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The Future of Retail in Communities

COVID is no longer preoccupying our lives as it was three years ago. Now, the war in Ukraine and the destabilization of the world economy are creating more uncertainty. It may seem like there are just too many things to worry about. And for retail brands that have been anticipating a celebratory end of the pandemic, it might feel almost soul-crushing to be facing another major crisis.

So how do you get yourself and your team back up on your feet and looking ahead to a positive future when things are so uncertain? Today, I’m speaking to Richard Dirstein, SLD’s EVP of Creative and Innovation about how retail brands can support their communities right now.

Transcript


Announcer: This is “Think Retail,” a podcast where top designers, strategists, thought leaders, and business people discuss what’s coming next.
 
Melinda: Hi, I’m Melinda, and you are listening to “Think Retail.” COVID is no longer preoccupying our lives as it was three years ago. Now, the war in Ukraine and the destabilization of the world economy are creating more uncertainty. It may seem like there are just too many things to worry about. And for retail brands that have been anticipating a celebratory end of the pandemic, it might feel almost soul-crushing to be facing another major crisis.
 
So how do you get yourself and your team back up on your feet and looking ahead to a positive future when things are so uncertain? Today, I’m speaking to Richard Dirstein, SLD’s EVP of Creative and Innovation. And we’re gonna talk about how retail brands can support their communities right now. Richard, welcome. Nice to have you here.
 
Richard: Oh, thanks, Melinda. Yeah. Excited to have this conversation. So, let’s get to it.
 
Melinda: Yeah. I thought we could start off with something personally about, you know, framing the conversation through our own experience. Just like, how are you feeling right now? And is there anything that you are looking forward to?
 
Richard: Yeah. You know, I’m an optimist. Let me start by saying that. I always look at opportunities. So I am elated, I’m excited about…you know, Canada’s been in a little bit more stringent COVID lockdown. I’m excited to be coming out of that finally, with all of our restrictions being lifted. And just looking at this opportunity to re-engage in retail. How is it coming back? How are brands re-engaging their customers? You know, and as supply chain kind of comes back up to its normal pace and in-store traffic increases, what are we doing to engage the customer?
 
And, you know, I think, you know, we’ve had a great two years that technology such as, you know, digital experience has really gone a long way in engaging customers. You know, a lot of people have embraced e-com and online shopping and delivery. And, you know, but it’s left the other side of it where we don’t have this retail, this emotional retail engagement that you get from bricks-and-mortars. So, you know, I think we’re all looking forward to getting back out to re-grouping, to socializing without constraints, and really kind of rediscovering that retail journey and bringing people back to bricks-and-mortar, you know?
 
Melinda: Yeah. Yeah. I feel the same way. And I moved during the pandemic to a completely different area of the city. And so what I’m looking forward to is getting out into my new neighborhood, which I’ve never lived in before, and discovering all those little special spots that become mine. I’ve already found a really great coffee shop and a really great bakery that I really like. And so that’s been really fun for me.
 
And I’m looking forward to, as the weather gets better, being outside and enjoying, you know, just being on the street and the kind of life that happens when you walk along a busy street with all these different shops. I will say that, you know, parenting through the pandemic, it’s very tiring. And I think the sort of general feeling that I get when I talk to a lot of my friends who are parents, is that everyone’s just really tired and needs something to kind of lift them up and make them feel excited.
 
And even if that’s just going and having a glass of wine at the local bar with a friend, little tiny things like that, feel like such a special moment when you’ve been deprived of it for three years. And so, for me, I’m really excited about really savoring those little moments that I think I definitely took for granted before. I mean, I’d go for a glass of wine every other night, you know, before I’d think nothing of it. And now it’s like, oh wow, it’s this really special thing. And so I am looking forward to that as well.
 
Richard: Yeah. You know, it’s funny. It’s like when you haven’t been out in the sun for a long time, you’re supposed to take vitamin D, right? I mean, right now we’re all living in this state of being deficient. Like we’re socially deficient, you know, the pandemic and this, you know, relative isolation, it’s created a [inaudible 00:04:19] for us. I mean, we prioritize our time different.
 
