HMY UK Magazine - Issue 1 - January 2018

ISSUE 1 Q1 2018

INNOVATION IN RETAIL What’s inside: STORE DESIGN

360˚ VISION

How to entice customers through theatrical design and what’s hot in 2018

NEWS New products and case studies from HMY UK

TECHNOLOGY Showcasing the latest technologies from HMY and around the world

POLITICAL Retail trends from 2017 and the 2018 predictions you need to know

©HMY 2018 All rights reserved

hmy-group.com

Note from HMY UK Managing Director “The overwhelming factor that is impacting our industry, causing numerous challenges for retailers – both online and offline – and prompting a dip in consumer confidence is, of course, Brexit and the resulting political and economic uncertainty.

HMY UK noted that many retailers experienced a strong start to 2017 with encouraging figures during the first half of the year, followed by a weakened second half – demonstrated by widespread profit warnings, slumps in sales and significant internal reshuffles. Some retailers put expansion and refurbishment plans on hold, as slower growth and declining performance perhaps meant investment into bricks and mortar wasn’t financially viable.

That’s not to say it was all doom and gloom though, as the discount market continues to thrive in the face of hardship. During times of uncertainty, such as the financial crisis, consumers turn to discount retailers to save money and luxury purchases are put on the back burner. We’ve seen a huge shift in consumer behaviour over the last few years as shoppers convert from traditional retailers to lower cost rivals, such as Aldi, Lidl and Home Bargains, to hunt for offers and seek better value for money – a prevailing trend that will continue into 2018.

Stuart Geekie, As a supplier to the retail industry, we begin the year in confidence – as whenever HMY UK Managing Director difficulties are encountered, new opportunities arise. It may be a challenging time for retail, but there’s a lot to be said for knowing your customer, adapting to change and setting yourself apart from the market. As such, HMY UK looks forward to supporting more brands and retailers in designing and creating innovative solutions that will keep them competitive – throughout 2018 and for years to come.”

Store Design 03

Retail Theatre “HMY have noted that retailers are expected to invest further into

experiential as they are focusing more on refurbishing current stores.”

04

Trendsetting Our Concept designer takes you through his trends to keep an eye out for in 2018.

05

Gender Based Store Design “Clear pricing, clear navigation and clear promotions are no-brainers, while bringing in technologies like augmented reality is another way to keep footfall in-store and offline.”

HMY Latest News 07

Michael Kors Case Study

08

B&Q Case Study

09

Coming Soon Visit our latest EE Showcase Store.

10

HMY Exclusive France Showroom Interested in seeing the latest retail technology yet to be implemented in the UK? Head over to page 10.

Technology 11

Ready, Set, Go Amazon unveils “store of the future”

12

What’s Next in Technology?

“Nearly one in two UK retailers (44%) are seeking in-store technologies as a priority for 2018.”

Political 13

What Can We Learn From 2017?

British High Street in flux as shops close, sales fall, and visits decline

14

2018 Retail Predictions & Brexit

UK households are spending less as they face biggest budget squeeze in three years.

03 Store Design

Setting the stage to entice shoppers away from the screen and back onto the high street

RETAIL THEATRE “RETAIL THEATRE IS AN IN-STORE DISPLAY INSPIRED BY THEATRE, ART AND CREATIVITY, DELIBERATELY DESIGNED TO MAKE SHOPPING AN ENTERTAINING EXPERIENCE”

Splash, Topshop Oxford St

Champagne Bar, House of Fraser Rushden Lakes

R

etail theatre is a term a lot of retailers are referring to recently, especially since many retailers like John Lewis, House of Fraser and Topshop invested heavily into experiential design in 2017. However, what does retail theatre actually mean? Retail theatre is an in-store display which is inspired by theatre, art and creativity, deliberately designed to make shopping an entertaining experience.

Many retailers’ reports show that sales are increasingly driven by online, as online shopping is becoming a strong commodity amongst customers. When we shop online we are less inclined to have an experience as we simply want to purchase our items and check out. However, the concept of experiential in-store is becoming a part of their expectation; people now visit stores and expect to be entertained. As a result of this increasing trend, retailers are partnering with various companies and brands to widen the in-store experience; from cafes, restaurants and technology solution providers. The list will continue to grow as we can expect to see more of this in 2018.

Experience Desk, John Lewis Oxford

HMY have noted that retailers are expected to invest further into experiential as they are focusing more on refurbishing current stores and expanding certain areas of a store dedicated to providing a service, as opposed to opening new stores.

