Trend #1: The dissemination and proliferation of pop-ups
We are fortunate to live in NYC’s retail capital, and have the opportunity to enjoy the latest retail innovations. What about when you move out of the Big Apple? Freestanding malls and stores have been stable for many years in the majority of the country.
This will change in 2019 and beyond. Retailers will begin to take the essence of creative pop-ups from their stores and make them permanent.
This is particularly important in a world where information is quickly shared online and on social media. Someone in St. Louis may see on Instagram that their favorite department shop had an innovative pop-up in New York. They’ll be disappointed to find that the same store is still in business in their hometown.
It’s not difficult to create a pop-up idea. Retailers are applying the lessons from pop-ups to brick-and mortar locations. Pop-ups offer a unique way to delight your target audience and introduce new ideas and products into your store.
Trend #2: Flex Retail Makes Waves
Retail is becoming increasingly blurred. E-commerce doesn’t only exist online. Stores don’t have a lot of inventory, and pop-ups can’t be temporary. Flex retail is a new type of store design that has been popular in recent months. We expect to see this trend continue in the new year.
Retail should not be a one-size-fits all business. It should be flexible. Every quarter, stores should update their merchandise and change how they feel. Even more, a store located in Toledo, Ohio, should not look and feel the same as one in San Francisco, California. The climate, culture, needs, and preferences of each region are vastly different and should be treated accordingly.
Timberland has proven that it is possible to scale this model at scale, where in the past many retailers have abandoned location-based store designs due to cost. These temporary stores emphasize flexibility and are located in the right place for the audience, such as NYC winter. They are easy to set up (3-6 Days total, as opposed to months), and they can be moved to another location easily when needed.
This trend is indicative of a larger shift in retail overall: brands must be flexible and agile in their business models in order to succeed.
Trend #3: Waiting is Getting Fun
Imagine the last time you waited in line at a shop for something. Your significant other is trying on shoes while you sit there, probably impatiently. While you wait for the computer to be fixed, you’ll be twiddling your thumbs. These experiences are vastly underutilized retail opportunities.
We expect that retailers will optimize the wait experience in 2019 by creating spaces with engaging amenities or fun features. Imagine a combination cafe/planning area in Home Depot where people can outline their projects or a juice bar near Apple’s Genius Bar. These sections provide a unique experience and encourage consumers to slow down, peruse, and enjoy the entire process.
In 2018, we were already introduced to Capital One Cafés and AT&T Lounges. These concept stores allow customers to meet up and enjoy coffee, pastries, and a conversation about products. They’re not just places to wait, they’re destinations.
This is what Barnes & Noble has done for years through their Starbucks partnership. There is no better way to celebrate the purchase of a new book than to open it immediately with a cup fresh coffee. The greatest luxury for the consumer is time. It is time to treat it like such.
Trend #4: Showrooms get bigger
There is always a huge difference between brick-and-mortar and e-commerce. E-commerce allows you to place an order and wait between 2-7 days for your purchase. Brick-and-mortar allows you to get your item immediately.
There are more and more “showrooms”, which have limited or no stock. These “showrooms” combine e-commerce and the physical to allow customers to test out products before placing orders online or in-store.
Even smaller stores that don’t have a lot of inventory aren’t totally out of place. It’s obvious that people will wait for their products, even if it takes a few days, thanks to Amazon and other e-tailers. By reducing (or eliminating completely) inventory, showrooms allow retailers to concentrate on the customer experience and provide a better level of customer service.
Bonobos is a great example of e-commerce. Bonobos, a men’s apparel retailer, started in e-commerce before it launched Guideshops. This idea isn’t new, but we expect it to grow in 2019.
Trend #5: Anti-Brands are on the Rise
Brandless was the best retailer we saw in 2018. The e-tailer noticed the increasing distrust in big brands and created a brand that was based on the opposite. Brandless, in essence, is anti-brand. It has no logos, permanent stores, and a host of disruptive ideologies. The retailer isn’t about retail, it’s about the customer.
We expect similar brands to emerge in the next year as well as versions from the big boys. Target tried to play the same idea by launching Smartly, their private label. Target, a deeply rooted brand, is trying to be both sides of this coin. We expect smaller microbrands to respond more likely.
We are excited to see 2019 as a year of strategic, flexible retail disruption.