News 28.12.2020

Looking Back in 2020: Retail

Retail brands were this year forced to explore new phygital channels for commerce and communication, writes our retail sector lead Alex Hawkins.

The Trend: Feedback Frontiers

Character Illustration IV by OmarAqil
Character Illustration IV by OmarAqil
Character Illustration IV by OmarAqil

The role of customer service is being reframed. As the number of communication channels has grown, the relationship between brands and consumers has become more complex. Our 2020 macrotrend Feedback Frontiers explores how businesses must reconsider how they connect with their customers, and fundamentally alter their perception of them.

With the understanding that every piece of information can provide insights to improve their business, brands are taking a less extroverted approach. Some are rethinking the structure of their internal teams, while others are creating new business models.

‘Our approach is part of a new era of direct-to-consumer businesses – one we’re calling ‘direct-with-consumer’ or DWC,’ says Nick Ling, CEO of Pattern Brands. ‘At its core, we see DWC as a model intrinsically designed to build intimacy at scale through much deeper, more personal consumer relationships.’

As customer service evolves from a cost centre to a driver of profit, these brands will no longer try to limit interactions with customers as in the past. Instead, they will strive to create conversations, forging ahead across the multiple interactions and touchpoints that are emerging as the next frontiers for brands.

The Big Idea: How retail is becoming a phygital playground

The Last Statement T-shirt by Carlings and Virtue The Last Statement T-shirt by Carlings and Virtue

With bricks-and-mortar retail facing new challenges amid Covid-19, retailers looked to innovate with new experiences that invite shoppers to interact with products and spaces both physically and digitally. From visual merchandising to product design, innovators created interactive mobile experiences that extend across both online and in-store channels.

Scandinavian fashion retailer Carlings, for example, worked with creative agency Virtue to introduce the world’s first augmented reality t-shirt. According to Roy Mikalsen, CEO of Carlings, the aim was to ‘extend the digital impact of a single t-shirt. Meanwhile, colour cosmetics brand Lime Crime has launched an augmented reality app, highlighting how technology can activate traditional packaging and take consumers on a ‘virtual journey’.

Elsewhere, Ikea innovated with a phygital window display featuring a virtual influencer as part of its Happiness at Homecampaign in Japan. Imagining a future of touch-free retail experiences, StudioXAG’s conceptual project Feel Touch used customer data and augmented reality (AR) to show product offerings through individual smartphones.

The Campaign: Project Earth by Selfridges

Project Earth by Selfridges, London
Project Earth by Selfridges, London
Project Earth by Selfridges, London

While sustainability took the back seat for many retailers amid the Covid-19 crisis, British department store Selfridges continued to push the issue with an ambitious new sustainability initiative that aims to transform the state of retail by 2025.

Building on Selfridges' sustainability initiatives from the past 10 years, Project Earth addresses everything from the materials used in products to repair and resell models. ‘Project Earth is not only our bold, new commitment to stretching environmental targets, it is about imagining new ways to do business, within the next five years,' says Alannah Weston, group chairman at Selfridges.

Aiming to inspire mindset shifts among consumers and employees, its August launch was also be supported by talks, takeovers and screenings that tacked topics such as ethical consumerism and sustainable beauty. As part of this series, The Future Laboratory also hosted an Instagram takeover in October, discussing the future potential of Immaterial Fashion and the end of product ownership.

The Interview: MetaFactory on community-owned brands

MetaFactory, Canada MetaFactory, Canada

We profiled new retail platform MetaFactory in November, and co-founders Drew Harding and Hammad Jutt discussed how cryptoculture is inspiring new decentralised brand economies.

MetaFactory builds new community-owned brands where creators and consumers both share incentives and collective brand management. The platform adapts the existing concept of a decentralised autonomous organisation (DAO) and applies it to the retail category.

‘We're approaching fashion from a completely different mindset,’ says Harding. ‘Beyond just the passive buyer or the active designer, which are two very distinct user types, there's a community of people who are deciding what products make it to the marketplace.’

Speaking of why this open-source model appeals to consumers today, Jutt adds: ‘Internet subcultures have existed for a long time, but this starts to turn a hobby into an economic force. And instead of just using the internet to share information, we can now use the internet to share and coordinate value.’

The Space: Off-White’s Miami flagship

Off-White’s flagship store is a fulfilment centre and a multipurpose events space designed by Virgil Abloh and AMO Design, Miami Off-White’s flagship store is a fulfilment centre and a multipurpose events space designed by Virgil Abloh and AMO Design, Miami

Reconceiving the store as a reactive retail space, Virgil Abloh and architects AMO designed the Off-White flagship in Miami Design District to serve seamlessly as a fulfilment centre and multipurpose events space. The idea, according to Samir Bantal, director of AMO, was to create a ‘space that is adjustable and transformable over time.’

The two-storey store is fronted with a moveable wall on the ground floor, which can be pushed back, while all the furniture is placed on wheels or is collapsible. These changeable design elements mean that both the shop floor and storage spaces can be compressed or expanded to accommodate a variety of activities or events.

As such, the store’s physical layout can react and respond to the immediate needs of the Off-White brand, rather than betting on square footage that needs to be used for retail exclusively. Moving away from the strict measure of sales per square foot, the store can leverage its adaptive design to host runway shows and live events or focus on fulfilment.

Download the Future Forecast 2021 report

Now that you know what shaped 2020, discover what’s on the horizon. Download our Future Forecast 2021 report comprising 50 new behavioural patterns across 10 key consumer sectors, expert opinion pieces and interviews with global innovators.

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