It has – to put it mildly – been a strange few years for retailers in many of the world’s more mature economies. Accelerated by the pandemic, the migration towards online sales has presented existential challenges to retailers whose presence was historically grounded in high street outlets. Simultaneously, those wanting to retain their physical stores have been obliged to invest more – principally in developments related to digitisation – in one of the most uncertain periods in living memory.
Six months on from our last look at the retail market, there has not been a major shift in the underlying conditions. In the UK, for example, ONS statistics for July 2023 show that a long established tendency for online to account for around 26% of all retail sales remains unchanged. However, there are signs that the cost of living crisis is starting to impact upon retail sales as a whole, with overall volumes estimated to have fallen by 1.2% in July after a rise of 0.6% in June.
With store closures continuing – and, in particular, the fate of major UK nationwide chain Wilko hanging in the balance at the time of writing – it’s inevitable that the burden of this drop-off will fall on physical stores. So, if anything, it’s likely that – resources permitting – efforts will be redoubled in many areas around improving store performance and pulling out all the stops to help protect the future of physical retail.
Above all, it seems probable that the main focus of investment will be on high-impact visual technologies – even at the lower end of the market. As Luke Marler-Hausen, sales manager at LED & LCD digital video wall & display solutions company Leyard Europe, observes: “There has been an emphasis for a long time [among the larger retailers] of using LED walls to help bring people through the doors and then go on a journey with the store. But latterly, the smaller retailers – including the ‘mom and pop’ style stores – are also wanting to do some of this, having realised that display screens in general are a lot more affordable than they used to be, and can offer a very good RoI.”
Markus Deserno, European digital signage business development retail manager at Sony Professional Displays & Solutions Europe, says: “The requirements of digital signage and AV have increased greatly to make sure the in-store experience is appealing for visitors and customers. High quality displays, a clear focus on sustainability and well-connected solutions are the focus.”
Marler-Hausen is not alone in pointing to some of the major shopping centre developments of recent decades – including Westfield – as being hugely influential in terms of engendering an approach to “the store experience that [involves] screens of all shapes and sizes, such as trolleys and LED table-tops”. In general, he says there is now a strong interest in using newer technologies to “engage with people and in a number of different ways”, adding that this goes beyond display screens to encompass innovations such as virtual mannequins and motion-tracking cameras.
While these developments can be observed to varying degrees in different categories of retail, there’s no question that fashion and luxury have been among the most enthusiastic adopters. Recent examples for Leyard include the flagship H&M store in Regent Street, London, that features generative artwork displayed across 4200 x 3536 pixels on 2.5mm LED display technology provided by Leyard. The concept created by design agency Hirsh & Mann in conjunction with creative coding studio Variable features artwork evolving in response to customers as they move between the ground and first floors via escalator.
As this eye-catching project indicates, retailers are certainly willing to invest significantly when they deem it appropriate, although understandably the biggest share of the money tends to be allocated to ‘hub’ sites in major towns and cities. Hence there is an impetus for retailers to achieve “a balance of understanding the product and the RoI on the investment that they can expect in [a specific location]. Plus, there is a requirement to have flagship-type stores that the regional stores look up to.”
It’s often the case that, once they have perfected one or two flagship locations, retailers will seek to implement downscaled versions of some of the same ideas at their other sites in a way that reflects the predicted RoI in each case. “I think you would find that retailers would stop very quickly with these sorts of installations if they were [not justified] by the extra revenues,” notes Marler-Hausen.
With so many variables – and, potentially, sites – in the mix in any large-scale deployment, it’s beneficial that several contributors to this article allude to increased cooperation within retail organisations, not least between sales & marketing teams and those directly involved with selecting and installing new technology. Still, it certainly doesn’t hurt for vendors to be able to present a range of possible solutions in an accessible and compelling way.
Marler-Hausen agrees that there tends to be greater understanding of current display options these days, but adds: “It might be that sales & marketing know what they want but need to physically see the screens for it to become tangible. So that’s why there is a requirement for customers to be able to visit a showroom, such as our London Showroom [in Whitefriars Street], or maybe invest a small amount of money in order to a prototype.”
