Amazon Diversion

 

Amazon have recently announced that they will be opening their first bricks and mortar clothing store in California. They are already well established in the physical store realm with Amazon 4 star (merchandise, books, devices), Amazon Books, Amazon Fresh (groceries), Amazon Go (convenience & prepared meals.

Their current physical stores are carefully curated with their top selling lines to limit the risk of old stock sitting on the shelves.

However the whole concept of this original online retail behemoth now having a physical presence intrigues me. Several years ago as Amazon online was coming to Australian shores, brands were strongly being encouraged to jump on board because you needed to be on the Amazon platform to survive. They spruiked that your products would have great exposure to a huge buying base. It was marketed so strongly that many brands were too scared not to be listed with Amazon. So they signed up.

Back then the retail game was tough; and it still is. Throw in the global pandemic and everyone is learning to play by new rules. Oh, but how Amazon have learnt thanks to the sales data generated by all the brands and manufacturers who sell with them.

To me it seems the line has definitely blurred. The online giant who did exactly that- “Online”, seems  to have decided “stuff it”, now we’re going to play in the physical world also.

Were brands signing up with Amazon in blind faith and assuming Amazon would always stay in their corner of the ring or were they going in with one eye open? By entering the arena of physical stores, is Amazon now eating the same suppliers who use their online platform?

It will be interesting to watch this play out. So far the Amazon physical stores have not reached Australian shores. They have established in North America which has a much larger market than here.

The new Amazon clothing store is planned to be larger than an average department store. This gives Amazon amazing lease negotiating power when dealing with landlords. They would be seen as an anchor tenant (will attract lots of shoppers to the shopping centre) and most likely be on a very reduced rent rate per square meter as a result.

It’s easy to go on line and find the same clothing item stocked by several different retailers and easy for online retailers to be competitive with prices, but paying rent is a major overhead for physical stores.

This also brings a myriad of issues. How do brands structure their net pricing band to ensure an equitable end price between their items sold at Amazon stores vs a smaller retailer? Will smaller retailers selling the same items become obsolete, beaten in the pricing game by Amazon who will have great negotiating powers with the suppliers? Will suppliers have to come up with product lines exclusive to Amazon stores, so that this double up scenario doesn’t occur?

One of the reasons that department stores have been struggling for many years is that the brands they once exclusively stocked have now opened their own stores. The presence of physical Amazon stores could create similar scenarios by offering the same products within the same shopping centre.

Watch and Wait. The fact that Amazon are testing the water in the massive US market and in very carefully selected areas will take a while for the impacts to be felt.

The X and Why of Retail

 

One of the things I’ve always loved about retail design is the X factors that combined give the Why.

I failed maths miserably thru out school. All those numbers just registered as a blur in my brain, and needless to say I could never get my mind around algebra. What was the point of X and Y?

But I now deal in a slightly different version and they have a story and reality to them that becomes a visual reality and can be manipulated in ways to influence shoppers.

I was quite surprised recently. I met a “retail expert” who is frequently interviewed on tv about retail matters. She is brilliant at numbers and statistics, but when she made a comment about a current trend in the retail world I asked her why she thought it was happening and she had no idea. She could not even come up with 1 suggestion. It wasn’t a trick question and I have numerous ideas about why this retail event was occurring.

There’s so many things that happen on a daily basis in the retail world. Some are obvious and others we aren’t aware of.

Why are the supermarkets are so quiet at 3pm? Because the mums are at school pickup.

Why are the hardware stores are so busy on Saturday mornings? Because the weekends are the time for projects at home and everyone needs their supplies.

Why is there a huge demand for cardamom? Because one of the reality cooking shows is featuring Middle Eastern cooking that week.

Smart retailers know their X’s and Why’s and they make sure they all match up. These are the retailers who order up the big stocks of fertilizer in anticipation for Spring and then move it to a prime visibility location when they hear rain is forecast.

I designed a chain of bakeries for many years. They were about to open a brand new store in a brand new shopping centre. They were known for their award winning meat pies. The night before the opening it started to rain. The baker decided to double the set quantity of pies knowing that the next day was due to be cold and wet all day. An hour later there was another call to double that amount again. This was all happening in the wee hours of the morning and the rain was quite set in by then. Sure enough on opening day every pie sold out with customers looking for even more. Knowing their X factors is WHY they had such a successful day.

A recent headline caught my interest. It was about a Vietnamese food chain opening their first American store in Salt Lake City. The first thing that popped to my mind was that Salt Lake City is the home of the Mormon church. I wondered why Vietnamese food would be popular there. So I googled does Salt Lake City have a large Vietnamese population? Turns out it does and it is rapidly growing. And whilst it’s true that Vietnamese food is not limited to particular nationalities, it always helps to have people familiar with their own style of food who  integrate it into the broader community.

Understanding the unique X factors for each business means that you can design stores and tailor retail to influence WHY we buy.

