Experience + Revenue Per Sq. Ft.= Future of Retail
Amazon and online retail are changing the way we shop. Brick and mortar stores that do not offer a positive consumer experience are shuttering at what feels like an alarming rate. Shopping malls around the country are being torn down, repurposed and left behind.
In order to survive retail stores must adapt to create a consumer experience that is better than buying online
Here is a short list of businesses that are filing bankruptcy or shutting down many of their physical stores. The links below tell some of the story of each business’s store closings.
– Rue 21
This year the WSJ estimates that over 8000 Retail stores will be closing their doors this year. Yet, not all retail is failing.
Why Apple is Winning in Retail
Apple is an exceptional example of the power of a quality retail experience. Across the brand at almost any Apple store you are greeted by employees who are passionate, knowledgeable and help you with your overall consumer experience.
Apple has a great return policy, provides in store classes for consumers of many skill levels, and keeps their stores clean, efficient and organized.
Have a problem with your Apple product? Set a time online and they will help you troubleshoot it for free.
The result is that Apple is one of the most valuable companies in the world, and has the highest revenue per square foot of any retail chain (over $4,000 per square foot).
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Costco may be known for the ability to buy in bulk, but the in store consumer experience is surprisingly good. From free samples, to happy employees, to well put together product demonstrations Costco blends value with experience.
As human beings we desire to be a part of a group or tribe. Despite advances in technology human nature values face to face interactions and being part of a group.
Stores like Lululemon (an athletic clothing company) & Whole Foods do an outstanding job of engaging and supporting the local communities. Walk into a Lululemon and you will find pictures of local fitness instructors, yoga classes and passionate employees.
The grass roots approach to experience combined with a great product allows Lulu the ability to succeed in the current markets.
Whole Foods supports community events, and spends 5% of their days helping in communities.
Crafting a real sense of community and reaching out to influencers in local communities takes time, effort, knowledge and passion. It is a dynamic change from simply offering goods.
Surviving Future Retail
By having an experience and a product people want to buy, brick and mortar retail will move forward. The change is that offering a product alone is likely not enough to offset the costs of brick and mortar stores. By providing consumers with a memorable positive experience retail stores will continue to grow their brands.