The symbiosis that often exists between the physical and virtual retail interests should also not be underestimated. Indeed, it’s arguable that in an increasingly competitive virtual world, there is a tremendous opportunity for retailers to raise their brand profile by dreaming up innovative and headline-making physical installations.
Deserno remarks: “The experience of visiting retail stores makes all the difference to the online world, so the real task is to create, maintain and operate these experiences. We already know it’s become a real challenge to build the brand to customer relationship in person over the past few years, and it’s made even harder when online is the only resource due to how heavily saturated this market is, so the experience in store has had to become exceptionally appealing.”
Specific Sony solutions that are “helping to digitise the in-store experience” include TEOS signage & way-finding applications and the BRAVIA BZL 4K professional displays. Deserno notes an increased demand for solutions that complement retailers’ sustainability visions: “Sustainability is an important factor for the retail industry, [and] not just for clothing. We’ve found ways to adapt to being consciously sustainable as well as accommodating our customers’ needs for crystal clear displays. [For example] our newly launched BRAVIA BZL 4K professional displays feature new deep black non-glare coating to provide the best image quality in bright, high ambient light environments. In addition, we create intimate usage scenarios for our customers that enable them to save energy even during operation.”
Growing awareness of sustainability issues is also highlighted by PPDS, which issues a dedicated annual report on the topic. Most recently, ISE 2023 saw the company launch its ‘zero power’ Philips Tableaux advanced colour ePaper (ACeP) signage displays, which are able to show content without even being plugged in or using power at all. The displays only require connection to an electricity source when content is being updated, then immediately revert to zero power upon completion. Tableaux joins a roll-call of other PPDS products frequently specified for retail, including the 6000 and 7000 series direct view LED display products.
Sven Beinlich, international key account director for PPDS, says that the ability to have no power consumption whilst showing content is a “big thing!”. He goes on: “We are one of the first companies to have this kind of product. We are also [addressing the fact that] our carbon footprint is part of the carbon footprint of our customers, so as well as assisting with new product concepts, we are also working on steps to do with the logistics chain, packaging and so on.”
Audio can still often end up playing second fiddle in both retail projects and reporting about them – and this mainly video-focused article is no exception.
However, it’s important to note that, in hub sites especially, there does seem to be a tendency for retailers to invest more in audio than would have been the case five or ten years ago, and that this is often also being undertaken in tandem with a keen eye on energy consumption.
Logan Helps, brand development manager at Audio-Technica, says that “for a long time [companies have been] looking to invest more into larger [outlets’ AV], such as those in the bigger cities, and that includes a desire for higher-quality audio. For example, the Audio Pro Business business – which joined Audio-Technica’s distribution portfolio in 2020 – offers wireless audio speakers that can be added to existing track lighting installations “so they’re powered from the lighting rail, which also means the installation time is very quick.”
As well as looking for clever time-saving solutions like this, Helps says that there is also a wider understanding these days that retailers “will save money in the long-run by investing in energy-efficient amplifiers. They are more willing to spend money [in this areas], and installers are very happy to put forward those sorts of solutions as well”.
So what of the short to mid term future? Whilst there will continue to be plenty of mega eye-catching display installations, it’s likely that retailers will spend more time exploring the ability of compact, yet still highly creative deployments that can help enrich the overall impact of stores.
Marler-Hausen notes: “I’ve been really impressed by the willingness [of some retailers] to use smaller screens, like H&M with its fixed window totems, very creatively and in a way that generates a lot of interest and attention.” Moreover, he adds, a new display project “doesn’t have to be massive and expensive to have a lot of impact”.
And although the overall physical retail estate in many countries is destined to diminish further, the effectiveness of what remains will increase as digitisation matures. Deserno comments: “There certainly will be a reduction of retail space, but those spaces will become much more digital and more sophisticated, meaning the change will come with more possibilities. If we look at the luxury sector, for example, we expect a growing investment in technology of up to 25%.”
Plenty of reason, then, for vendors and installers to maintain an open door policy when it comes to physical retail.