The idea of sipping Champagne at a Chanel boutique isn’t far-fetched, but noshing on a slice of pizza while perusing vintage-inspired maxidresses at Urban Outfitters?
A keen eye for fashion might not be enough anymore, as proven by Urban’s deal last month to acquire most of The Vetri Family’s portfolio of Italian restaurants. Philadelphia-based Urban Outfitters — owner of its namesake chain along with Anthropologie, Bhldn, Free People and Terrain — cited growth of the fast-casual segment, which is the category sitting above fast food but below sit-down restaurants, as the motive for the deal.
It isn’t the first company to have food on the brain when it comes to competitive advantage. Retailers and fashion brands around the world are discovering that these days simply offering apparel or accessories just isn’t enough. They also have to be baristas, sommeliers and chefs to draw shoppers into their stores.
One of the key lessons from the rollercoaster ride that was holiday 2015 was that consumers are no longer satisfied with just shopping. They want experiences — and the better the experience, the more they might spend on other products. As Sarah Quinlan, senior vice president and group head of market insights for MasterCard Advisors, said earlier this week, the experiential economy “is and will continue to be the economy that is growing and strong.”
“People want to spend more time with their family and friends again,” she said. “They want to create a memory that’s more permanent and meaningful to them than buying a blouse or buying another pair of boots.”
Retailers and brands from Saks Fifth Avenue to Shinola are jumping onto the bandwagon. Saks, as part of the $250 million revamp of its flagship, plans to open a branch of famed Paris brasserie L’Avenue.
At Shinola’s new West Coast flagship, a nook in front of the tall windows facing Sunset Boulevard in Los Angeles’ Silver Lake neighborhood encapsulates the brand’s vision. A white oak cabinet was installed, holding a brushed stainless steel refrigerator packed with a rainbow of fruit and vegetable juices.
Provided by Pressed Juicery, which also staffed one of its employees to explain the benefits of cold-pressed juicing, the natural nectars are the latest gastronomic additions to Shinola’s locavore menu. The company already serves Commonwealth coffee in its Detroit boutique and sells vegan pastries from Smile Newsstand at its outpost in New York’s TriBeCa neighborhood.
“The idea is not just about retail,” said Shinola creative director Daniel Caudill. “It’s about connecting to the community, really being part of a neighborhood, as opposed to getting people in and out.”
The growing trend is also a response to e-commerce. Retail consultant Anne Ziegler has noticed that, in the past five years, fusing food into the shopping experience has gone mainstream. Plus, she said that in many cases traditional malls no longer represent major destinations for people to shop, eat and hang out, pushing the onus on store owners to drive traffic into their stores.
“Creating a destination and an experience is key because it is something that e-commerce cannot offer,” she said. “Brick-and-mortar stores know that they need to evolve the traditional store format and strategy to get customers to leave their computers and shop in stores.”
Retailers’ zeal to prioritize community over commerce, lifestyle over social media likes, has been intensifying over the years. Back in 1999, Ralph Lauren became one of the first designers to break into the restaurant industry, welcoming diners into a clubby corner called RL Restaurant, opened next to his Polo store on Chicago’s tony Michigan Avenue. The designer has since expanded the concept to his Ralph Lauren flagship in Paris as well as his Polo store in Manhattan, which even has a Ralph’s Coffee Bar. Roberto Cavalli, Versace, Giorgio Armani and even Tommy Bahama have followed suit with eateries stretching from Australia’s Gold Coast to Dubai, Miami to Tokyo.
As reported, 2015 has seen a string of hospitality-related openings by luxury and fashion brands in China, including a Vivienne Westwood Café in Shanghai’s luxury-focused K11 mall and the July launch of Gucci’s first full-service restaurant, 1921 Gucci, within the huge Gucci store in the IAPM mall. The brand also operates cafés in Florence and Tokyo.
Other fashion businesses are now trying their hand at hospitality. The new Muji flagship on Fifth Avenue in New York sells small bags of Café Grumpy coffee. The Japanese retailer’s two-year-old store in the heart of Hollywood will introduce a coffee shop pop-up next year. And from L.A. to London, Toms runs what it dubs community outposts that are hybrids of retail stores and coffee shops with free WiFi.
