Store of the future: shifting from transactional to experiential

 Shoppers can buy literally anything online today and, thanks to Prime, usually have it delivered the very next day. Amazon has taken every effort out of shopping and, in the future, this will go one step further as certain household products move towards simplified and auto-replenishment. As our homes get smarter, shoppers’ lives will get easier. The average adult currently makes a whopping 35,000 decisions every day but in the future our connected homes will do all the low-level, mundane re-ordering of household products, freeing up time to focus on more enjoyable tasks. Shoppers will no longer have to traipse down supermarket aisles when they run out of bleach or toilet paper. They will spend less of their valuable time buying the essentials and we believe the impact on the physical store will be immense: retailers today should be rethinking store layout, trip drivers and broader purpose of the store.

In the future, we will see a greater divergence between functional and fun shopping. No one does functional like Amazon, so competitors must focus on the fun element. Winning in retail today means excelling where Amazon cannot, and therefore focusing less on product and more on experience, services and expertise.

WACD – What Amazon Can’t Do – has become a recognised acronym in the retail industry as competitors desperately seek ways to survive in the age of Amazon. Even the very terminology – words like ‘retailer’ and ‘store’ – must be reconsidered: Apple wants their outlets to be called ‘town squares’ and cycling chain Rapha, ‘clubhouses’. In a similar vein, many shopping malls are actually ditching the m-word in favour of phrases like “village”, “towne center” and “shoppes”. Others have taken the notion of experiential retail to the extreme – UK department store retailer John Lewis lets shoppers stay overnight in an instore apartment while US home furnishings retailer West Elm has branched out into running hotels.

Not all retailers will have the means or incentive to go to such extremes, but one thing is clear – stores must be repositioned as genuine destinations. It can no longer be just about product, instead retailers must tap into community and leisure, providing an experience that is compelling enough to ditch our screens for. Angela Ahrendts, Apple’s SVP of Retail, observed in 2017 that “while people are more digitally connected than ever, many feel more isolated and alone.” The physical store is well-positioned to cater to a growing consumer desire for social connectedness in today’s digital age.

We’ve already talked extensively of the trend towards a more blended retail experience as online and offline continue to merge. But bricks and mortar retailing will also become more blended in the sense that retail space won’t just be about retail. The future, particularly for malls and larger formats like department stores, is mixed-use development, which will open doors for collaboration with all kinds of unconventional partners. These aren’t entirely new concepts: retailtainment (or retail theatre) and positioning retail as a leisure activity have featured in retailers’ playbooks for the past century. Mr. Harry Gordon Selfridge himself once said that “a store should be a social centre, not merely a place for shopping.”

This is sound advice for retailers today. For all its perks, shopping on Amazon is still a very utilitarian experience. This presents an opportunity for competitors to distance themselves by injecting some personality and soul into their stores, which will further blur the lines between retail, hospitality and lifestyle.

We believe the store of the future won’t just be a place to buy things but also a place to eat, work, play, discover, learn and even borrow stuff. But it also must be a place for retailers to appease the ‘on-my-terms’ shopper through instore collection and returns, as well as same-day delivery. In an increasingly digital world, the role of the physical shop will have no choice but to move from transactional to experiential.

Amazon: How the World’s Most Relentless Retailer will Continue to Revolutionize Commerce, written by Natalie Berg and Miya Knights, is out now, priced £19.99 –


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