A recent example of a company who have done this is John Lewis. John Lewis are putting customer experience at the heart of their business which is visibly clear from their recent opening of the Oxford store, where they took experiential to a whole new level.

John Lewis have put many initiatives in place including sending their partners to theatre school so they can be “trained through the lens of the experience”. 20% of the Oxford store square footage is being dedicated to services. HMY visited the Oxford store to find out exactly what they offer to their customers and here’s what we were able to explore: • • • • • • • •

Experience desk Book a partner Menswear personal styling Tech workshops Beauty bar Home design service John Lewis opticians Cafes & bar

If you’re planning on purchasing a bed, you can even sleep overnight to see if it’s the bed for you... It’s almost as if we will never need to leave the store! Perhaps we will see other retailers follow suit on this ‘one stop shop’ trend?

1. www.retail-week.com 2. www.teenvogue.com

TRENDSETTING It’s a new year and with it comes the promise of new colours, materials and trends carefully crafted by design experts with the intention of getting you to part with your hard earned cash in 2018. Our Concept Designer takes you through the trends to keep an eye out for in the coming year:

Each year Pantone’s colour of the year sets the tone, both literally and figuratively for what’s coming to a wall near you.

As such you’d expect 2018 to be the year of Ultra Violet - a dramatic, mysterious and inventive colour and Pantone’s 2018 COTY. However these things usually take time to permeate and much like 2017 saw the dusky pink “Rose Quartz” of 2016’s twin COTYs rising to the fore, 2018 will likely see a burgeoning for 2017’s COTY, “Greenery”.

Paper Mache Tiger, London

Towards the end of 2017 we were already beginning to see stores using real plants to add vibrancy to their interiors expect 2018 to continue this trend and expect to see lots of “Greenery”. This honest, organic green inspires a bright outlook; not quite the inspirational quality of “Ultra violet” but the promise of spring time. Something we’re all looking forward to after the long, cold winter that was 2017.

Reduced stock quantity at Asda, Didcot

Hipsterism is so 2016. Minimalism is the new-old black. As tech retailers look to streamline their stores’ inventory (devices aren’t the money maker here, the services are) and online services like Amazon Prime continue to explode in popularity (can anyone say 650 million+ products?) having a store with loads of products isn’t appealing anymore, for the customer or the retailer. This doesn’t just apply to tech stores either - in 2017 Asda opened a new Didcot store with a massive reduction from 12,000 SKUs to around 4,000 SKUs in order to improve the customer experience for their shoppers and reduce overhead.¹

However, it’s not just products we’ll see less of, its time too. Pop-up and “timed” stores are becoming more and more prevalent, offering specific products for a limited time. Take Devialet’s gorgeous St. Pancras pop-up. There is a limited selection of products on display, and they’ll only be available until they aren’t, but shoppers are inexplicably drawn to the courage of a retailer willing to say “this is our only product, and it won’t be available forever.”

An extreme example of the pop-up is Louis Vuitton’s Hong Kong pop-up. Brave, intriguing and extremely exclusive - this is not a store, it’s a statement. Minimalism sparks curiosity, reinforces quality and focuses the attention of the shopper.

1. https://www.tccglobal.com/blog/article/store-week-asda/

Louis Vuitton fragrance pop-up, Hong Kong

Alex Tinkler is the HMY UK’s dedicated concept designer. A graduate of one of the world’s most prestigious design courses, Northumbria University- Design for Industry, he has worked with some of the world’s largest companies to produce bespoke designs for retail. Please email alex.tinkler@hmy-group.com to get in touch.

Store Design

GENDER BA STORE DES

MALE VS FEMALE

05

https://www.j2store.org/blog/digital-marketing/men-vswomen-shopping-behaviour-and-buying-habits.html

“MEN BUY, WOMEN SHOP” FACTORS TO CONSIDER WHEN DESIGNING YOUR STORE...

I

t may be a stereotypical – and somewhat controversial statement to make but, by and large, shopping is typically a woman’s sport. Visit any local high street or out-of-town shopping mall on a Saturday afternoon and you’ll find hordes of ladies of all ages lunching, browsing and buying the latest fashions.

Of course, for those of us working in retail, we know that shopping is usually a true ‘experience’ for females, whereby they view it as a standalone activity and will often combine it with a trip to the cinema or dinner in their favourite restaurant, for example.

That’s not to say that their male counterparts shun shopping; retailers simply need to be aware of the two different consumer behaviours.

ASED SIGN Emotions Can Take Over

Women traditionally shop with emotion and need to feel a connection with a brand – buying is so much more than a financial transaction.