In its 5,000-square-foot shop in Miami’s Design District, Chrome Hearts has changed the menu, replacing Cuban sandwiches made by a local eatery with macarons and savories created by Ladurée. Reflecting a mixture of Ladurée’s signature pastels and Chrome Hearts’ rocker-style crosses and stars, the café also sells a collectible macaron box illustrated in a sweet but spunky style from Chrome Hearts’ Pete Punk Offspring line.
Los Angeles-based Chrome Hearts is integrating some sort of culinary concept in all future projects, including the 16,000-square-foot marquee that it is constructing in New York’s West Village. “Anything we’re building will have a kitchen,” said Chrome Hearts co-owner Laurie Lynn Stark, a devoted cook who dedicates a page in the company’s magazine to recipes by her father, professional chef Herman Solomon. “It’s a real lifestyle.”
It’s also about the experience, especially for information-saturated Millennials who altered the way they shopped during the Great Recession, when the economy declined and hunting for bargains online became the norm.
“The retailers that are incorporating food have figured out what some landlords have known for some time, which is that the more experiential you can make your shopping destination, the longer they stay and the more money they spend,” said Dave Moore, president of retail at Newport Beach, Calif.-based Irvine Co., which operates malls such as Fashion Island.
Food is a vital ingredient for mall makeovers. Scott Burnham, chairman and chief executive officer of Newport Beach-based developer Burnham USA Equities Inc., selected an assortment of home décor, artisanal eateries and clothing boutiques to recast a tired, 300,000-square-foot shopping center in Costa Mesa, Calif., a few years back into what is now the South Coast Collection. “Good taste likes good taste,” he said.
Epicurean enclaves aren’t confined to the food court. DJM Capital Partners Inc., a San Jose, Calif.-based private equity firm that also develops commercial properties, inked a 14,000-square-foot lease to chichi sushi spot Nobu for its soon-to-open Lido Marina Village project in Newport Beach, where tenants will include Bailey44 and Steven Alan.
“Before, you could put in six great chain restaurants and you’d be done,” said Linda Berman, a senior vice president at DJM. “Now, you’re looking for chic cafés. You’re looking for great health clubs with juice bars. You’re putting in artisanal food halls. You’re competing for chef-driven restaurants. You’re looking for great confectioners and bakeries.”
Even digital-only brands have realized that the way to a customer’s heart is through their stomach. Although it doesn’t own permanent brick-and-mortar stores, in the past few months Everlane welcomed customers to its New York showroom in SoHo, where they collected tips for gathering the best local ingredients, cooked with the staff from Haven’s Kitchen and sipped cocktails from Tiny’s and the Bar Upstairs. It also opened the doors to its San Francisco headquarters to show off its clothing next to a fresh spread prepared by Good Eggs. These efforts seemingly support Everlane’s mission to promote transparent manufacturing, although its representatives declined to discuss the reasons behind cross-pollinating food and fashion.
“It’s not a short-term fad,” said Michael Lushing, principal of Lushing Realty Advisors in Beverly Hills. “You’ll see more and more people mixing uses.”
On the other hand, collaborators could turn into competitors. Considering that a bottle of juice sells for around $10, executives aren’t fretting if a customer has to choose between something that nourishes their belly and clothing that adorns their back.
“That may happen occasionally,” said Pressed Juicery ceo Hayden Slater of the either-or scenario. Still, he cited the benefits that outnumber the risks. “The power of both brands combined brings in a much larger audience,” he said.
Two blocks away from Shinola’s Silver Lake store where Pressed Juicery installed its sleek refrigerator, Juice Served Here is living up to its goal of being “a fashionable juice company.” One cofounder and its chief marketing officer, Greg Alterman, started Alternative Apparel, which he still co-owns and directs as a board member. Its other cofounder and ceo, Alex Matthews, previously worked as G-Star Raw’s national retail manager. On a marble countertop, $40 vials of Vita Parfum are neatly lined up next to samples of bright yellow juice. A few feet away, a blond wood bookshelf artfully showcases an $86 orange-streaked pouch by Rewilder and $360 wood sunglasses by Vakay Eyewear.
“We see juice and fashion intertwined moving forward,” Alterman said.
Executives can go only so far with blending food and fashion. Matthews confessed to going on a shopping spree with Web site domains, snatching the rights for soup, coffee, lemonade, practically anything edible that could be combined with “served here.” He set some limits, however.
“I just don’t know how well the Juice Served Here name lends to a fashion product,” he said. “I didn’t buy Jeans Served Here.”