Twelve industry leaders put South East Asia under the microscope and tell us what’s needed for the region to fully unleash its potential in the near future. On the future of retail in the region, here is Thorsten Walther founder of Inspify.
What will it entail to be the leader in retail in the future?
Thorsten Walther (TW): It’s very important that future leaders in retail get tech-savvy and open-minded. This is what Covid-19 did – pushing retailers to the extreme and changing mindsets. It’s like the saying, ‘forming, storming, norming and performing’. Once you have accepted a situation, you’ll find the solution and begin performing again.
In the past decade, legacy retailers have been trying to embrace online and omnichannel commerce. In the next decade, how much more of an evolution do you foresee?
TW: The biggest evolution for luxury brands is to understand that in e-commerce, online and offline are not two separate departments. From a brand perspective, they will merge and work hand in hand. From a technological perspective, more digital elements (holograms, for instance) will enter the store and create the brand message. It will be less about selling the product, but more about telling the stories. It’s about ‘edutainment’ – educating and entertaining the customer at the same time. Personally, luxury retail is all about experience. If I want to buy an S$8,000 Chanel bag, I want to enjoy the experience. Sure, I can order it online and get it for a bit cheaper, but do I get the same level of happiness?
Brick-and-mortar still remains fundamental to retail, right?
TW: In the next ten years, I believe there will be a consolidation of physical stores and there will be the flagship stores that will get bigger and more entertaining. You will have a virtual space that bridges the gap between e-commerce and the physical boutique. Here, you can have a digital experience, but the purchase in the end will be in the boutique. E-commerce will grow a little, but the physical boutique will remain the biggest element.
Since getting hit by the pandemic, how has consumer behaviour changed? Are people getting less materialistic or are they buying more?
TW: Covid-19 has shown that family and health are important, and that if you’re not healthy, a bank won’t help you. But there will be sunshine after a storm and people will want to reward themselves. Luxury will still have an important role in people’s lives.
Humans are complex creatures and change is the only constant. What will it take for a retailer to ultimately understand the customer?
TW: The most important thing is having the right data. I think a lot of retailers make decisions on an empty stomach and don’t really know what makes the customer click. Retailers will need to invest in the right technology in their boutiques to truly understand.
What do you think will remain the same in terms of the luxury retail of today, yesterday and tomorrow?
TW: I strongly believe that the constant will be the salesperson on the shop floor, even in 20 years from now, but empowered by technology. The luxury business is about personal relationships, after all.
Thorsten Walther is the founder of Inspify, a digital platform that functions as a bridge between online editorial content and retail, seamlessly connecting the reader with store offerings. In other words, what you see is what you will get.