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The Reinvention of Physical Stores

There’s been a lot of speculation about the future of retail when ‘all of this’ is over. When all the pivoting, reinvention and new-normalising is done, what will the new shops look like?

The reinvention of physical stores

Back to nature

The next generation of stores will be designed by looking a lot more closely at customers’ behaviours, wants and needs – not at current shopping patterns, but how people want to live their lives in the future.

We know that it takes about three months to either break a habit or acquire a new one. Isolation will have already done that. Many of us picked up those habits startlingly quickly. It took about a week for us all to become obsessive about hygiene. I don’t see that going away. Our natural hesitation in venturing into a potentially still-infectious environment keeps us avoiding unfamiliar, crowded, shopping experiences, trusting our local shops and cafes to keep us safe.

We’re rediscovering the beauty of nature, simple pleasures like fresh air and sunshine, even talents for art, crafts and music. Our biggest need is for human connections, social interactions.

But we’ll also need our space. Who wants to spend time at the supermarket or the shopping centre when you could be at the beach with friends or a family barbecue, making up for lost time? Customers will be looking at everything with new eyes and will have a new cynicism about ‘just buying stuff’. They will have spent much of their time at home clearing it out. The last thing they will want is more of it.

There is already a move back towards the very efficient, transactional kind of retail, particularly for essentials. The big weekly shop has also returned, for now anyway. Many more people will become ‘tedious task’ shoppers who just want to get in, get out and get it done – they’ll have better ways to invest their regained freedom. Checkouts will get faster, and click-and-collect and drive-through more efficient. And definitely low-touch, too.

Reinvent, reinvigorate and renew

But moving forward from that is a much more interesting future where you don’t even have to go shopping for those low engagement categories like dog food, tinned tuna and, yes, toilet paper. They’ll just turn up at your house on a subscription basis. For those of us who live to eat, life will become a lot more fun. There’s an opportunity for extra-high engagement food shopping for fresh fruit and vegetables, meat, fish and fresh bread. We’ll see a move towards ultra local, with seasonal produce coming from community gardens and even people’s backyards.

I’ve speculated on this before, but now I believe that food will have a much more social component. Look out for cafes, restaurants and bars in these new food markets, or even just spaces designed for people to bump into each other, talk and meet new friends. In time, these will become social hubs, anchoring small local communities of service based retail, pop-up retail, small businesses, health care and child care.

With people emerging wild-haired and rag-nailed from isolation, there will be a resurgence in personal services, but there will be new categories of service retail. Remember the stigmas once attached to now mainstream mall offerings like hearing clinics, laser hair removal and teeth whitening? Mental health might be next, with mindfulness clinics, counselling and psychotherapy as mainstream offerings in shopping malls. Our skills in creating excitement and heightened emotion for customers will be reverse-engineered into creating calming and nurturing environments.

Pharmacy will look completely different. Over time, it will have developed an important role in taking over routine tasks from doctors – routine testing, monitoring of blood pressure, treatment of minor ailments. It will play a vital part in our recovery, providing testing for COVID-19 as it becomes more accessible and, as the vaccine becomes available, its distribution and administration.

The design of pharmacies will change dramatically, away from discount selling to a professional services environment – a place to go to maintain good health instead of somewhere to go just when you’re sick.

The evolution of bricks-and-mortar

Post-coronavirus, we’ll all finish up being a lot more tech-savvy. Online shopping will not become an alternative, but the main event. Our expectations of fulfilment will be so much higher. Shops will be extensions of the online offer, not the opposite. The physical part of the store will exist to provide the three-dimensional product experience that we just can’t get online.

The size of retail chains will polarise. The big ones will get bigger and stronger as they replace or acquire weaker competitors. Chances are there will be two discount department stores in Australia, not three. Maybe there will be just one department store, not two.

These are the big trees that will grow bigger. But at the other end of the scale will be green shoots, the smaller, independent entrepreneurs building offers based on growing local, making local and buying local. Some will be hybrids based on two complementary businesses sharing overheads. A bike repair and juice bar. A dry cleaner and shoe care. Custom furniture and hifi.

Even those bigger, stronger stores will be expected to embody a deeper social purpose. For example, the purpose of an outdoors store will become less of a ‘warehouse of product’ and focus on ‘enabling people’s connection with the wild’, or simply ‘therapy from nature’.

The design of that store will be completely different. More online transactions abetted by fewer, more experiential, more experimental, shops. Less retail, more therapy.

But how will those green shoots businesses look? These new micro-retailers will benefit from the smaller spaces, shorter leases and lower rents offered by landlords. They’ll be offering not just goods for sale, but a whole world around that.

For example, you’ll make an appointment online to buy some running shoes. When you go to the shop, you’ll have a one-on-one consultation with a qualified specialist on the right shoes for your needs. You’ll receive training on how to start running and ongoing online advice on proper recovery techniques. The retailer will let you know how much mileage you’ve clocked up and when you’ll need a new pair. And a proportion of the store’s profits will go to a related charity foundation. You’ll become part of a community, not just a credit card with legs.

The definition of a store fitout will have to change. A conventional retail fitout employs long-life conventional building techniques (plastering, tiling, drywall, etc) and costs the same as a house. Instead we’ll be looking at high concept, low-cost solutions that will be upcycled and recyclable and bump-in and bump-out in a day. ‘Shop in a box’ will become a thing. Highly creative pop-ups will proliferate as new businesses get a foothold. More IP, less building.

Many of these trends were on their way anyway, the future has just been brought them closer. It’s not an apocalypse for retail, more of an asteroid. The strong will get stronger, the nimble will get creative. For all of us who will be in recovery, the new retail must be more social, more purposeful, and kinder. We’ll need it.


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