American retail is faring well. Supported by a strong economic dynamic, with unemployment at 5%, retail and e-commerce are making good progress. Moreover, Forrester has recently adjusted its forecasts, predicting a 56% increase in American e-commerce between now and 2020. At the same time, retail is growing even faster overall, by over 3% in 2015 according to the NRF (the American National Retail Federation).
This context is favourable to the development of new concepts. Here we list three that merit a closer look, as in some ways they are oddities in the American retail environment.
Let’s begin with Warby Parker, the brand created in 2010 that’s been revolutionising the optical business ever since. Glasses at a single price of 95 dollars, vintage and designer models and a simplified, redesigned customer experience… that’s all it took to attract customers and the brand’s appeal is real. This was clearly demonstrated to me at its New York stores when visiting for the NRF show in January last year. The Chelsea and SoHo stores were packed…while the surrounding shops struggled to attract even a few visitors.
Attractiveness in retail is a major subject and Warby Parker is a model to follow. What’s more, Warby Parker won the award for most innovative brand of the year at the NRF show in 2015, and the American magazine Fast Company named it the world’s most innovative retailer.
Warby Parker in the Chelsea district, a shop like no other
The second brand to watch in 2016 is RH (Restoration Hardware). RH is a chain of upmarket homeware and decoration stores. Originating in California, the chain already has over 60 stores in the biggest American cities, offering dream homes tailored to the local context. The store in Houston, Texas is a ranch. The brand has also taken over and renovated the Museum of Natural History building in Boston, and recently opened a store in a huge Californian house. This is a brand to watch, and its stores are well worth a visit. What’s more, RH recently achieved a turnover exceeding a billion dollars and is growing by nearly 20% a year! The brand has made the customer experience (including many retailers) a central focus and when you visit its stores, just like with Warby Parker, you are in the presence of a brand that is totally unlike any other.
Above, the RH store in Los Angeles
Above, the RH store in Boston
Last but not least, the third brand to follow is the Canadian brand Lululemon, because it just keeps on growing. Originally a specialist yoga brand, it is now expanding into fitness, indoor clothing and fashion. The chain already has over 200 stores in the United States, and after being voted Retailer of the Year in the US by the NRF in 2013, it’s expanding internationally with new store openings in London and Berlin. More than just innovating, it has achieved a rare thing in the distribution business by creating a new category: yoga stores. Lululemon does all it can to encourage yoga practice: putting people in touch with local yoga teachers, and giving in-store classes – the furniture is on castors and is pushed back so people can put their mats down and start practising!
In the Lincoln Square store in New York, classes are taught every Saturday morning!
The latest Lululemon store in Flatiron, New York opened in November 2015 and offers a dedicated yoga room in the basement where customers can try out all the equipment.
Customer experience is a major topic in retail. Firstly because it enables differentiation from an ever-growing crowd of competitors (online and physical), but also and above all because it really develops brand preference and therefore helps to create value (when done well).