The act of buying commodities – buying because we HAVE to – is becoming a much more delightful experience. Company’s like Amazon, Stitch Fix, Ipsy and Blue Apron are among many other subscription based companies that have transformed the world of retail. By introducing auto-renewals, one-tap purchases and same-day delivery options, The “chore” or “routine” component of commodity shopping is much easier and more streamlined than ever.
In the month of April 2017, subscription company websites had about 37 million visitors. Since 2014, that number has grown by over 800%… so what does this mean for the future of brick and mortar retail?
While commodity based Retail is certainly taking a hard hit, the experiential side of retail — the part that involves discovering great products and socializing with others — is booming! In order to keep shoppers visiting brick and mortar stores, many retailers are combining entertainment with traditional shopping. People are still making their way to physical stores, not because they want to “buy stuff,” but because they don’t want to miss out on experiences they won’t find anywhere else. We call it, “Retail-tainment!”
According to the National Retail Federation’s 2017 “Consumer View” report, which polled 3,002 millennial and Gen Z consumers, of those surveyed, 49% were visiting stores more often than they used to because of “new entertainment” or food options. Nearly half of the respondents said they were shopping in more stores than they were just a year ago!
Source: National Retail Federation
There are countless retail companies all across the world that are taking innovative leaps to drive business. Bass Pro Shops are incorporating themed restaurants within their facilities. Saks Fifth Avenue is providing bespoke services including a barber, a leather spa and a coffee bar. Cinder House, located on the top of The Four Seasons Hotel, delivers a breathtaking view of the Gateway Arch.
One company that really stands out in bringing innovative experience to the retail space is Alibaba. November 10, 2017, for Singles Day – a festival that generates billions of dollars in revenue in a single day for the company – Alibaba tested 60 futuristic pop-up stores across China that employed the use of emerging technologies. Among the technologies implemented was Virtual Reality, Augmented Reality and AI-enabled “store concierge: chatbots.
The implementation of these technologies allowed Alibaba to smash their previous record with 812 million orders, equaling $25.3 billion in sales from just that day.
As new retail models arise and evolve quickly, the dramatic and ever-changing landscape of retail is certainly an exciting place to be.