Walking into a struggling fashion retailer on a recent Sunday afternoon, I was surprised to be greeted by a smartly-dressed employee offering a glass of champagne and asking me to pick a card – any card! – for the chance to win a discount on my purchase.
Though the purchase in question never materialised and I left the store empty-handed, the event stuck in my memory. It forms part of a trend many of us have noticed when going shopping in-person nowadays – that of experience-led retail.
Experience-based shopping is not a new concept. Authors Pine and Gilmore first coined the term “Experience Economy” back in 1998, arguing that businesses should seek to create memories that satisfy consumer desires for escapism, entertainment and education.
But the need for this kind of thinking has accelerated in recent times. A decline in traditional shopping trips, driven by a combination of online retail’s convenience and on-and-off Covid-19 restrictions for the best part of two years, have left retailers scrambling for ways to entice customers back to physical stores.
All kinds of retail spaces – from high streets, to shopping malls, to department stores – are feeling the crunch. Even prior to the pandemic, physical retail spaces were witnessing significant dips in footfall, dropping by a tenth between 2012 and 2019. And by the first half of last year, vacancy rates had reached an all-time high of 14.5 percent.
Perhaps the most potent symbol of the shopping destination’s fate was Croydon’s infamous Westfield development getting the axe after more than a decade spent in planning limbo. The scheme said to have delighted then-London mayor Boris Johnson was finally thrown out last year, with the local authority citing the shopping centre’s “outdated operating model”.
This description would have been unthinkable post-2012 Olympics, when Westfield centres were becoming something of a symbol of urban regeneration. Fast forward to today, and the idea of a traditional shopping centre seems rather passé. Videos touring empty shopping malls – known as “dead malls” – now rack up thousands of views on YouTube thanks to their distinctly nostalgic feel.
Part of the solution will lie, of course, in converting some of the most ill-fated retail spaces for other uses. The regeneration of Croydon’s town centre is now set to include a tech office hub in place of the 1960s-era Whitgift shopping centre. Across the pond, shopping malls are being converted into, ironically, Amazon warehouses.
But are all retail spaces destined for the same fate, or is there still time to salvage the shopping destination?
This is where experience-led retail comes in, which starts off with thinking less of retail destinations as places for shopping per se, but rather a whole host of in-person experiences that can’t be replicated through a screen. Shoppers still want to go out and buy, but the promise of a new purchase alone won’t be enough to get them there. According to Barclaycard, more than half of consumers would now prefer to pay for an experience than just a physical product.
Crucially, in-person, retailers can capitalise on the consumer’s ability to feel, smell, taste and hear the environment around them, using this to enhance the shopping experience in a way not possible through a screen.
With some of the most common types of outlets to buck the closure trend being fast-food and food delivery, consumers still appear to have an appetite – quite literally – for buying meals in person. Unsurprisingly, retailers like Arket that feature built-in coffee shops and restaurants are now an increasingly common sight, with two thirds of customers being more likely to shop at stores with places to socialise. Primark’s Birmingham flagship recently unveiled its new ‘Taste by Greggs’ cafe, featuring its very own doughnut-shaped swing, picnic area and self-serve coffee cart.
But experience-led retail also means incorporating events not so commonly found on the high street – from live music, to catwalks, to opportunities to satisfy our digital addictions – into physical stores.
As part of its first ever fashion store set to open in Los Angeles later this year, Amazon will integrate QR codes, touch screen dressing rooms and data on past online purchases into the physical space in an attempt to streamline the shopping experience.
And in many cases, thinking about the digital sphere also means making sure stores and their surrounding public realm are primed for Instagram opportunities – how many times have you been out and seen someone ask for their photo taken, perhaps near a newly installed public artwork or flower wall? Retail Economics suggests that the spending habits of younger consumers in particular are increasingly guided by the chance to come away with a memory to share on social media, rather than a material possession.
One of my favourite experience-led retail initiatives was a collaboration between Selfridges and cult second-hand shopping app Depop. Featuring a selection of curated vintage items – from Britpop-era band tees to designer statement pieces – clothes moved around the store on a kinetic rail, bringing the online-only marketplace to life.
Shoppers could mingle with Depop sellers acting as sales assistants or attend panel sessions with the likes of second-hand selling sensation Internet Girl, whose name is rather indicative of where much of the retail market has gone. Indeed, the proportion of retail sales made online in the UK stood at 26.6 percent in 2021 – and it could prove an uphill battle to reverse this trend back in brick-and-mortar’s favour.
Though the Selfridges initiative could easily have been an attempt to drive shoppers back in-store post-lockdown, the six-month event in fact pre-dated the pandemic by a year, suggesting that retailers have long been aware of the need to move in this direction.
But as evidenced by the failure of free alcohol to win me over on my quest for new clothes, experience-led retail can be hit-and-miss. John Lewis abandoned its virtual mirrors that superimposed outfits onto customers, with the department store’s then-head of IT architecture noting that the initiative was a “dud”. It may be a long time before retailers uncover what consumers really want out of the post-pandemic shopping experience – and what works for some stores may not necessarily be right for others.