Day Two of Global Shop began with a keynote presentation by Wendy Liebmann, CEO and Chief Shopper of WSL Retail Strategies. Liebmann’s session was entitled “Hope for Retail.” According to Liebmann, we’ve had a decade of calamitous change, and the crisis is over, but the behaviors and impact are not; fear and uncertainty remain. Some aspects of the shopping world have been permanently altered, and she defined 3 areas for us to focus on:
During Q&A there were a few comments that were relevant for spas. Someone asked, “If customers are not shopping now, what are they doing?” Turns out the kinds of things they want to spend their money on are experiences! Going out to dinner, vacations, going to the spa. As business owners, we need to keep up with capital improvements; clients don’t want to see the worn carpeting and tired fixtures, they want a compelling experience. Liebmann also remarked on how her clients were getting into health and wellness in non-traditional ways; Gap is doing pop-up stores with Crunch, so that you fit into your jeans. I am sure there are some spa opportunities in partnering with existing retailers, like the blow-out bar that Bumble & Bumble has put into Bloomingdales on Lexington Avenue.
Next I attended the session entitled Research Informed Design 1 + 1 =3, given by Maureen Boyer and Barry Bourbon of Gensler, and Tom Moseman of Envirosell. This session was an overview of store design that starts from the consumer. Shared Moseman, “It’s extraordinarily important to understand needs and values of shoppers, so they can be translated into stores that understand those needs and are driven by those values. Today, with changing economy and society, shoppers are being driven by value, but not just the price/quantity/quality equation; now, consumers are driven by what they VALUE in their life.” Moseman then shared a film clip of interviews with consumers about how the recession has affected them; they were staying home with the family, renting movies instead of buying them or going to them, making meals at home. And many of them said they would be sticking with these new behaviors, that the recession was a needed wake-up call.
The group discussed the need to focus on the brand experience with the shopper at the center, such as Sephora creating vibrant online communities and then translating that to the store level. They also recommended emphasizing “local” and “community” where possible; creating an oasis in your store, giving people a chance to gather themselves, feel like part of a community. This can be difficult to do in an appointment-driven business model, but perhaps we need to rethink our reception/retail/waiting areas. It reminds me of the way many hotels are re-imagining their lobbies with pool tables, food from kiosks, and Wi-Fi hot spots. The more that people hang out there, the more they are likely to buy, and also to feel that the lobby itself is a destination.
The last session of the day was Increasing Store Performance and ROI through Visual Merchandising, moderated by Brad Somberg, and featuring three different retailers; Philip Johnson, V.P. of Juicy Couture; Chuck Luckenbill, V.P. of Visual Merchandising at Office Max; and Les Satinover, V.P. of Visual Merchandise Presentation at Belk. What was most interesting about this presentation was the varied approaches taken by these retailers.
Luckenbill of Office Max, which has 930 stores, was all numbers. He knew his store metrics exactly, and had a great understanding of the core customer. At Office Max, they’ve named their core customer avatar Eve; she is 25-55 yrs old and has both children and a job. She wants to be educated on product benefits and shown “how to.” Luckenbill stated that their customers walk 30 feet in 7 seconds; they need to grab her attention somehow with creative merchandising and current trends. Even when that is successful, she will only look at the display for 3-5 seconds. Wow, I felt glad that at spas we typically have their attention when they come in the door! Also very interesting, Office Max currently has a mix of 25% private label products. So it’s not just spas who are exploring better margins through private branding.
Johnson of Juicy Couture has 65 stores, and a young and trendy customer. JC needs to change displays at minimum every 30 days, and even as often as every two weeks, with a steady stream of new merchandise.
Satinover of Belk shared some of their challenges, including that Belk has 309 department stores in 16 states, and the chain was grown through acquisition, creating a number of different floor plans and visual display approaches. Satinover and his staff had to create consistency in display and graphics in a number of departments that had been identified as growth opportunities, including Costume Jewelry and Denim. Their changes resulted in 26-30% increases in sales in those departments. It made me think about what a challenge that would be, taking all of these disparate stores and creating a cohesive brand message; where do you start? So, they broke it down by department and opportunity, made a plan, and followed it through. One department at a time.
So, when your mandate is to create specific environments, where do you go for inspiration? Johnson says he looks to stores like Barneys, Bergdorf’s, Abercrombie and Coach. He also looks at smaller stores, somewhere not totally corporate. Luckenbill reports that “I don’t get inspiration from retailers so much as from anything I can see that I like. Just the other day, I saw a photograph of an olive bar in a supermarket trade magazine, and that gave me an idea to use at Office Max.” Satinover was inspired by Avatar, but not just the visual, more by the idea of having 10 years to develop something.
Overall, Global Shop was a great conference; all of these terrific breakout presentations along with a huge trade show floor featuring all of the behind-the-scenes needs of retailers, such as music, flooring options, display cases, bags, software, loss-prevention and fixtures. Definitely worth the time and expense to discover new resources from outside the beauty industry, and to hear about retailing from executives whose business is all about brand and metrics.
- New Retail World Emerges - business is down at department stores, malls, and mass merchants, but the internet is up 13%. We’re also seeing new outlets, like Sephora vending machines at the airport.
- New Shoppers Emerge - shoppers have gotten more strategic with planning. They’ve become really smart and now shop across channels, rather than sticking to one type of venue. According to Liebmann’s research, 52% of shoppers say they stay out of stores where they may overspend, 63% say they’ve gotten used to buying less and like it. So these new behaviors are really here to stay.
