Irene Maguire, our director, attended the recent World Retail Congress in Dubai. Here she shares some edited highlights and projected trends in international retail. Experiential was a constant theme at the recent WRC with Lush picking up a much-deserved award for their uber experiential store in Oxford Street, hopefully inspiring other brands, including in the luxury sector, to be equally bold and innovative. Many of the speakers talked about the accelerating pace of change, and the need for businesses to be thinking Omnichannel in order to make customers interactions with their brands as engaging and seamless as possible. None of this is new of course, but there felt like a greater sense of urgency for brands to be braver, bolder and move faster. Here are some of the bite-sized takeouts we found most interesting...
We know the millennials are all about the instant, the now, and the immediate. A brilliant talk from David Caygill from Iris Worldwide balanced this by some of their research findings, which offer huge cheer for those of us who still believe in the compelling power of bricks and mortar as a vital tool in delivering an immersive brand experience. It talked about how millennials overwhelmingly want to touch and feel product, but also enjoy the experience of ‘just being here’, when mentioning shopping spaces such as TOMS, and valuing the social interaction aspect of shopping in a physical store.
Jerry Storch, group CEO of Hudson Bay, provided a grounded sense check on dispelling the myth that online retail was a more affordable business model that would outpace traditional retail. He said the idea that the Internet killed stores was “pure and utter hogwash”. “Some customers [prefer] online shopping for some experiences, but still, 90% of the market occurs in physical stores,” said Storch. He said it was a “myth that internet companies can offer lower prices”, arguing that the cost of delivering to every individual that orders online could never be cheaper than classic retail; “It’s probably three times more”.
Dr Ira Kalish, Global Chief Economist from Deloitte, covered the macro trends that are influencing the global economy, but also touched on some interesting findings that will be shaping future retail. One of those was the dramatic fall in driving licenses being issued to under 24 year olds. With people increasingly working and shopping from home, it seems that the desire to own a car, traditionally regarded as a right of passage, is dramatically losing its appeal. This trend will have a huge influence on the changing shape of our cities, and consequently retail, where the relevance and importance of ‘local’ will grow exponentially.
Arthur Martinez, Chairman of Abercrombie & Fitch, spoke about the reinvention of the brand, undergoing a fundamental shift that involves going back to its core DNA, and shaking of the hyper-sexualised, logo-laden approach of recent years. “Abercrombie & Fitch in particular has a deep and rich history grounded in a company that was founded in 1892 and that DNA has morphed in ways that frankly became undesirable,” explained Martinez. “One of the journeys we’re on right now as an organisation, as a leadership team, is to peel back all of that unpleasant history and rediscover the essence of the brand, bring it forward with a touch of modernity, but to be very much in contact with that DNA”.
Mulberry CEO Thierry Andretta defended the role of mono brand stores in luxury. A sector which is responding to global growth figures of around 1-2% globally over the past year, compared with figures nearer 7-8% in recent years. The luxury retail sector must adapt the way it creates retail experiences for customers in order to stem a growth slowdown. Paolo de Cesare, CEO of Printemps, warned that mono-brand architectural statement flagships may be a thing of the past. “We must ensure that the experience of shopping for luxury is as valuable as luxury experiences,” he said, while Thierry countered that luxury must address the needs of millennial shoppers, and that mono brand stores can engage the customer in ways that are unique to that brand spirit and culture in delivering a unique, memorable luxury experience.
Erik Volkers, CBRE Middle East, shared the results of a survey amongst shoppers in Europe, South Africa, and the UAE in order to understand the factors for future success for food brands. The key findings were that two thirds of shoppers regard F&B integral to their shopping experience, whilst health, newness and home grown were all highlighted as key criteria for success. The importance of F&B in retail was also reinforced by Morty Singer, Marvin Traub Associates president who said restaurants should be at the heart of any retail development and just as with anchor stores: “F&B is in the DNA of mixed-use development”.
Finally, and by no means least, Jo Malone gave an impassioned talk about the role of creativity and emotion in building a brand and noted that, customers are “the creators, not just the buyers”. We are proud to have worked with Jo in creating the original Jo Malone retail concept, which has retained its enduring and timeless appeal.