Is ‘experiential retail’ taking a new form?
There are few buzzwords more buzzier today than “experiential retail.” Everyone from apparel merchants to supermarkets are being told to embrace this trend. But what does experiential retail mean?
As it turns out, it means something entirely different to different retailers.
West Elm is taking the notion to an extreme, with plans to open a group of hotels that will create a hospitality experience for the Williams Sonoma-owned home furnishings brand. There are five locations already announced — Charlotte, Detroit, Indianapolis, Minneapolis and Savannah. The first, in Detroit, is on track for a late 2018 opening date.
The locations strategically target Millennials by way of location in the downtowns of emerging or re-emerging cities. Each location will host events in addition to overnight guests. The goal is to be highly localized and create something for locals and visiting guests alike, according to Peter Fowler, West Elm VP of hospitality and workspace. The furnishing will, of course, be available for purchase, as well.
West Elm hotels are not just a new experience, but a new channel of retail. The plan is to open very few new stores and focus on hospitality instead.
“The Millennial mindset shapes what we do as a brand, but hospitality has a much broader reach,” Fowler told Shoptalk attendees last week in Las Vegas. “In two years, 50 percent of all business travelers will be in the Millennial demographic.”
Millennial spending may be shifting to experiences in large numbers, but the Internet of Things (IoT) is taking a bit longer to make a financial imprint. Still, Target is looking to IoT to help create unique experiences in stores. “IoT is going to be a thing, the question is when, not if it’s going to happen,” said Gene Han, VP of consumer IoT and head of Target’s San Francisco innovation office.
Open House debuted in mid-2015 and looks a lot different today — less futuristic with more vignettes to showcase how IoT looks and works in the home. Shoppers can touch, play and experience the product. The space is also hosting events for the local tech community.
“This is where physical retail should thrive,” Han told Shoptalk attendees.
West Elm’s program is a partnership with hospitality management team DDK. Target is working with brands to create a compelling IoT experience.
- The Five Most Exciting New Features Coming Soon to Target Open House – Target
- West Elm Hotels
- Will opening hotels help West Elm sell more furniture? – RetailWire
- Target’s ‘Open House’ is all about IoT – RetailWire
DISCUSSION QUESTIONS: How do you define experiential retail? Do you see value in retailers such as Target and West Elm investing in new formats or channels to create better customer experiences?