Retail Innovations 2020

Since 2005, we have published the Global Retail Trends & Innovations Report in collaboration with Ebeltoft Group, a consortium of international retail consultancies of which we are a founding member. In this year’s report, Retail Innovations 2020, we explore stores and concepts on the cutting edge of global retailing through detailed case studies representing the leading ideas and innovations across 18 countries. This year’s case studies speak to four key themes driving rapid change in retail that we will be highlighting cases for and commenting on in the coming weeks:

1. Omni-integration. Retailers serving mobile shoppers in any channel is less of a trend than a must-have capability. And now, innovators are taking omni-integration to the next level:  Onofre, a CVS affiliate in Brazil, operates an automated fulfillment center allowing online orders to be delivered anywhere in Sao Paulo within 90 minutes. Their remodeled flagship store has added self-checkout and tablet-checkout capabilities as well as a robotic restocking system. Building omni-channel capabilities is especially important in developing countries, where much of this decade’s mobile internet user growth will occur. Onofore is already a leader in this field, with nearly half their orders coming through the online channel.  In developed countries, where smartphone usage is already ubiquitous, leaders are pushing the omni-channel envelope even further. One such example is the Bershka apparel store in Cremona, Italy, where customers can scan any piece of clothing via smartphone app, have it quickly brought to a fitting room (from the stockroom, streamlining operations), and check out directly from their phones. Bershka’s fitting rooms are equipped with smart-mirrors that can display a product’s details, suggest outfit options, and display additional clothes the customer may like.
2. Extreme Convenience. Retailers use technology to remove friction along a customer’s path-to-purchase. Some retailers have enabled increased convenience by removing store personnel from the equation: Bingbox in China, Zaitt in Latin America, and Lifvs in Sweden have created app-based, small-format, staffless convenience stores, removing bottlenecks in the form of queues or checkout kiosks while reaching a wider customer-base. Other innovators are focused on cracking the last mile of delivery supply-chains, such as the Kroger-Nuro collaboration that delivers groceries via self-driving car, Wing (Alphabet’s drone-delivery initiative), and Starship Technologies who delivers goods within a 4-mile radius using 6-wheeled robots. The examples above demonstrate that if you can streamline the customer journey using technological solutions, you can also streamline your internal operations, eventually boosting your bottom line.
3. Extreme Experience. In the age of ecommerce, retailers are creating destination experiences for shoppers more than ever before.  Some brands focus on prestige, like Galleries Lafayette where luxury brands are organized by fashion theme rather than by designer or the Woolrich flagship, which is as much a museum for the brand’s rich history as it is a store. Others focus on activities and community, such as the Lululemon flagship in Chicago which offers food, events, meditation classes, and group fitness classes that reinforce the brand’s health-focused brand image.  Another example is the Hi Panda flagship in Japan where the entire store hosts an interactive AR game experience.
4. Sustainability. Retailers are aligning their business model with consumers’ increasing desire to spend their money with companies that share their values.  Many new concepts emerged globally that are built around sustainability.  Empty Shop is a concept where the shelves are initially empty, and patrons donate used clothing to fill them.  The cruelty-free cosmetics brand Lush featured a London pop-up staffed by homeless from the community and devoted to educating people on the dangers of single-use plastics. And even legacy players are getting involved: for example, the 90-year-old grocer Lidl recently opened a store in Turin powered by 100% renewable energy, with urban gardens open to the public, and spaces to host social activism workshops. As Senior Partner Neil Stern put it, the 2020s will be the decade where “greentailing becomes mainstream…really, finally.”

These cases illustrate that we really are at the beginning of a new normal in retail.  To learn more, please download the full Global Retail Trends & Innovations report here.