The latest in experiential retail

Macy’s in January revealed the first 66 locations that are closing as part of plans announced nearly a year prior to shutter about 150. Most in this round will close in Q1, with a few already closed and a couple closing mid-year.

The 66 locations slated to shutter span 22 states and many are mall anchors, according to a list released by the department store. Several are stand-alone furniture stores that in some cases will shift operations to nearby full-line stores.

The department store is closing four of its 24 small-format stores, a shift from the acceleration of small-format openings announced in 2023. Six out of nine of the retailer’s freestanding off-price Backstage locations will also close.

Many of the closures confirmed by Macy’s are mall anchors, but its shrinking of the small-format and off-price footprints indicates that two concepts previously touted as full of potential may be getting shelved or at least downplayed.

The small-format stores are about one-fifth the size of Macy’s full-line stores. In 2023, under previous CEO Jeff Gennette, the company said it could triple the number of these locations by the fall of 2025. In February 2024, CEO Tony Spring said that, while 150 underperforming Macy’s stores would be closing, in some cases even if they are profitable, 30 small-format, off-mall Macy’s stores would open.

Macy’s launched Backstage about a decade ago and saw expanding the off-price operation as a way to grow and more effectively leverage its real estate. Though most locations have been carved within full-line stores, in recent years the company said it would return to its idea of opening more stand-alone Backstage stores, which like the small-format stores are mostly housed away from malls.

Macy’s didn’t immediately reply to questions about how much its small-format plans have changed, if at all. In a statement, Spring emphasized improvements in merchandising and customer service at stores slated to remain open; the company didn’t mention its forays into off-mall stores, smaller stores or off-price.

“Closing any store is never easy, but as part of our Bold New Chapter strategy, we are closing underproductive Macy’s stores to allow us to focus our resources and prioritize investments in our go-forward stores, where customers are already responding positively to better product offerings and elevated service,” Spring said.

Some analysts don’t view either the small-format or off-price strategy as productive.

“The small-format idea isn't a big winner,” Erik Gordon, professor at the University of Michigan’s Ross School of Business, said by email. “Backstage isn't great. Unless Macy's comes up with a new idea, its future is to shrink, not grow.”

In fact, these closures don’t go far enough, according to Nick Egelanian, founder and president of SiteWorks.

“I noticed closures at Southlake in Texas and some very good malls. Not many surprises, though,” he said by phone. “They continue to pare back only as stores become all but dead. I’ve been saying for many years, ‘Close more, get out of the Midwest and stop with the useless small-store program.’ What we need to see is what Macy’s is doing to save their best 200 stores — not their annual closing list.”

There may be nothing that Amazon doesn’t sell. That means that every small to medium chain or independent shop in America, in every category, has been up against a competitive juggernaut for the last quarter century or so.

"I don’t think any categories are 'Amazon-proof,’” Nikki Baird, vice president of strategy and product at retail tech firm Aptos, said by email. “It’s more about how to coexist with Amazon across any and all categories.” 

Yet, in many U.S. cities and towns, certain stores seem to be thriving. Bicycles, photo equipment, record stores, resale — even, of all things, Amazon’s first category of books — are among those that have been quite resilient in the last couple of decades. It’s not that Amazon, or other disruptions like digital alternatives to music and books, hasn’t posed a challenge. The e-commerce giant sells bikes, cameras, records and used goods, after all.

But experts say that indie shops have stuck around in the Amazon era because of the products they sell and how they sell them — and because of the people who are both buying and selling.

The product

Some merchandise is more conducive to buying from a physical store because the buying decision is based on a host of variables beyond price, according to research from Jonathan Zhang, professor at Colorado State University’s College of Business.

That includes anything that people would rather try out in person. Bicycles, clothing, footwear, furniture, mattresses and used items are difficult to assess online, especially with the level of information found on most websites, including Amazon’s, he said by phone. There are choices to be made around materials, fit, features and other variables, said Zhang, who has developed a scale to measure what he calls “the depth of inspection.”

“There's definitely a product-type effect,” he said. “The products are so complex that it’s hard for a description, or even for photos — no matter how many photos — to capture it, to make the consumer feel like ‘This is the right fit for me.’ Then there are products in general that do not require a lot of inspection, like buying a hammer, where most people have no problem just buying them online, because they don't need to physically inspect them.”

How it’s sold

But what about merchandise, like books, that are the same whether you buy them on Amazon or elsewhere?

When Amazon entered the retail picture in 1994, it was a bookseller and, as it undercut traditional retailers on price and introduced the world to e-books, industry observers prepared to watch the industry collapse. 

“A lot of bookstores did go away,” Zhang said, noting the demise of the Borders chain and struggles at Barnes & Noble. “A lot of the stores that only sold books, without product curation, a lot of these did go away. The ones that survived, the ones that are thriving, they have changed their business model.”

In a Harvard Business School working paper on bookstores that have rallied, Ryan Raffaelli notes that, in a surprise to many, the number of independent bookstores grew nearly 50% between 2009 and 2018, citing figures from the American Booksellers Association. Raffaelli credits the pivot to three main tactics: retailers promoting the “buy local” movement; curating their inventory and personalizing the customer experience; and using their spaces to host events like story hours, reading groups, book signings and lectures.

Barnes & Noble seems to have taken the note. When the chain embarked on its turnaround several years ago, it shifted to a very indie strategy where each location was given leeway to shape its operations to its local community.

Who’s selling it

Customers who opt for their local stores are also looking for specialized knowledge and meaningful interaction with the people who work there, experts say.

Community-based happenings like music events at record stores or group rides at bike shops are direct ways to connect with customers. But effective retailers also create a “showroom effect of trust” based on expertise and shared affinities, according to Brett Wickard, who launched a small chain of record stores in the Northeast that has since been taken over by its employees. 

This not only forges connections, but also provides a retailer with valuable information about what customers want going forward, said Wickard, now founder and CEO of unified commerce platform FieldStack.

“You might just be talking shop about whatever,” he said by phone. “But when you, as retailers, pay attention, then you see the other opportunities that are out there that could make you —I don't want to say Amazon-proof — but you should just be seeing where your customers are headed. You may be surprised.”

For a lot of retailers in various categories, where their customers want to go is resale, and many are missing out, he said. While resale across categories is available online, several experts say that it’s usually only profitable when operated in stores.

“Tons of retailers are sitting on a gold mine and so few are taking advantage of it,” Wickard said. “Resale is a gigantic opportunity in our brick-and-mortar retail world right now. It is overwhelmingly valuable and an on-premises experience. It changes the customer journey — I don't care if it's clothing, if it's entertainment, if it's bikes or if it's sporting equipment, it makes every item in there potentially unique. It gives a reason, that kind of ‘wow’ effect of a reason, to visit a retail location more and more often.”

Who’s buying

Another reason that certain stores have prospered despite Amazon’s dominance is that there are two kinds of shoppers in this world — those who prize convenience and price, and those open to discovery, according to Zhang.

“People differ in how they want to shop. Physical stores are going to get those customers that enjoy the physical experience, and online retailers are catering to those who do not want to go to the stores,” he said. “That’s how the world will be like going forward. It's not going to be about which wins, I think both will coexist peacefully. It's just that they serve both segments in different ways.”

Doug Stephens, founder of retail consultancy the Retail Prophet, sees it much the same way.

