookings for appointments and events online.
Learn more about how Qudini works with Samsung here
