2002: A Year In Review

The Book of Lists offers our readers a visual snapshot of the retail design industry—the best, the worst and the up-and-coming. It is also an opportunity for candid discussion on the state of this creative industry. Several editorial advisory board members have taken the time to share their unique insights about the current state of the industry. So sit back and let's explore some of the hottest topics in the year of design.



The state of retail design

A look at the past year would not be complete without paying respects to the tragedies that befell our nation. This month marks the anniversary of the terrorist attacks on Sept. 11. The tragedies intimately affected people throughout the country, especially those close to the heart of the attacks in New York and Washington, D.C. That single day made an entire nation contemplate what is truly important in life. "Sept. 11th was a huge whack on the head of what really matters," says Kathy Tierney, partner, consumer environments, North America, Fitch Worldwide, San Francisco. "People in general are more focused than ever on where they invest their time and money. If you read the numbers, people are investing more money into their home, and that's where they want to spend most of their time. People are looking for things that last and matter. Before, it was more of a throwaway mentality."

The terrorist attacks not only shook the nation's economy but also put everything in perspective. "On the business side, it made employees try harder for the 9 to 5 work schedule," says Mark Artus, managing partner strategy/creative, RPA, Columbus, Ohio. Another effect is a driving desire by retailers to truly connect with the uncertain customer. "Retailers are really beginning to look at their core customer and are trying hard to woo them," he says.

When the economy stumbles and struggles, as it has throughout 2002, retailers proceed with caution. That response can often stomp out creativity in retail. "I think one big problem right now is that retail is acting from a point of fear. Retrenchment is never good for creativity," says Tierney. "I hope when things settle down again there will be a renaissance, where people are willing to fulfill their dreams. That's something that retail must do."

Many retailers are beginning to understand that store design is an art, not a science, and have accepted that store design is an evolutionary process, according to Joseph Nevin, senior principal of Bergmeyer Associates Inc., Boston. "More and more retailers are creating a total customer experience and doing it in a way that is meaningful to the customer," says Nevin. "The 'wow' should be the customer experience and should be repeated again and again—from the store environment to pulling the item out of the shopping bag at home." Retail design must become more efficient and put the product on the pedestal, according to Barbara Emerson, vice president, store planning and design, Sephora USA, San Francisco. "So much of retail design is product driven. It should be about how to present the product, not design for design's sake," she says.

When the economy slows down, retailers may take their foot off the pedal for a time, but eventually someone will have to race beyond the pack. With all the competition in the marketplace, retailers will have to make a bigger statement to break through all the white noise. "What was enough before, has to be even more now. Retailers have to shout a little louder to be heard," says Tom Herndon, CEO, Robert Young Associates, Dallas.

"I'm concerned that too many retailers look the same due to simplified store design. Walk some newer malls and you see white stores with some wood accents and little or no brand differentiation," says Michael Cape, director of visual merchandising and store design, J.C. Penney Corp., Plano, Texas. "We need to remember that each store should contribute to the company's brand persona and create an experience." But something is emerging on the retail landscape that is a sight for sore eyes. Heralded as "the new urbanism," many shopping malls are embracing the cultural and community differences from region to region, and designing the stores to reflect the surrounding environment. Malls such as The Grove in Los Angeles and Desert Ridge in Phoenix, Ariz., are a relief to the eyes. "Customers have voted against the homogenous mall. They are tired of not knowing whether they shopping in Portland, Maine or Tucson, Ariz.," says Tierney. "So many retailers are so insistent on looking the same from store to store, but it is better to embrace the environment they are in and reflect that in the design."

It appears that many department stores have had difficulty finding a new voice for the evolving customer. Tierney suggests that American department stores should dust off their passports to ignite their imagination. "In London I spend so much time in department stores, and the same holds true for Japan. I would never say that about the United States. The London department stores create shop-within-a-shop concepts. They offer diversity and areas of discovery. For example, you could turn the corner and there would be a health juice bar. And in Japan the design may be homogeneous but they capitalize on customer service. People will actually help you."

