In 2022, global brick and mortar retail store sales are projected to reach $19.1 trillion USD. That number is expected to reach $22 trillion USD by 2025. The rise of e-commerce and omnichannel retail strategy should “not diminish the significance of physical retail.” That said, retail stores are no longer places to simply sell products. The modern retail store is a place to “immerse customers in a brand story.” It is a place to integrate disruptive digital technologies with compelling in-person customer experiences to turn “once-unattainable concepts into reality.” Read more about the most cutting-edge trends in brick and mortar and the retailers leading the charge:

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EXPERIENTIAL STORE CONCEPTS

The rise of D2C e-commerce has forced retailers to reimagine the traditional in-person shopping experience. Retailers need to adapt to changing consumer behavior and build excitement for visiting physical stores. The future of in-person shopping is the experiential store. Retail locations “not only require a change in format” but also need to facilitate “new, elevated in-store experiences.” Retailers need to design compelling experiential stores to drive critical repeat traffic.

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THE ADIDAS FLAGSHIP STORE DUBAI, UAE

This Middle Eastern flagship store “span[s] nearly 1,500 square meters, the store features… smart fitting rooms and premium services like MakerLab, which personalizes products.” Customers relax in the store and play FIFA “in the dedicated football area, join exclusive yoga sessions and shoot hoops at an in-store basketball court.” Walter Bruppacher, the Adidas Middle East Marketing Manager, says the UAE is a developing sports market. Adidas has positioned this experiential store to help facilitate growth in the market.

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THE UPCOMING DELIPOP CONCEPT IN PARIS, FRANCE

The upcoming DeliPop concept in Paris is a fascinating look at the future of retail. DeliPop “is a centralized click-and-collect location for pedestrians to access products from multiple retailers.” DeliPop is “a joint venture between French retail and logistics company Star Service and Polish robotics player Retail Robotics.” The company hopes to decrease the costs associated with last mile delivery by “allowing customers to pick up their grocery orders from a single location.” This experiential concept is designed with the end user in mind. It creates a seamless and efficient shopping experience. Over the next five years, DeliPop plans to open 500 stores in the UK.

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THE IKEA OUTLET IN SHANGHAI, CHINA

The newly renovated IKEA Outlet in Shanghai was built and designed around the concept of community. This IKEA “is equipped with a theater-like communal space for shoppers to socialize or relax.” The store also boasts an area “where staff can help repair old items and build new ones” in an effort to increase repeat foot traffic. China officially transitioned to a three-child policy in August of 2021, and IKEA wants to create innovative retail concepts and will appeal to growing families in the market. In an interview with the Global Times, Andreas Flygare, Market Manager of IKEA Shanghai, said, "I think that what we wanted to show is that if you have your first child, then the second and in the future, maybe the third child as well, at IKEA the range can really grow together with you.”

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DIGITAL INTEGRATION INTO BRICK AND MORTAR STORES

As consumer expectations continue to rapidly evolve, it is critical for retailers to integrate digital technology into the traditional in-person shopping experience. “Retailers must optimize store formats and in-store experiences to better weave the physical and digital retail channels together.”

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THE WARBY PARKER DIGITAL EYE EXAM

In July 2021, Warby Parker released its new Virtual Vision Test app. This app allows users to take an eye exam on their phones. From the comfort of their home, customers can now renew glasses and contact lens prescriptions. It is an exciting addition to the growing Telehealth market. Warby Parker, which is valued at $3 billion dollars, says “results are available in two days.” When the prescription is approved, the customer will be billed a mere $15 USD. Traditionally, “optical retailers have relied on in-store exams to drive sales because prescriptions are required for customers in the US to purchase corrective lenses.” The new Warby Parker app will continue to disrupt the eyewear industry. The app illustrates the power of digital integration into brick and mortar retail. Although Warby Parker is typically considered a digital B2C company, the company has opened physical locations across the United States in recent years.

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THE ZALANDO DIGITAL ASSORTMENT IN BARCELONA, SPAIN

Through a partnership with Google Maps, Zalando, a Berlin-based clothing retailer, launched a unique digital catalog and marketing campaign in February 2021. “Using Google Street View, consumers can shop the apparel collection on Zalando’s website while exploring the virtual streets of Barcelona, Madrid, Málaga and Valencia.” Customers can purchase clothing, which is modeled by social media influencers, directly from Google Street View. It is an extremely innovative and creative way to highlight products and drive interest in a brand.

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THE CU STORE IN THE ZEPETO METAVERSE

With over 12,000 locations, CU is one of the premier convenience store chains in South Korea. In August 2021, CU opened its first entirely digital store on the ZEPETO metaverse, which is “Asia’s largest metaverse platform.” Users can visit the digital store, which features digital snacks and a concert stage for large online events. “CU’s digital convenience store exemplifies how a brick and mortar retailer can build brand awareness through a virtual platform to engage with existing and potential customers.”

SOCIALLY RESPONSIBLE RETAIL CONCEPTS

Strong commitments to social and environmental responsibility impacts consumer shopping decisions. For example, “sustainability is rated as an important purchase criterion for 60 percent of consumers.” Consumers want retailers to reflect their values. “Retailers and brands must go beyond solely providing quality products to now also showcasing their corporate, social and environmental responsibility credentials.”

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THE MOVIL MARKET 1070 IN COSTA RICA

Movil Market 1070 is a mobile grocery built from a converted bus. The mobile supermarket is designed “to make grocery shopping more accessible to the elderly and other vulnerable populations.” The husband and wife team that founded the mobile grocery store say they took “inspiration from the traditional fruit carts that still make their way through many neighborhoods in Costa Rica.” While younger consumers have been able to seamlessly adapt to e-commerce shopping, “some segments of the population, including the elderly, did not adapt as easily.”  The Movil Market 1070 concept is scaled to serve smaller communities that struggle to reach traditional grocery stores.

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THE REWE SUPERMARKET IN COLOGNE, GERMANY

REWE is Germany's second largest supermarket brand. In May 2021, REWE launched a new concept store which “takes a holistic approach to sustainability.” The store is built from natural wood and only uses renewable energy. The store collects rainwater, which REWE repurposes for all of the store’s cleaning and sanitary needs. The store also operates a farm on its rooftop, which “produces 14,000 pots of basil and one tonne of fish meat each month.” Basil and fish might sound like strange choices for a supermarket farm, but the combination is very synergistic. The basil plants help filter the water in the onsite fish farm, and the fish manure is used as fertilizer for the basil plants. This concept grocery store helps paint a picture of the more environmentally responsible stores of the future.

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THE PATAGONIA SHOWROOM IN MANCHESTER, UNITED KINGDOM

The outdoor retail giant, Patagonia, is often on the cutting-edge of sustainability and environmental stewardship. In December 2021, Patagonia announced that several of its key stores in the UK would be transitioning to 100% renewable energy. “Under the initiative, Patagonia has signed on to a power purchase agreement with Energy Garden – a network of 27 wind and solar projects across Greater London, with its headquarters in Streatham, South London.” Beth Throen, the Patagonia Environmental Action and Initiatives Director, said, “We hope that, by going through this process, we have opened doors for businesses, of all sizes, to enter their own agreements with Energy Garden and other community energy projects.” This agreement will synergize with other initiatives in ethical/sustainable manufacturing, recycling, and climate activism.

As retail continues to evolve and create exciting new opportunities in the coming decades, we expect the lines between physical and digital to blur as new seamless shopping experiences emerge. Retailers should embrace both e-commerce and innovative retail development. Leverage our deep experience in retail strategy - schedule a consultation.

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