Retail needs therapy: Why stores need a mindset shift if they’re going to survive

No one is denying the trauma the sector has faced. Covid’s rapid adoption of e-commerce has affected us all, to the convenience of online shopping. Supply chain issues and geopolitical conflict have sent costs soaring. Wage increases and limited workforce supply have led to staffing shortages. The cost-of-living crisis has put a squeeze on consumer spending, and shoplifting has hit record highs. It’s enough to make any business doubt itself.

But industry’s response has begun to impact its relationships with consumers. Despite 76% preferring to purchase in-person, 41% of shoppers find physical stores to be “less enjoyable” than before the pandemic.

It’s not hard to see why. With long lines and unkept displays, invisible staff and endless security barriers, rising prices and empty shelves, one could be forgiven for mistaking many post-pandemic retail experiences for post-apocalyptic.

If retailers are serious about reversing declining sales, in the UK, the joint-worst ever volume recorded in October, it’s time for them to look not only in-store, but inwards.

When it comes to turning things around, introspection and counseling aren’t too far-fetched as metaphors, actually. As a reflexive practice, talk therapy encourages clients to challenge their core beliefs and modify maladaptive behaviors in the hopes of achieving growth, something the retail sector desperately needs right now.

Talking shop

The core belief that needs challenging here is the purpose of physical retail. The industry has long been built around the assumption that stores – from flagships to pop-ups – are transactional places. Consumers are framed as (largely rational) actors whose experiences can be mapped on a ‘path to purchase’ towards a particular product or service.

But at its heart, the act of shopping has always been transformational over transactional: an imaginative hedonism where shoppers indulge who they’ll be, and how they’ll be perceived, when they slap down their Monzo card to buy those size 5 Kurt Geiger court shoes. Evolving the role of physical retail from a marketplace focused on selling things to a platform for personal discovery radically alters its role in consumers’ lives, and the retail experience itself.

Which brings me to maladaptive behaviors. Participating in the business of fantasy brings with a new set of competitors, namely Pinterest, Instagram and e-commerce with its personalized recommendations, generous return policies, and lack of overhead lighting. To get people back in stores at a time when it pays – quite literally – to stay at home, you need drive desire, and that requires disruptive new ways of doing things.

And I hate to break it to you, but a cafe and personal shopping service isn’t going to cut it. From Burberry’s Shenzhen flagship being run by WeChat to Off-White’s multi-use space in Miami’s Design District, Glossier’s NY wet bar to Nike’s XR Weatherdome, the future of retail is a more immersive, more memorable, more brand-first beast.

Radical acceptance

It may not be comfortable, but accepting the new retail reality, as challenging as it may be, is the first step in driving change. Retailers need to acknowledge that physical stores are a single touchpoint in a holistic, channel-less brand experience – one at which shoppers might not even make a purchase. And that’s OK because, now, that’s what the website is for.

Focusing instead on new approaches, whether fulfillment-as-theatre, nomadic stores, blockchain traceability, community events, or hyperphysical environments will create retail experience well worth making the trip. And the products? Well, those will become mementos of and markers of belonging.

With a little cognitive restructuring, the sector will see the challenges its facing aren’t insurmountable obstacles, they’re opportunities for growth. A moment in time to reflect, reassess and reimagine what retail could be.