Many have been commenting the retail apocalypse, including the newly appointed Chief Product Officer, Tomas Pueyo, for the French startup Ankorstore, which gained a $2 billion valuation in its last round of financing. Founded in 2019, Ankorstore is planning to take on Amazon, operating a wholesale environment for independent retailers across Europe. Like Pueyo, Warren Richmond, founder and CEO of the brand new concept in the UK, Situ Live, believes that retail plays a very important role in the lives of its community, customers and employees. Whether it’s the job that’s offered to someone in need or the bustling activity that comes with people in the streets, retail is more than just pure commerce. Yet, we all know that eCommerce offers a radically disruptive alternative to getting in a car, parking, finding the store, dealing with sales personnel, a queue to pay and more.
The inexorable rise of eCommerce
According to Statista, eCommerce has been on a basically straight line upwards in terms of percentage share of total retail, notwithstanding a blip through the pandemic. From 1Q 2010 through 3Q 2021, the percentage share of Ecommerce of total retail in the US has gone from 4% to 13%, having hit nearly 16% mid-pandemic.
And in China, where e- and mobile commerce is far more advanced and accounts for more than half of total eCommerce in the world, the share of retail in China has hit nearly 25%. {Source Statista}. Meanwhile, according to emarketer, the share is even bigger (see below):
The fight back by street retail à la Situ Live
So, what’s a brick & mortar store to do to stem the tide? They need to play to their strengths and to be a worthy complement to the alternative methods, with an eye to seducing the customer in the way he/she is wishing. Situ Live, launched just four months ago, is a fascinating option. I would call it an experiment for now, since it’s not yet proven its worth. Yet, in Situ Live, founded and run by Warren Richmond, proposes a genuinely unique concept that works with other retailers and brands in an effort to provide a very different offer. And it’s an offer that doesn’t include a sale. Where Oxford Street was proud to announce that their retail stores were changing the way we — the consumer — shop (see image to the right of a neon sign on Selfridges), Situ Live is changing the way brands propose and sell. Located in the Innovation Hall of the upscale Westfields shopping mall in Shepherd’s Bush, London, Situ Live presents a very different kind of retail.
Situ Live – An experience worth talking about
Among the many problems with retail is getting word out about your existence. One of the best ways to do that is to create such a surprising or memorable experience that the people who go into the store are compelled to speak about it (witness this post!). After all, word of mouth is the most powerful form of marketing there is. A second problem is providing a valued and differentiated proposition versus the convenience (and price competitive) eCommerce. Situ Live is a highly curated and immersive show room, allowing potential customers to have an experience in situ. There are six different themed areas in the space that sports a variety of products that can be tasted, questioned and tested. For example, they have hired a bona fide chef who will cook a genuine meal and interact with the audience, talking about the utensils and ingredients.
Starting on the outside
I came across the Situ store by luck… but it wasn’t blind luck as the store is situated in the Innovation Alley of Westfields, facing the Apple Store and the Amazon 4**** store, so my kind of turf. From the outside, on the other side of the passageway, it was hard to gauge exactly what it was. With the reflected Apple logo on the front, I could imagine from the left hand side home furnishings. But on the right, it looked like a car. So I was initially confused.
Approaching the store, I was attended to by two of the store personnel, who gave me a short introduction and I quick automatically gave a try out to the interactive mirror on the left, designed to lead you through more home exercise. I’ve got a problem with my hips and flexibility, so this spoke to me.
To the right, I saw a masterful Maserati. While I wasn’t able to do a test drive, there were plenty of interactive components, including a car configurator and viewing color and trim samples. I was told that they’d actually had one confirmed sale of a Maserati from the demonstration in store.
I spent a considerable time in the “living room” space where I was able to taste the sound of the Sonos system, full monty. That’s to say with the volume cranked up. The room is fully connected and demonstrates, for example, how the electric blinds work. It had many other interesting items to check out, with QR codes that lead to more explanations on their site… including pricing, availability, etc.
Rethinking the retail business model
So, the big question was around the business model, since this was a store where none of the goods were actually for sale from the store. The business model is based on the relationship and subscriptions with the different brands. The ability to measure the tangible sales uplift depend on the tracking and the diligence of the customer to make a connection between Situ Live and the brand. Otherwise, the main idea is that this is a curated space, allowing for an unique and personalized experience for the shopper. As Warren Richmond explained to me in an interview, Situ Live is pro all retail outlets. And in terms of the selection of brands in the ‘store,’ they have a committee that evaluates the brands’ purpose and ethics.
I noted with satisfaction that the staff in Situ Live were all keen and very open to my questions and that I was allowed to photograph all I wanted… which isn’t always the case in stores, where management is overly worried about their IP being stolen (for example at Amazon across the hall).
The 5E’s of Retail…
Those of you who’ve followed my work know about my framework of the 5 E’s: Engagement, Exchange, Emotion, Experience and Essence. To my thinking, and in line with various surveys about customer expectations, Situ Live goes a long way in bringing the 5 E’s into retail. Kantar Panel Research (from Situ Live) says that “70% of consumers want to physically experience products that will enhance their lives.” The Momentum Worldwide WE KNOW survey shows that 80% of respondents “agree that brands need to form an emotional connection with consumers to succeed.”
As the GM of Maserati North Europe, Peter Charters, explained, “Launching Maserati at Situ Live is a really exciting moment for us, it marks a new way for us to engage with people, and we’re looking forward to introducing new audiences to this iconic brand.” When the floor personnel are trained to tell the brand story, engage with the consumers and the company makes sure that the chosen brands are aligned in terms of purpose (i.e. in their Essence), Situ Live is well on its way.
If you’re in London and want to know about the future of retail, there’s definitely something in this experiment that is worth checking out. Naturally, it’s early days, but finding a model that allows brands to feel sufficiently rewarded, personnel that are engaged and appropriately trained and compensated, we can say that Situ Live is paving if not striking a new path. The rest of retail has a long way to go, though.
