Department Store VIPs: Value in Personalisation
By Sanela Lazic
In a fast multi-channel world, where the progress beats-per-minute is breaking through the sound barrier, it is a big ask for the conventional department store formats to move their large wheels at the speed of innovation led by today's brands. These giants, in their many guises, with long histories, individual organisations, varied locations and broad customer base, are having to work hard to balance the very complexities that define them; from the unique brand mix to the endless categories, private labels, entertainment programmes, service models and multi-channel demands.
Therein lies the challenge and, for those that seize the moment, the fruitful opportunity to become the destination emporium of tomorrow. In reality, the power of Usain Bolt is needed to sustain the speed of change and innovation, and the stamina of Mo Farah to keep delivering unique experiences. Let's face it, the extraordinary takes years to practice and perfect before the deserved moment in the spotlight. Although retailers are working hard to get channels to fully align, most department stores still resemble the real estate profile of mega-cities; far from nimble. There are, of course, a few worthy exceptions (we're looking at you, John Lewis).
We are observing the early shoots of progress, by a happy chance, or perhaps intention, the department stores are starting to take a leaf out of the leisure sector's book. Strategies that span collaboration projects, pop up / temporary experiences and local community initiatives, were first deployed by fashion and brands at the turn of the 21st century and are now at the heartland of leisure's success.
The customers of tomorrow are the Gen Y Millenials and Showroomers. This global power tribe is changing the way we think about in-store and online experiences, and the image we curate to forge a relationship with them. Despite the digital world being their second nature, the impersonal online experience is making us all crave "Co-company" – you and me, together, whether we are familiar or a network of strangers. The "Co-company" is co-creative, co-operative, co-llaborative and co-rrect; the new way to interact.
For this customer, the idea of ‘big’ has become ostentatious and showy, and for department stores to remain relevant, the experience should be broken down from big to bite-size, unless one is catering to the mainly tourist customer base. Then, the expectations shift towards the larger than life, "the biggest [shoes] department in the world", the exclusive three floor status brand's boutique destinations – securing its place on every shopping tour map. Across all aspects of leisure, including shopping, lifestyle choices are becoming more personalised and intimate.
There has been some shift towards bite-size. These smaller formats are being put to the test, the location driven and multi-channel examples include Bloomingdales’ Soho offshoot, Barneys’ Co-op standalone, and in the UK, House of Fraser's click and collect store and John Lewis' small format store in Exeter. This is just the beginning, but they are not quite hitting the "Co-co" store experience just yet.
To make the department store experience really relevant, the next step is surely to beat leisure at their own game. Leisure learned from retail and deployed smart retail thinking, with the rise of members' clubs, personalised service and flexible work-live-play formats. The bloggers and entrepreneurs "mooch" in Ace Hotel, New York, hot-desk from the lobby and run the digital brands of tomorrow. These customers seek intuitive qualities in their retail co-buddy.
As a proposition, Ace Hotel surrounds its guests with like-minded fashion and hospitality brands, a unique coming together- providing true value to visitors. Whether guests are tapping into an alternative network, being alone in their Zen space, or discovering new brands and lifestyle choices. The key is being with your like-minded entities, and gaining knowledge that is presented in an unassuming way.
In essence, this idea of personalised group or individual education will work well within department stores, provided that the one-on-one is simple and presented effortlessly.
One of the early manifestations of this renaissance is the departure away from the established foolproof formulas. What were once typical adjacencies, such as accessories and beauty, are starting to migrate away from ground floor locations to the basement or upper levels. Examples can be seen at premium stores Harrods, Barneys, Printemps –who are bravely carving the path to new experiences.
It will get even more interesting when the department stores start to personalise the journey and redefine the perception of the store from the brand's [department store's] point of view. The members of staff have become "the cast" and, for the customer, each visit is a theatre production; a performance. A new personalised journey creates a lively dialogue upon entering the store. Customers are finding this increasingly appealing, it's what the leisure sector has mastered and retail needs to adopt…fast.
20.20 are collaborating with Karstadt, Germany's leading mid-level department store, to create a modern and forward-thinking fashion destination. Our ambition for the store was to be an inviting and impressive environment with strong retail theatre and curated storytelling presentations throughout. The store will engage customers and establish a fresh dialogue of ageless attitude.
Breaking down the large store format (over 25,000 m² in total), the store concept in Dusseldorf sets out to stage new international fashion brands and Germany's favourite labels, including Karstadt's own brands. The journey moves seamlessly through the four floors with a fashionable mix that's been tailored to attract new and existing customers and to put the new store firmly on the fashion radar.
Each floor level has been designed to delight customers with adjacencies led by editorial stories, aligned with Karstadt's merchandising and customer segmentation "nine box grid", and anchored by wardrobe favourites including Denim, Labels to Watch, Tailoring, and Everyday collections. Every aspect of the new store has been thoughtfully planned to make shopping easy, intuitive and inspiring. The unique 'fashion kaleidoscope' design concept is a spatial expression of Karstadt's "Full of Life" ethos that allows a dialogue between brands, beautifully staged and cross merchandised to contrast and compliment one another to their full potential. With up-to-date brands, espresso lounges and on-brand service areas with the latest event news, customers can shop the very best in today's fashion and lifestyle.
The overall direction shuns traditional department store trends; instead presenting an up to date image with an international, modern showroom feeling. The ambition for the new store is to be an intimate environment that continuously challenges the norm of the mid-level to mass department store experiences, whilst staying true to its emotional proposition.
Sanela Lazic is head of Fashion & Department Stores at 20.20. Sanela joined 20.20 in 2005 and was appointed creative director in 2007, where she was responsible for the environmental design team’s overall performance, client relationships and design quality. She has extensive experience of working with brands across number of retail and leisure sectors. Prior to joining 20.20, Sanela worked with Caulder Moore, Fitch and HMKM. During this period she was part of a team or individually managed the delivery of design projects across luxury to mass retail, primarily for international brands in fashion, department stores and beauty.