We’ve developed new habits and not all of these are for, you know, the best. Alcohol brands have had banner years, right? Like it’s no secret that we’ve all enjoyed that extra glasses bottle of wine over the last couple of years. But the brands that require social gathering, you know, gyms, and again, certain types of shopping have suffered. And, you know, our guards up. Like, you know, can we go out? What can we do? And, you know, we’re always looking over our shoulders.
 
So, you know, we’ve also, in times of great social downturn or economy downturn, this mentality of self-reward, you know, I’m suffering, and therefore, I wanna reward myself. You know, I wanna get that $5 or $10 coffee. And I want to go out and experience something. I deserve it. So, you know, we’re at a point where I think we’re just waiting to be primed and brought back into this retail experience and ready to go, ready to engage.
 
Melinda: Yeah. And I mean, the one thing I wanna talk about is the conundrum of consumer confidence because in some places people have already been out and have, you know, basically, the pandemic doesn’t exist. No one’s talking about it even though, of course, it still does exist. And then you have other areas like where we live, where we’ve been, we really have been in a pandemic mode for quite a long time.
 
And you’ve got, you may have stores as a retailer, you may have stores in both areas. How do you adopt policies that aren’t gonna make somebody, some of your customers mad? And how do you support your staff in helping them reduce that level of hostility? Because there’s a pent-up sense that it’s just a level of emotion, whether it’s anger or frustration or feeling that we’re been deprived, but there is sort of a higher level of just emotionality, if we wanna call it that. How do you help your staff and how do you adopt policies?
 
Richard: Yeah. It’s a great question. There will always be policies that please and offend customers, right? And unfortunately, I mean, COVID, you know, it was really polarizing. It really became a political platform as much as a health concern. So, you know, brands really need to stay focused on their customer experience and the journey. So, you know, be true to who they are and be true to the customer’s needs.
 
The physical protocols, you know, they’re out of the retailer’s control. And there have been some great examples of success stories and how that has been handled over the last couple of years. You know, I think that like Apple and any kind of mall anchored that’s really drawing that crowd in and still been able to maintain their sales. They quickly adopt policies that a lot of the customers still experience but also manage their health and safety concerns.
 
So in my mind, it’s convenience that’s really most been affected. You know, this impulse of just being able to walk out and go shopping, you know, it needs a little bit more calculation, you know, it needs to be potentially planned. And, you know, you gotta invest a little bit longer to make that happen. But, you know, there are some great design elements that can be leveraged.
 
You know, how does color play a role in soothing and addressing customer anxiety, adjacencies? You know, to help again, get customers who wanna get in and out quickly versus a customer that wants to have a deeper shop, privacy. You know, that’s always something that we plan and you don’t want an irate customer front center. How can they be secluded or given the level of privacy they deserve and strengthen that path to purchase?
 
And, you know, ultimately it comes down to managing the customer’s experience from the moment they walk up to the store to the moment they leave, you know, purchase completed or not. What to say, how to say it, and the process of onboarding that customer in the space. And for me, I think the best opportunity for retail is to provide an immersive, emotional experience, you know, where the customer can deeply engage a product or service and escape the stress of their short-term, you know, world and really have that meaningful connection, that meaningful emotional connection with the product or with the brand.
 
Melinda: Yeah. I mean, you gotta know your customers. And I think for me, when, you know, I’ve had a lot of conversations with people who work in retail, who work in hospitality about the level of abuse that sometimes their staff have to endure, or, you know, customers who are confused, who are worried, who don’t wanna come in, because they’re worried that they’re gonna be exposed to COVID. And it’s just kind of all over the place. And for me, I think if you can give your regional managers greater latitude within some guidelines of how they can respond because nobody is gonna know the stores better than the people who are actually working there.
 
And so while a head office can certainly set some parameters about how that’s executed, I think giving local managers the latitude to be able to respond to their own market and their own little segment of customers is gonna help to sort of reduce that anxiety quite a lot. Because I think sometimes, you know, head office may be in an area where there’s a certain political attitude about, you know, yes, masks are good, but you may have stores in areas where masks are really perceived as, you know, something very negative. And so if you give that freedom to your local managers, you are helping them make decisions that are gonna be best for the customers that they’re serving.
 