“On one side you have brands like Amazon and Walmart. I see these as super-high utility brands that become cognitive defaults for consumers,” he said by email. “If I want to save money, it's Walmart. If I want to save time, it's Amazon. Those are strong positions that appeal to deep consumer needs. However, the other constellation is comprised of brands that appeal to our emotional needs. Super-high fidelity brands that become emotional defaults.”

Examples include not just local stores but also larger retailers like Patagonia with its activism; toy retailer Camp with its theatrical experiences for kids and families; B&H Photo Video with its “high levels of professional-grade product expertise and service;” and Dyson with its “remarkable products” and gallery-like showcases, according to Stephens.

“These are the kinds of retail experiences that will thrive in spite of Amazon,” he said. “In short, the way to beat Amazon is not by being more like Amazon. It's by being anything and everything it is not.”

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The retail industry is undergoing a digital transformation, driven by changing customer expectations, omnichannel strategies and eCommerce platforms, with security risks evolving just as fast. Risks such as data breaches, downtime, organized retail crime and return fraud, and supply chain disruptions can damage customer trust, brand reputation and revenue streams, as well as incur fines and legal costs.

Threats against retail resilience

In retail, the customer is king, and modern customers expect seamless, personalized and secure shopping experiences. However, this is easier said than done. The pace of innovation and the meteoric rise of online shopping come with security challenges that could negatively impact the customer experience and retailers’ brand reputation, customer retention and ultimately their bottom line.

Creating a culture of security to prevent and quickly respond to incidents is key. Considerations include:

Threat landscape awareness: Cyberattacks are becoming more sophisticated, frequent and targeted, aiming to disrupt operations, steal data or extort money. Retailers need to be proactive and vigilant in detecting and blocking threats before they impact their business. For example, attackers often target retailers during seasonal and holiday shopping windows, threatening retail operations during the most lucrative times of the year.

Regulatory repercussions: Retailers handle sensitive information from customers, partners and employees, such as personal data, payment details and loyalty programs. They also need to comply with various regulations and standards that govern how they handle data. Tracking and adapting to changes in the regulatory environment is necessary to prevent fines and protect customer trust.

Personalization, payments and the omnichannel experience: Customers expect fast, convenient and secure shopping experiences from retailers, whether online or in-store and they want to know that their data is protected. Retailers need to secure access to confidential data as well as securely leverage that data for tailored shopping experiences. It’s also necessary to protect the entire omnichannel ecosystem, including eCommerce platforms, POS systems and mobile apps and legacy systems.

eCommerce crime, fraud and shrinkage: It’s projected that eCommerce will account for ~25% of total retail sales by 2030—a significant increase from 15% in 2021. Online marketplaces will likely proliferate as a result, which organized retail crime (ORC) groups can exploit to profit from stolen goods. eCommerce return fraud also poses a significant threat, contributing significantly to physical shrinkage (i.e., inventory losses from theft and errors).

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Foot Locker is sending its stores back to the changing room.

The retailer’s first store of the future concept, which CEO Mary Dillon previously teased in an earnings call, opened in April at the Willowbrook Mall in Wayne, New Jersey. Another one will open in Paris ahead of the Summer Olympics, and more are planned for Melbourne, Australia, and Delhi, India, later in 2024. The new format fixes a number of problems the team had identified, including a lack of a cohesive store experience.

“Even though we have nearly 1,800 global Foot Lockers, we haven't always had the most synchronized store brief and expression. And so this is an opportunity to really start on a journey to synchronize that,” Chief Commercial Officer Frank Bracken said in an interview. “A lot of our store designs in the history of Foot Locker have been really honestly male-dominant in terms of like, ‘Let's establish the male footwear and apparel sections, and then we'll build women's and kids around it.’ And this was really holistic in terms of all the consumer journeys: men's, women's and then family with kids.”

The women’s section will be brought forward to the front of the store and will feature more storytelling around trends in the sneaker space — colors, silhouettes or other hot topics — as well as mannequins showing how to style a certain look. There’s also a checkout in the women’s section and at other points throughout the store allowing shoppers to pay where they are versus using a centralized checkout area.

“We gave it really prominent placement in terms of the store layout,” Bracken said of the women’s section, adding that the size is also bigger in the new store. “It's more commensurate with our aspirations for the women's business, not a reflection of where we are today or where we were yesterday.”

While the New Jersey store doesn’t feature a Kids Foot Locker, the retailer’s 34th Street flagship location opening in the summer in New York will. The retailer’s approach to that concept includes more space around fixtures to accommodate strollers and a stronger “sense of play and discovery” in the artwork and graphics of the store, according to Bracken. The area includes a space for kids and parents to “meaningfully connect,” per the press release. 

Connection as a concept is also seen in a new try-on area. Rather than benches placed throughout the store, Foot Locker’s new format features a 250- to 300-square-foot centralized try-on area that Bracken likens to a campfire. A round, central structure serves as a centerpiece to display product, with seating and additional merchandise displays in an oval shape around it.

“It actually almost feels like a bit of a lounge or a living room vibe within the very center of the store. So it's very intentional in its design and its placement,” Bracken said. 

The hope, beyond creating a comfortable space for shoppers to try on shoes, is that it sparks conversations among customers about the latest shoes they’re trying on and creates more of a community feel. Associates are nearby to help and now can check the store’s inventory from handheld tech.

Upgrading Foot Locker

Foot Locker’s business has undergone meaningful shifts in recent years, including bringing on Mary Dillon as CEO, exiting markets and businesses, and shuttering stores amid sometimes serious sales declines. Most notable was an announcement in 2023 that it planned to close some 400 mall-based stores by 2026. Then, in March 2024, the company said it would revamp two-thirds of its remaining global Foot Locker and Kids Foot Locker fleets.

Bracken himself calls 2024 a “critical year” for Foot Locker on several different levels. To him, it represents a year where a lot of the retailer’s efforts will come together, from a new loyalty program and app to a new brand platform (launched in 2023) and now a new store experience. The new store concept is a step toward the broader store experience upgrade, as the retailer will take learnings from the store and apply them to the upcoming revamps.

“The refreshes are a little less capital intensive, I'll put it that way, than a full store remodel, but they come out of the same brief and spirit and store design,” Bracken said. “So the storefront, fixturing, navigation, marketing materials and storytelling is all highly correlated to this new store expression.”

Bracken said the footwear retailer consulted with shoppers around pain points and asked its vendors what’s important to them as it worked on the new format. The lobby of the store has a storytelling component to highlight what Foot Locker is most focused on at a given time, and the retailer changed the layout of the store to offer more marketing opportunities throughout.

“If you look at our current concepts, the majority of the actual floor space is L-driven and fixture-driven and so we created secondary and even tertiary points of footwear storytelling that allows that capacity,” Bracken said, noting an emphasis on showcasing what’s new or important to shoppers. 

Sections at the front of the store will now celebrate new releases and trending products. Foot Locker is also working on digital content and other features to tell customers more about the shoes it’s selling in stores. Bracken said the retailer plans to integrate its app into the store experience as well, but the new app hasn’t launched yet.

Shoes can be personalized with special laces in a “Sneaker Hub,” which also serves as a pickup area for online orders and a place to sign up for Foot Locker’s loyalty program. The retailer plans to use that space for special member benefits throughout the year, like additional shoe customization options or gift with purchase events.

The New Jersey location was chosen to pilot all of this for a variety of reasons, including how close it was to Foot Locker’s New York offices, allowing for frequent visits. Bracken said the store also services a good mix of consumers and it’s a strong basketball market.

