WHAT’S GOING ON IN RETAIL

ORANGEPAPER BY JOSDEVRIES No 2.

DIY

SIMPLICITYIS THE KEYNOTE OF

ALL TRUE ELEGANCE

COCO CHANEL

DIY

RETAILERS NEED TO EDUCATE AND ENGAGE CUSTOMERS BE-CAUSE THE MARKET IS AGING. MORE AND MORE PEOPLE DO NOT KNOW HOW TO TACKLE THE SIMPLEST JOBS IN AND AROUND THEIR HOUSE. THIS KNOWLEDGE IS NO LONGER HANDED DOWN FROM GENERATION TO GENERATION. TO BE SUCCESFUL TO-WARDS THE FUTURE DIY-RETAILERS HAVE TO DETERMINE THEIR FOCUS. FROM PRO TO HOME-DECO. FROM COMPACT TO XL. DIY-RETAILERS HAVE TO MAKE CHOICES TO AVOID GETTING STUCK IN THE MIDDLE. HOW CAN RETAILERS TAKE THE NEXT STEP FROM RATIONAL WAREHOUSES TO EMOTIONAL STORES WHERE CONSUMERS FEEL FULLY UNDERSTOOD AND INSPIRED?

DIY

CHANGINGCUSTOMER NEEDS

Society is changing and with it are the gender specific role models. DIY and hardware stores used to be a very masculine environment. But more and more woman pick-up a drill or a hammer and gain DIY skills. We see that in Europe and America the share of individual house own-ership between woman and men is almost the same. And because of the improvement in electric tools, construction doesn’t have to be heavy labour anymore. Because of the more feminine target group, the store experience is changing. There is more attention to service and ex-perience. Because DIY-skills aren’t passed on from generation to gener-ation like they used to, the millennial wants to be offered a helping hand. The modern hardware store is clean and gives a good overview of the dif-ferent departments. Clear naviga-tion brings the customer from home deco to constructions materials, from tools to lighting. And especially the departments like paint and wall-paper are very inspirational.

INSPIRATION & TRENDS

The hardware store looks more and more like a furniture shop. Not only because of the quickly changing sea-sonal assortments, but also because the assortment is blurring. Various hardware stores began to stretch their assortment to lightning or garden fur-niture, some concepts cover the whole home improvement sector and even sell small accessories like pillows and candles, or even sofa’s. The Dutch

home improvement store Karwei of-fers a broad range of different fur-niture and claims to have everything you need to fit your entire home. They opened a pop-up in Amsterdam to show the newest trends in home and living. So when you are shopping for a new wallpaper, or redoing your floor, you can also choose a matching chair or sofa to be the finishing touch of your DIY-project.

INSPIRATION & EXPERIENCE

STORE EXPERIENCE

LESS IN STOCK

The old fashion hardware store looked more like a warehouse than a store. Big piles of materials filled up the room, all the way up to the ceiling. This made the stores hard to oversee and blocked out all the light. Now a days DIY-stores have less and less in stock making the store much more clear and pleasant. When entering the store, the customer has a clear view into the en-tire store, making navigating through the store much easier. Larger con-structions materials can be bought online or at the pick-up point and drive through. Making sure that the store experience isn’t disturbed by rows and rows of storage shelfs. The amount of SKU’s needed to keep the shelves stocked and everything restocked in time depends on delivery time. The infrastructure of Chinese or Russian stores and hardware stores in Germa-ny is completely different.

SPECIALISATION ‘FROM PRO TO DECO’

Because of the changing custom-er needs retailers need to keep in mind which target group they want to appeal to. Does the professional plumber want to shop in the same store as a student whom picked up a second-hand dresser she wants to pimp? Probably not. Too much of everything clouds the brand story. Some retailers focus more on the professional shopping trip, while at others you can find everything for a Pinterest DIY-project. When added to much experience and in-formation, something the starters really need, the professional handy man might get frustrated. But in a no-nonsense and clear environ-ment, the deco-target group will get lost. Do you still want to attract both? Create clear segmentation between departments, or different sub-brands.

A BIG BOXCAN BE BEAUTIFUL TOO

More and more brands improve their store experience. But not only on the inside. The outside of the ‘big boxes’ are also subject to change. The ultimate retail experience is created only when all touch points tell the larger brand story together. When all manifestations of a brand tell one consistent brand story, all the pieces of the puzzle fall into place, from the layout structure to the store design and the com-munication concept. The circle is complete when the exterior of the store matches the interior. Take for example the Bauhaus store on Kur-furstendamm in Berlin. Bauhaus took the challenge of designing the big box to the absolute top lev-el. This architectural masterpiece shows the leadership of the Bau-haus brand.

NEW FORMATS

MULTIFORMAT

We see that retailers better understand the different shopping trips of their customers and therefor offer different formats for different moments. That’s a trend we also see with DIY-retailers. Different formats for different shopping trips because sometimes is the cus-tomer just looking for some screws or an extra bucket of paint. They know ex-actly what they want and prefer a sim-ple and quick shopping experience. But at another moment they are looking for inspiration and want to stroll around in the store. Maybe even spend the whole afternoon in the store, together with the family. That’s why DIY brands are experimenting with multi-format strategy. For example, a city concept to facilitate the quick shopping trip and a large XL store with garden centre and café to inspire customers.

CITY CONCEPTS

For the bigger jobs people take their car and visit the big boxes of the home improvement retailers. But what if you are living in the city, do not own a car and just need some screws to hang a painting, or want to repaint the stains in the hallway? That is why, for example, Hornbach, but also the Dutch retailer Gamma, developed a Compact concept. The stores are not just smaller, but have an assortment that precisely fits the needs of the people living close. At Gamma Compact you can even bor-row a Gamma cargo bike to bring you purchases home.

