Magnificence & Wellness Briefing: ‘Inexperienced leases’ and RFID tags are driving enterprise selections in brick-and-mortar retail growth

This week, I am reporting on Future Stores 2024, a retail conference I attended last week in Los Angeles with brick-and-mortar leaders from retailers such as Lush, Madison Reed and Mejuri. Reducing shrinkage, boosting trust through in-store messaging, building sustainable supply chains and in-store processes were top of mind amongst execs. Additionally, L’Oréal unveils a tech-y new hair device, and Kylie Cosmetics enters Target through Ulta Beauty’s shop-in-shop.

How ‘green leases’ and RFID tags are driving business decisions in brick-and-mortar retail expansion

Brick-and-mortar retail leaders gathered in Los Angeles last week for the Future Stores summit, a three-day conference that centered discussions around the ideas and challenges driving physical retail in 2024. 

Topics included the habits and preferences of Gen Z and Gen Alpha shoppers, tactics to reduce shrinkage, best practices in messaging sustainability initiatives in-store, the latest trends in blended retail, and tips for standing out in the specialty retail space. 

“Green leases” were a buzzy topic on a sustainability-focused panel hosted by Glossy. The term was used as shorthand for an in-depth legal component added to all leases by the Lush team that calls out their expectations for access to recycling, composting, and energy and water metrics, for example. 

Amy Merli, regeneration and sustainability specialist at Lush, said she thinks about the agreement’s value in two parts. First, it’s a way to ensure landlords are up to the challenge of renting to an eco-minded storefront. She also sees it as a way to present ideas that may seem novel now, like solar panels and rainwater collection, but may eventually appeal to the landlord for a widespread rollout. 

Lush is known for its bright and colorful shops located in malls and outdoor shopping centers. The chain launched in 1994 as a more natural alternative to commercial personal care products and has since grown to around 260 stores in North America and 900 stores worldwide. The company is privately held and sells cruelty-free soaps, bath bombs, shampoo bars, body lotion, face masks, and a variety of other personal care and beauty products, most of which sell for under $20. The majority of products are “naked,” or sold without packaging, while others are sold in post-consumer plastics. The brand centers its campaigns around its values, such as the ethical treatment of animals, ethical supply chains and environmental impact. 

In 2021, as a reaction to “the Facebook files,” which revealed the negative psychological impact of social media on young people, the company went dark on social media, leaving behind just text boxes explaining the decision to its 3.9 million Instagram followers. Today, reaching its consumers happens primarily in stores, which has inspired the Lush team to rethink its in-store copy. 

For example, in-store signage over a stack of shampoo bars, which once read “Lather up with Lush,” now speaks to the environmental impact of the plastic-free product, said Erica Vega, manager of brand, product and service training at Lush. 

As consumers become more aware of the unseen waste tied to brick-and-mortar stores, like packaging, outdated displays, testers and shipping materials, retailers are becoming more thoughtful in the management and consumer messaging of waste protocols. Michelle Field, shop and space planning manager at Lush, shared the brand’s strategies during a panel. For example, lettered light boxes are found in every store, which make messaging changes easy; displays only travel to stores with larger product orders; all visuals are made from the same recycled plastic as its product packaging; and store displays are reused or recycled with returned packaging. 

For other retailers, especially those struggling to build community in smaller spaces, building functionality into store displays was also a hot topic. For example, to make events possible at Velvet by Graham & Spencer’s 800-square-foot store in Brentwood, California, the interior was exclusively outfitted with multi-purpose furniture. Coolers to hold event beverages are disguised as benches in-store when not in use, and racks are modular to create more space as needed, said Angela Kendall, director of retail at Velvet by Graham & Spencer, during a panel. 

Velvet by Graham & Spencer started in 1997 as a T-shirt line and has since grown into eight stores across California, Texas and Washington. The brand also has a retail presence in Revolve, Anthropologie and Bloomingdale’s. The company is privately held.

Also at the conference, shrinkage was a hot topic. “About a third of our stores represent 75% of our total company shrink,” said Joel Quill, vp of retail at PacSun, during a panel. To help combat this, and better improve inventory accuracy, the brand uses RFID tags, or radio-frequency identification tags, which are small, soft tags attached to items that offer geo-tracking through radio waves. “[RFID data] offers another level of data that’s more in real-time,” Quill said. For example, the data helps the PacSun planning and allocations team determine what merchandise goes to which store, often diverting merch that’s stolen at higher rates in certain stores. 

PacSun started as a surf shop in Seal Beach, California in the 1980s and currently has more than 300 storefronts across North America. It is owned by Golden State Capital.

Meanwhile, during a panel discussion with Gen Alpha and Gen Z guests, young consumers shared the things they love about shopping in 2024. They included buying secondhand clothing off resale apps, shopping in-store sales and being greeted by welcoming sales associates. These young shoppers also shared their gripes, including self-checkout, rude salespeople and hot dressing rooms. 

Additional Glossy coverage from Future Stores includes how brands like Swarovski are using data to expand store fleets and a look at how AI is becoming a valuable tool for connecting with consumers.

News to know:

  • L’Oréal Paris launched a new device to aid in the at-home hair color process. The Colorsonic is a brush-like device that mixes and distributes hair color for consistent application on all hair types and lengths. It retails for $124.99 and takes specialty-designed color pods, which sell for $29.99. It reportedly took 10 years to develop, has 29 patents and is available on and DTC through L’Oréal Paris.
  • Kylie Cosmetics can now be found in Target stores through Ulta Beauty’s shop-in-shop program. The offerings include a curated collection of bestsellers like the Matte Lip Kit, Tinted Butter Balm and High Gloss.
  • According to Forbes‘s new billionaire ranking, Francoise Bettencourt Meyers — the richest woman in the world and the vice chair of French cosmetics giant L’Oréal — is the first woman to surpass $100 billion in net worth. 
  • Fenty Beauty is expanding to hair care. Stay tuned to Glossy for more as the story develops this week.
  • The Honey Pot, the feminine hygiene brand that sold its majority stake to Compass Diversified Holdings earlier this year for $308 million, has entered a partnership with the WNBA’s Atlanta Dream basketball team as its exclusive body-care partner.
  • Kering Beauté, the fragrance house behind Creed and the forthcoming Bottega Veneta perfume, has made a minority investment in niche fragrance brand Matière Première. 

In the headlines:

Kosé, Japan’s beauty giant, opened its first standalone retail store in the Los Angeles area. Philosophy opens a skin-care academy in New York. How Julie Schott made acne a laughing matter. Celebrity hairstylist Andrew Fitzsimons buys back his brand from Maesa. Win-win: Inside the beauty industry’s support for female racing drivers

Need a Glossy recap? 

Estée Lauder Companies completes acquisition of Deciem for $1.7 billion. U Beauty taps Tinx for its first product collaboration. Kiko Milano’s CEO on expanding to the U.S. and targeting Gen Z. How Supergoop plans to seize the summer. Forty years in, Derma E refocuses on customer acquisition. Laura Geller’s Sara Mitzner: ‘We keep women 40 and older in mind’ at every stage of the brand.

Source link

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button