So, retailers need to engage with all the senses; for instance, adding a theatrical feel to the experience will set your store apart from competitors by incorporating scent, touch and taste. Installing exciting pop-up stations to showcase specific ranges, and encourage shoppers to try out items while they’re in-store, can add a little extra to their visit.

Colours, Lighting & Materials

Women are very put off by stereotypical colours and graphics. The 2018 woman is individual and free thinking and does not like to feel she fits in a certain bucket or stereotype.

Retailers should allow women to explore their personality with the exposure of different colours in different lightings.

For example, Boux Avenue have installed different mood lighting in their changing rooms from dim to bright to allow customers to see themselves trying on garments under different lighting options, instantly engaging the customer while concepts like the award winning Missguided flagship capture the attention of a very specific female market by using internet memes and instagram themes to grab attention.

Direction is Key

Men often want their shopping experiences to be efficient and easy. Their time in-store should still be exciting, but retailers need to step up their game if they are to build brand loyalty and align themselves with their target customer.

However, grabbing male attention is a little more challenging. The men’s section of a store is all about reassuring their confidence in their purchase and using masculine materials for fittings, such as glass, metal and brick and, if using a pattern, stick to subtle and neutral colours.

For example, clear pricing, clear navigation and clear promotions are no-brainers, while bringing in technologies like augmented reality is another way to keep footfall in-store and offline.

Eye-line is Buy-line

A lot of brands often make the mistake of utilising every inch of available space in a bid to showcase as many products as possible; however, high hanging spaces can be a sure-fire way to turn customers off and lead them out the door.

Eye-line really is buy-line, so ensure hero products are within easy reach and that, importantly, there is a good selection of sizes on display.

Masculine Materials

“IF RETAILERS ARE TO MAINTAIN- AND INDEED, GROW- IN-STORE FOOTFALL- THEY NEED TO TAKE THE TIME TO FIND OUT WHAT THEIR CUSTOMERS RESPOND TO, WHAT THEIR COMPETITORS ARE DOING, AND HOW THEY CAN STAY AHEAD OF THE CROWD”

07

MICHAEL KORS

Latest News

Michael Kors

Bespoke Premium Fitting

Bespoke Premium OVERVIEW The Michael Kors and HMY relationship began in 2015 and these images are just a few from the Forte dei Marmi store in Italy.

HMY have worked on a number of Michael Kors stores in 9 countries and 25 cities.

• • • • • • • • •

UK (Birmingham, London, Manchester) Germany (Berlin, Munich) Switzerland (Zunich) Austria (Vienna) Croatia (Split) Mauritius Russia (Moscow) Italy (Forte dei Marmi, Milan) Spain (Barcelona, Bilbao, Coruna, Madrid, Malaga, Mallorca, Mijas, Palmas de Gran Canaria, Puerto Banus, Tarragona, Tenerife, Vigo)

Services provided: Project Management Product Development Prototyping Production Installation

360º Vision

FITTING • BESPOKE • P.O.P. • CONSULTING & DESIGN • PROJECT MANAGEMENT • GENERAL CONTRACTING • RETAIL TECHNOLOGY hmy-group.com • RETAIL LIGHTING

360ºGlobal VisionReach

UK • GERMANY • BENELUX POLAND • GREECE • PORTUGAL • ITALY • NORDIC COUNTRIES TURKEY • FITTINGFRANCE • BESPOKE• SPAIN • P.O.P. • •CONSULTING & DESIGN • PROJECT• MANAGEMENT • GENERAL CONTRACTING • RETAIL TECHNOLOGY • RETAIL• LIGHTING ANGOLA • MOROCCO • CHINA • INDIA • MALAYSIA • MEXICO • BRAZIL • ARGENTINA • CHILE • PERU • COLOMBIA • AUSTRALIA

Global Reach ...and many more

FRANCE • SPAIN • UK • GERMANY • BENELUX • POLAND • GREECE • PORTUGAL • ITALY • NORDIC COUNTRIES • TURKEY • ANGOLA • MOROCCO • CHINA • INDIA • MALAYSIA • MEXICO • BRAZIL • ARGENTINA • CHILE • PERU • COLOMBIA • AUSTRALIA ...and many more

B&Q

Sole Shelving Supplier Sole Shelving Supplier

B&Q CLIENT OVERVIEW B&Q is the UK’s leading home improvement and garden living retailer with over 300 stores across the country. The B&Q vision is to help people create homes to be proud of and HMY are proud to be a part of bringing this vision to reality.

The partnership first began in 2011 when HMY worked on a project for a tiles gallery roll out and we are now a long-term trusted supplier.