THE PICK-UP POINT

We see more and more stores where you can order online and go to the store to pick up your order at the pick-up desk or even the drive-through. The store is the pick-up location. But what we also see it that the brands that al-ready worked by ordering open their warehouses as stores. These stores used to work with catalogues and profit of the rise of internet shopping. These stores have small showroom

DESTINATION CENTER

Next to the smaller city concepts DIY-retailers place the absolute destination centre. A place to get in-spired. This is not just a sales-chan-nel but the home of the brand. Peo-ple spend much time in the store, it even works as a day-trip with the family. Especially in combination with a garden centre or home deco-ration departments. You could even go as far as to call it a lifestyle-cen-ter. Because of the spending time it is often combined with food service. But also to add value to the desti-nation centres integrated shop-in-shops can be an interesting (and fun!) strategy. The focus of a desti-nation centre should be fully on ex-perience and inspiration.

to show the latest models and promo and a desk that connects the store and the warehouse. The warehouse is mainly the logistic centre for internet purchases but now also functions as a pick-up point. A succesful example is the British brand Screwfix. Screwfix is now the largest direct and online sup-plier of tools and hardware products in Great-Britain.

TEMPORARY OWNERSHIP

‘Younger generations do not want to own; they just want to use. ‘I do not need a drill, I need a hole in the wall’. Why own something if you can rent it. Owning is more expensive and takes up space. Retailers facil-itate this trend by offering rent ser-vices. But millennials like renting, but they love borrowing. This is how the platform Peerby works. 80% of the products that we own are used no more than once a month. This is why Peerby helps you to contact the people around you to share with. Need a high pressure cleaner?

CONTEXTUAL SOLUTION

Just ask your neighbours. Cheaper and better use of resources. So what can retailers learn from Peerby? Has the DIY-store of the future a free tool-library?

DO IT FOR ME

We see a shift from ‘do it yourself’ to ‘do it for me’. This worries diy-re-tailers with a large non-professional target group. People work more and have less time to tackle the projects in house themselves. And even if they would have the time, they wouldn’t know where to start. This is a big chal-lenge for the market. What to do? Well first, educate the customer.

The millennial generation has less knowledge and time, but also less to spend. Show customers the quick wins of do it yourself. Another way to still bring the millennial to your store is to make it the meeting point between the professional and customers. Offer-ing a professional for the harder jobs and the right products for the jobs ev-eryone can tackle themself. Using the store as the place to get inspired about different trends and materials.

I DO NOT NEED A DRILLI NEED A HOLE IN THE

WALL

SHOW AND TELL

We concluded that next generation need a little more education. You-tube is full of videos that show you how to ‘do it yourself’. Until now these videos are mostly made by enthausiastic handymen and pri-vate contractors. But these videos form a great opportunity for retail-ers to engage potential customers. A store can become a classroom empowering men and especially woman to be self-sufficient. This way the store is a meeting point and creates a powerful relationship with customers.

AUGMENTED REALITY

Digital solutions can help to improve the experience and show personalised solutions. The American brand Lowe’s recently introduced a new technology in cooperation with Tango. This new function navigates through the store using augmented reality. Customers can search for items and the app will show the quickest route and the right shelf. You can also make shopping lists and receive more information about products. Home Depot uses augment-ed reality to help their customers to imagine how products would look in

their house by placing virtual items di-rectly in your room on your screen in photo-mode. We also really like Flexa’s app. The Flexa Visualiser. With this app you can colour the walls around you. Making it easier to choose the colour that fits your taste. You can even select colours around you to create new co-lour codes.

MILE

The aim of Mile was to develop a complete-ly new DIY concept for the Belarus market. A concept that is focused on the future with a concept that will be easily relevant for the coming eight years. The result is a store that is inviting and has a more feminine touch compared to the old-fashioned DIY store. The paint, wall pa-per, lighting and home-deco departments are designed in a way that they inspire cus-tomers, almost like a department store. We added clear routing, information and acti-vation layers in the communication struc-ture to improve the shopper journey.

The most DIY stores in Germany and Austria are still bix boxes, which has consequences for investment and inventories. BauMax wants to re-spond to the needs and wishes of the new consumer.To respond to the changing wishes and purchasing habits of custom-ers Baumax changed the position-ing. The new positioning is focused on clients. This means that experi-ence and service are more import-ant than huge stocks and high store racks. Furthermore, large stocks

WE CREATEDIY CONCEPTS

BAUMAX

are no longer needed with the new distribution process. Emotion and inspiration are the key elements in the store, which makes the in-store experience differentiating. For ex-ample, there is a large square for in-spiration that’s changing during the seasons.

TECHNISCHE UNIE

Technische Unie has been the fore-most knowledge partner for the construction sector for years. But previously, it mainly worked with only the largest Dutch construction companies. It now wants to be more attractive to a wider audience by also becoming a knowledge partner for small businesses and the self-em-ployed. But Technische Unie operates in a strongly competitive field, which is why it’s telling its story in its new flagship store in Zwolle.

COMMUNICATIONThe aim of the communication is to inspire and inform the client in a way that is in line with the brand promise. It already begins outside: the domi-

nant green brand colour makes it imme-diately clear where visitors are. They can see at a glance where they have to go to collect ordered goods and other services. The communication in the stores is sup-ported by an abundance of imagery: inspir-ing photos from real people on their own construction projects, with which visitors can identify.

DYNAMIC COURTYARDHere, you will find a ‘smart home’ that shows how new technical developments make living in and around the house eas-ier, from the ‘Internet of Things’ to ‘domiti-ca’ and revolutionary design in and around the bathroom. Communication specially developed for the ‘smart home’ tells at a glance what the technology does for end users.

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