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Lighting the way...

...to purchasing paradise... It’s fashionable to think that online shopping is the dominant force in the retail industry at the moment.  This came to mind when I saw Burberry's announcement about its new store.  Burberry has taken over a 1820s Grade II listed building in the elegant Regent Street shopping district in central London and revamped it into its flagship store.  You can see Burberry's Chief Creative Officer, Christopher Bailey, giving an introduction to the store by clicking on this link.  Burberry's massive investment in creating its new and original store is a timely reminder that while online trading may be vitally important for most retailers, the great bulk of sales for many brands, especially the established luxury brands, are still made in person by customers who expect to be appreciated and pampered in the comfortably extravagant environment of a physical shop. The statistics on the chart demonstrate the trend:  The retail sales figures come from the Office of National Statistics (ONS) and show the sales in the UK for the month of February for the last three years.  I should clarify that these figures have not been adjusted for inflation, and exclude petrol sales.  While offline sales show a relatively small increase, the growth of online sales has nearly doubled since 2010.  As the data shows, online sales represented 11% of the UK’s total retail revenue of £24.6bn for February 2012.  During the last year High Street sales have grown by just £0.1bn whilst online sales have increased to £0.6bn.  But we have to remember that even though online retail sales are growing faster than High Street sales, physical shops still account for 89% of all retail sales.  Burberry’s impressive store points to a seamless blending of the online and offline worlds where fantasy meets reality, and imaginative theatricality and stunning lighting effects have been used to produce a wonderfully engaging and entertaining total shopping experience. It’s fascinating to see that at night, and from a distance, (see picture on slide) Burberry’s store doesn’t look very different from the original store as it was two centuries ago.  In the 1820s, the shop would also have been a blaze of light, (in those days, of course, innovative gaslight), as retailers have always understood the importance of using high levels of lighting in stores, and in the windows, to provide a sense of drama and increase the appeal of the products.  It reminds me of a something I was told, by somebody in the position to know, when I was consulting for the supermarket chain Sainsbury’s:  Apparently the very last words of John James Sainsbury, the eponymous founder of the stores, were to remind his descendants to “keep the stores well lit.”  High levels of lighting are still considered vital to help stimulate sales but it has lost much of its impact as bright lighting is now so pervasive in our environment.  In the early 1800s foreign visitors to London marvelled at the newly introduced gas lit streets.  In 1817 one French visitor, Madame d’Avot, wrote in her diary: “This most beautiful lighting allows one to read as if in the full light of day.  But those neighbourhoods that are lighted by oil afford a sad prospect, and one hardly dares to enter streets where these feeble and ancient lanterns look like dim small stars.”  Gas lighting was the latest, must-have, technology when 121 Regent Street, the home of Burberry’s store, was built.  Most gas contracts then stipulated that access to gas for lighting was only available from 4pm in the afternoon and had to be switched off at 10pm at night.  You can read part of the intriguing story of how London led the world in gas lighting by clicking here. But I digress: once inside the new Burberry store one immediately becomes utterly absorbed in the whole drama surrounding the stunning presentation of the goods. The cunning fusing of classical elegance with the latest technology has created an experience of such seductive and classy drama it is psychologically irresistible and almost overwhelming. The Gap shop sequence in the film Minority Report which you can see here, springs to mind.  One of my favourite features is the multi- media “digital storm” that can be summoned up at will to remind customers of the reason to buy those iconic Burberry trench coats.  Take a Burberry garment into one of the swish changing rooms and a mirror may respond by displaying images of the garment on the catwalk, or by showing a video sequence of the product being made with immaculate care.  This intimate and exciting experience is made possible by sensors in the mirror being triggered by the radio-frequency- identification (RFID) tag embedded in the garment.  But there’s more - retail theatre has been taken to an extraordinarily novel level as the store is capable of actually becoming a theatre when required.  Hidden around the main room are 420 speakers and a hydraulic stage for live music, as well as a gigantic screen that can display catwalk shows like the recent Burberry Prorsum Womenswear Spring/Summer 2013 collection.  