The Future of Retail Walking Tour

Over the past couple of years, we at commercetools have seen our customers innovating in their physical stores through the use of digital technology. Physical retail is no longer the stagnant format we’ve all grown up with. 

We’re seeing two fundamental shifts that we wanted to explore in a first-of-its-kind retail walking tour. 

Experiential Retail

The first trend we wanted to explore is the full embrace of experiential retail, often through digital technology. Our customers are selling a brand, a lifestyle, an experience. And yes, they’re also selling t-shirts, toys, electronics, etc., but they’re selling more than cotton, plastic and circuit boards. Do your kids ask for Legos or do they ask for “plastic blocks that snap together”? See what I mean? 

Customers want brand experiences, whether that brand is Walmart or Tiffany. And they want a seamless experience both on digital channels and in physical stores.

The Evolving Point of Sale

The second trend we wanted to highlight is the evolution of the point of sale. Our customers are increasingly tossing their legacy point of sale systems and using us as -the- point of sale. There are now many options for paying on your own through an app, having an associate with a mobile device check you out, or Amazon’s pioneering Just Walk Out technology. It hasn’t made sense to have a completely separate POS system with its own products, promotions, inventory, etc. with support for offline.

Real omnichannel is here and customers love the seamless experience as they switch from physical to digital, often multiple times in the same physical store.

What We Learned from the Tour

The tour consisted of 15 guests, with Rick and I moderating along the way. We stopped at seven notable stores along our route. We started up on 5th Avenue, the historic capital of retail in Manhattan. We then got on a charter bus after Lululemon and went south to the Meatpacking district, the home of some of the hippest new retail spots in the city. 

Rick and I took a few minutes to introduce each store and why we thought it was worth including on the tour. I’ll cover each stop later in this article.

Now onto the tour and what we learned from each stop. 

We started our tour at Apple’s global flagship store. Steve Jobs personally oversaw the design and construction of this 77,000 square foot (7,154 square meters) store that is entirely underground. Apple has long-been a pioneer in retail experience with its Genius Bars, mobile checkout, and near-constant classes. 

We then continued to Bergdorf Goodman, the iconic department store on 5th Avenue. Founded in 1988, they were among the first to build elaborate display windows to draw in customers. At over 200,000 square feet (18,580 square meters), it’s an iconic part of New York’s retail scene. 

Above is a photo of the windows (credit to Bloomberg) as they look over the holiday season. Unfortunately the windows were still being prepared, so we couldn’t see them as pictured above.

Bergdorf Goodman is also an example of the consolidation we’re seeing across retail. After being acquired by Neiman Marcus, the entire Neiman Marcus group was then itself acquired by private equity. 

We then continued on to the Lego store, which is among the top retail experiences in the world. We started by building our own personalized figurines on a computer which were then printed in-store for pickup within minutes. 

Following that, we went to an immersive room that was a combination of theater and escape room. Part of the experience involved building a figurine with Legos. The figurine was then scanned with a 3d scanner which resulted in the image being projected on the wall for additional (hands on) interaction.

Lego continues to set the bar for interactive retail.

We then continued on to Amazon Go, underneath the iconic 30 Rockefeller Plaza. Amazon Go is a chain of 42 convenience stores featuring Amazon’s Just Walk Out technology, which they have patented.

We scanned a credit card once which allowed everyone in the group to enter. Through an elaborate system of cameras and sensors, they were able to determine who pulled each item off the shelf and charged our credit card accordingly. It worked flawlessly. No cashiers, no checkout. We all said it felt like we were stealing.

Our last stop on 5th Avenue was Lululemon, which we are proud to have as a commercetools customer. Lululemon was among the first retailers to understand the value of community. Through in-store yoga spaces, hosted classes, and generally fostering community among their customers, Lululemon has grown to > 570 stores and has revenue exceeding $6 billion dollars since its founding in 1998. 

In 2020, Lululemon bought Mirror (rebranded as Lululemon Studio), which was a startup that allows for immersive instructor-led workouts. An employee was kind enough to walk us through this immersive experience.

By being an early pioneer of headless commerce, Lululemon is able to connect with its shoppers and continue to focus on community building. Lululemon is among the most advanced of our customers in its embrace of digital technology.

We then took a charter bus to the Meatpacking district, where we stopped at the New York Roastery, which is part of the Starbucks Reserve collection of stores. 

I cheated and used professional photos above because I wasn’t able to capture the beauty with my own camera.

Not only is this destination gorgeous, there are many attractions within the establishment. The store featured a fully functional coffee bean roaster, restaurant, bar featuring coffee-infused cocktails, a merchandise store, and meeting space.

Every 15 minutes, they had a live demonstration of how they roast coffee beans in-house.

A few of the tour participants told me some variation of the same thing: “It’s a Starbucks but it feels like a local high-end coffee shop.” The attention to detail was quite impressive. The finishes they used throughout were top quality and everything was immaculately clean. And, in case you’re wondering, because it is in fact a coffee house, the drinks / food we had were outstanding. If there was a downside, the lines were a bit long. 

On our final stop, we went to RH (formerly known as Restoration Hardware), which is another commercetools customer. Like the Starbucks store, the physical property was simply spectacular. I’m running out of superlatives to emphasize just how beautiful these spaces are. At 90,000 square feet (8,361 square meters) over six floors, this store is a work of art.

I’ll cheat again and use a professional photo, since the photos I took don’t do it justice.

Here’s a photo I took of one of the show rooms:

RH was among our first customers to have in-store checkouts performed from mobile devices. As an industry, we’ve talked about omnichannel commerce for decades, yet there are still few that actually do it. 

We concluded our  evening with dinner atop the restaurant above RH.

Big thanks to Rick for joining me as co-host, to all of our attendees, and to the organizers from commercetools (Christian Macey, Stevie Hutchinson, and Dana Sarcona) for organizing the event. Follow me and commercetools for updates on future walking tours and other unique events coming soon