- Hope Arrives – New White Spaces. The message here was clear - get creative, and rethink the relationship between the shopper and the store. The store is no longer a clearly defined space; it’s on the internet, it’s in your phone. Liebmann recommends restating the worth of our brands and telling people why they need us. She gives the example of the Louis Vuitton print ad showing the craftsman making a wallet, reminding us what we’re paying for – years of experience, the everyday item painstakingly handcrafted. People don’t need more stuff, they want experiences. Perfect for spas! Says Liebmann, “What matters now, in the new white space, is innovation, optimism, and an unmistakable understanding of who you are. Delivering on why you’re worth it now will drive everything.”
During Q&A there were a few comments that were relevant for spas. Someone asked, “If customers are not shopping now, what are they doing?” Turns out the kinds of things they want to spend their money on are experiences! Going out to dinner, vacations, going to the spa. As business owners, we need to keep up with capital improvements; clients don’t want to see the worn carpeting and tired fixtures, they want a compelling experience. Liebmann also remarked on how her clients were getting into health and wellness in non-traditional ways; Gap is doing pop-up stores with Crunch, so that you fit into your jeans. I am sure there are some spa opportunities in partnering with existing retailers, like the blow-out bar that Bumble & Bumble has put into Bloomingdales on Lexington Avenue.
Next I attended the session entitled Research Informed Design 1 + 1 =3, given by Maureen Boyer and Barry Bourbon of Gensler, and Tom Moseman of Envirosell. This session was an overview of store design that starts from the consumer. Shared Moseman, “It’s extraordinarily important to understand needs and values of shoppers, so they can be translated into stores that understand those needs and are driven by those values. Today, with changing economy and society, shoppers are being driven by value, but not just the price/quantity/quality equation; now, consumers are driven by what they VALUE in their life.” Moseman then shared a film clip of interviews with consumers about how the recession has affected them; they were staying home with the family, renting movies instead of buying them or going to them, making meals at home. And many of them said they would be sticking with these new behaviors, that the recession was a needed wake-up call.
The group discussed the need to focus on the brand experience with the shopper at the center, such as Sephora creating vibrant online communities and then translating that to the store level. They also recommended emphasizing “local” and “community” where possible; creating an oasis in your store, giving people a chance to gather themselves, feel like part of a community. This can be difficult to do in an appointment-driven business model, but perhaps we need to rethink our reception/retail/waiting areas. It reminds me of the way many hotels are re-imagining their lobbies with pool tables, food from kiosks, and Wi-Fi hot spots. The more that people hang out there, the more they are likely to buy, and also to feel that the lobby itself is a destination.
The last session of the day was Increasing Store Performance and ROI through Visual Merchandising, moderated by Brad Somberg, and featuring three different retailers; Philip Johnson, V.P. of Juicy Couture; Chuck Luckenbill, V.P. of Visual Merchandising at Office Max; and Les Satinover, V.P. of Visual Merchandise Presentation at Belk. What was most interesting about this presentation was the varied approaches taken by these retailers.
Luckenbill of Office Max, which has 930 stores, was all numbers. He knew his store metrics exactly, and had a great understanding of the core customer. At Office Max, they’ve named their core customer avatar Eve; she is 25-55 yrs old and has both children and a job. She wants to be educated on product benefits and shown “how to.” Luckenbill stated that their customers walk 30 feet in 7 seconds; they need to grab her attention somehow with creative merchandising and current trends. Even when that is successful, she will only look at the display for 3-5 seconds. Wow, I felt glad that at spas we typically have their attention when they come in the door! Also very interesting, Office Max currently has a mix of 25% private label products. So it’s not just spas who are exploring better margins through private branding.
Johnson of Juicy Couture has 65 stores, and a young and trendy customer. JC needs to change displays at minimum every 30 days, and even as often as every two weeks, with a steady stream of new merchandise.
Satinover of Belk shared some of their challenges, including that Belk has 309 department stores in 16 states, and the chain was grown through acquisition, creating a number of different floor plans and visual display approaches. Satinover and his staff had to create consistency in display and graphics in a number of departments that had been identified as growth opportunities, including Costume Jewelry and Denim. Their changes resulted in 26-30% increases in sales in those departments. It made me think about what a challenge that would be, taking all of these disparate stores and creating a cohesive brand message; where do you start? So, they broke it down by department and opportunity, made a plan, and followed it through. One department at a time.
So, when your mandate is to create specific environments, where do you go for inspiration? Johnson says he looks to stores like Barneys, Bergdorf’s, Abercrombie and Coach. He also looks at smaller stores, somewhere not totally corporate. Luckenbill reports that “I don’t get inspiration from retailers so much as from anything I can see that I like. Just the other day, I saw a photograph of an olive bar in a supermarket trade magazine, and that gave me an idea to use at Office Max.” Satinover was inspired by Avatar, but not just the visual, more by the idea of having 10 years to develop something.
Overall, Global Shop was a great conference; all of these terrific breakout presentations along with a huge trade show floor featuring all of the behind-the-scenes needs of retailers, such as music, flooring options, display cases, bags, software, loss-prevention and fixtures. Definitely worth the time and expense to discover new resources from outside the beauty industry, and to hear about retailing from executives whose business is all about brand and metrics.