“Lastly, it's a competitive mall,” Bracken said. “We know our competition is in this mall and we'll get a very fair benchmark and read as to how this performs against itself, but against the competition as well.”

If the new concept performs well, it’s a good sign for Foot Locker’s vendor partners as well. Part of Foot Locker’s recent problems was Nike’s highly publicized move away from wholesale, which it has since adjusted course on. And Bracken sees that as good timing for Foot Locker and its strategic lace up plan.

“There's been a lot of talk recently in the press about the return to wholesale,” Bracken said. “And so we just think the timing is perfect for us to put our best foot forward, to intersect with our brand partners’ strategies and you know, in the context of lace up, we're starting to really put some points on the board and show some green shoots and some proof points that our lace up strategy is taking root.”

With the holiday season underway, retailers are tapping their marketing budgets to entice shoppers to spend at their stores and online. At the same time, though, they are making mistakes that are keeping customers away.

“Retail right now is a mixed bag — some winners and some losers. And a lot of that comes down to the experience offered,” Nikki Baird, vice president of strategy and product at retail tech firm Aptos, said in emailed comments. “Consumers today have higher expectations for what a retail experience — particularly in the store — needs to offer than it did five years ago.”

Here are retailers’ most common missteps in merchandising and store operations.

Getting the merchandise

Many retailers are making it difficult for their customers to obtain what they’re trying to sell.

An obvious example of this is the locked-up products that consumers are increasingly finding at stores, mostly at drugstores and mass retailers. A great majority of shoppers — 62% — say they’ll wait for a store employee to help them, but more than a quarter say they will give up on their purchase or go elsewhere, according to recent Numerator research. Those unwilling to wait for assistance spend 21% of their dollars online compared to 18% for those who waited.

“When faced with a locked product, there’s more than a 1 in 4 chance shoppers will leave that retailer without making a purchase,” Numerator analyst Amanda Schoenbauer said by email. “This rises even higher if you’re talking about younger shoppers, people with children, or if the locked items are in everyday categories like health and beauty.”

Inadequate staffing exacerbates the very problem of theft that locking merchandise is supposed to thwart, according to Brendan Witcher, vice president and principal analyst of digital business strategy at Forrester.

“Associates have always been a key factor in making sure stores are safe and secure by acting as a deterrent through visible presence and shopper interactions,” he said by email. “Without enough of them in place, retailers are forced to find other ways to ‘protect’ the store.”

Self-checkout is another area where retailers are missing customer expectations when it comes to assistance and connection, experts say. 

“The folks missing the boat are viewing self-checkout as a cost-savings opportunity, which ignores the sole advantage of brick-and-mortar retail, where you have human interactions,” Brett Wickard, founder and president of unified commerce platform FieldStack, said by phone. “Retailers who are studying the customer journey data know that the more touchpoints you have — the more genuine person-to-person interaction you have — not only does that customer shop with you longer, they're a more engaged customer.”

Fostering discovery

People who shop online are there primarily for convenience, while those who head to stores expect a certain level of merchandising, according to research from Jonathan Zhang, professor at Colorado State University’s College of Business.

Research from Zhang and others indicates that curating merchandise and providing good customer service in store have helped protect local retailers like independent booksellers from Amazon’s fierce competition.

This matters to some extent online as well, according to Kristin Naragon, chief strategy officer at Akeneo. Research from Circana highlighted “the growing importance of online research and price comparison before making a purchase.” More than 80% of holiday shoppers plan to shop online in 2024, according to Circana’s Holiday Purchase Intentions report. Fewer will shop online exclusively, which is an opportunity for brick and mortar, per that report.

With so many consumers shopping online and being careful about their discretionary spending, it’s more important than ever to create “a frictionless discovery to purchase experience where customers can easily find, compare, and confidently purchase products,” Akeneo’s Naragon said by email. This is accomplished in part through online assortments, product descriptions and search options that are meaningful to customers and easy to manage.

“However, where many retailers continue to fall short is either overwhelming buyers with choice or not giving them enough information in order to make that confident selection,” she said. “A core reason driving both of those failures is a retailer’s lack of investment in curating their products.”

Customer service

Squirreling away goods behind locked cases or over-reliance on self-checkout aren’t the only ways retailers discourage customers. Too many have trimmed their costs by drastically thinning out their store staffing in general, experts say.

More than 40% of consumers surveyed by Theatro, which supplies tech for frontline workers, described shopping in stores as “less enjoyable” than before the pandemic, and 60% of them pointed to poor staffing levels. This hurts the top line, according to GlobalData Managing Director Neil Saunders, who has monitored a dearth of staff and customer service at retailers like Macy’s and Nordstrom.

Retailers who measure repeat business find that good in-store customer service brings people back into the store time and again, according to FieldStack’s Wickard. Cutting staff is a short-term profit boost that hurts in the long run, and is usually undertaken by retailers that aren’t looking at the right data, he said.

“Retail at its core is really four walls and some people coming through the door. What you do with that is what makes you who you are,” he said. “If you don't have incredible retail teams and great inventory — that's literally the reason you exist. You can never under-allocate customer service. Not only that, you should view it the exact opposite way, where, when other retailers are under-serving customers, you should actually be doing the reverse and investing in that because you are going to have more and more customers who are going to be entering your doors, and you have that golden opportunity to win a new customer.”

A lot of retailers miss this because they fail to view holistic data, due to disconnected point-of-sale and customer management systems. This leads to “smart short-term decisions and really poor long-term decisions,” Wickard said.

Failing to cater to customers in stores through meaningful communication and merchandising is throwing up obstacles, according to Colorado’s Zhang.

“Retailers are foolish if they do not make it easier for consumers to shop, easier for consumers to get their questions answered by trained staff, and also easier for customers to discover new things and new categories,” he said by phone. “These are the benefits that stores have over online, so they should just maximize that.”

Sephora is in the middle of the largest capital project in its history, wherein it is redesigning every store in its North American fleet, Artemis Patrick, president and CEO of Sephora North America, told an audience at the National Retail Federation’s Big Show conference in January. 

Some stores “will get major redesigns, and some will get minor,” Patrick said of the project, which launched last fall. The beauty retailer has over 700 stores in North America. 

The beauty retailer doesn’t know exactly how long the store transformations will take, but the majority of it will be done over the next five years. 

A number of company insights are currently informing the redesigns. Sephora examined heat maps and how people are shopping. The company also thought about its gondolas, or displays in stores that showcase a brand’s products, which Patrick acknowledged are expensive. “We’re not a cheap date,” she said, “and we don’t want our brands to be spending a ton of money on building these amazing fixtures, and then it doesn’t work out.” 

Therefore, the company began testing a format that makes it easier to update its stores, with a focus on its key categories of makeup, skin care, fragrance and hair care. Sephora wants to ensure that the shopping experience represents its current assortment but also what the company thinks it may be in the future. 

After talking to “millions of consumers,” the beauty retailer also designed a space where its beauty studios could be off to the side. “The reality is, [shoppers] didn’t want their makeup being done in the windows — not shocking — but they wanted more lighting,” Patrick said. 

Sephora also considered its line formation for checkout. Shoppers are used to a “snake” line wherein they can look at and consider grabbing product minis while they wait. Yet, 25% of shoppers are being checked out by beauty advisers via mobile throughout the store. 

