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6 ways in which D2C Brands are redefining physical stores

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Shiv Joshi
Shiv Joshi
An editor with over 20 years of experience across industry verticals and content formats from tabloids to magazines, he is the Deputy Group Managing Editor at Images Group.

From quirky fixtures to restageable elements, D2C brands do it differently when they open brick-and-mortar stores

In recent years, online-to-offline (O2O) expansions have accelerated with many direct-to-consumer (D2C) brands choosing to open stores for a variety of reasons, ranging from getting closer to the consumer to tapping into a new user base. Lenskart, Nykaa, Mamaearth, Wakefit, Sugar Cosmetics, Plum, The Moms Co., Superbottoms, Mokobara, BlissClub, HRX and Snitch are some prominent O2O success stories.

But when online brands go offline, they don’t just open stores but seek to do things differently, redefining the offline retail experience in the process.

Here’s what they are doing differently…

1. Approach

D2C brands look at offline expansion from a fresh perspective and it reflects in the way they go about it. “When D2C brands open offline stores, their entire approach is different from that of offline-first retailers,” said Surender Gnanolivu, senior experience consultant, who has worked with offline retailers for over three decades and is now working with eight to 10 D2C brands like Mokobara.

Gnanaolivu shared that in the case of D2C brands, the founders are involved in everything from the vision to execution.

“There is a lot of exploration before they go offline because most do not wish to be a ‘me too’ brand,” said Juhi Santani, director and creative head, of Retale Design, a firm that 5-6 has worked with O2O brands like Licious, HomeStrap, GoDesi, Shree She is Special, Ola Eats (Khichdi Experiment) and Paratha Envy among others.

Quoting the example of Licious, Santani said that Licious combined retail with food service creating a cross-over between retail and QSR.

Gnanaolivu seconded Santani’s views about the brands not wanting to emulate anyone. “Usually, people give references of how they want the store to look. These guys often do not give any and want to create something that nobody has ever seen before,” he said.

For instance, at its upcoming outlets, food-tech company Ghost Kitchens, which operates as a platform offering a virtual restaurant network for food businesses wants to create designs inspired by its celebrity partners.

“Since we are doing brands in partnership with popular celebrities, our brands will embody the essence of their personalities. It will be an extension of their persona and fans will enjoy dining in an experience which is associated with their idols,” said Karan Tanna, chief executive officer and founder, of Ghost Kitchens India adding that the company plans to open 8 to 10 retail stores within this fiscal year between Mumbai and Ahmedabad for two of its brands.

2. Design Philosophy

D2C brands are conscious of their social reputation and image, and this is reflected in their design philosophy. “Everything has to be worth posting on Instagram, which translates into the addition of interesting elements like unique fixtures. Their way of presentation is also disruptive, for instance, things hanging from ceilings,” explained Gnanaolivu.

Santani reports a similar experience. Citing an example of Indian ethnic wear brand Shree She is Special by SHR Lifestyles Pvt. Ltd., Santani shared that since the brand had a strong social media presence, the team wanted a design which was “extremely Instagram-friendly, with bright wall graphics in several nooks and corners, trial room corridors, and dedicated social media zones”.

The stores are often designed to mirror the website experience where consumers can reach desired products in a few clicks.

“The brands want consumers to reach products the same way here. Therefore, signages are designed in a way that you can help consumers quickly reach what they want,” said Gnanaolivu.

3. Store positioning

For D2C brands, physical stores are showcases rather than points of transaction. “The store is not supposed to be a hard-selling sales point, but we want it to act as an experience centre for people who would like to know more about sustainability, newer materials in the fashion industry, and Indian craftsmanship,” said Mangalam Lalpuria, founder of D2C Luxury fashion accessories brand Kaamna, sharing the thought behind its first store in Mumbai.

The store would also be the meeting point for the community the brand is building and would host various workshops and seminars. Its five future stores in Bengaluru, Delhi and Mumbai will all be designed along the same lines.

4. Data-backed elements

Being online and using technology extensively, D2C brands have a treasure trove of data which they use wisely when opening stores. Everything from the location of their stores to the merchandise mix is backed by data.

Ghost Kitchens, for instance, is planning to open stores in regions where it experiences high success for its food delivery.

“Depending on the success of the food delivery business and understanding the trends of customers in the hyperlocal area, we decide to open a retail store in that region. Alongside, there is a lot of data that is studied before deciding on the product mix in areas where we will open retail stores,” Tanna said.

5. Design elements

In addition to attractive store elements, D2C brands want their stores to be flexible to accommodate new trends, arrivals, product launches and frequent stock turns.

“They want the store to reflect something new every week. You can not have the same stuff. So, the store must be highly restageable,” said Gnanaolivu explaining the term which is different from modular. In modular, the furniture can be changed, here the wall itself can be moved so the entire store itself is redesigned. “So, the fixtures are all free-standing. And about 70% of the elements used are salvageable, should they decide to move the store,” he said.

The elements in the store are also intended to not only add drama but also align with social media reputation.

“These brands wish to integrate a lot of their web/online communication to the offline store – like client testimonials, reels and similar content,” explained Santani.

Some opt to display giant screens showing their social media feeds.

D2C brands are also ecologically conscious and they integrate it into the stores by using recycled or sustainable materials.

“Sustainability is at the core of our every decision. Therefore, we plan to use better materials in our store’s design and only have the correct merchandising mix that aligns with the brand’s vision of producing luxury products sustainably,” shared Lalpuria of Kaamna.

Contrary to what one would expect of D2C brands, they do not go overboard with technology at their stores, said the design specialists. They use basic tech features like endless aisles, e-shopping and self-checkouts, QR Codes and smart cameras.

6. Doing more with less

Typically, D2C brands start their offline journeys with kiosks of about 80 sq. ft. to 150 sq. ft. before opening full-fledged outlets. Once they open stores, the size increases gradually—from 250 sq. ft. to 750 sq. ft and sometimes even up to 1,500 sq. ft.

“The products are hyper-localised, based on data from their online sales,” shared Gnanaolivu adding the demand from D2C brands is to make stores that are highly functional and multi-purpose.

“It should be a highly functional, high-density store with efficient planogramming. You won’t find an inch of space wasted—some even don’t have cash counters. Also, they want to use the front area more. And since these stores also are fulfilment centres, they are designed to serve multiple roles,” said the Bengaluru-based consultant.

Doing more with less also extends to the budgets. “Budgets are typically tight initially, sometimes bordering on unrealistic for the brand positioning, size and structure, although this

changes over time, typically after 5-10 stores,” said Santani.

While Ghost Kitchens said it would allocate $2 million to $2.5 million in the next 18 to 24 months for offline expansion, Kaamna plans to allocate 35%-40% of its overall budget, Lalpuria informed without revealing numbers. How much out of it they will shell out for the design itself, remains to be seen.

 

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