Non-selling showrooms and experience stores: What’s actually working?

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Ahead of the Seamless Asia conference, happening 3-4 May, Wong Mei Wai, former business director of Aspial (Aspial – Lee Hwa Jewellery), Founder & Chief Change Catalyst at APAC Global Advisory, shares her thoughts on how retailers can make the best of use of non-selling showrooms. What follows is her responses.

What showrooms or experience stores have you seen that stood out for you in Southeast Asia?

Louis Vuitton Store at Changi Airport Terminal 3 (Photo Credit: APAC Global Advisory)

Overall, I feel that North East Asia (including China) houses more outstanding experiential stores with notable examples like Starbucks Shanghai, Burberry Hong Kong – compared to Southeast Asia. This may be due to the fact that there is more success in integrating technology into the store to enhance the consumer experience and more willingness to embrace the digitalisation with giants like Alibaba at close proximity to China tech cities .

 

However, what recently caught my eye in Southeast Asia, was my experience in travel retail at Terminal 4 of Singapore Changi Airport (T4). Travel retail is normally a predictable experience. However, I found the T4 experience was designed to be surprising, innovative and unique — integrating well into the consumer lounge experience as well as into the mainstream F&B outlets. Much thought has been put into the design of the customer (passenger) journey to bring across the intended experience and to showcase not only the retail outlets but also the Singapore way of life. To bring out the “cool nostalgia” of a series of local mainstream Singapore brands such as Heavenly Wang and Old Chang Kee (to name a few), they have been put together effectively to evoke the flavor of nostalgia, heritage and culture.

 

These brands were designed into shophouses at the airport waiting lounge. The non-selling environment (the waiting lounge) was transformed by media touch points showcasing the inside of a shophouse opening up to unveiling a twirling dragon or an authentic musical performance. The experience beckons you to patronise the local stalls by raising the curiosity of the food and beverage retail shops — inviting customers to explore or enter to enjoy the entire experience.

Conservative Shophouse Experience at Changi Airport Terminal 4 (Photo Credit: APAC Global Advisory)

Louis Vuitton Store at Changi Airport Terminal 2 (Photo Credit: APAC Global Advisory)

The other strong experience is the glittering Global Luxury Brand Louis Vuitton’s store.

A magical luxurious store experience with innovative design, magnificent media usage, sound, visual merchandising and store service. Interestingly this was set up at Terminal 3 Changi Airport.

 

It is not a coincidence that experiential stores were set up at Changi airport: Singapore has been chosen as a gateway by companies that want to expand their footprints in Southeast Asia. They are using Singapore’s retail and consumer sector to break into the region. According to a report, Singapore is playing this role for both the traditional brick and mortar retail sector as well as for e-commerce players such as Alibaba, Amazon and of late some Japanese companies that have moved into Singapore as well.

 

Showrooms for high-value items e.g. cars make sense, and have been used for decades. But what about showrooms for lower -value/lower-margin items ? How feasible are they?

 

We all know what to expect when we walk into the car showrooms. Mostly, they are cold and there will be pressure to test drive or purchase a car. There have been attempts to deviate from this model but it is still less prevalent. For instance, this Tesla store features interactive displays and design studios where customers can configure their car on a large touchscreen and then view it on an 85-inch video wall at the back of the store.

 

GRAZ showroom by NAP Architects, Tokyo – Japan

If we look at lower value items, you can already see the evolution and need for them to move towards the same direction. Be it making it an “amusement park” or “museum” by integrating technology and media to develop an exciting media touchpoint. However, the retailers would ideally want to be able to have a strong linkage back to sales via a strong CRM and digital linkage, or be able to sell products from the showroom.

 

 

 

FZDP shoe showroom in New York City for luxury sneaker brand (Photo Credit: Mark Clennon)

Separately, showrooms may have different objectives. For instance, in the case of Shimano that brings numerous different experiences to the avid cyclist — including the interactive digital experience and the theatre,  it was a flagship store outside of Japan aligned with the Singapore Sports Museum to encourage the community to partake in an active lifestyle – where the approach is only possible with subsidized rental rates.

 

 

 

Shimano Cycle World in Singapore Sports Museum (Photo Credit: APAC Global Advisory)

The move by Media Markt (now part of Ceconomy) that take care of electronics for the Makro stores (which are now part of Metro), may show the way for low margin products. For instance, now stores by Media Markt trialed in Wilrijk and Eindhoven has the robot Pepper welcome visitors. Customers can play games in their newest gear, get their hair styled, and taste a cappuccino made by a real barista. There is even a chocolate printer and virtual reality applications. You can personalize your fridge or washing machine with a colourful print and even play with drones. The store also houses the latest technological gadgets, like the amazingly thin (2.57 mm) LG Signature W OLED television or an intelligent fridge with touch panel. Young (local and international) start-ups can also showcase their ideas in innovation pavilions. Media Markt believes in the combined future of a physical store and online shopping.

 

Do you foresee a future where most stores would be showroom stores?

Increasingly I see stores becoming more of a media touchpoint which could be a experience store or showroom. They are the rare asset that allows customers to experience the on-line experience on the ground. The beautiful imagery one sees online are all brought to life. Increased omnichannel demands are driving stores to work a lot harder. A key challenge to all global, regional and local brands is to be rigorous in considering the role of the store. This includes an increasing growth of quality of stores with strong experiences versus a quantity of the network. That said, I still believe that there is a general tendency to move towards experiential stores where sales can be made or integrated digitally – compared to showrooms. These would start to house digital interfaces, scale robotics and 3D, machine learning and conversational commerce.

 

How do store designs for showrooms differ to those of stock-carrying stores?

The store designs for showrooms is a rigorous process. The showroom would not be successful if it is just a “museum”. It would need to have seamless marketing, PR and digital activations connected to strong CRM to build a community of engagement. This differs from the new way of designing the stock-carrying stores. This is mostly because as brick and mortar retailers try to enhance their stock carrying in-store experiences, new options are emerging to help close the gap between online and offline. The basic expectation of stock-carrying stores should be to find the best way of combining e-commerce with in-store shopping to create a consistent retail experience. However, many are still struggling with this. A big consideration is not necessarily what tells the story, but what merchandising and visual merchandising mix brings in the profits.

 

By making the shopping process as simple as walking into a store, scanning an item, and paying for it with a series of taps on your smartphone, or, better yet, buying products online, picking them up in-store and checking yourself out, more stores are successfully blending the best of in-store with the best of online shopping. The focus of the stock-carrying retail experience will be around drawing traffic and not just about bringing the convenience and speed of the online shopping experience into the store. The real goal is to find ways to help consumers reduce the scope of their search and simplify their shopping experience and, in the process, make retail stores more intuitive and brands more attractive. Today we believe stock carrying stores can gradually move in great advancement with community and Telco support with projects like the Kampong Glam’s digital makeover.

 

Wong Mei Wai is the Founder & Chief Change Catalyst of APAC Global Advisory (AGA). AGA specialises in transforming retail experiences and creating new concepts for showrooms or specialty store with the integration of digital solutions. Catch her presentation at the Seamless Asia conference on 3rd May, 17.40 – 18.00.

 

To book passes to Seamless, click here, or contact Sunny Wilson, Audience Development Director, +65 6322 2340 or sunny.wilson@terrapinn.com

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