Using that information, and the idea that checkout may increasingly be done in-store via mobile, the company is making some of its fixtures more modular, like the “minis” setup. “We can actually break up the fixture and move it to the front if we wanted to, creating a much more agile footprint,” Patrick said. 

“I think too many times retailers talk about the ‘store of the future’ and it’s very much driven by the design team. So you have this conversation of form versus function,” Patrick said, stressing that there’s nothing wrong with that approach. However, Sephora wanted to consider the stores beyond its flagships and ensure a cohesive shopping experience regardless of store location. 

“We do believe we have that consistency with our beauty advisers, but maybe not necessarily in our retail stores,” she said. 

Sephora had brought the changes to 111 stores prior to the presentation and, as a result, key performance indicators, transactions, productivity and sales were up when compared to the control group. 

Outside of store renovations, Sephora in 2024 increased its global footprint in Australia and over the summer announced Tanger would add locations to its shopping centers. The beauty retailer’s presence at Kohl’s through shop-in-shop fixtures is helping the department store drive growth by bringing a younger, more diverse customer to its stores. It’s also helping Sephora to better compete with Ulta, as many Kohl’s stores operate in the same type of shopping centers as Ulta. In fact, in recent quarters Ulta has directly called out the impact of competitive pressures on its performance.

For Paralympic swimmer Anastasia Pagonis, makeup has always been a passion. But when she lost her usable vision at age 14, Pagonis had to find new ways to apply and shop for her favorite products.

“Most people take independence for granted, which is something that you can lose hold of quickly when you have a disability,” Pagonis said in an email. “The ease of discovering new products became challenging.”

Many beauty products on shelves today are inaccessible to individuals with disabilities, whether they are part of the blind and low-vision community or face dexterity challenges, like arthritis. 

Pagonis credits her mom for helping her identify products and shades. For the past five years, her mom has helped create QR codes to go on Pagonis’ products. Pagonis can then scan those codes to hear an audio recording of her mom describing the product, including its finish and any application tips.

That innovation caught the attention of E.l.f. Beauty. The beauty brand and Pagonis have been working together over the past two years and in August launched the “Beauty For Every Eye” bundle. The products include the same tools Pagonis’ mom had been providing her with for years, but the QR codes lead to Pagonis herself describing the product and how to use it.

“Our research and work together revealed that, often, the blind and low-vision community has to either rely on sighted people or creative solutions to tasks such as discerning a tube of mascara from a lip gloss tube on the vanity,” Laurie Lam, chief brand officer at E.l.f. Beauty, said in an email. “We found that the journey towards inclusivity is an ongoing process, and taking the time to learn how your community, those that are both abled and disabled, interact with your products and packaging is a vital step to providing universally accessible packaging to every eye, lip and face.”

While more brands are actively working toward creating packaging that’s more universally accessible, it’s not widespread across the beauty industry yet. Companies not prioritizing this may risk missing out on a real business opportunity, according to Deb Gokie, vice president of Consumer Health and Ease of Use at the Arthritis Foundation.

“They're leaving a lot of money on the table,” Gokie said.

Where the industry stands

Creating universally accessible packaging isn’t a priority for many brands right now. The reasoning could boil down to a lack of awareness, according to Kailey Waskall, a practicing occupational therapist and creator behind the Occupation Beauty Instagram account, which reviews product accessibility.

“I think some brands are trying really hard, but I think, mostly, brands just aren't aware of what inclusive packaging or universal packaging is, or they've never specifically had to think about it from a disability perspective,” Waskall said. “I just don't think it's something a lot of brands are thinking about at this point.”

Rare Beauty and Guide Beauty are two brands that have been thoughtful about how consumers interact with and use their products and have designed the packaging to accommodate various needs. The founders of those brands consider product design on a personal level: Rare Beauty was founded by Selena Gomez, who has spoken about her dexterity issues, while Guide Beauty was founded by celebrity makeup artist Terri Bryant, who began experiencing dexterity challenges in her hands and eventually was diagnosed with Parkinson’s disease, leading her to design products that are easier to use and apply.

But bringing awareness to the industry at large, to executives who might not have that personal experience, has been a challenge.

Then there are the operational and financial boundaries that can make creating more accessible packaging prohibitive. 

For “more indie brands that want to really dive into this space, the reality of it is, is that making any packaging that's customized in this way, it takes a lot of investment in terms of cost,” said Joyce Kim, chief product officer at Rare Beauty. “It's really challenging.”

But for larger companies and brand conglomerates that may have the capital, the size of their portfolio can pose a challenge, according to Bryan Rahning, a director at PERLab, the product redesign practice of Kearney.

“They have their tried-and-true designs that they continue to iterate upon, and those designs have been grounded in classical designs that are not meant for a variety of different levels of accessibility, whether it be vision, mobility or other sort of cognitive ability,” he said. “I think that the ability to get that change requires a momentum effort when you have a portfolio as large as they do. They haven't started to move that elephant yet.”

Rahning noted that some companies in the personal care space are making more noticeable efforts when it comes to increasing product accessibility. For example, Procter & Gamble has taken steps to add tactile indentations and symbols to products like shampoo and conditioner and laundry detergent pods to help low-vision and blind individuals identify the products. But the prestige beauty space has been slower to adopt tools to make packaging more accessible, Rahning said.

“In the prestige beauty space, it is really hard to get new designs approved,” he said. “You have a lot of packaging suppliers that they're consistently dealing with, and the new product launch cycle just takes a long time for some of these larger companies.”

Smaller startups, he added, might actually have an advantage over larger companies in that they are more nimble and can test out new designs quicker.

Another factor brands are considering is how sustainability fits into making a product more accessible.

“Most of these design elements require additional packaging from a design perspective, and the industry is definitely in a process of trying to become more sustainable,” Rare Beauty’s Kim said. “It's kind of strange — trying to hit accessible packaging with using less plastics because we're trying to be more sustainable, while trying to have the capital, or the money basically, to do these customized tools. There's just still barriers in the space of how to accomplish all of that. … I don't know if it's easily scalable at this point.”

How companies are addressing the barriers

Creating packaging that was easy to open and close came about organically for Rare Beauty because of Gomez’s personal experience.

The brand started to hear feedback from its customers about how accessible they thought its products were. Rare Beauty wanted to learn more about what elements made its products easier to use, so it launched the Made Accessible Initiative in partnership with the Casa Colina Research Institute. 

The Casa Colina Research Institute conducted a study to determine what features make a product easier to open and close, apply or hold for individuals with upper extremity disabilities. Over the course of two weeks, participants tested seven of Rare Beauty’s products and provided feedback on usability.

“This study gave our patients the chance to reintroduce makeup into their lives in a way that was more accessible,” Hannah Cone of the Casa Colina Hospital and Centers for Healthcare said in a statement on Rare Beauty’s website. “It showed that even with limited hand and arm mobility, you can still partake in the beauty community.”

The study examined the brand’s Soft Pinch liquid blush, Soft Pinch tinted lip oil, Positive Light liquid luminizer, Liquid Touch brightening concealer, Positive Light tinted moisturizer, Liquid Touch weightless foundation and Kind Words matte lipstick. Following the study, the brand has identified three key features to make its products more accessible: packaging that’s easy to use, packaging finishes that give users a secure grip and applicators that are comfortable to hold and use with precision.

