During the course of the past two years, the Covid pandemic has altered our shopping behaviours in small yet discernable ways as our mobility had been limited. That prompted a surge in cross-border shopping but has also increased loyalty to and patronage of local retailers. A Google Trend study had shown searches for “available near me” have grown 100 per cent during the past year globally. Although Covid boosted e-commerce and became a threat to brick-and-mortar stores, neighbourhood stores
ores have largely been favoured with one-third of small business owners noting an increase in local shoppers during the past year. As the impact of Covid passes, these stores are expected to continue to pick up steam. Riding this wave, large-scale retailers are taking notice of the boutique concept. Perhaps more of a recurring concept rather than an entirely new trend, the hyper-local concept is modelled on mom-and-pop boutique stores, factoring in the careful curation of merchandise and shaping the retail experience based on the store’s surrounding vicinity. Large retailers have begun opening new small-format stores with products and services customised to local tastes. Contrary to the large flagships staking a brand’s presence in a broader market, retailers are scaling down to serve local communities, as these leading brands demonstrate: Ikea, Hammersmith Known for its maze of flatpack furniture, the Swedish home goods retailer has been rolling out small format stores that are a quarter of its usual size after realising the new generation could only afford micro-size homes. Instead of walking through the infamous Ikea maze, the small format stores encourage an ‘organic wander’, becoming less chore-like and more lifestyle orientated. Geared towards urban city residents, these small format stores sell selected home furnishings to fit the average apartment size, with their interior decorated to optimise small spaces. The curation of merchandise is sold with ease of transportation in mind, as the stores are conveniently located to commute close to home with options of delivery for larger pieces. The new Ikea also emphasises personalised services, such as working with a consultant on home design, to help shoppers optimise their living space with the aid of a digital rendering. The retailer also uses these hubs as a community centre to connect with the crowd through events and workshops. Aside from its signature Swedish meatballs, Ikea’s food court welcomes local producers and cafes at their food hall in a series of rotating pop-ups. Nike Rise, London After its grand House of Innovation debut, the sportswear retailer has been opening hyper-local stores; first with its Nike Live concept and most recently, with Nike Rise. First launched in China and subsequently in Seoul and London – with more to come – both concepts use the local city and community as an inspiration. The stores are the brand’s new experiment in merging technology with physical retail, using consumer insights from those engaged with its Nike apps (Nike Run Club, Nike Training Club) to determine their activity and interest in shaping the store experience for their loyal fans. The stores are located in areas with large concentrations of members and double as a sports and wellness hub for the community. Local events, in-store workouts, running clubs along with restaurant partnerships are all hosted within the stores. Nike Rise stores pull data from their ecosystem to curate localised merchandise and retail experiences to personalise the store to local residents’ needs. Nike heavily emphasises personalised services with one-on-one styling appointments, mindfulness workshops, and customisation stations. These events and experiences entice the community back into the store. Li Ning, Beijing Trailing hot on Nike’s tracks is China’s Li Ning with its Custom City (a direct translation) store, debuting in Xidan – a core business district of Beijing. The Chinese sportswear brand takes pride in its origins and has launched urban stores to highlight Chinese culture, fused with elements of sports and fitness. In the age of guochao, several products are exclusive to the store – including merchandise from its Bored Ape Yacht Club #4102. Chinese elements are detailed throughout the space, helping to underscore the message of great product design and customer service. Beijing’s oriental charm is reflected in decorations around the store, inspired by the Great Wall and with door knockers mimicking of those from old Beijing houses. A VIP members’ clubhouse displays Li NIng’s brand history and exhibits the craftsmanship culture of the city. The lounge is also a space to host social experiences, including workshops to educate the community on brand concept and culture. Patriotic to its roots, the brand is committed to bringing vitality to the sports scene in the city, and will continue to roll out local stores across other regions to highlight the unique charm of different China cities. Atelier100, London Swedish fashion retailer H&M and Ingka Group (Ikea’s largest franchise) came together in a partnership to launch a hyper-local boutique called Atelier100 in Hammersmith, London. This project supports locally made crafts, hosting manufacturers and makers based in Central London. The store features fashion items, jewellery, art, ceramics, and vinyl – all made using locally sourced materials by creatives working within 100km of Trafalgar Square. The store also doubles as an idea factory where makers, designers, and customers can meet to collaborate and connect through workshops. Selected designers are funded between £1000 and £10,000 and are mentored with the aim of guiding them to convert their conceptual ideas into viable businesses so they can develop run independently. Building the store of the future together Local neighbourhoods and their residents represent ‘low-hanging fruit’ for brands. Trimming down the product mix to cater to their tastes helps win over shoppers who traditionally value local offerings. Rather than adhering to a one-size-fits-all strategy, there is a growth opportunity for global brands to adopt this localised approach in building a community of fans and capturing their loyalty for conversion. Making the most out of data points can solidify strategies and differentiate from competitors in crafting a unique and memorable brand, whilst delivering an exceptional customer journey. In an environment where consumers are bombarded with choices, a hyper-local store is there to make the consumer feel like they’re being catered to, meeting their evolving needs and expectations. This story first appeared in the November 2022 issue of Inside Retail Asia Magazine.