The future of retail: How brick-and-mortar stores are trying to woo customers

From in-store bars to shops without inventory to new technology, retailers are experimenting with the traditional brick-and-mortar format as e-commerce has left businesses scrambling to figure out how to bring shoppers into their stores.

The pattern has signaled a change in how stores look and operate that has reached the Bay Area.

“Retail is having to reinvent itself,” said Judge Graham, chief marketing and new business officer for marketing agency Ansira.

Graham pointed to Best Buy, which has implemented a variety of demo and service areas in an effort to draw people into its physical stores. In many stores, it has introduced in-store Dyson shops where people can test out high-end products like cordless vacuums, for example, and it has struck deals with big electronics companies, including Apple and Samsung, to set up showcase areas within its stores to show off their products. It is also expanding its tech support offerings.

Best Buy had embarked on a plan in 2012 to roll out some of its customer-service offerings and in-store innovations as it faced negative comparable sales and declining operating income rates, and according to the company, it worked. The company reported in a September news release that comparable sales and operating income rate are up and that total shareholder return over the last five years was 263 percent.

Other retailers are experimenting with personalized customer experiences in stores.

Nordstrom drew attention recently for its announcement that it will pilot a small-format store concept that does not actually have any inventory, but rather dressing rooms and a “styling suite” where personal stylists will transfer merchandise in for customers. The stores, which will also offer a beer and wine bar and manicures, will serve as a place to pick up purchases ordered online, get alterations made and other services.

“I think in retail there are so many more options for using space now,” said Kathy Gersch, a former Nordstrom executive and current executive vice president at consulting firm Kotter International. “Today you could have more of a showroom base that’s smaller where people can try things on … technology has enabled a lot of new ways. I think you’ll see more and more of this.”

Nordstrom has an advantage in that it already uses personal stylists frequently in its traditional stores, Gersch said, so it’s unclear whether the new concept would work for other department stores or retailers that would have to create a whole new department. Still, the …read more

Source:: The Mercury News – Business

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