Richard: Absolutely. Absolutely.
 
Melinda: And I mean, like one thing that we’ve talked about a lot and one of my recent podcast was all about staffing and hospitality, and everyone is hiring right now. So, let’s talk about what we can do to inspire the staff that you have right now, instead of the staff that you’re trying to hire, who you’ve already got in your stores, what do you think is key to frontline retail employee experience right now?
 
Richard: You know, I think, you know, good retailers and good staff really know their customers, right? They know their customer, we call it, you know, their pain. What’s the problem that they’re trying to solve? You know, are they coming in to browse? Are they coming in to purchase? As they come in, how do they manage that customer and manage ultimately their expectations? You know, they document. So good employers and employees, you know, they document and share their talk track.
 
It’s a choreography and there’s great, you know, Starbucks and really great brands understand this and they don’t make it complicated. It’s very simple or often, you know, 3 to 10 steps, but they really understand that process. And in doing so, you know, they really empower the staff to feel that they have the tools and the means to solve the problem and that their concerns are being addressed. And also, you know, the customer needs. And the customer always feels that they’re at the center of the journey.
 
So, for employers, you know, they provide the training council for the staff and their needs, the flexibility to ensure that their employees don’t burn out and that they do feel positively supported in their efforts. And give the recognition, you know, because these people are really the front line of the brand. They’re the front line of customer interaction. And I think that’s true of, you know, anything from a call center to a retail store. And again, even in an econ front or a mobile front, it’s the front line of customer interaction. So, it really has to be addressed properly and done right the first time.
 
Melinda: Yeah. You said a couple of things that really resonate with me. One is flexibility, which I think is so important. I think right now we recently did a project on the future of work with one of our clients. And when we asked potential employees, what they’re really looking for, yes, of course, money and compensation is really important and you have to address that. But the next most important thing to them was flexibility.
 
And I think more and more, especially coming out of a situation where people have been working from home, addressing flexibility, even as much as offering job-sharing opportunities, and there’s so much more that employers can do that they just haven’t been required to do. But now they’re gonna have to think about it. The other thing that you said that resonated me with was recognition.
 
And I think it’s beyond sort of… We’ve all seen, you know, the typical things that companies do to recognize employees and everyone’s been doing sort of similar things. But I think it’s time to surprise your staff with small things that really matter. Small things can make a big impact.
 
They can say a lot, especially if they’re thoughtful. And to empower managers at the store level to say, “Here’s a budget for this. And here’s how, you know, we want you to spend a certain amount of money in a certain amount of time on small things for your team.” Because I think that that kind of being surprised and being recognized with something that’s specific to you means a lot more than something that feels like it’s coming from head office.
 
I also think just on a last note, I think all retail companies need to adopt a zero policy for abusive behavior from customers. And sadly, I’ve heard from many people who do work in retail that this is something that’s been increasing. And whether you need to add security, it really depends on your situation. But it does need to be a policy that’s quite clearly stated.
 
And in some cases, you know, I know restaurants are posting signs outside saying we’re not tolerating any abusive behavior. And it’s unfortunate that they feel that they have to actually go to that level where they’re communicating it before you even walk in the door. But if that’s something that you need to do, then you do need to do that because I think staff have endured quite a lot during the last three years. In certain cases, say, for example, in pharmacies, I know a lot of pharmacy staff have really suffered a lot of abuse that they didn’t deserve. So it’s really important to protect your staff.
 
Richard: Absolutely.
 
Melinda: And we talked a little bit about this, but let’s talk about it a little bit more. We adopted online shopping faster than we could ever have possibly imagined. And every brand that wasn’t already all the way into online shopping platforms has really spent all their time investing in it. What do you think we should keep? And what are you hoping will change in terms of e-commerce and omnichannel as we come out of the pandemic?
 
