Ten years of consultancy have gifted Rachel Shechtman with enough knowledge about marketing, merchandising and business development to create a unique retail experience, STORY. She will share her fascinating experiences with the public on the RetailDetail Congress (23 April), but let RetailDetail in on a few insights already.
The birth of a new store type
How did you come up with the idea of STORY, which has been described as a store that is "curated like a magazine, revolves like a gallery and sells things like a store"?
R.S.: "STORY is the realization of ten years spent as a consultant for brands like Kraft, J.C.Penney, Gilt Groupe and Toms. I saw the opportunity to take the strategies of merchandising, marketing, and business development that I had been using for other companies and test them in a physical retail environment. I really believed shopping could be about more than spending, and I wanted a place to prove it."
STORY introduces a sort of ‘curated shopping’. Can you briefly explain how this works?
R.S.: "I would say that STORY editorializes its merchandise in the same way that a magazine editorializes its content. We create a context – whether that’s Colour or Love – and layer the merchandise into that narrative, so really the items we 'curate' become party of the story."
You coined the term “retail media” and compare your store to a magazine. Does this mean every retailer should consider themselves an ‘editor in chief’?
R.S.: "The term retail media refers to our business model, which borrows from that of publishing: we draw revenue from corporate sponsors who lend credibility to each of our themed installations. I really see retail as a viable media channel for meaningful conversations between consumer and brand and the success of STORY in attracting sponsors including American Express, Target, and Intel speaks to that.
I think retailers, particularly online, are embracing the idea of taking an editorial viewpoint – whether it is Net-a-Porter’s new magazine “Porter” or Barney’s new magazine. So it’s less about every retailer adopting this model, but more about what can be learned from the way that media does business, to make retail a richer experience."
At STORY, three key words are: content – commerce – community. But how do you realize this in what basically remains a shop?
R.S.: "You’re right, we are basically a shop, but if you break down what people do when they shop: it’s social, it’s discovery, it’s buying. What we do at STORY is to make an effort to design our experiences to hit on multiple touch points: we create in-store content that offers information about each of the brands we carry, we hold public events that range from pasta making classes to Instagram meetups where our community can socialize and learn, and yes, we encourage our customers to shop.
By offering our consumer more than just a gateway to a transaction, we engage them on multiple levels and so what is basically a shop becomes more. It becomes the place you did a craft with your kids, the place you discovered that great gift from a local brand, the place you met an inspiring designer."
Make the experience as impactful as possible
Interactive and dynamic platforms like yours are usually online, because it is more cost-efficient and reaches a wider audience (geographically). How do you tackle these issues?
R.S.: "Arguably, because most dynamic platforms are online, we are at a distinct advantage because we are able to offer something that isn’t widely available. That enables us to have a dual revenue stream and do things, like change our entire storefront every four to eight weeks, that may not be cost effective for most businesses, but are at the core of our model and central to what we offer our partners.
Simply put, we can’t reach everyone so we focus on making the experience for those who we do reach as impactful as possible, so they go home and tell someone – you know what I did today…I went to this cool store."
You’ve already had a ‘Love story’, a ‘wellness story’, … Don’t you fear that one day you’ll be out of stories to tell?
R.S.: "There is an endless stream of stories to tell! Just because it’s the same topic, it doesn’t have to be the same STORY. For example we’ve done a “Wellness” STORY which was an experience based around encouraging people to play, and this past January we did a “Well Being” STORY that was based around the idea of taking editorial content from experts offline. It looked and felt completely different."
Another important element is that online the conversation continues. How do you make sure this happens?
R.S.: "For us, the digital component is less important due to the fact that we don’t have online shopping: our online component is simply about amplifying the content happening in store. From a social media perspective, we have found that Instagram has been an incredibly important channel for us in telling our story and sharing the experience of visiting the store. We integrate social call-outs into all of our brand signage and use hash tags throughout the store to underscore the fact that the conversation continues online. "
What would be your advice for other physical retailers?
R.S.: "I think for many retailers, success is still measured in sales per square foot. I get why that is important, but I would argue that when the focus is placed entirely on sales, the consumer experience is compromised. So then they ask, why didn’t I just buy this online ? Give the customer something they can’t get online, create an experience for them, so that shopping in your store becomes something they look forward to, something that’s special."
In your TEDx Talk you said: “We’re a dating service, making the match between brands and consumers”. Is that what a retailer should do?
R.S.: "I think a retailer should try to foster these dialogues but for us, because we integrate sponsorship, it’s central to our business model. We are in a sense introducing a brand to our consumer, as we see it. I think on the whole more retailers need to realize that there’s more to it than a transaction – it’s the interaction."
Brands are important in your concept, not only retail brands. They pay to be part of the conversation. Can you guarantee them return on investment?
R.S.: "Each of our concepts is reverse engineered from a set of deliverables from our sponsor. These deliverables differ from sponsor to sponsor and can range from content creation to research and development. By starting the concept with these deliverables in mind, we are able to create an experience engineered to meet their goals and give them an assurance that they will see ROI from this initiative."
Brands also use STORY as a lab, to test new products for example. How do you measure the response?
R.S.: "Unlike most retailers, we integrate digital technologies behind the scenes as a tool to measure consumer response to our installations. For example, we work with Prism Sky Labs on an ongoing basis, to gain heat mapping technology so that we can pinpoint what products and strategies are working in real time. By integrating this technology into our experience, we are able to offer our partners unique data about consumer behavior and adjust our merchandising strategies to reflect consumer engagement."
Rachel Shechtman will explore even more cases and go even more in-depth at the RetailDetail Congress on 23 April. If you wish to be there, you can get your tickets here.