Retail is in revolution, and progressive ideas are coming to the market. These changes aim to evolve the shopping experience and redefine how we interact with our favorite brands.
Faith Hope Consolo, renowned retail broker and consultant, has made it her life’s work to track these trends. She explores retailers' relationships with shifting markets and the overall shopping experience.
In a recent interview, Consolo touched on some of the biggest factors that will shake up the retail game in 2017. Not surprisingly, millennial consumers are on the list. So are experiential marketing, transitional space and the expansion of online stores into brick-and-mortar locations.
Here's a closer look at the forces converging to shape retail in the coming year and beyond.
The millennial market
Marketers have been studying millennials' retail behaviors for many years now. Millennials lean toward investing in experiences rather than material objects. Consolo has seen this trend affect major retailers' marketing strategies. “It’s all happening in Times Square in New York City,” Consolo says. “Consumers don’t want a simple purchase anymore. Instead, they want a comprehensive retail ‘experience.’”
The buying influence that millennials exert has helped sprout a new concept. “Experiential marketing allows customers to try out a lifestyle, concept or product instead of only seeing it on a shelf,” Consolo says. “Experiential shopping is a growing movement. For luxury, the trend means selling a lifestyle associated with the brand as a way to showcase the product.”
Consolo has tracked retailers' decisions around experiential shopping. “The Hershey’s store is trading-up to three times its size at 20 Times Square from its current location at Broadway and West 48th Street," Consolo says. "The concept will be something immersive and huge along the lines of Chocolate World in Hershey, Pennsylvania.” Also at 20 Times Square, the National Football League (NFL) is partnering with Cirque du Soleil to create a 40,000-square-foot theater and interactive exhibit. “The space will be full of NFL merchandise, of course," Consolo says, "and the League will broadcast its archived NFL Films onto a four-story video board outside the building.”
A store and interactive experience are in the works for Foot Locker, too. The athletic powerhouse will open a 36,000-square-foot House of Hoops flagship store at Broadway and West 41st Street. Other entertainment companies coming to New York City include Margaritaville inside the Brill Building at 1619 Broadway, and the Grand Ole Opry at nearby 1604 Broadway.
Shopper expectations are driving these marketing decisions, but it's worth noting that experiential events actually are changing the way people consume products. “These area retailers are bringing on the experience with more dining options, gyms/spas, theaters and experience-focused stores,” Consolo explains. “They’re creating more reasons to visit and becoming a one-stop shop for all family members. It’s luxury mixed with necessities mixed with services.”
Consolo tells us to watch for more perks at the mall, including concierge service, personal shoppers, coat checks, play areas for children and delivery services. “It’s all about elevating the shopping experience," she says.
Retailers and designers are testing new markets with pop-up shops, and that trend will expand in 2017. In New York City, consumers already are getting a firsthand look at this phenomenon in the restaurant scene.
Pop-up eateries and outposts allow startup and established foodies to dip a toe in new waters. “Food halls like Urbanspace are providing platforms for restaurant brands to try new venues in new neighborhoods," Consolo says. "These happen for short periods in a small footprint to gain exposure and test the market, just like for fashion."
Ecommerce will continue as another arm of the multi-channel. “Shoppers like to be informed and are keen on comparison shopping, so when they walk into a store, they’ve likely done their homework and are ready to buy,” Consolo says. “Retailers must be open to expanding technology, using social media to capture attention and helping connect the dots online.”
Consolo forecasts an increase in brick-and-mortar storefronts, quick on the heels of physical store openings for both Amazon and eBay. At the same time, traditional retailers are discovering that ecommerce grows around their neighborhood space and disappears if the location closes.
“We want instant gratification, but we also want to touch, see and try products. It’s clicks and bricks, not one or the other,” Consolo says. “We’re seeing online companies -- such as Amazon -- and TV-based companies including QVC and HSN increasing their relevance by opening stores.”
To keep up, even established brick-and-mortar stores are expanding their ecommerce businesses. Actually, the two channels work quite well in tandem.
“It's a mistake to think it's one or the other,” Consolo says. “The truth is that shoppers love their brands. They will go to a Crate and Barrel store, then come home and buy more online. Meanwhile, we've also seen a few test cases where big companies grow their ecommerce business and then close the store thinking online-only will carry them in that market. But that it's not true. The whole business disappears.”
Consolo points out it's the relationship between brand and shopper that counts. In that vein of thinking, online versus physical location becomes merely a question of delivery. The shopper assumes he or she will have both.
As Consolo and other retail experts study these transformative opportunities, one thing becomes clear: The retail world never has been more intuitively focused on what appeals to shoppers.
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This article originally appeared on Entrepreneur.com. Minor edits have been done by Entrepreneur.com.ph.