The first Decoded: Future summit held by Stylus in New York shed light on the evolution of the fashion and retail industries in the age of technology. Despite the fact thatnew, innovative technologies are happening all around us, a panel of retail industry figures sat down early in the summit to discuss the importance of brick and mortar stores in the changing industry.
According to Jim Hilt, EVP and chief customer experience officer of Express, 86 percent of consumers under the age of 30 still want their primary shopping experience to be in a physical store. While digital commerce is growing, brick and mortar is not dying; it is just changing.
Retailers agree that the future of the physical store is fully dependent on the customer experience. Hilt shared that Express went from 1,100 physical store locations ten years ago to about half that amount today, but the stores are still just as important as ever, now with a different purpose. “What we need from the store is very different from what it was a decade ago,” he said. “They need to be both the place where consumers buy products, but also to have styling services. Consumers expect stores to be fulfillment centers, so the ability to get product to them within 24 to 48 hours. And they also expect it to be a huge return vehicle relative to the online business that we have. So the store is a much more complex enterprise than it was a decade ago.”
Shoppers do not use stores as a primary retail space as they had in the past. A store’s purpose can no longer be to simply sell items, as that is what digital retail allows. Now, brick and mortar stores must be a destination and an experience to a shopper. Ali Kriegsman, co-founder and chief operations officer of Bulletin shared that her brand’s physical retail space didn’t receive consumer attention until it took a hard look into consumer wants.
Bulletin allows digitally native brands a physical retail space without requiring wholesale partnerships. The retail platform was built up with a focus on meeting the needs of the digitally native brand, developing technology to allow for seamless integration into a physical store. However, Kriegsman noted that “we had absolutely no one coming into our stores.” She said, “We had brands paying our pay-to-play membership fee, but we had zero foot traffic. So we had to figure out what the big problem was, and the problem was all about customer experience.”
The purpose of brick and mortar is to enhance the customer experience
Kriegsman committed to learning the Bulletin customer, analyzing who she is, what she wants to shop, and therefore determining how to optimize the assortment and the experience for that consumer. “It completely transformed our growth and our foot traffic, and it showed us what the future of retail is, and it’s definitely driven by the customer experience and community,” said Kriegsman.
“We spend less time thinking about a ‘cool’ experience, and we spend a lot of time thinking about a purposeful experience for the consumer,” Hilt agreed. According to his experience, the element of the retail process that physical stores can offer and digital cannot is services. Hilt said that the most beneficial services to consumers in Express stores are clothing styling and supplementing digital retail features, such as in-store returns and pick-ups. The retailer’s goal with these services is to make the in-store experience as streamlined and convenient as possible. “There are a lot of operational pieces that weren’t part of the original retail store in the mall that really is forcing us to transform ourselves into a more customer-focused business,” said Hilt.
Kriegsman has learned that newer brands often don’t understand how to get started in brick and mortar retail. Most new brands are digitally native as ecommerce is a less costly way to get started in retail, with a multitude of platforms to assist up-and-comers. Kriegsman said that digitally native brands don’t see physical retail as a possibility for them, citing issues of financing for wholesale and not knowing where to get started, even for brands with a wide digital consumer base. “We are bridging the disconnect between physical retail and digitally native brands” Kriegsman said.