To Compete With Online Shopping, Stores Are Ditching Inventory For Experience

In the middle of a sprawling mall in suburban Toronto, between the glistening glass storefronts filled with festive holiday displays, you’ll find a mountain. It is not scalable but it is, in fact, shoppable — kind of. 

The dark grey rock of the faux mountainside doubles as the façade of Canada Goose’s newest concept store. Called “The Journey,” it’s an experiential retail space billed as a “mini adventure that engages your senses through the spirit of the outdoors.” The objective is to bring together the convenience of online shopping with the perks of immersive brand interaction. 

“With the retail landscape changing so much these days — as we all know e-commerce [is] becoming more important — we want to be a leader and be at the forefront of that,” Canada Goose CEO Dani Reiss told Refinery29. “The mandate for this store was to create something that’s never been done before.” 

On that front, the luxury outfitter has managed to do just that. While experiential retail concepts are nothing new — the pop-up store being the most ubiquitous of examples — here, Canada Goose has produced something that’s as creative as it is risky. 

For starters, there’s no inventory. Instead, visitors of “The Journey” are encouraged to engage with on-site brand ambassadors and to purchase product through a digital platform after they’ve gone through the whole immersive experience. The floor near the entrance — comprised of OLED panels under glass encasements — mimics ice breaking when you walk on top of it. There’s a curved wall of massive screens that project 4K images of glaciers crashing into the sea in slow motion. And the pièce de résistance: You can be briefly transported to the Arctic in the “cold room,” where it snows daily and temperatures can dip to as low as -13°F.

Consumers can select and purchase their product in-store, but leave empty-handed. (Toronto-based shoppers can receive their goods same-day at home if purchased before 1 p.m., and the next day if it’s after.)

“Ultimately, this is an e-commerce store. It’s a spoof on our e-commerce — and it should drive e-commerce sales — but there are other benefits as well,” Reiss says. “It facilitates a stronger connection with fans of the brand, and it also explores the possibilities of the future of retail.” 

“The Journey” is the latest example of retailers moving to reinvent themselves and overhaul the entire shopping experience as we know it. The end goal? Keep customers coming to physical storefronts in a time when traditional brick-and-mortars are struggling to stay afloat and — in many cases — shuttering altogether. 

In August, Barneys New York officially filed for bankruptcy, setting in motion plans to close down 15 of its 22 stores, including its Manhattan flagship in 2020. A month later, as part of a long-anticipated restructuring plan, Forever 21 announced that it was ending operations in 40 countries, including Canada and Japan. Additionally, it’s in the process of closing up to 178 stores in the United States and up to 350 in total. 

These developments are unsurprising given the rise of Amazon and the growing dominance of e-commerce. In February, for the first time in history, online retail sales were higher than general merchandise sales, which includes department stores, warehouse clubs, and big box stores like Target and Walmart.

“Consumers have access to and utilise the vast amounts of online information for nearly every product they purchase, including information offered by brands on their own websites, information for comparison shopping on Amazon, and user-generated reviews,” explains Joy Lu, assistant professor of marketing at Carnegie Mellon University’s Tepper School of Business. 

When shoppers enter a typical store, they often know exactly what they want to purchase. And if they find a product in-store or at the point-of-purchase that they’re interested in learning more about, they can easily do so with a quick Google search on their phones, explains Lu. Because of that instantaneous access, they’re less likely to go to a physical store to get educated about a product. Why bother? Everything shoppers need is literally at their fingertips. 

“Knowing that consumers can purchase anything they want online, retailers like Canada Goose are seeking to make their physical stores attractive to consumers in a different way,” Lu says. “[They’re] emphasising the experience, knowing that memorable experiences may then drive online sales.” 

It’s an approach other companies are embracing: Less inventory, more interaction. The hope is that elevated interaction will ultimately translate to sales, even if customers aren’t walking out with a branded shopping tote in hand. 

“We believe the store of the future is about less products, yet more optionality around customisation and delivery,” says Katie Hunt, co-founder and chief revenue officer of Showfields, which has described itself as “the most interesting store in the world.” Its four-story New York City location opened in December 2018, and sells a curated selection of products from digital-first brands. 

Showfields has quickly garnered attention for its many interactive elements. Gone are the stacked shelves and overstuffed racks filled with countless SKUs. Instead, there are art exhibitions, theatrical productions, community events, and coffee shops. It’s your Instagram feed brought to life. 

“We believe in curation around inventory, so the most successful brands at Showfields have hero products you can walk out with, and some items that can only ship to home, and ideally, items you can customise, either on the spot or through an ordering system,” Hunt says. “At the end of the day, shopping is more fun when you can actually shop.” 

Does that mean physical stores could be totally inventory-free in a few years’ time?

“Not across the board,” argues Doug Stephens, an author and business adviser on the future of retail and consumerism. “Some categories of products and convenience retail formats will continue to trade on immediacy and availability, but it will be a very, very small portion of the overall retail sector.” 

Stephens singles out clothing as a particularly poor commodity to sell using the traditional retail model. 

“When you really think about it, traditional retail is extremely inefficient, especially in the apparel market,” he explains. “Stores are often over-inventoried, sometimes with the wrong assortments. Merchandise is damaged, stolen, or lost. Dead inventory gets sold off at a low to no margin.” 

But in an inventory-less or inventory-free environment, the store experience is more focused on that one in-stock product, and all other merchandise is ordered specifically for each customer’s exact needs.

“It’s a far more efficient model for retailing, and consumer surveys indicate shoppers are willing to wait to receive the right product,” Stephens says. “In essence, media is becoming the store and the store is becoming media.”

Back in Toronto, Reiss emphasises that although uncertainty is a marker of the current retail landscape, the consumer remains the key driver behind the brand’s decision-making. 

“We know people go onto our website to buy our products, and we also know our stores are very powerful,” Reiss says. “What none of us know is how fast it’s going to continue to change. It’s about finding the right balance that’s going to work for the future consumer. Projects and experiments like this will prepare us for whatever happens.”

Retail is not going to look the same in the decade ahead. That much is certain. Another guarantee: Consumers will continue to demand the latest and greatest. So long as that’s true, brands that prove to be agile enough will always find a way to weather the storm. Even if it’s brewing inside their own stores.