15 years ago Steve Jobs launched the mould-breaking Apple stores and created a retail model which generates more revenue per square foot than any other retailer. He was driven to this because he was tired of having his products placed at the back of the store.
Today, there are still too many retail stores where the most exciting new technology ecosystem to emerge in a generation is being put at the back of the store or even omitted from the sales offering.
The good news is that we are seeing a new type of experiential retail store emerge where connected objects are front of stage. Fnac, the French based retailer, has launched a Fnac Connect format dedicated to smart and connected products. Half of Maplin’s sales area is dedicated to Connected Home and John Lewis has invested in a Smart Home experiential area in its flagship Oxford Street store.
But the smart home retail sector is still lacking the Apple magic – which by the way is nowhere to be found in Apple where Homekit is ranged in a quiet corner somewhere!
Here are some tips for what we think is necessary to achieve what Steve Jobs has done with Apple:
- Courage is needed – to bring the goods to the front of the store and provoke people’s curiosity. The ROI is not there today, but the winner will be an innovator who takes a longer term view of this market.
- Understanding consumers is vital – they are prepared to spend £150 on one product in 2016. Across Europe it is the same story. There are plenty of products to fill the shelves which sit below the £150 threshold – smart plugs (topselling introduction to the world of connected home), lightbulb starter kits, smart home starter kits, baby monitors, IP cameras, or one of the most recent arrivals – a smart door lock. The only category where it is hard to spend in this budget is smart thermostats most of which sit between £200-300 and often include installation costs.
- Nothing will happen unless retailers assume their historic role of educating consumers – this is the biggest barrier to people purchasing smart home goods. 65% of consumers in our recent Smart Home survey worry about their home when they are away from it, but only 10% have heard of an IP camera or a smart door lock. Imagine if through good selling practices, retailers were able to link these two and sell a solution to a real consumer need. This education role is now being led by the specialist etailers, who are doing a great job of explaining new products and supporting confused consumers – look at a UK etailer like Vesternet (http://www.vesternet.com) and the helpful support system they have created.
If there is one courageous retailer who is mimicking Apple in the Smart Home world it is Lick in France (https://lick.fr/). Its 17 Paris based stores are dedicated to connected objects. There are well educated salespeople, some ex Apple employees – who engage and explain how those products work and can bring benefits with customers. The store layout is simple and encourages dialogue with salespeople across tables like in the Apple store. Stéphane Bohbot, the founder, calls his salespeople “coaches”. The retail space is used also to showcase tech start-ups, part of the booming French Tech sector.
Steve Jobs always loved France and used Paris as the base to launch a number of his products. Maybe the French are going to lead the way on Smart Home Retail as Apple has done for the last 15 years in mobile technology.