Burberry has cleverly positioned its brand around up and coming, young and innovative musicians like those featured on the Burberry Acoustic portion of its website.  The impressive in-store stage can also be used to feature some of these musicians thus bringing carefully branded entertainment within the brand.  This level of entertainment is something few retailers can provide without resorting to third party premises.  So it’s full marks to Burberry’s design team for its intelligent appreciation of the psychology of modern shopping - and its ability to meet that expectation.  At a time when many retailers are still so confused about the potential of selling online and offline that the management is structured into two disparate and often destructively competitive parts, Burberry is merging physical and virtual shopping into one harmonious and highly pleasurable experience.  Tellingly, the flagship store is designed in a similar configuration to the website, not the other way around.  Inside the store one can painlessly purchase goods with the swipe of a credit card whilst relaxing indulgently on a comfortable sofa.  Christopher Bailey explains: "We designed it like that because when you're shopping at home online, you are on the sofa with your credit card.  You don't stand up and queue."  He is right of course and I expect many retailers will now be forced to go well beyond a token acceptance of digitally-connected customers.  At the moment, many stores are beginning to emulate Apple’s successful in-store strategy and are planning to equip their sales assistants with tablet computers so that they can instantly check stock availability for customers.  But eventually many shops will have to fundamentally restructure their retail operations on and offline after carefully examining and evaluating the psychology of their brand, their brand image, and their customer base.  Tesco’s original maxim of piling it high and selling it cheap may still be effective for supermarket groceries but it doesn’t provide any customer satisfaction in other retail areas.  I predict that it won’t be long before other stores follow Burberry’s lead in understanding that shopping, particularly for non-essential goods, has become established as a favourite leisure entertainment.  To gain an interested and loyal following and generate sales they, too, must construct a pleasurable and uniquely engaging buying experience for both their virtual and real- world customers. October 2012
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Lighting the way...

...to purchasing paradise... It’s fashionable to think that online shopping is the dominant force in the retail industry at the moment.  This came to mind when I saw Burberry's announcement about its new store.  Burberry has taken over a 1820s Grade II listed building in the elegant Regent Street shopping district in central London and revamped it into its flagship store.  You can see Burberry's Chief Creative Officer, Christopher Bailey, giving an introduction to the store by clicking on this link.  Burberry's massive investment in creating its new and original store is a timely reminder that while online trading may be vitally important for most retailers, the great bulk of sales for many brands, especially the established luxury brands, are still made in person by customers who expect to be appreciated and pampered in the comfortably extravagant environment of a physical shop. The statistics on the chart demonstrate the trend:  The retail sales figures come from the Office of National Statistics (ONS) and show the sales in the UK for the month of February for the last three years.  I should clarify that these figures have not been adjusted for inflation, and exclude petrol sales.  While offline sales show a relatively small increase, the growth of online sales has nearly doubled since 2010.  As the data shows, online sales represented 11% of the UK’s total retail revenue of £24.6bn for February 2012.  During the last year High Street sales have grown by just £0.1bn whilst online sales have increased to £0.6bn.  But we have to remember that even though online retail sales are growing faster than High Street sales, physical shops still account for 89% of all retail sales.  Burberry’s impressive store points to a seamless blending of the online and offline worlds where fantasy meets reality, and imaginative theatricality and stunning lighting effects have been used to produce a wonderfully engaging and entertaining total shopping experience. It’s fascinating to see that at night, and from a distance, (see picture on slide) Burberry’s store doesn’t look very different from the original store as it was two centuries ago.  In the 1820s, the shop would also have been a blaze of light, (in those days, of course, innovative gaslight), as retailers have always understood the importance of using high levels of lighting in stores, and in the windows, to provide a sense of drama and increase the appeal of the products.  