Many visual merchandisers have expressed their concerns about this creative profession—its past, present and future. But many retailers feel that visual merchandising is too valuable a tool to be forgotten. "Lately it's been about building architecture, and that has taken away from visual merchandising. But I don't think visual merchandising is dead—we will find other ways to rediscover it," says Kevin Brailsford, vice president of store design, planning and merchandising, Blockbuster Inc., Dallas. "Now we are seeing more mannequins in windows. All trends are cyclical and come full circle," he says. Cape agrees that the tide is changing. "Visual merchandising is more important now than ever. Store design, décor and fixturing development continue to focus on simple and flexible environments," says Cape. "This puts more emphasis on visual to differentiate store brands and merchandising statements. Without an emphasis on forms, graphics and other visual elements, stores can be sterile and boring with no point of view."



Technology: proceed with caution

In past years, retailers were scrambling to bring anything and everything that was high-tech into their stores. But many big-name retailers that invested big bucks into their in-store technology have now ripped it all out to focus on merchandise presentation and straightforward design. "We gravitated to technology too fast before we were ready, and it broke down," says Brailsford. "It will now have to emerge with more common sense. At Blockbuster, we will be using it as more of a selling tool for our sales staff instead of just plopping a kiosk anywhere in the store."

It looks as if both retailers and designers have to get smart about interactivity. "Technology was the big hype of the last five years and retailers like The Gap invested a lot of money in it. But at the end of the day you are buying and selling things, and if it does not offer a service it won't work," says Tierney. However, over the past year Tierney has noticed there have been a lot of interesting developments in digital signage systems that can create a useful and customer-friendly addition to store design.

Technology must be more than just window dressing. "We should be careful in technology. There is certainly an application for it, but it has to be product-driven, informational and easy to manage, not just a nice visual in the store," says Emerson. Some retailers are right on target. "At Brooks Brothers, they have a digital measuring technology that helps customize suits for their customers. That is a perfect example of how technology can be a valuable service for the customer," says Herndon. Wireless technology also offers some exciting opportunities in retail design, according to Artus. "Completely wireless units create so much flexibility in retail design. With no cords around, it allows a store's design to be more flexible," he says.



Survival of the fittest

Many eyes have turned to big-name retailers that have taken a tumble in 2002. Such retailers as Kmart Corp. and The Gap Inc. have had their share of knocks over the year. Are they down for the count?

The consensus is that Gap will recover, if executives remember that customers got them where they are in the first place. "I was one of the most loyal shoppers of The Gap. They just stopped selling things that I would buy. Not everyone in America wants to show their belly button like Britney Spears," says Tierney. The once upbeat, perky brand seems to have fallen flat. But many retailers and designers feel Gap will get back on its feet by "making good" with its core customers and creating a memorable in-store experience. "Gap made some seriously bad moves. They moved away from the core customer and made some poor buying decisions that were too fashion-oriented. They've hit some bad times, but they are a smart company and I think they will come through it," Artus says.

Kmart has an uphill battle ahead. "Unfortunately, Kmart has a bad position," says Artus. "Wal-Mart is on one end of the scale and Target is on the other. Kmart got what's left. Both Wal-Mart and Target have a clear vision of who they are, and Kmart is missing that. But I don't think anyone wants Kmart to die; they want to keep that third leg of the table." For Kmart to survive, it will have to find something that distinguishes itself from the competition. "Is there still room for them? Sure. But they will have to develop a great deal of credibility and a unique point of view," says Nevin. Kmart's troubles ring a clear message to the world of retail. "It's a wonderful opportunity to show the world that store experience really does count," adds Herndon.

Brailsford believes that there are always lessons to be learned from failure, and all retailers must take heed. "The Gap rested on its laurels. There is a lesson to be learned—you can never stop," he says. "Kmart never got its engine going, never busted out of the image of the 'old Kmart.' It's all about change and reinvestigating the customer."



Would you like to have your voice heard on any of these hot topics? If so, please e-mail your thoughts to rsway@ddimagazine.com.