Tell me a story: Why selling goods is no longer the main purpose of physical stores

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The recent announcement the Hublot is partnering with Japanese artist Takashi Murakami to release two NFTs tells me one thing: Physical property is no longer the primary ideal in luxury today.

Do not mistake that for meaning that physical luxury retail is over. That is not the case at all. In fact, it is more important than ever. The recent LVMH results which showed double-digit growth demonstrate that luxury is as powerful as always and the fact that DFS is returning to growth too shows that physical stores will be vital in luxury travel retail and the wider market for a long time to come.

No, what Hublot and Takashi Murakami’s partnership – and numerous other digital-based luxury collaborations – means is that what shoppers want from luxury and luxury brands has changed. Customers today are buying a piece of the brand experience. They want to feel like they are part of something. For younger shoppers this is felt even more keenly. They want to feel part of a community and associate with a brand which reflects and ties in with their own brand.

What shoppers want from luxury and luxury brands has changed; they are buying a piece of the brand experience

In this respect, this younger generation prefer to engage and interact online because the freedom to adapt, collaborate and personalise is greater in a digital space.

While online delivers this sense of “zero added value”, shops must learn to do so too.

Physical stores have an unparalleled opportunity to bring to life the story and experience which brands carefully cultivate online, but in a more tangible and engaging way. The ability to take their online engagements into the real world – and create fresh online content from that – is incredibly exciting to young shoppers.

Moncler’s Genius stores are an excellent example of this in practice, with striking visuals created which tell the brand’s story. To walk through one is to be in an experiential gallery of all the brand is.

The key focus of a store should no longer be on pushing products and making sales; it must be about crafting experiences and making memories. Offering an experience which is a physical manifestation of the online story-telling will create community among shoppers and sales will be a by-product of that.

20partners highsnobiety-gate-zero-zurich Tell me a story: Why selling goods is no longer the main purpose of physical stores Uncategorized  travel retail luxury experiential retail experience

This, again, is why it is vital that all physical and digital engagement is part of one holistic, omnichannel approach. For brands to benefit, shoppers must be able to enjoy their engagement anywhere and then make the purchases seamlessly on any platform that they choose.

This is good news for travel retail. It is time for the market to step away from old out-dated notions of what stores should look like and be more flexible and innovative. This is a chance to step out of the box and do something new and exciting. Highsnobiety and Zurich Airport gave an excellent example with their recent GATEZERO pop-up.

Putting a focus on experience will allow brands and retailers in travel retail to be more creative with the unusual spaces which are on offer in airports

Putting a focus on experience will allow brands and retailers in travel retail to be more creative with the unusual spaces which are on offer in airports; this approach reduces the challenges around inventory issues as more purchases are made online and creates more freedom.

In recent months we have seen signs of a gradual evolution of the business model in travel retail which will make a less purchase-focused model more possible. But this is a shift which helps all stakeholders; creating a better airport experience for travellers is just as good for landlords as for brands themselves.

Marco Passoni has decades of experience in the travel retail sector. He has spent the majority of his career in senior leader positions throughout the market, including a 12-year tenure as CEO of a leading international Duty Free distribution company and a further 8 years running a retail firm that operated fashion mono-brand stores in several international airports.
Today, as Senior Executive VP and founding partner of 2.0 & Partners, he leads the company’s efforts in developing and innovating services which create new opportunities and partnerships for all members of the travel retail Trinity. A former elite-level sailor, with a World Championship to his name, Marco now spends much of his time airside, experiencing the changing travel retail industry first-hand, to better guide partners and clients on the best way to do business in this vibrant and unique market.