It reminds me of a something I was told, by somebody in the position to know, when I was consulting for the supermarket chain Sainsbury’s:  Apparently the very last words of John James Sainsbury, the eponymous founder of the stores, were to remind his descendants to “keep the stores well lit.”  High levels of lighting are still considered vital to help stimulate sales but it has lost much of its impact as bright lighting is now so pervasive in our environment.  In the early 1800s foreign visitors to London marvelled at the newly introduced gas lit streets.  In 1817 one French visitor, Madame d’Avot, wrote in her diary: “This most beautiful lighting allows one to read as if in the full light of day.  But those neighbourhoods that are lighted by oil afford a sad prospect, and one hardly dares to enter streets where these feeble and ancient lanterns look like dim small stars.”  Gas lighting was the latest, must-have, technology when 121 Regent Street, the home of Burberry’s store, was built.  Most gas contracts then stipulated that access to gas for lighting was only available from 4pm in the afternoon and had to be switched off at 10pm at night.  You can read part of the intriguing story of how London led the world in gas lighting by clicking here. But I digress: once inside the new Burberry store one immediately becomes utterly absorbed in the whole drama surrounding the stunning presentation of the goods. The cunning fusing of classical elegance with the latest technology has created an experience of such seductive and classy drama it is psychologically irresistible and almost overwhelming. The Gap shop sequence in the film Minority Report which you can see here, springs to mind.  One of my favourite features is the multi-media “digital storm” that can be summoned up at will to remind customers of the reason to buy those iconic Burberry trench coats.  Take a Burberry garment into one of the swish changing rooms and a mirror may respond by displaying images of the garment on the catwalk, or by showing a video sequence of the product being made with immaculate care.  This intimate and exciting experience is made possible by sensors in the mirror being triggered by the radio-frequency-identification (RFID) tag embedded in the garment.  But there’s more - retail theatre has been taken to an extraordinarily novel level as the store is capable of actually becoming a theatre when required.  Hidden around the main room are 420 speakers and a hydraulic stage for live music, as well as a gigantic screen that can display catwalk shows like the recent Burberry Prorsum Womenswear Spring/Summer 2013 collection.  Burberry has cleverly positioned its brand around up and coming, young and innovative musicians like those featured on the Burberry Acoustic portion of its website.  The impressive in-store stage can also be used to feature some of these musicians thus bringing carefully branded entertainment within the brand.  This level of entertainment is something few retailers can provide without resorting to third party premises.  So it’s full marks to Burberry’s design team for its intelligent appreciation of the psychology of modern shopping - and its ability to meet that expectation.  At a time when many retailers are still so confused about the potential of selling online and offline that the management is structured into two disparate and often destructively competitive parts, Burberry is merging physical and virtual shopping into one harmonious and highly pleasurable experience.  Tellingly, the flagship store is designed in a similar configuration to the website, not the other way around.  Inside the store one can painlessly purchase goods with the swipe of a credit card whilst relaxing indulgently on a comfortable sofa.  Christopher Bailey explains: "We designed it like that because when you're shopping at home online, you are on the sofa with your credit card.  You don't stand up and queue."  He is right of course and I expect many retailers will now be forced to go well beyond a token acceptance of digitally-connected customers.  At the moment, many stores are beginning to emulate Apple’s successful in-store strategy and are planning to equip their sales assistants with tablet computers so that they can instantly check stock availability for customers.  But eventually many shops will have to fundamentally restructure their retail operations on and offline after carefully examining and evaluating the psychology of their brand, their brand image, and their customer base.  Tesco’s original maxim of piling it high and selling it cheap may still be effective for supermarket groceries but it doesn’t provide any customer satisfaction in other retail areas.  I predict that it won’t be long before other stores follow Burberry’s lead in understanding that shopping, particularly for non-essential goods, has become established as a favourite leisure entertainment.  To gain an interested and loyal following and generate sales they, too, must construct a pleasurable and uniquely engaging buying experience for both their virtual and real-world customers. October 2012
Click here to download the PowerPoint chart: Click here to download the PowerPoint chart: