The document discusses emerging retail trends for 2012. It notes that post-recession consumers, called "New Normals", demand ethical values and community principles in addition to value and convenience. Retail brands are keying into this "New Normal" mindset by offering artisanal, local products through innovative online and digital approaches. The report outlines trends like reinvented retail, digital convenience, and brands promoting genuine values through partnerships with small producers.

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Trends that innovate and inspire
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Papabubble sweet shop, Tokyo
Retail Trends 2012
LS:N Global Market Report – Retail Trends 2012

2. Retail Trends 2012
A fresh breed of post-Crash consumers is emerging: the New Normals. They shop
with ethical, environmental and community principles firmly in mind, demanding
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convenience and value with real values. Vasstige, super-convenience and hyper-
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localism are the buzzwords that touch their hearts, and open their wallets.
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Our researchers identify how the most progressive retail brands are keying into the
New Normal value system, helping these demanding consumers to realise their dreams
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of a community-based, rural existence in an urban setting, rediscovering heritage,
artisanal and hand-made through innovative and inspirational use of online and digital.
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In this report:
Re-invented Retail, A New Normal world, Vasstige, Retail Trends, Innovate
: Re-invented Retail – we outline the way in which post-recession consumers are
rewriting the rules of retail by demanding a synergy of value and community-based
heritage craftsmanship, and cutting-edge online, digital technologies.
: A New Normal world - Digital super-convenience, multi-channel retail and stripped-
back Leanomic product ranges. We reveal just some of the ways that brands from
Nike and Adidas to Waitrose and Issey Miyake have risen to the challenge of the New
Normal demand for genuine eco-credentials at affordable prices.
: Vasstige – We unpack the combination of ethical principles and value prices shaping
New Normal retail sensibilities, and identify how brands like Diesel, Punkt, Aesop and
Starbucks are using corner shop comebacks, no-frills products and covetable private
to labels to reach out to them.
: Retail Trends – We show how Gucci, Nokia, Stumptown, and Levi’s have found
ways to use rural themes, artisanal skills and heritage narratives to tap into the New
Normal’s desire for retail conviviality.
: Innovate – We focus on how specific future-facing retail brands such as Rapha,
Erik Schedin, and Stella Artois are creating a new world of Wraparound Retail.
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3. M-commerce
Forward-focused retailers are turning their attention Near-field communications (NFC) technology enables
from ‘share of wallet’ to ‘share of pocket’, as sales of consumers to pay at the counter with their mobile instead of
smartphones increase and consumers switch on to the a credit card. The Starbucks Card Mobile service enables
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convenience of in-the-moment mobile retail. customers to check and top up their Starbucks card
balance, as well as pay for drinks and snacks, by using their
Shoppers around the world are expected to spend about phone as a mobile wallet.
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$119bn (£73bn) on goods and services through mobile
phones by 2015, according to tech market researcher ABI ‘The ideal NFC future scenario is that a shopper will walk
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Research. In Japan, m-commerce is already responsible down the street and shops will be able to communicate
for 50% of all transactions, according to service provider with the consumer’s enabled device to entice them with
O2, thanks to the number of price tracking and price offers,’ says Richard Johnson, chief strategy officer of
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comparison services available. Monitise, which provides banking and payment systems
to businesses worldwide.
Meanwhile, handsets are increasingly behaving like wallets
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that enable on-the-spot payments. In the US, the mobile From mobile payments to mobile vending, hardware apps
money market is expected to be worth $8.6bn by 2014, such as Square and Mophie are making mobile vending
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according to ABI Research. more efficient, by plugging into smartphones and turning
them into payment-taking, credit card-scanning devices.
This page, from left : John Lewis iPhone app; Net-A-Porter iPad app
Opposite page : Zara iPhone app; eBay fashion iPhone app
Previous page : Pave bike shop by Joan Sandoval, Barcelona
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4. App-tailing
The last decade saw the steady rise of online retail. In the ‘Users can now try on hundreds of shades and narrow their
New Normal, online and offline are increasingly merging selection to three or four, which they can then try on in-
as web-savvy consumers translate learned internet store and purchase,’ says Parham Aarabi, CEO and founder
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behaviour – such as searching for bargains and conducting of ModiFace, the company behind the MakeUp app. The
comparative research – into real-world decisions company has already tapped into this trend, which has seen
and actions. up to 10m mobile users download a beauty-related mobile
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phone app, according to mobile ad exchange
‘This is the second generation of e-shoppers. They don’t network Mobclix.
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distinguish between online and offline shopping,’ says
Robert Bready, CEO of online fashion store ASOS. From mobile banking and virtual tickets to clip-on payment
‘To them, it’s all the same and they’re as exacting of the systems, m-commerce futures are well under way. The
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retail experience in-store as of their experience online.’ next step will be augmented reality (AR), where digital
information is superimposed onto a real-world environment
Smart apps that bridge online and offline browsing, as seen through a mobile device’s screen. AR apps such
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research and purchasing turn mobile devices into essential as Streetmuseum and Acrossair already give tourists
shopping companions. Apps such as Google Shopper, and travellers detailed information about landmarks and
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RedLaser and ShopSavvy use smartphones to scan hotspots. GPS-enabled devices will add to the experience
barcodes and product labels to instantly find additional by providing relevant hyperlocal content to engage with
product information and compare prices online. customers in real time.
Elsewhere, users create virtual wish lists on Amazon’s
iPhone app by taking pictures of real-world items with their ‘The future for AR in retail is limitless,’ says Maarten Lens-
smartphone’s built-in camera. Fitzgerald, co-founder of AR mobile browsing software
developer Layar, which enables consumers to explore and
App-tailing – selling through mobile apps – reflects connect to this hidden digital layer of information. ‘In retail,
consumers’ confidence in technology as well as shoppers’ people can have new engagements with brands in-store.
enhanced expectations. Consumers increasingly expect to The parking place of a supermarket, for instance, could
be able to access the brands they want to buy while they enable children to run around collecting branded virtual
are on the go. From brands such as fast-fashion labels items while their mother is shopping. Instead of aisles,
H&M and Zara, and luxury retailer Net-A-Porter, app-tailing children could see racing tracks in-store, helping to
is proving increasingly appealing. Beauty apps such as keep them busy, but in a branded way.’
MakeUp, NewBeauty and WeightMirror have been turning
smartphones into smart compacts, using photo recognition
technology to enable users to test colours and shades on
photos of themselves.
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5. Show Your Working
Consumers have long been fascinated by the provenance The factory also enables the shop to act as a social space
of their food. Now they are demanding to know the back for the community. ‘We are trying to pioneer an experience
story of the other products in their lives, too. for the customers,’ says Gage. ‘That way they will
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remember us and come back. And most of them do.’
Retailers are responding to this growing desire by using
interactive or educational displays to bring the factory Other brands use the internet to demonstrate their
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process to the shop floor, creating a new sense of manufacturing. Notebook company Moleskine has launched
theatre for shoppers. a series of online videos that document the making of
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special-edition notebooks. People can see the process
When Andrew Gage traded in his car to buy the first bag of involved in printing artists’ illustrations. ‘In these videos we
coffee for his fledgling business, he expected to be selling tell the story of the product,’ says Giovanni Pesce, head
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coffee, not educating people about it. of PR and events at Moleskine. ‘The idea is that Moleskine
products are story-telling objects, so the relationship is that
Now Gage’s company, Velo Coffee Roasters, based in they should have a story too. The work of the craftsmen and
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Chattanooga, Tennessee, brings the roasting process to craftswomen in the videos is worth documenting. They are
the shop floor. ‘Education is a big drive for the company,’ he creating a piece of art.’
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says. ‘Having customers come in and learn about the coffee
helps them to engage with the product and increases their Consumers are also interested in the processes that go into
loyalty. They like certain coffees the more they understand making clothes. British brand Albam has published a book
about the processes that go into making them. And they of portraits called Factories that provides a snapshot of
trust the methods we use because they are familiar.’ the people, tools and places that bring the brand’s
garments to life.
‘People are looking for an increased understanding of
where food comes from,’ says Albam founder James Shaw.
‘I think clothes are going that way too. People are important.
Ours is a people business, for people, made by people.
We’re proud of the relationships we have with the factories
we use and we want to display that.’
This page, from left : Bench-Made Boots by Horween Leather Co, Chicago; Albam Factories by No Days Off
Opposite page, from top : From the Heartland by Tim Adler for Red Wing Shoes; Factories by John Spink for Albam
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6. ‘People now want to come together in
a more authentic way. They are putting
technology back in its place.’
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Maggie Jackson, author of Distracted: the Erosion of Attention and
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the Coming Dark Age
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7. Puma Creative Factory
It’s second nature for today’s digital natives, the teens and Above the table, iPads – housed in rustic wooden frames –
20somethings growing up online, to want to hack, mod are loaded with custom shoe design software. Customers
and customise a product. Smart retailers are allowing play, touch and feel the deconstructed shoe parts. This
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them to do just that. gives them a hands-on way of imagining their final
shoe design.
Online stores enable consumers to personalise their goods.
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Now you can virtually build your own shoe on the NikeiD ‘It helps to visualise the design process in an analogue
iPhone app, or create your own headphone colour scheme way,’ says Eckel. ‘The whole thing screams: ‘Make a shoe!’’
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in Kotori’s online store. Once customers have played with the components, they
take their creative ideas to the iPad. The software lets them
Sportswear brand Puma, however, has gone one innovative choose different colours and textures to help them create a
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step further by allowing an intimate, loyalty-building personalised shoe.
exploration of texture and material. Its new Creative Factory
store concept – launched globally in cities such as Mumbai, The iPad is an ideal device for this process, according to
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Prague, Moscow and Cape Town – is a digital retail idea Eckel. ‘Firstly, the iPad is small and lets you have a lot of
that has an added element of tactility. scope to work with,’ says Eckel. ‘It’s also very tactile,
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which lends itself to the hands-on process. And it’s
‘We thought: ‘Let’s do a shoemaker’s studio’,’ says Ryan a very intuitive device.’
Eckel, head of marketing for Puma in Eastern Europe, the
Middle East, Africa and India. ‘We wanted to make it as Once the customer has completed his or her shoe on
close to the sneaker design experience as you can get.’ the iPad, they can send the digital design to a customer
assistant and make the purchase. Next, Puma wants to
In The Creative Factory, customers are invited to explore add a Web 2.0 element to the idea. ‘We’re appealing to a
their creativity at a round wooden table. Slots hold different creative core of consumers in their early 20s to early 30s,’
shoe parts in assorted colours and textures. says Eckel. ‘We want them to share their shoe designs on
their social networks. Eventually, people could have their
own online boutiques that sell their designs.’
This page and opposite page : The Creative Factory by Puma
LSNglobal.com sample page from Retail Trends 2012

8. ‘It’s a business born out of passion. Every
product we make has a story linked to a
place or person.’
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Simon Mottram, founder, cyclewear and accessories brand Rapha
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LSNglobal.com sample page from Retail Trends 2012

9. This page : Hoxton Street Monster Supplies shop by We Made This, London
Opposite page : HK Honey urban bee farm, Hong Kong
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LSNglobal.com sample page from Retail Trends 2012

10. Value
As value has become more important for consumers hit Site users are able to crowdsource money-saving tips
hard by the recession, a few smart retailers are helping that are passed on to customers via the grocer’s YouTube
customers get the most for their money. channel. A blog also updates followers on money-saving
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in-store concepts, such as a vending machine for less-
More than ever, people around the world are seeking expensive fabric conditioner refills. To give customers the
value from their purchases. Food enthusiasts in France value products they need, Asda lets them vote for specific
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are trading down on costly specialist foods. In Japan, products they would like to buy in their local store.
shoppers are shunning expensive luxury in favour of
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frugal consumption. Value-driven grocers now top British Similarly, consumer goods manufacturer Procter &
consumer satisfaction studies. And in the US, consumers Gamble has launched a fashion-driven, value-conscious
are learning to live without luxuries, and are even forfeiting website called Supersavvyme.com. It offers insider tips on
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service and convenience for greater value, according to optimising the brand’s products and online money-saving
a study by advisory firm AlixPartners. forums aimed at mums seeking style and shopping advice.
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‘The digital age has made information available 24/7,’ says Tesco has gone even further, announcing plans to
Tarlok Teji, UK head of retail consulting company Deloitte. introduce an allotment scheme to help frugal consumers
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‘Products, prices and opinions can all be researched online produce their own food.
and, with mobile technology, on the go. This has created an
unprecedented level of transparency. Retailers are adjustingSainsbury’s has taken a more subtle nudge-style
the way they interact with these smart shoppers.’ approach, encouraging customers to mix key premium
food products with offers on basics via menu ideas
Some retailers are not only adjusting but are also giving distributed around stores. ‘We know that our customers
their customers extra tools to help them achieve the most want to mix our top end products with our basic ranges.
for their money. Asda, for example, has launched a social It’s about teaching them they can have taste and value
networking site called Your Asda to offer more transparency at the same time,’ says a Sainsbury’s spokesperson.
to its value-seeking customers.
LS:N Global predicts that post-recession consumers will
keep returning to retailers that not only offer good value
but act as a mentor to help them achieve even more for
their money.
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