Amazon Go

There were a record number of store closings in 2017, and that’s not including the number of stores going bankrupt. But there were also a record number of store openings in 2017. So what gives? Consumers are still shopping…a lot. And, while you may think that online shopping is taking over, 88 percent of global sales in value terms were still made in-store.

Yes, it’s clear that online shopping has been a wake-up call and has turned brick-and-mortar shopping on its head. By now we all know the history of which businesses and retailers lost their battles. Now after the shock of online retailing has faded, off-line retailers are figuring out how to compete and understand their own home advantage. Consumers still like to touch and feel products and they still want to have a shopping experience. Brick-and-mortar retail can offer consumers an experience that online shopping can’t offer.

Even online retailers understand this. Increasingly, consumers, particularly younger consumers, want an experience when they shop, as only brick-and-mortar retail can offer. That’s why e-tailers such as Warby Parker and Indochino have opened physical locations. And then, there’s Amazon. After contributing to the shuttering of thousands of bookstores, Amazon has been opening bookstores. Yes, bookstores. With salespeople armed with tablets who can research your likes in real time and help with selections and ordering.

In addition, Amazon has opened Amazon Go, its no-check out concept store, in Seattle; it also acquired Whole Foods. These are clear indications of the advantages of physical locations.

Retailers all know that “experience” matters, and now we’re seeing more innovation in this area than ever before. Target’s “next-gen” stores feature several examples of this: they have two entrances, one for those who need to get in and out quickly looking for convenience and another entrance for customers more interested in browsing; beauty, jewelry and accessories are intermingled to present fashion styles; there are more self-checkout lanes; faster packing and pick-up counters, and better displays and lighting.

Same-day delivery services are spreading throughout brick-and-mortar, such as those offered by CVS and Walmart to compete with Amazon. Restoration Hardware is combining retail and hospitality. Their store of the future — the first opened in Chicago — is still presented as a showroom but also offers an integrated restaurant, wine and coffee bar.

One of my favorites is American Eagle. It transformed its store in New York to a first floor “jeans gallery” where customers can participate in an experiential shopping environment and then go to the “Makers Shop” where they can personalize their jeans. And, because of the store’s proximity to New York University, students can also do their laundry — for free — in the store and wait with their friends in the studio bar.

Consider The Market@Macy’s. These are in-store shops in select Macy’s department stores that offer up-and-coming brands an easy way to showcase innovative products and services, keeping 100 percent of their sales. Macy’s has also partnered with Samsung, experimenting with an in-store concept shop dubbed the Samsung “experience,” which allows customers to test and purchase a full range of Samsung products from tablets to wearables to televisions. These experiences are designed to bring customers into the Macy’s stores.

And, finally, I must mention pop-up stores. They can last a day or they can last several months. Originally a way for owners of real estate to fill vacancies left by departing stores, now brands — including retail brands — are opening these short-term retail experiences all over the country to promote their products and attract consumers. And they almost always include more than just a product offering.

Fashion magazine Marie Claire opened a pop-up offering beauty products organized the way the current magazine issue was organized, including a photo lab where customers could get a headshot. Beauty brand St. Ives and Unilever teamed for a pop-up that not only offered products but beauty advice and the opportunity for customers to create custom lotions. TRU, Yankee Candle and The Sharper Image all opened holiday pop-ups. And online retailers are also getting into the pop-up experience.

Amazon teamed with Calvin Klein last year with all sorts of interactive ways for consumers to participate with the brand, and DNVB Birchbox opened a pop-up to engage with its consumers directly at a physical location.

Whether it be at the mall, in the store, at a pop-up or anywhere else, consumers these days are looking not only to buy products but to have a fun experience. It’s the home advantage of brick-and-mortar retail. And both online and off-line retailers have gotten the message, loud and clear.

Allison Ames is president and chief executive officer at Beanstalk. With more than 20 years of experience leading licensing initiatives for diverse brands and retail exclusive programs, Ames oversees the strategic direction of Beanstalk globally and leads the agency’s growth efforts.

Since joining Beanstalk in 1995, Ames has spearheaded strategic licensing initiatives for diverse brands and individuals including Stanley Black & Decker, HGTV, Diageo, Airheads, U.S. Army, Purina, Danskin, Kelly Ripa, Mary-Kate and Ashley, Salma Hayek, among others. She was an integral part of the development and management of worldwide retail exclusive programs for Ashley and Mary-Kate Olsen and Danskin.

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