Rare Beauty found that its Positive Light liquid luminizer, for example, features a cap design that allows for a secure grip, an applicator that can easily be removed and a bottle size that allows for comfortable hold and a firm grip.

“We plan to use all the information and education that we're learning and apply that to future packaging decisions,” Kim said. “The biggest goal is that the beauty industry does the same.”

Target has also taken steps to make resources available for creating more accessible packaging. The Arthritis Foundation in May announced it partnered with the mass merchant to develop its Ease of Use Design Guides, which it said are the “first guidelines for easy-to-use products and packaging developed in the United States as resources for engineers and designers in the requirements definition and design development stage.”

“We were having a lot of companies that were bringing products to us, and it would go through testing and they wouldn't pass,” the Arthritis Foundation’s Gokie said. “The design was fabulous, but they might have forgotten to put a tab on the inner seal, and no one could get it open.

“What we were trying to do with the design guidelines, and what we are working in collaboration with Target to do, is to design and offer up resources and design guidelines for engineers and industrial designers, so that when they're at the stage of design, they have a very easily accessible design guide to help them when they're in the prototype stage versus when the product is already at market because if there's something that they need to change, it's often cost prohibitive to go back in and redesign once it's at market.”

The guidelines were influenced by the Arthritis Foundation’s Ease of Use Certified program, which independently tests products to determine if they are easy to use for individuals with mobility limitations. 

The effort, funded by Target, has led to the creation of several guides, including one on “Bottles and Bases” and another on “Components,” intended to help designers and engineers across the industry develop packaging that’s easier to use.

The “Bottles and Bases” guide highlights some potential factors that could make using a product more challenging, such as being too heavy, having a linear force requirement that’s too high and requiring excessive grip span. The guide offers several suggestions to make products easier to use such as making products under five pounds for items that require a single-handed carry or less than 10 pounds for a two-handed carry; easy-to-remove seals; and comfortable grasp areas that do not exceed 2.5 to 3 inches.

“Any product that comes through, it’s our goal — we want them to pass because we want to bring more products to market that are eligible for the arthritis community,” Gokie said.

Who benefits from universal design

Arthritis is the No. 1 cause of disability in the U.S., according to the Arthritis Foundation, and it alone affects some 60 million adults and about 300,000 children. And over one in four adults in the U.S. have some type of disability, according to data from the U.S. Centers for Disease Control and Prevention.

It’s important for brands to consider the various needs of people with disabilities when creating a product’s packaging. The benefits, however, extend beyond those communities.

“Everybody benefits from it,” Gokie said. “When you have packaging that is accessible, if it's easy for someone with arthritis or chronic pain or visually impaired, it's really much easier for all consumers.”

Beyond the beauty industry, many things that were originally designed with accessibility in mind have become fixtures in everyday life.

“Curb cuts were originally made for people in the disability community — having those little tactile dots right by a curb,” Waskall said. “But now moms with strollers or families with strollers, it helps them. If you're trying to unload something heavy and you're pushing a dolly, you're not going to want to go up a curb. 

“So these changes that seem … like, ‘Oh, you're only catering to this one community’ really help everyone. Universal design is there to just make the world more accessible and that helps everyone.”

Prioritizing universal design can also play into customer loyalty: More than 70% of consumers said they would switch brands or products if they were Ease of Use Certified, according to a 2016 Nielsen Ease of Use Survey cited by the Arthritis Foundation. And it can determine whether a consumer continues to use a product if they develop a disability.

“The disability community is the one community that anyone can enter at any time,” Waskall said. “When you get older, you can … develop a disability. Just think about if you, right now, have this holy grail product, and you plan on using it your entire life, and then you hit an age and you acquire a disability, and all of a sudden you can't use this holy grail product. That's going to leave a [bad] taste in your mouth about that brand.”

Aside from hindering brand loyalty with customers, not prioritizing accessible design can pose a business threat.

“From a logistical business side, they are missing out on a huge subset of the population, especially as we have an aging population,” Waskall said. She noted that for individuals who develop a disability, it could cause them to change how they interact with their products. “If you're able to right now say, ‘Hey, we design products accessibly,’ you're going to continue and really foster a very engaged and loyal customer base,” Waskall added.

Beyond the revenue opportunity, working toward making packaging more accessible can also help support companies’ goals around inclusivity, according to PERLab’s Rahning.

“A lot of these brands are built on stories and claims around inclusivity,” he said. “A lot of the elements of universal design are very much in line with the types of brand stories that they're trying to tell. I think that they can give them some credibility in some of those stories that they're putting on their products already — actually put some teeth behind it.”

Is a more accessible industry within reach?

Rare Beauty and Target have funded research to determine what makes a product’s design accessible. And Lam said E.l.f. Beauty’s partnership with Pagonis marked “the first step in our journey” to make beauty more accessible.

But there are “low-hanging fruit” ways for brands to make their products more accessible, according to Kim.

“Creating an entire collection is the more challenging part,” she said. “But I think there's small things that brands can do to make their packaging more accessible.”

Waskall has created videos on her Occupation Beauty account that show how users can adapt their beauty products to make them more accessible, like adding rhinestones to a compact to add texture or wrapping self-adhesive tape to a lip liner to make it easier to grip.

 

 

 

 

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But there are relatively small changes brands can make to their designs to make them more accessible to begin with.

Adding texture or using a matte finish, for example, can allow users to better grip a product, while a shiny exterior can make the product slippery. Integrating angled edges into a product’s design, like Fenty Beauty did with its Eaze Drop Blurring Skin Tint, can also make it easier to grip and prevent it from rolling away when set down.

And giving users the ability to use a single product in multiple ways can also help make it more accessible, according to Waskall. She highlighted the Makeup by Mario Softsculpt Multi-Use Bronzing & Shaping Serum with Hyaluronic Acid, which allows individuals to use a pump to dispense the product or unscrew the cap to access a wand applicator for more precise application.

“Universal design doesn't need one design. It needs options,” Waskall said. “It can be this product that you can apply multiple different ways and you can interact with in multiple different ways, so that it can reach a wider variety of the consumer base.”

Brands should also consider at what step in an individual’s routine a product will be used. “Even if you don't have a disability, if you're trying to open a container right after you've put on your morning moisturizer, your hands are going to be slippery and it's going to be harder to get grip onto the packaging,” Waskall said.

There isn’t a one-size-fits-all solution to making products more accessible. Some formulations require specific packaging to prevent the product from drying out, to protect it and to ensure there aren’t issues when storing and shipping the product. And consumers have individual needs when it comes to a product’s packaging.

“I don't think it's realistic to think every single product is going to work for every single person,” Waskall said. “There are certain foundations that are for people with dry skin, there are certain foundations that are for people with oily skin. But overall, people with all skin types can easily find a product for the most part.”

Including people in the disability community in the conversation and finding out what elements make it easier or harder for them to use a product will naturally lead to companies creating more inclusive designs.

“Disability is not a monolith,” Waskall said. “There's not going to be one right answer. But I think making small changes can make big impacts, even if that's as small as putting a QR code on your packaging [or] adjusting your packaging texture so that it's more matte or more of a soft touch versus slippery.”

A more accessible beauty industry is within reach, Kim said, “it just has to be a priority.” 

“I think once these types of brands that have a big reach make it a priority, then definitely others will follow.”

