A year after the global pandemic accelerated bankruptcies and store closures, retailers are launching and expanding formats tailored (they hope) to what’s likely to become the new normal.

While many retailers’ plans were likely on the drawing board pre-pandemic, the need for them became more acute as always-on homebound consumers settled into shopping less frequently but buying more during each store visit. And as stores gradually re-open around the world, retailers are cutting back on promotional pricing while heightening the shopping experience.

Recreation Facility
For example, Dick’s Sporting Goods next week opens its first Dick’s House of Sports in Victor, NY, that will be as much recreation facility as retail store. Among other things, the 100,000-sq.-ft. store will have an 17,000-sq.-ft. outdoor turf field and rock climbing wall. A second location in Knoxville, TN is slated to open in May.

That’s in addition to Public Lands, Dick’s latest effort at an outdoor products-only retail format, which opens in Pittsburgh, PA and Columbus, OH in August in locations that were previously home to Field & Stream outlets, the chain’s earlier (licensed) outdoor store effort. The chain also is developing four other specialty store formats, CEO Lauren Hobart told analysts last week.

Tailored Convenience in Japan
The pandemic also has led to changes in convenience stores in Japan that give local managers more autonomy to redesign stores to meet local tastes and trends. For example, Seven-Eleven Japan forecast that 50% of a given store’s SKUs will be sourced from the surrounding region, up from a previous 30-40%. And it will expand the concept to about 8,000 of it 20,000 stores within the next year. That’s a sea change for Japanese convenience stores that have long prized unified formats as a sign of efficiency.

In the UK and Germany, where many retailers are continuing to struggle, new formats appear to be on hold. “German shops have been closed for months and we will soon have a wave of insolvencies like we have never seen before,” reports Peter Hollo, Licensing International’s Managing Director in Germany. “This is not the time for concepts. It’s hoping that (economic) death walks past your door.”

In the UK, retailers that successfully shifted business online and mastered digital marketing during the pandemic “have done enough to survive,” says Graham Saltmarsh, Licensing International UK’s Managing Director. “Pre-pandemic there was a rise in pop-up stores in the UK,” but given the numerous lockdowns since “we will have to wait and see if that continues.”

Among the other format changes:

• Iconic UK retailer Marks & Spencer (M&S) introduced a new food and clothing format featuring an 11,000 sq. ft. food hall stocked with 300 products, about 35% more than the average store, the company said. The store also has WiFi and a click and collect desk for online purchases.
• The arts and crafter chain Michael’s is borrowing a game plan from the Internet in redesigning its stores. It’s hiring so-called “makers” (like those at the heart of ecommerce companies such as Etsy and Café Press), as salespeople and tripling its assortment of private label and other products to attract those types of customers, CEO Ashley Buchanan told analysts earlier this month. “Within our community of makers, we are gaining insights on how to improve our go-to-market strategy and improve our messaging,” says Buchanan. It also tested an “inspiration hub” last fall at stores in McKinney and Plano, TX.
• Dollar Tree will open “hundreds” of stores that combine its own nameplate with that of subsidiary Family Dollar to target areas with populations of 3,000-4,000. The chain has opened 50 of the combination stores since late 2019, but is expanding after they posted a 20% increase in same-store sales. The format combines Family Dollar’s “value and assortment” with Dollar Tree’s “thrill of the hunt and fixed price,” CEO Gary Philbin said.