Throughout 2024, report after report has shown online sales declining by around 7% year-on-year. In fact, the CBI’s latest figures in the UK showed online sales falling by a startling 45% in June. Some believe we’ve passed peak ecommerce, while others see it as a temporary correction to the COVID-induced surge, but whatever view you take it’s certain that many online retailers are looking at growth curves that are flattening or declining — and they’re urgently looking for ways to change it.
Many look to the example of Glossier and the way it has boomed since opening physical stores. A digital-first brand with a direct-to-consumer model and an Instagram following of over 2 million, the brand’s first London pop-up in November 2017 saw more than 10,000 visitors in one week, while its first shoppable showroom in New York was open for almost two years and earned more revenue per square foot than the average Apple store. Today Glossier has 11 permanent locations and the company is valued at over $1 billion.
And Glossier is not alone. Everlane, Gymshark, Amazon and others have all successfully made the leap from online to IRL. Yet taking an online store to the high street is not easy — you need to get it right. People need a reason to abandon online convenience and visit a store. And make no mistake, it’s never been tougher to run a successful physical retail business. From rental increases to environmental concerns, this is evident in the hundreds of vacant shops across the country.
Glossier and others succeed because they have found ways to deliver community, entertainment and sensorial engagement. Any retailer looking to make this leap should look closely into how it does this and, crucially, how to replicate it.
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Creating Community Spaces
Physical stores will never beat online for convenience, so they must become more than places for simple, efficient transactions. One way to do this is for stores to become spaces that foster and enable communities.
These can be communities of geography: Look at The Commons in Bangkok. This open-air mall is more than a place to buy things — from culinary workshops in herb gardens to yoga sessions in a community garden and a market-style eatery with artisan restaurants, bars, cafés and a fitness studio, it’s a place where shoppers can spend quality time in the neighborhood and feel a little closer to nature at the same time.
But stores also can be centered on communities of interest. Glossier does this brilliantly, creating destination flagship stores that fans discuss online as well as hosting workshops and demonstrations where beauty fans can meet, share and connect. All Glossier stores draw heavily on local culture. For example, its NYC store features red standpipes, subway signs and sculptures replicating those found around the city.
Nike, Gymshark and Lululemon also do this well in the sports sector. And even in finance there are innovators like Turkey’s Is Bank which, with its Is Mekan concept, is transforming branches into community hubs.
Entertaining Customers
A visit to a Glossier store is an experience. From selfie mirrors by the entrance to product testing stations and purchases that arrive by conveyor belt, it’s all about elevating shopping from transaction to entertainment.
Nike also does this well, cleverly interweaving the online and IRL experiences in-store, as does Gentle Monster with its breathtaking digital installations and of course, most famously, Burberry Rain.
The recent venture by YouTube supergroup The Sidemen is another interesting example here. With 21 million online subscribers, their distinctive, high-octane fast-food restaurant SIDES is a first venture into physical spaces. It features a dynamic digital ticker integrating live-feed social content as well as a “Creators Launchpad” that streams the #SidemenSundays or reruns of fans’ favorite content. It also can be rapidly transformed into a stage for VIP guest appearances, launch events and DJ nights — it’s a retail space that is always active and engaging.
Engaging the Senses
Finally, and perhaps most importantly, the brands that are most successfully moving from ecommerce to physical retail are finding ways to engage customers’ senses. Sensorial triggers can deliver emotional engagement. It could be the calming, dimmed olfactory experience you find in an Aesop, or the light, bright, white and wooden sleekness of an Apple store — whatever it is, it makes you feel something.
Look at Glossier’s use of color, dominating the space and enveloping visitors. Or how Lush and Abercrombie use smell in an amazing way to evoke a sensory reaction. Many brands use music, including specific brand identifications, to create recognition.
Johnnie Walker’s store in Edinburgh is a great example of this. An experiential space, it blurs the lines between distillery tour, restaurant and living brand celebration, taking whiskey tasting from an activity for the elite to something anyone can do on their Saturday afternoon shopping trip.
Distinctive Spaces
Recognizing that community, entertainment and the senses are your levers is a necessary first step to a successful online-to-physical shift — but it is only the beginning. You need to find the right expression of those elements for your brand and your customers.
Still, it’s a vital first step to take. The online sales downturn may be a temporary correction or something more serious, but either way it seems likely that blended retail is the future in most categories. Online for convenience, efficiency and value, alongside physical for community, experiences and sensorial engagement.
The e-tailers that act now to create distinctive and engaging physical spaces may not fully replicate the stellar success of Glossier, but they will certainly be more strongly placed for the future.
Becky Mailen is Client Services Director at the brand experience agency I-AM. She has worked with clients such as UniCredit, the National Bank of Greece, RBS, London Stock Exchange Group and Nationwide Building Society on projects ranging from brand identity and future branch design to in-branch communications and literature design. She has a wide range of experience managing projects in other sectors for clients such as Nike, Vodafone and Strutt and Parker across branding and retail design. For Mailen, ensuring that a client’s needs and brief are met is as important as the relationships that are made throughout the process.