Richard: Yeah. Another great question. So, I think the pandemic has really helped, as you say, it’s driven a lot of trust around digital tools. And the trust of using them and fulfilling and, you know, customers have really got this great opportunity to learn, you know, online, to compare, and then fulfill their orders without ever going into the store. So digital’s here to stay, but it’s the solution is not about digital in place of physical, but rather how the two can work together to help drive, you know, a deeper engagement by ultimately empowering the customer. You know, how can we use digital in a retail setting to kind of get rid of that kind of table stakes, monotonous, you know, choreography, the stuff that’s kind of baggage in terms of your journey and use that time and that customer’s time that’s been freed up to really emotionally connect deeper?
 
And again, allow them to have a more of a deep connection to the store experience. So again, here are some examples in machine learning and AI and, you know, it’s all coming into play. How can my preferences and my time be used to my advantage? You know what I’m coming in for, don’t make me run the gauntlet. You know, then when I say that traditional retailing, you know, you wanna get the customer through the entire store. If you’re a grocery store, you put the milk at the back so that the customer has to go through all of the departments. And I think that’s one strategy, but how can we recognize and prioritize the customer’s needs based on the journey they wanna have today?
 
How can AI provide me with an experience that I was not expecting? So again, surprise me. I was coming in to get the milk, but I walked in the door and I was inspired. I was connected. I saw something new. How can the technology drive me to do something that I wasn’t expecting? You know, and as I said earlier, how can we get through the clutter of this typical store to allow me to have a time-sensitive journey? Or a deep shop journey where I can learn? What can the store do that the metaverse can’t and that’s a whole other conversation with what’s happening with metaverse?
 
Melinda: Yeah.
 
Richard: But, you know, what is the value of bricks-and-mortar? And, you know, I always say like, you know, it’s the only journey that allows you to use at this period in time of your senses. So, you know, there’s still a lot of power in that. And to really tip everything on its end, you know, forget the traditional shop. You know, I come into a grocery store and I start in the produce area, what if I said, “Okay, retailer, I have 10 minutes, show me something, guide me, do something with my 10 minutes.”
 
And it just flips the whole, you know opportunity. And it goes from a purpose-driven shop to more of an opportunity, to more of an emotional shop. What would that look like? And, you know, I think some of these tactics, some of these approaches are gonna become definitely more prevalent as we move into a digital space, but what are the opportunities for bricks-and-mortar as well?
 
Melinda: Yeah, I agree. I think like, what I mean, I’ve only been out shopping a few times recently, as, you know all of our mandates here have lifted. And I find that my, first of all, I don’t have as much energy to sort of go through store after store, as I might have before the pandemic. So I might choose a few select stores. And if I’m not really engaged, I’ll just kind of call it quits and say, “If I’m only gonna go to five stores, I want that experience to be worth taking this trip out of my house for.” And I want curation, I don’t want to go into something where there’s a lot of stuff that’s in my face. And I’m finding this with websites as well. I don’t want too many products because it’s just, you know, we’ve all been in our houses.
 
We’ve all been in this really sort of small, very safe little environment. If something is too cluttered into crazy, it’s hard for me to even… I walked into some stores and walked right out because it was just like, “Wow, you’re hitting me with too much stuff.” I couldn’t even see to the end of the store. I couldn’t even have that sort of experience of like seeing the expanse of what your store looks like. And I think, like, that’s something that as stores evolve and we think about what is the experience? Because it’s not just about showing me a bunch of products, because I probably went on your website before I came in here and looked at a bunch of products.
 
So I’ve already seen the products, so what else? What else is there? And I think that curation is really gonna be really helpful to making a more memorable experience and having it be more about the experience and less about the products, because I can always just, if you don’t have my size, I can just order it online and it’s gonna be at my house by the next day anyways. So I agree that it’s really time to get…I wanna be excited when I’m out.
 
Richard: Yeah. Absolutely.
 
Melinda: One of the things I’ve been thinking a lot about is that during the pandemic, we all found new ways to entertain ourselves, whether it was like being part of the sourdough trend or, you know, my husband really got into spoon carving. How could retailers integrate some of these newfound hobbies and interests into the store experience?
 
