New Retail Reality – A New Goal Through Winding Roads

Why should customers visit stores in which they know exactly what to expect? In order to captivate their guests, stationary stores need a network of creative ideas, event plans, a talent for creating narratives, and a considerable amount of boldness. Therefore, some old dogmas have to be thrown overboard.

by Jens Fischer

Green Future is making a difference. Even those who cannot afford a hip e-scooter want to know where they can save energy and what contributions they can make to avoid seeing the climate blown to smithereens. When it comes to the green future of a halfway intact planet, people are very open, concerned, constructive, and receptive. That is especially true when they are presented with an attractive environment in which they can educate themselves and exchange information with each other, as the VON7 branch in Ingolstadt’s WestPark Center did with two of its most recent 3-month-long themed events, titled “E-Mobility” and “Green Future”. E-bikes, e-motorcycles, and e-scooters were put up for sale, unexpectedly combined with NFTs, performance art, social media, events on the topic, and e-future visions by students from the “Transportation Interior Design” program at Reutlingen University of Applied Sciences, Germany. Attendees marveled at the art and talked shop, with positive feedback across the board on the green themes – a fresh, digital, and modern take on ambience.

The example shows that small stores are often the ones that provide the real learning opportunities for the industry as a whole. New responsibilities have arisen for retailers who are willing to survive. VON7 stores provide a striking and exemplary demonstration of how this can work. One thing is certain: Purely product-oriented sales presented in the retail space can no longer be the top priority, because sales are omnichannel nowadays. Those who are wholeheartedly committed to making the small and large shopping places in our cities as charming and livable as possible must get out of their comfort zones and discover and embrace new things.

Hospitality Before Expert Advice

Meeting people and bringing communities together should be at the top of the to-do list. The eternal argument of “expert advice only being available in brick-and-mortar stores” is no longer valid. Customers often come into a store very well informed, all the information about the products and reviews are accessible to everyone online, and sales staff with above-average expertise is, with a few exceptions, wishful thinking. Those in the retail industry can learn a lot from the tourism, hotel, and restaurant industries. Visitors to a store should not be perceived primarily as potential customers, but as guests. The focus should not be on the purchase itself or on initiating a purchase. Instead, today’s focus must be on making sure guests have a good time – nothing more, nothing less. The purchasing of products should then follow – whether online, via a QR code, as is the case in VON7 stores, or in the traditional way, on site.

Think in Stories

To be able to offer guests a good time, it is advisable to think and plan in terms of stories rather than in terms of merchandise and products. “Green Future” was the name of the most recent story at VON7, and slots with titles like “Whiskey and Pleasure”, “Shine of the Women”, and “Steel and Fire” will also be announced soon. Quite a stir should be created whenever Harleys roll through a center to a given store. You can definitely look forward to seeing all the looks on the faces of the center’s guests.

Experience per sq m

Putting together the right brands and products for the stories, and staging them accordingly requires expertise, time, precise planning over long periods, and a dedicated contract system. In addition – and perhaps the most difficult thing for traditional retailers – a change of mindset, away from previous shopping behavior, is necessary. The step from merchandise groups and seasonal planning to theme planning is a big one, and it is one that might be better entrusted to a specialized agency. Event managers think about merchandise sales from the bottom up, in other words, about maximizing experience, storytelling, and staging; experience per square meter is the currency. Event managers know how to play with “brands” in the physical space, including social media marketing and the like. Many brands, incidentally, possess the same knowledge, which is demonstrated in their advertising campaigns and marketing events. Nevertheless, as a counter-example, the anecdotal story of a glorious jeans legend, ranging from the Gold Rush era to James Dean, is reduced to a simple stack of blue pants in a store. That, too, can be done differently.

Personal? Digital!

VON7 stores have been able to solve the fundamental staffing problem in the retail sector. The digital know-how borrowed from other industries has led to an approach that was atypical for the retail sector: A “staff pool” has been established in which people interested in working part-time, from students to those in their golden years, have been cast. The casting call and the invitation to register with their personal data in the staff pool was carried out via the internet. Weekly shift schedules are sent to registered staff pool members via an app, where they can “apply” for hourly and daily shifts. With one click, the respective store managers can assign time slots to the people they have selected. If someone cancels his or her shift, it is reassigned, also via the app. The logged-in data is automatically sent to the payroll office. The store managers – responsible people who understand their businesses – are tasked with managing the part-time employees. Shifts that are not filled are taken over by the managers themselves. As compensation, he or she has most weekends off, because Saturday is the most popular day for the staff members. Incidentally, staff pool employees do not work as salespeople at VON7 stores, but as “store assistants”. Such terminology, often dismissed as a minor matter, attracts young people. Innovative staff acquisition and the extremely flexible approach to shift bookings via app are very much in line with the lifestyles of more than just young people. Flexibility in all areas is an often-underestimated factor.

Management Problems: Omnichannel Works!

Digitization and omnichannel can do much more than they are currently being used for. Many are satisfied with the fact that they set up a web store a few years ago and have been dealing with merchandise management and interface synchronization ever since. However, a halfway intact omnichannel system is not the end goal of the transformation – it is only the beginning. The digital process control of innovative retail stores in the style of VON7 stores combines showrooming, product displays with QR codes, events, social media, storytelling, guest entertainment, and hospitality, thereby making the complex interconnections manageable. Digital competence is a must. Retailers should stop acting individually and build competent networks, which is another, albeit necessary, pill to swallow in order to achieve the goal.

Flexible Rent

The furniture industry is discussing suspending Monday as a shopping day, at least temporarily, and keeping furniture stores closed. Shopping Mondays are also losing importance at shopping centers. The question remains as to what conclusions can be drawn from this development. Should events and special offers be used to counteract the trend? That will not do any good as shopping habits have profoundly changed as a result of the online option. Should stores close on Mondays, or at least significantly scale back on their operations? That might be worthwhile if the rent for weak Mondays was also lowered. Making rent more flexible is a hot potato, though. That said, it must also be gradually becoming clear to operators and investors that if the focus on efficiency remains the only factor in center operations, realistically speaking, quite a number of centers would have to close in the meantime. While safeguarding mutual interests, rent must be put on the table to give tenants and retailers room to develop viable business models for the future. We need survival strategies, and everyone is called upon to work on them together.

With the digital possibilities, the self-image of the younger generations, as well as the experience gained in the meantime with omnichannel and the new customer journey, we have the complete toolbox necessary to implement and try out ideas that may even seem unrealistic. What the toolbox does not contain is creativity, courage, and standing. We have to deliver those aspects ourselves.

Jens Fischer
Jens Fischer

CEO of K.U.L.T.OBJEKT

Learn more about von7

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