Hyperphysical Stores Are The Next Big Thing. But Are They Here To Stay?


Limei Hoang | May 24, 2022

Balenciaga's Mount Street store, which was covered in pink fur to celebrate its La Cagole bag.Credit: Courtesy.

Tactile materials, robotic automation, and legacy locations are all the latest displays of hyperphysical retail, a growing macro trend that focuses on heightening the senses of consumers through enriching, emotional, ethereal, and exclusive experiences. But is this trend something all luxury brands should embrace and how long will it actually last?

When Balenciaga decided to adorn the interior of its Mount Street store in London with a bubble gum shade of pink faux fur to celebrate its Le Cagole handbag line, it perfectly encapsulated the kind of environment that luxury consumers have been seeking post-pandemic, the hyperphysical kind.

Everything from its walls, seating, shelves and the floor was covered in the soft, tactile material, inviting visitors to come and literally stroke it, whilst taking a selfie for social media. Likewise, the various pop-ups from French designer Jacquemus hosted in Paris, Milan and London which presented his products in playful ways like a handbag vending machine, or being inside a bathroom or swimming pool, visitors were encouraged to immerse themselves in the designer’s colourful world and interact with their surroundings.

“It's this idea of completely elevating the store space, giving it a greater meaning and reason for existence, and taking it beyond the provision of just goods,” said Kathryn Bishop, foresight editor at strategic foresight consultancy, The Future Laboratory, which recently released a report on the trend. “Retail has been doing this for a little while, but now it has accelerated in some ways around being more about the person visiting and what they experience.”

The report also highlights rising trends within hyperphysical retail such as Play-tail, dedicated areas in which retailers create for children to play whilst their parents shop, Hangout Hubs, destinations that are focused on socialising as a form of brand engagement, and Influ-sellers, brands that are leveraging the audiences of micro-influencers to present and curate shared shopping experiences, showcasing the different ways in which brands and companies address hyperphysical retail in relation to their audiences.

Jacquemus' pop-up concept 'Le Bleu' at Selfridges, London.Credit: Courtesy.

The rise of the trend has been simmering in the industry for more than a decade, but in the post-pandemic landscape, it has accelerated due to its ability to heighten the senses through the creation of spaces that go beyond just shelves of neatly arranged products and displays but instead transports the shopper into an immersive experience beyond that of a normal store.

“It's something that has become more interesting as the public seeing more of it now,” said Neil Saunders, managing director at GlobalData Retail. “And of course, in the aftermath of the pandemic, we're talking about what gets people back to physical stores, or what physical stores need to do to counteract online, so it's become a topic of much greater interest.”

Indeed, if the past few months have shown us anything, it’s that consumers are still hungry to spend their money on purchases, despite inflationary pressures. LVMH posted a 29 percent rise in revenue of 18 billion euros in the first quarter of 2022, compared to the same period a year ago and the latest figures for US retail sales in April showed the value of overall retail purchases increased 0.9 percent, after a 1.4 percent rise in March, according to the US Commerce Department.

Part of that desire to spend is led by the desire from consumers to connect and interact with their environments, after long periods of restrictions related to the pandemic. “We've had a couple of years of being very isolated compared to before,” said Saunders. “We've done many more things from home. We have cut back on experiences like travel, which are very enriching for us as individuals. We have cut back on physical contact with other human beings. We've reduced the amount of sensory experiences we have because we're not going into offices or interacting as much with other people, we're not travelling to different cities. We're not even going to the movies and things like that.”

“I think when you have that period where you cut back on things, you kind of get a desire for release which we've now started to have,” he added. “People are going back out into the world and are craving those things that they've missed. So, when consumers go back out there, they’re really looking to be stimulated and excited. And they're looking for things to be interested in.”

Join Luxury Society to have more articles like this delivered directly to your inbox

From luxury brand’s point of view, hyperphysical retail represents an opportunity to rethink and reassess the purpose of their stores post-pandemic, even more so than with other retail formats, said Bishop.

“We've seen everyday brands recognise that they have to turn their stores into experiential playgrounds,” she noted. “What I think has shifted now is this reassessment. What does the store now need to be? What is its purpose now? Obviously, there will be a need for convenience for a lot of retail formats and retail types, but if you are a luxury or high fashion retailer, there's a really interesting opportunity to build these sort of exciting stories to bring people back and get them away from the convenience and in a way the sort of boredom of shopping online.”

“For a retailer, it’s about tuning those experiences up by making it way more meaningful, exciting, intriguing and memorable,” she added. “Ultimately, retail brands want to be selling product and so they have to find a way to sort of balance the experience with the store sales.”

But it is important to note that hyperphysical retail isn’t for everyone. “I think that people want a very nice experience from stores. But that experience doesn't always have to be extreme hyper physicality. It can be just a really nicely laid out very simple store that's easy to shop and is pleasant,” said Saunders.

“Most of the retailers in a mall fall into that category,” he added. “Most retailers do not do extreme high physical type of design because it's just not economical for them to do it. You couldn't spin this out across every single store that you have if you're not a luxury brand with exceptional margin.”

“And if you look at a retailer like Target for example, and Target has had a phenomenal performance. It's done a lot of investments to its stores, it's made them a lot more pleasant, but you wouldn't really describe it as being hyperphysical,” he said. “Actually, what's enough is to have really nice products in a fairly nice environment. And a pretty easy, relaxed shopping experience. That is still the bulk of retail, really.”

“The idea of physical store won't be for every retailer,” said Bishop, who believes that hyperphysical retail will accelerate in the next three to five years. But there are ways that others can think about it. “It goes back to considering their purpose. It isn't just throwing all this the sensory stuff into a store and hoping that it sticks. It’s more about how does it actually fit with what we are about but also how can we challenge ourselves to think out of the usual sort of store experience and just try something a bit different as well?”

Analysis | Luxury | Retail