We recently ran our Lunch & Learn webinar looking at the future of store formats. Click below to watch:

We’ve packed a lot of thoughts into this quick read below and the video above. To learn more, get in touch to book in a chat with Sarah and Dan:

Brands often express a desire to ‘get closer’ to their customers.

What does this mean – and how close is close enough? We’ve seen Tesco state its intention to become the ‘most convenient’ retailer in the UK and to this end. Plans have been announced to open 50 new stores this year, with a particular focus on high streets. These locations call for small formats aimed at young, relatively affluent city dwellers looking for a bit of everything within easy reach of their front door.

digital - Future

Another example is upscale bakers Lola’s Cupcakes. We’ve spotted its collection lockers popping up in suburban high street locations. The lockers bring the brand to within easy reach of customers who would be put off the high delivery-to-home charges. However, many are happy to pick up their orders for free while going about their daily lives from these lockers.

Statements are branded in...

Conversely, large format flat pack furniture family favourite IKEA is opening stores in city centres. This is a significant statement for the brand, an acknowledgement of changing consumer lifestyles, of a move away from car ownership. Ultimately, as Peter Jekelby, Head of IKEA UK & Ireland recognises…

“We can’t just be what we always were"

This feels like a useful mindset for all consumer brands to adopt in the post-pandemic landscape.

Customers habits might be changing, but they might not be able to articulate what it is they want from retailers and brands. What is becoming clear is that stores need to play a role in solving the ‘last mile’ distribution piece of the puzzle.

Store formats that effectively run a small warehouse-style, back of house operation allow for click and collect that is convenient for the customer and cost-effective for the retailer – Sainsbury’s acquisition of Argos is a case in point. This then frees up the customer facing part of the store to work harder to surprise and delight visitors. For value retailers, this might mean frequently changing offers and promotions that are only available instore. For more upscale brands, invitation-only events that help to cultivate and nurture loyalty.

grocer - future formats

What about the tech?

It’s worth touching on the role of technology in the development of future store formats, most notably the rise of M-Commerce. Where customers use their mobile phones to navigate stores and access special offers and promotions that are only available to members. Amazon’s Style apparel concept in LA is a testbed for this sort of innovation, requiring customers to use their phones on entry and then to order clothing to their personal fitting room.

Another interesting emerging area is of course the metaverse. McDonalds has a virtual restaurant where customers can meet their friends to order food that then arrives IRL. This is just one part of McDonalds’s digital offer. It’s an encouraging example of a legacy retailer that is doing its best to be amenable to customers, with new stores opening in the UK that have 11 different ways to pay. 

This is an evolving area, and we’re going to keep looking at new and innovative developments. To learn more, or have a chat with Dan and Sarah click below:

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