The Rise of the Unstore

How mobile is changing retail to create a new type of store:

The rapid uptake of smartphones has had a significant impact in retail. Many stores are seeking ways to combat ‘show-rooming’, where consumers browse in-store and then buy elsewhere on their mobile. Some, such as Best Buy are simply matching online prices, others such as Macys and Toys-R-Us are creating a more immersive app-based experience to win their customers on the service side.

The other trend has been the re-invention of the store. Take the products away, and instead use posters to display the products. It means that the shops can be pretty much anywhere. Whilst some have described these as ‘virtual stores’, arguably they are not virtual as they clearly exist in the real world. Instead I am calling these ‘unstores’.

The first to appear was Tesco Homeplus in Korea, with their QR-based metro posters. Since then retail brands including PayPal (Singapore), eBay (London), Argos (London), Delhaize (Brussels) and John Lewis (Brighton) have delivered similar offerings. Net-A-Porter’s (London and New York) pop up window used augmented reality rather than QR codes, and Tesco’s F&F pop up store (London) used iPads and QR tags to allow users to order products.

These examples were all short-term, largely PR exercises, however the future looks more permanent. Chinese supermarket retailer, Yihaodain, plans to open 1000 unstores. It makes complete sense in that market. Chinese have no tradition of desk-top retailing, but the rapid uptake of smartphones creates an opportunity to engage the time-poor Chinese worker. This is likely to be just the start. I would expect many brands in Europe and the US to follow suit.

Tesco launches Jubilee pop-up shop using QR and AR

As one of the first retailers to create a more virtual shopping experience in Korea, Tesco have been ahead of the curve. They have just launched an F&F pop-up shop for the Jubilee in London’s Covent Garden, which will be open until the end of the Jubilee weekend. Users can try on clothes in the store, but can’t take them home there and then. That’s because the shop has no tills. Instead, users scan a QR code and pay through their online site for collection the following day from the nearby Tescos or home delivery in 2-3 days. Alternatively, there are iPad pay points, which customers can to make their purchases.

Tesco sells iphones from Dec 14th

The UK supermarket chain, Tesco, has announced December 14th as the date when it will start selling Apple’s popular phone. O2 lost it’s exclusivity on the iphone a few months ago and since then Orange has started selling the handset, and Vodafone have announced it will be available in early 2010.

As you would expect with Tesco’s they aim to undercut the competition. They are offering 12 month iphone contracts from £20 – their competitors are only offering 18 or 24 month phone contracts. With this contract, the handset price will be £222 for an iPhone 3G 8GB. They are also offering the 3G and 3GS on their tripple credit pay as you go price plan.

It will be interesting to see if there is a price war on the iphone. It will also be interesting to see how many more phones will be sold, now that the O2 exclusivity has ended. There were 1 million handsets in the UK in Feb 09, and approximately 1.5m in Dec 09. Watch this blog for more updates!