The death of stores had already been a much-discussed idea by the time the pandemic hit, cratering foot traffic across the industry and leading many retailers to file for bankruptcy and shutter large portions of their fleet. E-commerce secured an even bigger role in customers’ lives as a result and retailers invested heavily in their online capabilities to meet new needs.

But more than four years later, stores are not dead. In fact, foot traffic has largely returned to 2019 levels, according to PwC’s U.S. Retail Leader Kelly Pedersen. There are also fewer vacancies than in previous years and younger generations are embracing the in-store shopping experience, even if they aren’t buying there.

“It is a different type of traffic and a different type of purpose,” Pedersen said, noting that conversion rates are down despite traffic growth. “That's just really indicative of people going to stores for different reasons than to just purchase, right? They're going into them to return. There's a solid, bigger shift toward browsing.”

The level of turnover at malls and shopping streets can also be evidence that a new generation is making its preferences known, according to Michael Brown, a partner and Americas retail leader at Kearney. He sees it as a good thing because it means new shopper needs are surfacing. It’s also, in part, a factor of younger companies like DTC brands searching out shorter leases or pop-up style agreements, Pedersen noted.

All this to say, physical retail is still healthy, even in a world with higher levels of online purchasing. In fact, an Experian report found in-store shopping for the holidays held relatively steady from 2022 to 2023, with around two-thirds of sales done in stores between October and December. Nearly half of the shoppers it surveyed planned to head to stores in 2024.

And especially at the holidays, there’s something about physical shopping that AI recommendation services and personalized websites just can’t provide.

“When it comes to the word ‘shopping,’ it really takes place in the physical world because that's where you really go, you look, you feel, you touch, you engage and you decide eventually what you're going to buy,” Brown said. “You may buy it later in the store or you may just buy it online — so I think there is really a difference between shopping and actually buying. And I think we see shopping still [has] so high levels of people going to the stores to have those experiences.”

What online changed (or didn’t)

Over the past decade, holiday shopping preferences across stores and e-commerce have effectively swapped places. The 59% of shoppers who planned to buy holiday gifts in stores in 2015 has shrunk to a projected 45% in 2024, while those who expected to shop online grew from 41% in 2015 to 55% in the same period, according to PwC. 

It’s a noticeable tilt toward e-commerce, but not nearly as high as the 61% that looked online in 2020 during the exceptional circumstances of the pandemic. And in fact, the projected percentage of in-store shoppers in PwC’s survey in 2024 increased for the first time since 2021. Black Friday, too, saw a rare spike in popularity, with a 3% increase in respondents planning to shop on the banner holiday, which tends to be an in-store event. That’s the first time that metric has grown since 2018. It still only amounts to 22% of shoppers, though, down sharply from the 59% who planned to shop on Black Friday a decade ago.

There are other factors that might lead to higher store traffic in 2024 as well. The shorter holiday season, coupled with consumer delays due to the election, will likely send shoppers into stores more as the season wears on and delivery times become less reliable. 

“There's a lot of ingredients there for a pretty robust in-store holiday shopping season this year,” Pedersen said.

Interest from shoppers spans different buying environments as well. While there is a trend toward high-street shopping during the season, Pedersen said a lot of traditional malls are seeing higher traffic again as well, courtesy of the large swaths of the country that moved out to the suburbs during COVID.

But e-commerce retailers and social media platforms are also finding innovative ways to reach customers, including through the industry’s favorite buzzword of late: AI. Etsy, for example, introduced an AI gift recommendation service in January 2024, while Amazon launched AI shopping guides and a virtual holiday shop to entice customers.

Pinterest debuted a personalized gift feed on its platform in November, alongside a series of gift guides curated by celebrities and publishers. And a report from Fiverr earlier in 2024 found that 14% of Gen Z in particular planned to use generative AI search to look for gifts.

Efforts like these can work, “if the algorithms are right and you can really be hit with something that you've always looked for — you want it, maybe you had a pattern of trying to find those things,” Brown said. “I think the challenge that there always is with online is the screen in front of you is only like 10 by 12, and you can only see so much. But when you go out and you look at the physical retail environment, it all opens up, right? You get peripheral view. You get long-distance view … online, it's hard to do that.”

That said, online isn’t without its benefits. It’s great for mission shopping, according to Brown, referring to when a customer already knows what they want. And there are different times during the season when e-commerce channels have more sway with shoppers. Social media, DTC and emerging marketplaces (think Temu and Shein) are more successful at the start of the season, according to a report from Boston Consulting Group, when shoppers have more time to find the perfect gift and aren’t as stressed about price and delivery times.

Retailers can make their websites more enticing as well, with festive banners or by offering the same promotions that they do in stores, like a free gift with purchase. But Pedersen admitted it’s difficult for retailers to mimic the joy of shopping in person.

“Other than us at some point having true VR headsets where we're walking through a store and experiencing that way, it's pretty hard,” Pedersen said.

And during the holidays in particular, shoppers are looking for that.

The joy of shopping

What makes the holidays different than any other time of year? At its most basic level, it comes down to gifting. Customers prowling through a shopping street or mall during those critical fall months are looking not for themselves (at least not primarily), but for others. That means discovery shopping is critical, and that’s where stores thrive.

“What's successful this season is really having unique and differentiated products and an experience where consumers think they're really winning or they're getting that special deal,” Brown said, noting that off-price players have done this particularly well. “It's a little bit of that pursuit and uniqueness and surprise of what I can find in your store. Because if I know exactly what I'm looking for, then it's easy for me to shop online.”

Customers might make a lot of purchases online, but when it comes to discovering what gifts to give, shoppers of all generations turn strongly to physical stores. In a report by PwC, every generation except for baby boomers said visiting stores in person was their top way to discover gifts. For boomers, it was second only to talking to friends and family. Both of those methods — the flesh-and-blood variety — landed significantly higher than the third all-around highest, which was online marketplaces.

“Sometimes you just see how busy the store is, and you say, ‘Well, now I’ve got to go see it,’ right? There's that crowd attraction,” Brown said. “Even as much as we'd all like to stay away from more lines at the register when you're there, that means something's going on there. And again, you can't really see that and experience that online.”

There’s a psychological reason as well: Shopping during the holidays can be a lot of fun. Winter milestones like Christmas, and the act of indulgent spending that often goes along with them, can serve as a way to cheer ourselves up during the darkest times of the year. Stores decorate their windows, blast seasonal tunes and waft pine or peppermint fragrances into the air. And much like the scents of pumpkin spice can tap into nostalgia and remind shoppers of fond memories, the right sensory stimulation can make holiday shoppers view a store more fondly.

Even spending money on others makes people happier than spending on themselves, Happiness Research Institute CEO Meik Wiking told Retail Dive in 2023.

“People just generally like to go to the stores during this time of year, it puts them in the mood. They go get some hot chocolate or something from one of the food stands. There's just something about it,” Pedersen said.

Some retailers are answering that call. Macy’s, for example, is hosting a holiday market at its Herald Square flagship, alongside its usual holiday window displays and Santaland experience. Target is offering in-person “Wonderland” events this season as well, with shoppable brand experiences. Others, like Anthropologie, are taking a pop-up approach to create holiday-specific shopping environments.

The opportunity to do more than just shop at the holidays — to go out to eat, for example — is key to a thriving shopping center. Outside of the usual Santa visits and sale offers, retailers could try more creative ways of bringing people in as well, like exclusive brand launches or a loyal customer night, according to Brown and Pedersen.

