It sounds counterintuitive, yet CallisonRTKL, a global architecture, planning and design firm, sees opportunity at a time when store closings are common and the Internet is rising.
“The idea that something can be seen as a risk to retail is actually the very same thing that makes it interesting,” observed Eric Lagerberg, CallisonRTKL’s executive vice president and global practice group leader for retail stores.
Sitting in Sam’s Place, an old-style Italian restaurant in Manhattan’s Murray Hill neighborhood, Lagerberg presents a particular point of view on store design, discussing everything from worn wood floors and luxury environments to the impact of technology on retail settings and the CallisonRTKL agenda.
“The idea that traditional retailing is dead I think might be accurate, if traditional retailing is referring to something that doesn’t change. But I don’t think there is single category or aspect that doesn’t need to change and roll with the times. Today, it’s Amazon. Yesterday, there was some other disruptor that made it more challenging and interesting.”
CallisonRTKL is known for its scope, from shopping centers to designer boutiques and department stores around the world, as well as projects in the hospitality, health care, office and residential sectors. The company is involved in everything from brand positioning down to lighting the store and creating the signs. Then there is business analysis, trends, design and concept work, permitting and approvals, and construction administration.
In addition, Callison creates prototypes and implements rollouts. “We are distinct in the sense that we have the horsepower to do that,” Lagerberg noted. “It wouldn’t be uncommon for someone like us to either specialize in one or the other; do the front-end design and let someone else roll it out,” or vice versa.
Most recently, a visual merchandising service led by Ignaz Gorischek, vice president of store design and visual merchandising, was formed. Gorischek, a former Neiman Marcus vice president, said the new service offers window and interior visual presentations, seasonal and holiday displays, pop-up concepts both in-shop and standalone, kiosk design, and a full array of art services including acquisition, curation and installation.
In the retail sector, Callison has a wide range of clients, from Nordstrom, Burberry and Charming Charlie to a Brazilian jewelry brand called Hueb. There’s also a long list of beauty brands where Callison has created both in-store and freestanding shops. “We are working on hundreds of brands simultaneously,” Lagerberg said. Much of Callison’s work centers around helping brands to reposition, he said. “Everything is changing. It’s about hanging onto aging customers and attracting new customers.”
While reluctant to discuss specific client projects, he did go into some detail on a few.
“The fact that Liberty Travel is a thriving business — that there is a need and a customer base out there — was completely surprising to me, because of the accessibility of all the data that used to be held in the hands of a travel agent,” Lagerberg said. “But there are many people that are intimidated by the onslaught of information and they want the service to help them navigate the very same thing. That’s the kind of complexity that makes it interesting.”
Liberty’s locations had languished for a long time, Lagerberg said. “The objective was to bring back the customer experience, by bringing in new lighting standards, new materials, to make it a brand that speaks to the romance of travel, not a commodity. It’s all about being comfortable,” so a family or group of friends can readily interact with Liberty’s travel agents. “It was about integrating technology into the setting so it’s accessible, like it would be at your home, with more of an open-sell atmosphere. It’s in the type of furniture, the way the space was zoned, which allows for a more intimate, personal interaction as opposed to serving from behind the counter. Physically, people are on the same side of the table looking at the same screen.”
Liberty Travel, while not the most theatrical of retail settings, posed a challenge because of its wide customer spectrum. “The easiest [projects] are those that serve a very specific customer,” Lagerberg said. “The toughest retail projects are the ones that serve everyone.”
A mobile phone shop is tough to design because of the diverging attitudes toward technology. “There is a 16-year-old girl and 65-year-old woman, with different shopper mind sets, generally very far apart, and with different attitudes towards embracing technology,” Lagerberg said. “There are those who research the product, find out the price, know exactly what they want and their interest in the customer experience is just about ease of purchase. They don’t want advice. They don’t want someone in their face.”
Then there are customers who are “intimidated” by technology, possibly buying their first mobile phone device and have no idea what to buy. “They want interaction, so that’s the difficult part. How do you build a store, build the operations, build the service around a crazy, broad spectrum?”
Nordstrom has posed another type of challenge, he said. “It’s been a classic story on how to refresh the space to engage a new, younger customer without alienating the traditional base. The real litmus test is, does this feel like a Nordstrom store when you walk in? It has to be how do we evolve what’s there, keep the integrity and open the door for a new customer. It’s done with lighting, the material palette, coloration, art and integrating the food service as part of the experience, and not just as an add-on.”
Restaurants at Nordstrom, “used to be a separate thing in their older model — tucked away on upper floors. Now it’s integrated into the experience. It’s open. You can see into the restaurant from the shopping area. The lines are sort of blurred. Previously when you walked through the restaurant door, it was a very inward, pub-like space.”
Brazilian jewelry brand Hueb has a store on Madison Avenue with four different “zones” that help the operation of the business and enhance the customer experience. “You may look at it from the street and see it as one space, but once inside, initially, there is an open area, “a relaxation point off Madison Avenue,” Lagerberg said, “And then you are immediately confronted with a display fixture of gifting, lower price points. It’s lighter. There’s more daylight. The palette is lighter. The product is more accessible.
“The second zone is an interactive area, where people might huddle around a display case and talk about things. It’s similar to open sell at Liberty Travel where you have a salesperson more involved in the transaction. Here, price points start to go up a little. It’s a bit more exclusive product, underneath a wood ceiling.”
Deeper into the store, “There is more comfortable area facilitating one-on-one consultation type sales, for more exclusive product back there.
“There is a commercial component about engaging the right customer with the right product at the right place; and then there is an emotional piece — the Brazilian joie de vivre.”
Lagerberg said, not surprisingly, “the life cycle of a retail space could be as short as four or five years, though usually it’s five to ten years. With high traffic, there is a wear and tear component, and there is also the need to stay relevant and interesting,” as the company creates new products or learns what’s selling and what’s not selling.
If a store isn’t renovated within 10 years, “It would be living on borrowed time. It depends on the type of store, too. Some of the high-volume mobile phone stores, with so much traffic going in and out, think of the wear and tear on that…At Starbucks, it’s not just the massive high traffic, but it’s also a wet environment.” Still, “a worn wood floor is maybe not so bad,” since it could bring character to the environment.
With high-end designer boutiques, “The materials are better. The detailing is better and the wear and tear is not so bad. Customers treat the place pretty well, and there is less traffic volume. You can see a lot more interesting things going on with the facades.” It could be five to 10 years, generally speaking, before redos would be needed, Lagerberg said.
Asked if stores are cutting back on renovations and updates, Lagerberg replied, “It doesn’t feel like it. Sometimes when business is tough they want to get the most out of the assets they have. Aggressive expansions get hammered in tough economic times, but usually the repositioning and renovation stuff, with the real estate cycle, they are making decisions years ahead.”