Richard: Yeah. Well, that’s a big question. The most immediate connection I can make is, you know, I think for a lot of people, social. And social engagement has really been what has allowed us to stay mentally healthy to some degree over the last couple of years. To stay physically connected as we weren’t able to travel. And so, you know, I think there’s a big opportunity there. Like I said earlier, you know, we’re all socially starved. In the physical sense, we’re all sensory starved.
 
We wanna get out and communicate and see something, you know, other than our home office or the couch, or, you know, our, you know, short trip to the office for a couple of days a week. So, how can communities have a voice in the store? How can we start having the social interact with the retailer? And there’s some great examples out there of brands that have been able to start exploring integration.
 
But, you know, how can that digital world, that social world have a voice or a sense of sharing within the store journey. And that can appear in personalization, that can come into self-expression within the store, social sharing of what we purchased and how we purchased. And again, you know, just a real opportunity to kind of combine the best of both worlds.
 
Melinda: I agree that that personalization and self-expression is something that I really got super into on social media during the pandemic, learning about local artisans and, you know, indie brands like designers that are just sort of like a one-person show. And they really became part of my community as part of the pandemic. And if I could walk there, I might go and pick something up.
 
And I really loved the idea of these, you know, one, this is a unique piece. No one else is gonna have something like this. And one of the trends that I found really interesting was the small batch pottery drops where these different brands that are making pottery they would say, you know, it was almost kind of, you know, it was like a really trendy streetwear brand, people would be grabbing those pieces as soon as they dropped and they’d be sold out within minutes.
 
And this idea of these really unique, special things that it could be as something as small as a mug, coffee mug, but they felt so special. And so I think there’s an opportunity to have more small batch. You don’t need to create hundreds and hundreds and thousands of products to make something more special and more unique to me and my community and my experience. And that’s something I think that we’re already starting to see retailers doing that, and I’d love to see more of that.
 
Richard: Yeah. Yeah.
 
Melinda: Another behavior we learned online was socializing, learning, and working online. And we mentioned this a little bit and we could do a whole podcast about this. But let’s just dabble, dip our toe into the waters of the metaverse. How do you feel about these kinds of experiences and why do you think retail brands should, or shouldn’t be excited about them?
 
Richard: I think the metaverse is definitely exciting. You know, we are big believers in allowing the customer to have multiple ways of shopping, engaging, and having a path to purchase. But I think it’ll take some time for industries to really understand what the metaverse is capable of. I think the immediate challenge that we right now is that everybody’s, and the examples that have been out there, you know, that they’re kind of saying, here’s a physical journey and we just move that into a virtual journey. And, you know, there you go. There’s the metaverse.
 
And, you know, that’s one approach. I just think it’s kind of ho-hum because a lot of times the problem, the true customer problem isn’t being solved. It’s being emulated, but it’s not being solved. So, you know, yes, there’s a need to virtually represent products and services in an interface, but, you know, it doesn’t have to mirror the traditional journey.
 
I think we have, more immediately, we’ll have an era of augmented, physical shopping by way of glasses or mobile that layers product information and features and navigation to have that deeper, you know, educational, prime-sensitive shopping. I’m really excited for that. And that, too, is metaverse. That is part of the metaverse.
 
You know, the real opportunity when we get into the virtual world, and I think that’s where a lot of the news and the focus is right now, how can we completely take everything we know about a physical store journey and throw it out the window? You know, don’t show me a recreated shopping aisle that has 50 cans of soup sitting on the counter, why do we need an aisle? Like, you know, why do we need a can?
 
Melinda: Yeah.
 
Richard: What would that look like? So, you know, what if these barriers were removed? And like, for example, what if you could start your shopping experience by just thinking of a color and then going through a parade or having products offered up that are in that color? And again, so, you know, you’re engaging your senses a little more, you’re engaging emotionally a little bit more, and gaming has been really good in doing this.
 