“These things should really be called consumer engagement centers and it needs to be a mix of consumer activities,” Brown said, much like a downtown shopping area meets many different needs. “It should be about shopping, entertainment, food, social gathering points for the community.”

Some of these trends are already happening in malls across the U.S., according to Brown. And based on the interests of younger generations, in-store shopping could continue to grow. Of all the generations PwC studied, Gen Z leaned the heaviest toward shopping in stores to discover new gifts, at 60%. They do have expectations around digital components, like self-checkout technology and brand apps, but they’re interested in going to stores. And their spending power is rising.

“Gen Zs and Gen Alphas are big in-store visitors — they go to stores a lot,” Pedersen said. “I think this trend of more in-store shopping based on those generations is going to continue for the next few years because it’s just proven that the Gen Zs and Gen Alphas like to be in store more than the millennials. So I think we see a lot more of this.”

A Barnes & Noble in Washington, D.C. is hoping the sequel is better than the original.

The book retailer in November opened a three-story, 30,000-square-foot store in the heart of D.C.’s Georgetown neighborhood, directly across the street from a Rag & Bone, Bluemercury and Lululemon. The location was once the site of a jail, a movie theater, Henry Ford’s first dealership in the D.C. area — and a very familiar book store. Barnes & Noble itself occupied the same building in 1995 until it eventually vacated the space in 2011. 

Barnes & Noble CEO James Daunt called the D.C. space the “most ambitious” of the company’s new locations. 

“The old location was a fantastic store for Barnes & Noble. We left the space because our lease ended,” a spokesperson for the company said by email. “When the opportunity to open a store in that exact location came up, we could not resist to go back to our old building and once again have a location in Georgetown.”

The D.C. store is part of a larger brick-and-mortar expansion strategy, wherein Barnes & Noble is launching dozens of locations across the U.S. after over 15 years of declining store numbers. In 2023, the retailer opened more new bookstores in one year than it had in the entire decade of 2009 to 2019.

The company is now on track to open around 58 stores by the end of 2024. In November alone, Barnes & Noble will launch locations in New York, Florida, Utah, New Hampshire, Indiana, Kansas, California, New Jersey and Washington. 

Only a week prior to the launch in D.C., a store opened in Chicago’s Wicker Park in the historic Noel State Bank building, in what Daunt said was one of the most “beautiful bookstores anywhere in the world.”

Part of the bookseller’s overarching strategy, and what is taking the company into a period of growth, is handing the control of each location over to its local booksellers.

“The assortment has been curated by our Georgetown book team and will reflect the interests of the area,” a company spokesperson said of the D.C. store.

The space’s first level contains new book releases, gifts and an entire back wall of journals. Visitors to the second level will encounter fiction while the top floor features nonfiction. The store features private label Barnes & Noble products, seasonal gifts, an extensive toy and game selection and an expanded vinyl collection. 

The Georgetown store added new fixtures and furniture but kept the existing interior of the building. That includes columns and hardwood floors from Nike, the tenant prior to this iteration of Barnes & Noble. The space will eventually have a cafe that is scheduled to open in 2025. 

Barnes & Noble was acquired in 2019 by Elliott Management, owner of Waterstones, the largest bookseller in the United Kingdom. Daunt, who is the CEO of Waterstones as well as Paper Source, also took on the role of chief executive of Barnes & Noble.

At the time of the acquisition, Daunt hinted at the strategic trajectory of its brick-and-mortar stores, some of which has come to fruition through this latest round of openings. The inclusion of toys in stores and becoming a gift destination — goals that were stated in 2019 — can clearly be seen in the Georgetown location. 

But book store sales overall have yet to return to pre-pandemic levels. In 2023, U.S. sales in the category reached $8.3 billion dollars, relatively flat compared to the year prior, according to Statista data. 

Don’t tell that to shoppers in Georgetown, though. The retailer has been open for less than two weeks and has already seen packed crowds, conducted author signings and even held a pop-up featuring merch in collaboration with South Korean boy band Ateez.

“The return to this historic building is a dramatic example of the ongoing revival of brick-and-mortar bookstores,” Daunt said. 

“We wanted to put ourselves in front of more people.” 

That’s what CEO Sarah LaFleur said of M.M. LaFleur’s opening in Union Station in 2020. It would turn out to be an incredibly ill-timed decision, with the concept opening inse a train station just weeks before the COVID-19 pandemic shattered physical retail plans across the globe. But the brand still wants to put itself in front of more people — and is doing so with a new store in Washington, D.C.’s Georgetown neighborhood that opened May 8, as well as a few more on the horizon.

“We opened in Union Station like six weeks before the pandemic — and they were the six greatest weeks of that store,” LaFleur said in an interview reflecting on the period.

M.M. LaFleur ended up closing all of its stores in 2020, with a slow reopening process since then. Now, the retailer — known for its workwear — lists seven locations on its website, most of which opened in 2024, including the recently opened store in Georgetown and another that opened a few weeks later in Philadelphia. The Georgetown location, a few minutes walk from the main M Street drag, is across from Maman, a cafe M.M. LaFleur has partnered with before in New York. It joins another store in D.C., on K Street, which was the first to reopen and is more closely located to one of its key demographics — people who work in corporate offices.

“That location has done phenomenally for us. There are a lot of professional women who stop by during their lunch break or right after work, even in between meetings, so that location’s actually been very good for us,” LaFleur said of the K Street store. “We were like, ‘OK, D.C.’s grown so nicely, we could probably support another location. Where does it make most sense?’”

‘We don’t really have the luxury of locations not working’

Georgetown stood out as a spot where many of the brand’s customers in Maryland and Northwest D.C. like to shop, but M Street “didn’t feel quite right,” according to LaFleur. Georgetown’s main drag features a plethora of name-brand stores and up-and-coming retailers, including Glossier, Skims, Patagonia, Allbirds, Free People, Warby Parker and more.

“It's heavily trafficked, but it didn't actually necessarily feel like it was our traffic. There was a lot of tourist traffic, and obviously some Georgetown University traffic, but I was like, ‘This is not quite right.’ And then when we walked down Wisconsin, I was like, ‘Ah, this feels much better,’” LaFleur said about the road that runs perpendicular to M Street. “And, I mean, we're still very much underdogs. It's not like we've got hundreds of thousands of dollars to just drop on a new store opening. So we were also really opportunistic about what we could find.”

So far, the store has performed well. Katie Twidwell, vice president of sales and operations at M.M. LaFleur, told Retail Dive via email that the store saw double the expected sales in its first month in business. M.M. LaFleur is thoughtful about where it opens stores, for the most part only opening once there’s a certain level of e-commerce presence in a given city. And most of its stores are four-wall profitable, according to LaFleur.

“We don't really have the luxury of locations not working,” LaFleur said. “L.A. we know, online, we don't have as many customers as San Francisco. So even though I know L.A. is a big market and probably would be a good opportunity, we can't just open a store there and consider it a loss leader … We can't have it be a top-of-funnel strategy, like it has to return money to the business fairly quickly. So I guess that is the conservative approach here, but I think the one we feel comfortable with.”

The brand is planning one more opening in 2024, in Chestnut Hill, Massachusetts, and likely “a few more” in 2025, according to LaFleur. But even long term, LaFleur envisions a U.S. footprint of only about 20 to 25 stores. That’s low compared to some other DTC brands, but that might not be a bad thing.

