Fast Company has a fascinating piece about how Ikea is looking to transform its iconic physical retail experience and turn it into something sustainably experiential. Here's how it sets up the story:
"In late April, Ikea took over a warehouse in Milan for the world’s largest furniture fair. In the front, it built a vintage shop of Ikea furniture that dated back to the 1950s. It was a spin on Ikea as you would largely expect Ikea to be. But in the back were massive, multistory sculptures, built primarily from Ikea’s budget products, like light bulbs and bowls.
"Things only became stranger at night, when Ikea welcomed the Milanese vinyl store Serendeepity to coordinate a few DJ sets while Swedish lighting designer Anders Heberling staged a light show across the space. What resulted were two full-blown raves - the latter of which an Ikea spokesperson tells me was shut down by police.
"You might call it a stunt, but Ingka Group’s creative director Marcus Engman would call it a prototype to Ikea’s future retail experience.
"Indeed, Ikea has big plans for physical retail across the U.S., as it’s pledged $2.2 billion in investments to expand its big blue box stores and open hundreds of smaller pickup storefronts in cities across the country—as it aims to compete more directly with Walmart, Amazon, and Target.
"In other words, the big blue Ikea box store isn’t going anywhere, but its experience will soon change dramatically."
Engman tells Fast Company, "There’s so many things that are challenging for retail. Just look at transportation. Most of our sales are actually out of the blue boxes [the traditional Ikea warehouse store]. And fewer and fewer young people have a driver’s license. It’s hard to shop at Ikea! That’s a very physical challenge … But then, it’s also, how do you make that experience something that is worthwhile? To go out for a day for, more or less. You need to rethink it a bit, still keeping the best parts, like the efficiency of Ikea, so you’re not jeopardizing it being affordable in the future.
"Then I think it’s very much about the mix of things. I won’t say the word 'omni channel' because everybody’s saying that, and I don’t understand what it is. But life is a big mix. And that’s like the new normal. So how do we adapt to that and use each and every channel in a smarter way?"
Engman continues: "First, you have to make it easy for people, and then you could make it fun. If you start with fun, and it’s a struggle, it will never succeed. So I’m not thinking so much about a different digital layer. I’m thinking more like total experience."
Creating a spectacle like the one in Milan just isn't sustainable, Engman said. "It’s one, it’s a thing to create a [spectacle] like this [in Milan] once. But if you have a store on Oxford Street, for instance, like the old Topshop store, I would expect it to be sensational every time I go there. And every time I pass by. How do you create that? Some kind of retail programming needs to happen. Which is, to me, really interesting because you don’t want to make it too programmed either. It’s not like starting a TV channel. It’s more built upon surprises. And then you could put the layer of sustainability on that? You don’t want to create 'new' all the time because that’s not really sustainable. So how do you do that in a sustainable way?"
- KC's View:
One of the interesting things about the piece is that Ikea clearly doesn't have all the answers yet; Engman is exploring all the possibilities, trying to figure out how to balance efficiency with effectiveness, fun with a sustainable business model, and physical with digital retail.
To me, this exploration is critically important. Retailers who assume that the box essentially is going to stay the same are making a serious mistake - customer expectations grow and evolve as their options multiply, and retailers have to keep up.
Let's start here: Engman says that the ideal experience is "built upon surprises." So let me ask: When shoppers enter your store, are they ever surprised? Are they ever really delighted? Because if not - if there are no corners in your store around which, when shoppers make the turn, there is something that grabs their imagination - then you're missing an opportunity and giving another retailer the opportunity to steal that business.