HMY’S COMMITMENT We aim for a ‘right first time’ approach. HMY support B&Q through a management team dedicated solely to servicing all needs of the B&Q projects. There is an experienced project management team allocated to support these projects and manage all executions at sites to a very high standard and ensure HMY are constantly meeting the demands of the client.

RESULTS HMY are proud to be the sole shelving supplier for B&Q and we will continue to build a strong relationship with the leading retailer to work on more exciting projects. Amid Brexit uncertainty the house market is currently declining, therefore there is more room for HMY and B&Q to work together to help people invest more into their own homes.

HMY work towards best in industry lead times with projects and requests being completed from as little as 8 days to 20 days. HMY’s performance level with B&Q is currently 97.4% and we will strive to push this to be the best supplier we can. hmy-group.com

360º Vision

FITTING • BESPOKE • P.O.P. • CONSULTING & DESIGN • PROJECT MANAGEMENT • GENERAL CONTRACTING • RETAIL TECHNOLOGY • RETAIL LIGHTING

For more information on HMY projects, to view more case studies or for general inquiries about Global how HMYReach can Innovate for you please don’t hesitate to contact sales@hmy-group.com or FRANCE • SPAIN • UK • GERMANY • BENELUX • POLAND • GREECE • PORTUGAL • ITALY • NORDIC COUNTRIES • TURKEY • ANGOLA • MOROCCO • CHINA • INDIA • call 01908 488• BRAZIL 092. • ARGENTINA • CHILE • PERU • COLOMBIA • AUSTRALIA ...and many more MALAYSIA • MEXICO

09 Latest News

Visit our latest EE showcase stores!

Nottingham

intu Victoria Centre 26 Victoria Centre Nottingham NG1 3QN

Oxford

3B Westgate Centre Oxford OX1 1TR

FOOD showroom

Exclusive HMY Innovations

BUTTERFLY CHECKOUT

VIRTUAL REALITY VIEWER

DIGITAL CEILINGS AND POS

-Self scanning -Reduced staff -Item detection -Automated payment -Multiple checkouts in one

-Product demos and showcases -In-store interactivity -Concept viewer -Customer experience -Brand collaboration

-Unlimited display possibilites -Interactive, touch sensitive and transparent LCD screens available from HMY -Bespoke install service

Visit our showroom in Moneteau, France, to experience the latest HMY innovations and see the Food Weeks showcase!

Contact Nilesh Mistry to arrange your visit today!

Nilesh.Mistry@hmy-group.com T. +44-1908-488-092 M. +44-7975-820-758

11

Technology

Over the last 12 months Amazon have made a significant push into bricks mortar retail, especially with their recent buy of Whole Foods. We are sure we will see plenty of Amazon innovation in 2018.

READY, SET, GO

Everyone knows that Amazon is one of the most influential companies in the world and that it has a very promising future in the short and medium term.

The company has a very powerful presence in the online business world and is drawing on all of this strength in order to expand into other industries, in which it has begun to take its share of the pie. Amazon has given us another way to shop, comprehensively changing shopping in every way from planning a purchase to intent to purchase.

It is possible to purchase something with a few clicks (or a button) from the comfort of your home, work, or anywhere thanks to new retail technology. The key factor to note here is that Amazon is a place where customers can dictate what the prices will be, which is a significant contributing factor in their position against competitors.

HOW IT WORKS: “After a shopper walks through the gate, a bank of cameras and other sensors in the ceiling tracks their progress through the store. When an item is picked up, the same cameras recognise it and add it to the visitor’s virtual shopping cart. Ten minutes after the shopper walks out the door, the app charges a credit card and provides a digital receipt.�

Recently we saw the opening of the Amazon Go store in Seattle, where customers are able to walk in, grab their essentials and walk straight out. Is the future of stores going to be checkout free? A combined 72% of the social media discussion is inclined to think so, with the online community thoroughly intrigued by the concept...

Sources: https://www.theguardian.com/us-news/2018/jan/22/amazon-go-convenience-store-corner-shop https://www.brandwatch.com/blog/react-amazon-go-data/

RETAILERS ARE INTEGRATING MORE CONSUMER-FACING TECHNOLOGIES INTO THE BRICKS AND MORTAR ENVIRONMENT, THANKS TO INTEGRATED SOLUTIONS PROVIDER HMY GROUP

What’s Next In TECHNOLOGY? Despite the endless opportunities ecommerce presents to retailers, it will never be able to replicate the service in-store shopping has to offer. At least 60% of consumers still make their purchases in-store, which is why it is still critical for retailers to continue investing in their stores. Nearly one in two UK retailers (44%) are seeking in-store technologies as a priority for 2018. Creating an equally as good offline experience has been quite challenging for most retailers, however the solution to this will be utilising the new retail technology that has entered the market place.