“A lot of DTC companies look at Warby Parker and they say, ‘They opened stores and that's been really successful for them, so we should go and follow the same playbook.’ And like, Warby Parker is a fabulous brand, but I don't think of it as a brand-driven consumer goods company. I think at the end of the day, it's quite utilitarian and fashion doesn't have the same luxury,” LaFleur said. “I just think the number of stores that you can open before you might see that kind of slower return is lower.”

Nevertheless, physical retail is a critical piece of communicating with the customer, and M.M. LaFleur has evolved enough over the years that opening that conversation back up was important, according to LaFleur. The brand, which started with only dresses, still sells workwear-style dresses and tops, but also T-shirts and denim.

“A lot of people still think of us as the brand that was focused really on corporate dressing — and we do a lot more than that,” LaFleur said, adding that advertising on Google and Meta is “hairy and unpredictable” in a way that physical stores aren’t. “Right now, my strategy as CEO is just keep diversifying, diversifying, diversifying. Don't get caught with our pants down, don't lean too hard into one channel versus another.”

Evolving, but not too far

M.M. LaFleur’s current iteration isn’t a complete departure from who it was five years ago. Many of the brand’s best-sellers from 2017 or 2018 are still sold and still crack the top 10 in terms of sales, according to LaFleur. The executive still thinks of the company’s customer strategy as “narrow and deep” — and still sees the brand tied to “elevated clothing.”

“We're not the brand that you would probably wear if you wanted to relax at home. Or if you wanted to … just get a cup of coffee and walk around the neighborhood,” LaFleur said. “We're clothes where you want to just show up a little bit and I think showing up can take many forms, but if you just want to look a little put together, then that's when you put on your M.M. … We're not going to compete against Everlane or Uniqlo.”

But a brand evolution only works if customers come along for the ride. LaFleur hopes that a broader assortment means customers tell their friends about M.M. LaFleur more and the brand becomes more of a go-to store for its current customers. As it is, some existing shoppers are still surprised to discover M.M. LaFleur sells certain categories. 

“You could see a world in which they would say, ‘M.M. has gone in a different direction and it's not for me anymore’ — and I'm sure that's happened to some customers, I'm not denying that,” LaFleur said. “But I think for the most part, customers have really kept up with us, and they've liked the direction we've headed in and so we're not churning them.”

Newer collections have been promising, with the sell-through rates of its recent spring line “significantly higher” than its other lines in the post-pandemic era. 

It’s not just the product lines that are evolving. M.M. LaFleur’s Bento Box, a Stitch-Fix like subscription service, shut down in the fall of 2019 and relaunched in April, with a focus on having customers preview the items in their box and potentially make changes before receiving it. An initial lookbook usually gives customers eight styles to preview, which they then discuss with a stylist and add or subtract pieces based on what they’re looking for, according to Twidwell. Most shoppers whittle down their Bento Box to between five and six styles that they ultimately purchase, Twidwell said. M.M. LaFleur noted average weekly revenue has grown 12% since the relaunch. 

The company's stores have always stressed appointments, and still offer them, but the company is also expanding the in-store experience beyond that. Only two of M.M. LaFleur’s seven stores strongly recommend booking a stylist in advance, and even then, walk-ins are possible. 

“We really like our appointments — and I think our customers really like them, too,” LaFleur said, noting good basket sizes and higher net promoter scores from appointments. But part of the reason the Georgetown location was appealing was that anyone can walk in, according to LaFleur. M.M. LaFleur’s K Street store, on the other hand, requires prospective customers to hit a buzzer in order to enter, likely a deterrent to casual shoppers.

M.M. LaFleur is also marketing to customers through new avenues, including through a multiyear partnership with the WNBA’s New York Liberty that launched in 2023. The brand gives free clothing loans to women running for office and dresses a selection of authors that it works with for their book tours as well. Post-pandemic, M.M. LaFleur stores have also played host to book events for some authors.

The Georgetown store, for example, has its first store “book club” in the works and features a curated book collection in the store, thanks to a partnership with local independent retailer Old Town Books. The events are good not just for existing customers, but also serve as a unique customer acquisition tool, according to LaFleur.

“I’m a big reader, I mostly read a lot of novels. It's kind of my happy place,” LaFleur said of why the company has leaned into partnerships with bookstores and authors. The company’s New York locations also have a local bookstore partner. “We started actually featuring a lot of authors on our blog, maybe six or seven years ago … There is a nice Venn diagram of women who like to read fiction and memoirs, and M.M. customers.”

Ace Hardware is preparing to launch a new experiential store model.

Dubbed Elevate Ace, CEO John Venhuizen said the home improvement retailer plans to invest over $1 billion to add the concept to its new and existing stores over the next five years.

Key changes include adding store-in-store brand showrooms; new product assortments; a flagship store model featuring an outdoor space with a live goods display; and enhanced customer service.

“[We] wanted to create more than just a space where customers could come shop but a space in which they could connect,” Dale Fennel, the company’s vice president of merchandising, said in an interview with Retail Dive. “We think that Elevate Ace is a fundamental change in our store model.”

Ace Hardware introduced the Elevate Ace concept with a fully built out 13,000-square-foot model store inside the McCormick Place convention center during its recent convention in Chicago. 

While a handful of stores will feature the new concept in Q4, Fennel said the full rollout will begin in January 2025.

Experiential retail is “one of the absolute imperatives” for the company and for the overall future of retail, Fennel said. The revamp began two years ago with two goals in mind. The first was to build a store that highlights Ace Hardware’s core categories — paint, power tools, backyard grilling and home preservation. The second goal was about community. 

A key element of the changes is to create an in-store shopping experience that can’t be matched online, Fennel said. A small number of brands and categories are fueling most of Ace Hardware’s current growth, “so we set out to really elevate those brands and create this immersive shopping experience that you can’t find anywhere else.”

The hardware retailer is debuting the experiential store model as it celebrates its 100th anniversary in 2024 and the recent opening of its 5,000th location in the U.S. The company opened 111 new stores through June and plans to open 200 overall by the end of 2024. Globally, Ace Hardware has over 5,800 locations in 60 countries.

The industry has changed since the company last updated its store design five years ago. To enhance the customer service experience, Fennel said they’ve trained frontline associates to serve as brand advocates who can help walk customers through a purchasing decision whether they want to shop by brand or by features.

Additionally, Fennel said they’ve optimized the assortment in the home preservation section and that the makeup of the product categories will shift. While the grilling category will occupy the same space on the sales floor, Fennel said the power department will grow significantly by about 60%. 

“We really are focusing in on trying to understand what the customer wants, whether it be by brand or features and benefits, and serving up to them all the products that are available at Ace either in store or in the case of grilling, for assembly and delivery,” Fennel said.

As a cooperative, Ace Hardware has a different business model than big-box home improvement stores. And Fennel said the company operates in a slightly different retail segment than Lowe’s or The Home Depot. Most Ace Hardware stores, for example, don’t offer building materials or large appliances. That approach has insulated the company from some of the economically driven consumer reluctance or inability to spend on big discretionary purchases, like major home renovations. 

Lowe's and Home Depot saw sales decline in their most recent quarters, down 4.4% and 2.3%, respectively. Ace on the other hand reported first-quarter revenues grew 2.5% year over year to $2.1 billion.

“We know there’s different purchase occasions, and customers are going to shop with different retailers but that separation of home preservation versus home renovation is a key differentiator between us and big boxes,” Fennel said.