 

Designing for You or future owners

 

There have been a few occasions over the years when I’ve been sitting with a residential client discussing the concept and look of their home renovation and they suddenly hit a wall of panic. They realize that all the beautiful pictures they’ve have been merrily saving to their Pinterest or Houzz boards, may not be appropriate for the next owners of their house. They become very concerned about how their decisions will affect the resale of the house, even if they aren’t planning to sell for a long time.

This almost paralyses them like a deer in headlights. They can’t work out what they should do.

If you are renovating to sell in the next couple of years that will put different spin on the design process- which is a topic for another day.

 So here is my advice based on almost 30 years of interior design experience. Forget about future owners and design for you.

There seems to be a general misconception that people don’t like change, that they fearful of new and trendy ideas. Well… they aren’t. Do not underestimate or worry about offending future owners. The fact is that most of us are attracted to new, interesting and unique.

I have never had a client ask for a house design that looks like all the neighbours. We all want a point of difference, that WOW factor when our friends walk in the door and a home that reflects us.

It’s worth remembering that trends have roughly 10yrs of life (this varies, depending exactly what trend it is). This may help as a guide if you have an approx. idea of when/ if you want to put your house on the market. Look at the Hamptons style- still going strong after 20 years.

A good designer will combine all your ideas and your wish list and create a cohesive end result. We will steer you in the right direction and know when to gently apply the brakes to make it all work.

Be bold and confident and take a chance because that’s when it will really start to shine. Live your life, not the one you imagine for people in the future. I always tell clients that you must be able walk in the door everyday and know that you absolutely love your house. 

Flots and Jets Yamba

 In a recent break between interstate border closures, I ventured into new territory for me and visited the lovely coastal town of Yamba in the northern rivers area of NSW. After lunch at the very busy historic Pacific Hotel overlooking the ocean, I explored the gorgeous cluster of shops in the main streets. 

I love finding retailers who do it a bit differently while letting their unique style shine. This was the case at Flots and Jets. 

The store sells clothing, jewelry and vintage treasures. The owner has used her eye for the ordinary flotsam and jetsam to create quirky features through out the store. Even old dress making patterns are re-purposed for wrapping purchases.

https://flotsandjets.com/

Christmas Creep

 

Yes, we’re all aware the Silly Season has started. Groan! It started in September when we noticed the supermarkets starting to move the fruit mince pies, bonbons, advent calendars and plum puds onto the shelves. The official term is “Christmas Creep”.

Have you noticed that from now till mid May we really don’t get much of a break from the seasonal promos that the shops run? The Christmas merchandising and stock will disappear as of Boxing Day and we’re bombarded with hot cross buns and Easter paraphernalia. From Easter it runs into Mother’s Day. After that we finally get a break till the Father’s Day pitch, which is never quite as strong as Mother’s Day. In the middle of all this are the 2^nd tier promos for Australia Day, Valentine’s and Halloween.

The big culprits in the heavy-handed seasonal retailing are the supermarkets. Everyone takes their lead from the big boys. But does putting Christmas product in our face 3 months out make that much difference? The marketing gurus tell us it does and that the lead in to xmas is the biggest quarter in the retail year. But what amount of selling happens 3 mths out compared with the last few weeks? And what happens in other countries?

Go back a generation and in America the focus was on celebrating Thanksgiving at the end of November and more recently the Black Friday sales (also end of November) before the xmas shopping began. Britain used to wait till after Remembrance Day, but large parts of Europe and other countries have now also embraced Black Friday and it seems that Christmas creep has spread worldwide.

Last year Australian Christmas expenditure fell below the forecast. It was the lowest expenditure growth in 28 yrs. This year will not be an accurate gauge compared with past. Many families are watching the expenses with one or both bread winners out of work. At the other end of the spectrum are families who have profited in varying ways from the corona shutdowns. Many areas are still struggling with the aftermath of the summer bush fires.

Smart independent retailers who embrace promotional events to kick start their xmas trading, report favourable results. The reality is that the majority of shopping in done in the last 2-3 weeks. It’s no surprise that food is the biggest of all retail categories, making up almost half of Christmas expenditure. And for obvious reasons sees its largest expenditure in the last few days.

CBA research shows that ¾ of women start shopping only a month out from Christmas and that a quarter of men shop in the last 24 hrs.

What about the other seasons- Easter Creep? In Australia who wants to buy chocolate eggs in January or February and risk finding them in April as disgusting melted messes? Yuck. I’ll wait till closer to the date thanks. Although hot crossed buns are a great school lunch box item, if only a non easter version could run all year.

There’s even what I call the “school book list creep”. Parents are given the stationery and textbook list in November for the following year. OMG- overload. School books on top of just trying to get the kids to finish those last few weeks when everyone is so tired, and we’re being told to start our xmas shopping!