I’ve got a son who’s very much into video games, as I think most people have kids. And the gaming space, I think of like the recent…it was about a year ago, May 2021, Roblox hosted the Gucci Garden. And it was just a two-week popup where they could build awareness for younger consumers. And, you know, that you basically come into this space as, you know, a 3D silhouette, you know, devoid of color. And as you walk through these areas and you choose where you’re walking, you start absorbing, your avatar starts absorbing what it’s coming in contact with.
 
And, you know, as you go through these themed rooms and it really allowed the customer or these younger customers to really experience the brand in a different way, that is exciting. You know, show me something that I can’t do in the physical space, just like in the physical space, show me something that you can’t do in the virtual space. So, yeah, it’s exciting.
 
Melinda: Yeah. A lot of room for creativity that I think as companies try to make the technology work, I think there’s just so much more room exactly like you said to if you didn’t need walls, if you didn’t need to walk, if you didn’t need to touch anything, if you didn’t need product, what would the experience look like? And I think we have not seen what it’s actually gonna look like yet, but it is gonna be really interesting to see what happens with that.
 
Well, given that globally, I wanna go back to sort of just where we’re at right now, given that there is a lot of anxiety, especially around the economy right now, well, what’s the tone that you think will resonate with consumers? And are there any groups that you think brands should be giving special consideration to?
 
Richard: I think people, young and old, have really experienced tremendous isolation and anxiety. And, you know, as you mentioned, there are several things that lead into that. The opportunity is this platform, retail as a platform for social gathering, and, you know, whether it’s movie theaters or malls or individual stores, you know, let’s come out of the shadows, let’s refocus on the great feelings and the positivity of face-to-face.
 
You know, education has suffered, the physical connecting through proximity for like, you know, I think, again, my son, you know, whether it’s gym or school dances or walking with friends or after-school sports and socialization. Again, you know, what the opportunity is from a retail standpoint to really be that platform, that area where like-minded individuals can really celebrate their love of a brand, get back out from the isolation that they’ve been living in.
 
Melinda: Yeah. I think education is a really important one. I think there’s gonna be a learning gap that is probably gonna have a rolling impact for years to come. And I think I’ve already noticed that a lot of brands are offering in-house learning to their staff. They’re offering to pay back people’s tuition fees if they come and work for them, giving their company employees upskilling opportunities. I think we’re gonna need to really invest in young graduates who are coming into our companies with those opportunities because even if they have been at school, it hasn’t been a full educational experience for sure. So there’s definitely gonna be a need to support young employees as they come on board.
 
Richard: Yep.
 
Melinda: So, many retailers have been sort of in the suspended state, just waiting for the pandemic to end before putting innovation and transformation of, sort of, future-looking projects back onto their agenda. So now that it seems that, okay, we’re not necessarily bouncing back to this pre-COVID world, it’s gonna look a little different. What do you think retailers should do next?
 
Richard: Oh, my gosh, let’s go. I mean, you know, the consumer’s still there. And I think, you know, obviously, again, supply chain and some of the logistics of getting inventory out to the retail stores, there’s still some challenges and there’s still some lag that’s been in place for a year. So customers want a reason to leave their house. You know, I think about my mother, you know, wanting to get out of that house, she doesn’t need to, she wants to. You know, she can have the products delivered the next day or same-day from her grocery store, but there’s something about getting out and doing that.
 
And that excitement, that discovery, that journey that, I think, you know, customers are very much still hungry for. I think the pandemic and the last year or two, again, with these supply chain issues have shown us that immediacy isn’t necessarily a driver. I don’t have to leave the store with something. I may be just looking to fill my time card. I need to do something for the next hour or two. So I’m just gonna go out and experience.
 
Melinda: Just talk to somebody. Just talking to somebody.
 
Richard: Exactly. And if you don’t have all that inventory on the floor and you can reclaim some space. What would you use as that space to engage the customer in? You know, we’ve seen banks put coffee shops, and bookstores put coffee shops into their store, but, you know, your brand, what’s the opportunity to further engage your customer? How can we clear out a little bit of inventory, you know, and really create something that is unique and that’s experience-driven, and that will give customers something to talk about, in-store, socially, share with their friends, ultimately drive more traffic to the store.
 
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