Zara London retail concept store with fashion products on display

Physical retail isn’t dead, nor is it dying. It is simply transforming. While we’ve seen a great number of household brands fall victim to the so-called “Retail Apocalypse”, we’ve also seen huge retailers transform their physical presence with innovative technology, artfully blurring the lines between bricks and clicks.

Contrary to the many headlines, our research, The Spending Index: Big Ticket Edition, has shown consumers still value the in-store experience – particularly when considering high-value purchases. In fact, over a quarter (28%) of consumers like to look at an item in a physical store before committing to a purchase – even if they have researched it online. But that doesn’t mean enterprise retail can continue the way it’s been for the last decade.

The rise of concept stores is a testament to this. More and more brands are getting on board with an elevated in-store offering, expertly blending the online and offline experience with the help of retail technology. Research from The Future Laboratory identified that 75% of Generation Z consumers state they would prefer stores that provide a memorable and encouraging offer, with 50% of 20 year-olds searching for enhanced retail experiences. Enterprise retailers are constantly and quickly tweaking these offerings through partnerships with retail technology providers, from smart dressing rooms and augmented reality, through to in-store point-of-sale finance platforms, such as Divido, recently named by CB Insights as one of the providers disrupting physical retail.

From basketball courts and virtual reality holidays, to digital mirrors that can show what clothes you’ve been browsing during your visit to a large retailer, we’re listing the top five brands that are taking the in-store experience above and beyond with technology.

Nike: Introducing Nike Live

Following the success of its New York flagship store, complete with a basketball court with cameras from multiple angles to assess a user’s sporting performance and dedicated coaches on hand, Nike launched its latest offering, Nike by Melrose in LA this year.

In a truly connected approach to business, Nike analysed the insights and behaviours of its app, NikePlus, in Los Angeles, and developed a new store concept inspired by these findings to be built as a hub for its local members. In addition to the typical selection of products, Nike by Melrose also offers city-specific styles determined by Nike’s digital commerce data – including buying patterns, app usage, and engagement).

Nike continues to be a true mastermind of omnichannel retail. The impressive store features a digital vending machine where app users can redeem products or rewards using their member pass, personal shopping booked through the app, and even a drive-thru service for returns, exchanges and purchases using SMS, or Swoosh Text, between customers and the store.

Virgin Holidays: Try before you fly

Virgin is a brand famed for its innovation, and it hasn’t been trumped in its in-store experience either. Having experimented with various concepts since 2016, it recently opened a store in the UK with a spa, virtual reality rollercoaster, complimentary drinks, and business class seats that offer prospective customers a taste of their potential holiday as they browse different packages.

Virgin’s offering of the experience of business class seats is a clever move in tempting customers to make an upgrade. With a wide spectrum of customers and a third of UK shoppers viewing paying by finance as a convenient way to spread the cost of high-value purchases, licensing a multi-lender global retail finance platform, such as Divido, could create the perfect storm for Virgin Holidays.

Dyson – Hands-on with the hoovers

Dyson’s brand is all about superior engineering designed to solve real problems. The best way to get that message to hit home for its potential customers was to give them the opportunity to bring the science to life. First opening in London in 2016, Dyson Demo is a space designed to encourage consumers to pick up, test, and understand Dyson and its technology.

Our research has shown Brits are thorough researchers when it comes to big purchases, with 38% of shoppers doing their research in-store. Beyond interactive demonstrations, Dyson’s New York store offers a purification room, and hair styling stations featuring its newest styling products, allowing customers to try them out first-hand, and hopefully converting to a purchase.

Farfetch – Store of the Future

According to Farfetch’s Founder, Co-Chairman and CEO, José Neves, even with online shopping continuing to grow at a fast speed, physical retail will account for 80% of sales by 2025. To help luxury retailers stay current, Farfetch’s e-commerce platform has launched its Store of the Future, linking offline and online worlds and using data to enhance the experience for customers, delivering personalisation.

The concept is modular, allowing brand partners to pick and choose the components that make the most sense to its business. Some of the key applications that have been shown include: a universal login that recognises a customer as they enter the store; an RFID-enabled product rack that can detect which products a customer is browsing which then auto-populates their wishlist; and a digital mirror enabling the customer to view their wishlist and summon items in varying colours and sizes, among others.

One of the key elements that differentiates Farfetch’s platform is its open architecture, encouraging third-party applications to build into its operating system. Fully customisable retail finance platforms that can be seamlessly plugged into existing technology, such as Divido, can be offered through Farfetch, allowing customers to spread the cost of their high-value purchases – a benefit that encourages 36% of UK shoppers to make a repeat purchase.

Zara – A digital personal shopping experience

In a similar vein to the technology on offer from Farfetch, Zara has been one of the UK’s first high street brands to incorporate more digital beyond the gimmicks. It’s London flagship store features RFID-enabled fitting rooms, offering up recommended or coordinating items when a customer scans a product.

In addition to physical technology, Zara has recently become one of the first mainstream retailers to launch an AR app, allowing users to point cameras at sensors in the windows and see virtual models showcasing the clothes, giving the user the option to buy the featured clothes directly through the app, or in-store.

While there may have previously been cries of catastrophe around the immense growth of e-commerce and its impact on physical retail, we’re now seeing more positive takes from industry experts, led by hugely innovative and agile brands that are adapting to the customers of today and the future.

While technology can elevate the shopping experience and provide insightful data for brands, payments shouldn’t be ignored when considering the customer experience. According to our research, 61% of UK consumers are more likely to make repeat purchases if the payments process is effortless. To find out how you can maximise shoppers’ appetite for customer finance and increase average order values, get in touch.

The Future of Retail: 5 brands taking physical retail to the next level

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