Store Innovation Watch: July 2018

If you live in the Northern Hemisphere of our planet, it's fair to say that it has been hot. Perhaps the summer heat has slowed the pace of store innovation announcements for the month of July. More likely, retailers are taking a collective breath before hitting stores hard in preparation for either back to school, or holiday 2018, or both.

Here are six store innovations to watch from July.

UPDATE: Watch Nikki discuss some of these innovative store experiences in more detail during an interview she conducted on Facebook Live below:

Here are six

1. 1. Party City's Toy Cities

      Party City plans to take over abandoned Toys R Us locations with "Toy City" pop-up shops in the run up to the holidays. The retailer plans to extend its Halloween City pop-up concept by taking it to toys, filling the hole left behind by Toys R Us's downfall, but also doing so by bringing the logistics and assortment expertise of one of the original pop-up concepts to bear. This fall, this idea of seasonal expansion of a specific category will be one to watch – because if it's successful, we can expect to see more of it in 2019.

   
   

   2. Nike By Melrose

      While Nike has been revamping stores and investing heavily in customer experience in those stores, I've found myself wanting more. A basketball court in the middle of the store is cool, but hardly the kind of experiential retailing that seems to be the wave of the future. This store, Nike by Melrose, is Nike's first "Nike Live" store.

      What makes Nike Live different than other Nike stores? One, it is highly localized, based on data about local customer purchases, both online and in stores. The brand expects to completely refresh approximately 25% of its inventory every two weeks to keep things fresh and new for customers. There will be a lot more digital connections, like encouraging customers to scan product barcodes with the app to get more product information. Customers will also be able to book "try on" appointments online, as well as reserve specific inventory to try on.

      Nike plans to treat this as a lab store, rather than a specifically-designed concept that it's planning on rolling out everywhere, so anticipate that the offerings in this location will change.

   
   

   3. Margaux

      Margaux, if you don't spend time on Pinterest, is an online-only footwear brand. The company is opening its first store, in New York, after trialing a bunch of concepts through pop-ups across several cities. Margaux's store will look more like the Bonobos model – they expect more exploration and fit, less direct selling, though the company plans to sell an exclusive shoe out of its NYC location, a blue satin flat that will not be available anywhere else, which is an interesting twist.

      Margaux is not the only online-only retailer that is exploring more permanent physical locations. Lively, the women's lingerie brand, is running pop-ups across the country currently, as a proving ground for store concepts before opening its first store.

      The trend of opening several pop-ups across several locations seems to be the new way forward for brands moving online to offline – test, be flexible, be local, then learn, then build stores.

   
   

   4. Custom Consortium

      Custom Consortium looks to be yet another startup that aims to take a bite out of the future of the department store. Adweek describes it as a blend between bespoke and fast fashion, but digging into the concept reveals much more than that. Right now the store is part pop-up – the concept does not currently have any permanent locations, and part marketplace (it features several brands like Olfactory and Impish Lee). The key difference between Custom Consortium and the usual pop-up suspects is the emphasis on customization. Like Margaux, the expectation is that you will go in the store to explore and try, but then order to have products – customized for you – shipped to home.

   
   

   5. Container Store Flagship Store

      Container Store has updated its flagship store in Dallas with a new concept that the retailer says it expects to take to other cities going forward. The store looks more like a house, with a living room and kitchen and closet, etc., with a much heavier emphasis on empty tables and creativity stations where consumers can put together their own solutions to their organizing needs. Consumers can upload pictures of their organizing challenges online and then make an appointment to visit the store to get recommendations on how to solve those problems. And there is a lounge area for customers to wait for their appointment turn.

      The retailer emphasized the need to lower the ceilings, widen the aisles, remove shelving and merchandise to make the store more approachable and less intimidating for shoppers – a trend I've heard repeated by other retailers who are trialing new concepts.

   
   

   6. The "X" Factor

      Not the show, rather, retail crossovers and collaborations. Last month several collaborations crossed my desk, but I usually ignore store news that is not related to customer experience. However, two more collaborations/crossovers hit this month, and that starts to speak to an important trend: even brands that have wildly loyal followings are keeping the frenzy high by offering limited release collaborations, usually with either celebrities, or equally frenzied brands. For July, look for Savage x Fenty, a Rihanna-driven pop-up in London, and Under Armour x Steph Curry in California.

      Another x-factor of a totally different flavor is Goop x Cadillac. The relationship is more than transitory – Cadillac has crossed over with Goop for about two years with a "Road to Table" series of pop-ups. What's interesting about this relationship is that Cadillac and other "sponsors" are basically underwriting Goop's pop-up rent at the locations they visit, according to this article. Even more notable in this article are the complaints of long-term retailers in Aspen, the current Goop/Cadillac pop-up location, that the series of pop-ups moving through retail real estate in the area is hurting the sales of long-term tenants. Expect more collaborations ahead – and possibly more pushback against real estate companies from longer-established tenants.

   
   

   That's my list of store concepts to watch for July. Stay tuned for August's take – we'll see if retailers start pulling out all the stops for back to school. And if you know of something innovative happening in physical retailing that you think is worth paying attention to, please let me know!

   Want more of Nikki's perspective of innovative store concepts to watch? Read her June 2018 Store Innovation recap here.