Why Storytelling Is The Key To Luxury's Hi-Tech Future

Key Takeaways: Globally, New Retail has become the core mission behind all new retail merger & acquisition strategies. And, after learning from mass retailers, the luxury field has kicked off its own ecosystem war. The role of the store will evolve from a simple point of sale to a touchpoint for consumer engagement that introduces entertainment or personalized shopping expeditions into the experience. Only relevant storytelling that leads to functional experiences can generate data-collection at retail destinations in this new ecosystem. “Smart cities,” where objects, devices, and physical environments will be able to communicate with one another, are coming soon, and true “phygital” experiences are already popping up in many sectors. China’s model of New Retail is spreading, and now it’s merging with other worldwide actors in unexpected ways. At every level of the retail marketing chain, new ecosystems are being constructed as we speak. Think ecosystem early! Many Western marketers still report on New Retail as if it’s a confrontational model ready to do combat with American systems. But the COVID-19 crisis has pushed the duality of omnichannel vs. New Retail thinking toward becoming a powerful new hybrid. The book New Retail: Born in China, Going Global by Dudarenok and Zakkour explains how Tencent’s Smart Retail and JD’s Boundary Retail both share the same four “C pillars” as Alibaba’s New Retail: consumer-centricity, convenience, customization, and contributions. On their list of the seven ecosystems that will dominate the next 20 years, Zakkour and Dudarenok convincingly show how Walmart and Target will win the New Retail race. Thanks to a strong alliance with JD (partially by selling YiHaoDi-an to JD while keeping its company stake), Walmart has learned from Alibaba’s FreshHippo. Now it's testing new smart stores that focus on on-demand delivery, where customers use a Wechat-hosted Mini Program that already boasts 20 million users. On top of that, Walmart partnered with JD Daojia to enable one-hour, on-demand delivery within roughly two miles of the store. And finally, Walmart is preparing to leverage JD and Google partnerships to form a stronger alliance for SEO and Uni-Marketing. Globally, New Retail has become the core mission behind all new retail merger & acquisition strategies. And, after learning from mass retailers, the luxury field has kicked off its own ecosystem war. With Farfetch getting closer to its goal of becoming the global ecosystem for the luxury industry, many brands are thinking about how to move their thinking from omnichannel to New Retail. “Luxury New Retail is not a specific technology product or solution,” said Far-fetch CEO Neves to WWD. “It’s the division and also the full suite of solutions that we can offer brands that are completely connected. Because everything we offer brands is completely integrated and connected.” Farfetch’s precedent, “Augmented Retail,” created an ecosystem rooted in interconnectedness, delivering a comprehensive view of the individual tests, preferences, and browsing habits at the service of customer-brand conversations. Retail mergers favor hybrid partnerships Globally, retailers have now embraced a hybrid strategy, and the luxury industry is no exception. Farfetch has partnered recently launched The Store of the Future: a concept that uses Farfetch’s retail & online fashion technologies so retail staff can send smartphone recommendations to in-store shoppers. Additionally, staff members may review customer profiles, purchase histories, and wish lists. Globally, Farfetch partnered with Gucci on "Gucci in 90 Minutes," where customers can buy Gucci products on Farfetch and delivery would subsequently be arranged from a Gucci store within 90 minutes. Gucci also offers scannable advertisements and has introduced an AR app feature with frictionless Visualization and Try options to help customers evaluate sneakers and eyewear. Meanwhile, Valentino partnered with Yoox Net-a-Porter Group to create an AI-backed omnichannel business model called Next Era that enables customers to check product availability in inventory across all its fulfillment centers and stores. Its in-store features include quick checkout and detailed product information. The model also includes Click & Collect, return-in-store, on-site personalization, contextual search, and live chat assistance services powered by natural language programming. Brands embrace “functional storytelling” A recent report from Deloitte called The New Age Of Fashion & Luxury shows that Uni-Marketing forces retail to become a destination of “functional storytelling.” The report explains, saying, “The role of the store will evolve from a simple point of sale to a touchpoint for consumer engagement: less tied to sales and more to attracting customers through measures such as introducing entertainment into the experience or through one-to-one personalized shopping expeditions. The store will then become a critical touchpoint for offering exclusivity to the customer.” More importantly, this concept turns sales sites into data-collection hubs to help build tailor-made campaigns. One meaningful initiative of “functional storytelling” is the Moncler House of Genius, with locations in Milan, Paris, Tokyo, and Los Angeles. These innovative retail environments offer an interactive experience by hosting a series of live events, including talks, art, live musical performances, and creative sessions. A more in-depth example comes from Nike House of Innovation. After L.A., Nike opened its exclusive house of innovation in Shanghai in 2019, filling it with art installations, workshops, and special editions. With a focus on personalized products, the Nike Plus Club offers members access to the studio where designers are customizing shoes for them. The basement even has a motion-sensor floor that optimizes performance metrics. “The retail principles applied to other stores don’t figure here,” said Nike partner Accept & Proceed’s strategy director, Lily Fletcher. “It’s a space designed to react and evolve, and it’s already affecting the thinking and planning of all [Nike’s] current and future retail spaces.” Another example of “functional storytelling” is Armani Box pop-up stores. The concept aims at recreating a given appearance by offering a lookbook, photo booth, and personalized and engraved cosmetics products via a digital mirror that can save each client’s personal makeup videos. As we can see, only relevant storytelling that leads to functional experiences can generate data-collection at retail destinations in this new ecosystem. What functional story does your brand need to tell?

Why Storytelling Is The Key To Luxury's Hi-Tech Future

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Published February 03, 2021

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Why Storytelling Is The Key To Luxury's Hi-Tech Future