HMY offer many retail technologies, all of which are yet to be fully implemented by UK retailers: • • • • •

Virtual Mirrors In-store Audience Analysis Real-time Traffic Analysis Interactive Kiosks Holographic Displays

The list doesn’t end there! One of HMY’s customers – Dixons Carphone – equipped all of their staff with tablets which allows them to build their product knowledge to assist the customer better, ultimately making conversion rates jump. Many retailers and food chains are also currently in the early stages of developing robots to use as a delivery method. The great impact of technology can come from anything as small as tablets to engineered robots! The possibilities are limitless.

RFID Technology Two of the top three reasons why shoppers will leave a store empty handed is due to lack of availability.

Smart Fitting Rooms 3 in 10 consumers would like businesses to introduce this technology to avoid the wait.

Queue Management 50% of respondents say shorter queue at tills can make their in-store experience better.

http://guides.retail-week.com/5624.guide https://hmy-group.com/media/with-developments-in-technology-what-will-payment-areas-look-like-in-2018

RETAIL TRENDS IN 2017...

TRENDS

13 Political

KPMG REPORTED THE TOP 5 RETAIL TRENDS OF 2017 ARE AS FOLLOWSš: 1 Technology is changing the customer experience As technology is rapidly growing and new innovations being discovered every day, retailers are more likely to succeed if they adapt to this trend and evolve with it.

2 Mobile shopping continues to grow

Adobe’s 2016 mobile report showed a 54% increase in visits to retail sites from smartphones.

3 Creating a meaningful experience is critical

Creating a meaningful customer experience and brand engagement is important to build a competitive battleground.

4 Personalisation is the future of retail

Retailers who are personalising online user journeys, and who are also able to quantify the improvement, are seeing a 19% increase in sales on average.

5 Attracting and retaining talent is critical

The shortage of skills in the UK is growing, therefore it is important to attract, retain and develop a workforce that is able to meet the needs of a demanding marketplace.

What can we learn from 2017?

1. https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2017/06/retail-trends.pdf

2018 RETAIL PREDICTIONS & BREXIT

THE RETAIL INDUSTRY HAS FACED A CHALLENGING YEAR IN 2017 AMIDST THE CONSUMER UNCERTAINTY CAUSED BY BREXIT. 18% OF SHOPPERS SAY THEY HAVE SPENT LESS FOLLOWING THE REFERENDUM. WITH NO COMPARISON POINT, RETAILERS ARE STRUGGLING TO PREDICT WHAT WILL HAPPEN WITH UK’S ACRIMONIOUS DIVORCE FROM THE EU. GDP EXPECTED TO RISE 0.3%

57% feel less confident about the political situation in 2018

INFLATION EXPECTED TO STAY AT 2.4%

43% planning to spend more on food

DECLINING WAGES UNTIL 2022

40% of shoppers say Brexit has led them to seek out offers & promotions more

31%

In Stores% On a retailer`s website on a PC%

26% 10%

On a retailer`s website on a mobile phone% Through a retailer`s mobile app%

3%

On a marketplace website such as Amazon or eBay% On a marketplace app such as Amazon or eBay%

26% 5%

Scan the below QR code to see how HMY transformed an online experience into a physical store for Futbol Emotion.

The chart above shows that whilst online shopping may be generating more sales for retailers, the in-store experience is just as important to customers. So the only question is, what will encourage consumers to spend and bring back their confidence? The strategy retailers should approach should be combining bricks and clicks together to create a seamless shopping experience for customers through personalisation, creating offers customers cannot resist and building an emotional engagement with customers to build loyalty.

1. https://download.retail-week-connect.com/tar/?cstr=70770909VGdvH2wxcx 2. https://www.statista.com/statistics/306720/inflation-rate-forecast-consumer-price-index-cpi-united-kingdom-uk/ 3. http://www.goldmansachs.com/our-thinking/pages/macroeconomic-insights-folder/2018-global-economic-outlook-as-good-as-it-gets/report.pdf 4. http://guides.retail-week.com/5624.guide

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HMY UK Innovation in Retail Ltd | Hobson Industrial Estate | Burnopfield | Newcastle-upon-Tyne | NE16 6EA Tel: 01206 270 611 | Email: sales@hmy-group.co.uk ©HMY UK Innovation in Retail Ltd 2018