Why has Creep come about? Bottom line, a marketing gimmick to try to compete in an ever more difficult climate. Retail has been tough for a few years now. People have so many more choices for their money compared with 20 years ago. Our lives are so much busier and it’s common to feel stretched to the max. We have more choices for discretionary spending i.e. online, subscriptions, experiences and other non-physical items and payment schemes such as after pay.

Frequent exposure lessens our response to things. Just as swear words have become more tolerated in society and advertising, we’ve become blasé to seasonal creep. We know Christmas and Easter happen every year. Having it forced into our lives gives an annoying niggling feeling a bit like that annual check-up at the doctor. Usually something we try to put off for a bit longer. Shoppers don’t want to be dictated to; they will do it when they’re ready. They don’t want the guilt trip of feeling they are not organized. They also don’t want to feel spoken down to. Early seasonal promotional is here to stay, but over the years we have become conditioned to Creep and its lost the shock factor.

 

Colour in Kitchens

 

For a long while now white kitchens have featured prolifically in home magazines and digital images on Pinterest and Houzz. Very often people associate the Hamptons style with white kitchens. Carrara marble and the other similar veined marbles have been really popular. Last year I had 5 consecutive house renos where the clients requested these stones for their kitchen benchtops.

However we are slowly seeing some colour creep back into kitchens, which from my point of view is exciting. I do like the look of white kitchens if they are done well and have good detailing in the joinery and are complemented with nice feature pendants and beautiful splashbacks. I love working with clients who are not scared of colour and happy to embrace a new direction for their kitchen.

When I refer to colour, I don’t just mean paint colours. Colour comes from many sources such as timber tones, whether that is a red, yellow or black based timber. It can also be introduced with stones in greys, black, creams. Solid black has also become very popular as a new accent colour and there are a wonderful range of fingerprint free laminates available now. I’m also seeing blues appearing in 2 pack paint finishes.

There is an industry guide that a kitchen has a 10-year life span. The reality is kitchens are expensive and often 20 years plus before people do a reno. My design goal is to create a kitchen that is in keeping with the look of the house, is on trend and will last the distance and not age quickly.

If you are looking at a kitchen reno or building new and want some colour, I would advise to look at the colour sources suggested earlier. Select splashback tiles that whilst modern will age well. The classics such as subways and penny tiles have endured over time. Don’t use garish colours in 2 pack. You may love lime green for the first 12 months, but it’s an expensive type of surface to replace. Take into consideration the colours used near your kitchen, especially if you have a more open floorplan. Installing feature pendant lights can also introduce pops of colour. There are lots of beautiful cane and natural fibres available in pendants and these can add a warm yellow colour to your scheme.

If you are still feeling nervous and wishing for some colour, speak with a designer. In this industry we are constantly seeing the current trends and watching the lifespans of looks and finishes. A good designer will guide you with choices and help you obtain a finished look that you love.

Instore Experience Post Iso

Pre corona virus the term “instore experience” had a slightly different meaning to what I think the new post isolation version will evolve into.

As a retail designer giving BC (before Corona) examples, I would list

-make up demonstrations as your walk thru a department store

-staff that can suggest the exact type of clothing that suits you so well you end up buying the whole outfit.

-cranking music in the hip clothing stores that perfectly matches the image they wish to portray

-the luxurious smell of perfumes as you enter a store and elevates you to another level.

-trendy hair salons were the staff are the same level of cool that you aspire to when you walk in for your big transformation

- food tastings/demos in the supermarket

- your favourite furniture store showing room settings and vignettes in exactly the way that you would like to recreate them at home.

- amazing staff that greet you on an such a personal level that you feel you’ve instantly gelled with them.

Instore experience is often spoken about in the highest echelons of retail board rooms, but not always successfully achieved on the actual shop floor. All retailers think they can offer it, but they don’t always have the magic X factor to pull it off. I can design great looking stores but if the staff have bad attitudes the customers will remember that long after the incredible fitout.

So how might post isolation instore experience pan out? The staff free Amazon stores have ideas that can be built upon. Let’s put the thinking caps on for some more ideas!

-          Provision of entertainment outside the store while people are queuing. Keeping potential customers happy is important and keeping them happy and remaining in the que is key. Perhaps a busker of some type.

-          Taking temps pre-entry is becoming more normal, perhaps this can be done in some fun step in booth that doesn’t make you feel like you are having a medical examination.

-          A buzzer system on your phone that tells you when a change room is ready, so you don’t have to que.

-          More counter-less stores. Having staff that move around with tap and go handheld devices to prevent queuing at counters.

-          Self-serve wrap bars that dispense bags to minimize on handling.

-          Convenient pick up points, whether it’s counters, dedicated car spots outside for staff to run out or the embracing of free local deliveries.

All the wonderful senses like smell and sound can still be incorporated. Having great staff will always be a positive. I’m looking forward to seeing what ideas retailers come up with.