The irrational connection between a brand and consumers is every luxury brand's goal. The industry works by creating desire for the brand affiliation as much as the product. Allowing an aspirational and loyal consumer the opportunity to feel the brand is always worth the investment, so long as the objective is achieved. Gary Friedman is on the right track, however he is not the first and with any hope he will not be the last. RH is making these social locations to engage with the brand a permanent lifestyle destination vs. a pop-up shop and it resonates well with today's "accessible luxury" initiatives. Armani has hotels, Ralph Lauren has restaurants, Gucci opened a cafe, and Roberto Cavalli owns several. RH is creating a brand culture that is more than a physical product and should perform better than a Facebook ad or Google Adwords because people want someplace to go other than a traditional department store or Starbucks.
It's a long play strategy that is more expensive but it has the chance to reap unprecedented returns for the brand as a whole. The disconnect is how brands opening consumer touch points across the industry will embrace new technology to manage such an opportunity. Few solutions are on the market and even fewer brands are leveraging a CXM (Customer Experience Management Platform) to ensure every visitor is getting personalized, meaningful service and experiences are converting engagement into sales. I have a sneaking suspicion this will be a space evolving in retail tech over the next two to five years. The ROI make sense but it's nearly impossible to measure.
Beyond the compound and the new RH chill space in the Meatpacking District, I believe this is phase 1 of a larger initiative like opening a hotel chain. I can't think of a better brand experience for a home goods company than a chain of hotels furnished with entire collections of products that can be purchased. What would it really be like to have "this" design in your own bedroom, a living room? Experience a feeling in a space you might want to take home.
The first step, is to eliminate "branded" shipping boxes, no more FARFETCH, Carbon38, and Amazon slathered across the box sitting on my porch in Brooklyn would be helpful. Also, if we could track our packages with any amount of accuracy, we could make sure we were home or if it wandered away from our porch there would be something meaningful to report to the authorities like the "find my phone" app.
The logistics of USPS is ancient and leaving merchandise sitting on a porch is not a secure way for a federal organization to leave delivered mail. Perhaps every home should have larger "package" boxes that match the key to the mailboxes? I would be curious to know what the post-ship, pre-receive shrink rate is for companies to validate an investment for this timeframe. It's an interesting quandary; just last week, a neighbor was sitting on the porch with an umbrella in the rain waiting for a package that was being delivered after it was stolen three times. Not very convenient.
I find it interesting how tech is transforming the "work" to the consumer. Deleting customer service and forcing the shopper to take on the responsibility of "doing business" is not a convenience. Living in New York City, I advocate for a "locals" line or VIP pass like you suggest Ken. Having to change my brain from shopping which should be creative into a functional process dilutes the experience and actually takes away from the shoppers relationship with the brand. Downloading apps and doing all the work yourself does not feel like innovation but a sexy way for retailers to optimize their costs by passing it to the consumer. Universal preference guidance, live recipe builders based on cart add would be more welcomed in my world. Personally, I have no interest in bagging my own groceries and scanning items while I am coordinating ingredients for a weeks worth of meals.
Agreed Ricardo, I relish leaving the office for a coffee and enjoy the European cafe culture. I believe Starbucks has a greater success focusing on in-store experience and talking a page out of the RH playbook. Starbucks used to be the place, dare I say that is was a luxury experience in 2007? Now it feels more like an assembly line where no one knows your name. Do you remember when the Barista knew knew you and put a smile on your face first thing in the morning.
Personally, I have moved all "coffee" meetings and in-between times to the NY Meatpacking RH to the coffee bar on the 3rd floor because it is inviting, sophisticated, comfortable, and quiet. I can enjoy a moment with my coffee, a colleague, and my laptop.
There are some Starbucks stores that still have beautiful seating areas, local artists hanging on the wall, and music low enough to have a conversation but they are rare and typically found in Europe. Starbucks is one of the few players that can scale a social space. The demand for "a place worth going" is just as desired as "magically appearing."
In today's retailing environment you have to go high or low; there is no room for mediocre.