.png)
How is the next generation redefining what it means to shop, connect, and co-create in physical spaces?Grab a pen and get ready to take some notes because Melissa Gonzalez and her firm, MG2 Advisory, have cracked the Gen-Z code through groundbreaking new research. But make no mistake, this isn’t more one-size-fits all data about a large, and highly nuanced, cohort. This is granular research that unpacks the social, behavioral, and psychological forces impacting how different Gen Z personas shop. This week, we’re learning how brands can leverage powerful tools that Gen Z is already wielding to level up their physical retail experiences: nostalgia, authenticity, sustainability, and co-creation. Listen now to get Melissa’s data-driven blueprint for designing meaningful brand experiences.
How is the next generation redefining what it means to shop, connect, and co-create in physical spaces?
Grab a pen and get ready to take some notes because Melissa Gonzalez and her firm, MG2 Advisory, have cracked the Gen-Z code through groundbreaking new research. But make no mistake, this isn’t more one-size-fits all data about a large, and highly nuanced, cohort. This is granular research that unpacks the social, behavioral, and psychological forces impacting how different Gen Z personas shop.
This week, we’re learning how brands can leverage powerful tools that Gen Z is already wielding to level up their physical retail experiences: nostalgia, authenticity, sustainability, and co-creation. Listen now to get Melissa’s data-driven blueprint for designing meaningful brand experiences.
Have any questions or comments about the show? Let us know on futurecommerce.com, or reach out to us on Twitter, Facebook, Instagram, or LinkedIn. We love hearing from our listeners!
Alright. Alicia, I'm letting you know right now, I might get a little loopy because I'm coming to you from a nondescript basement in London. It's 91 degrees in London. I'm in, like, West London. I'm in Notting Hill, and I tried very hard to set decorate for this particular episode. I did a great job. And I'm looking a little dewy. I tried to escape the heat in Florida, but somehow I brought it with me. Today is actually a very special episode. Alicia, you connected us to our next guest. I'm very excited for it.
Yeah. Absolutely. So I have known Melissa Gonzalez for, I think it's about ten years now. We started, initially she was a award winner for our awards program at Retail Touchpoints, my former home, and we've just stayed in touch. I've always appreciated her perspectives and her background in store design, experience strategy has really been invaluable for me as I've learned about the retail industry and the fundamentals of it. And now she's doing some incredible work with MG2 Advisory, which is the advisory and research division of MG2. And today, we're going be digging into some really timely, relevant trends about Gen Z. And obviously, diverse demographic, a lot of nuances into their behaviors, but we're going to be exploring all of those intricacies and how it impacts customer experience and specifically in store design. So super excited to have her with us today.
Now, without any further ado, she is principal and founder of MG2 Advisory and the strategic insights practice within the global architecture and design from MG2, which is now part of Collier's engineering and design, where Melissa is now a shareholder. Welcome to Future Commerce, Melissa Gonzalez.
Oh, thank you. Thank you both for having me today.
Yeah. Welcome to the show. You have some research to unveil here today. I want to hear all about it. But first, congrats on this move over to this new firm and this new home. What has that been like for you guys?
Yeah. You know, it's a lot coming together. And so it's always exciting. It's a lot to learn. Putting on my research hat as I do that. So meeting a lot of division leaders across the organization and really the spirit of it was to further our resources and expertise, expand that, for our clients. And so we've always talked at MG2 about kind of specializing in physical environments. And now we can just do that at a greater scale and in a greater footprint from a national standpoint as well.
Congrats. And for those in the audience who may not be familiar, but they should be, you have an incredible amount of expertise under your belt. You and your firm have a legacy of over 200 experiential retail spaces for the world's most recognizable brands like Nordstrom and Victoria's Secret and Good American and many accolades to boot. Why focus now on the research side of the business? I'm sure you're still designing too, but what what does the research inform in the actual practice of the work?
Sure. Yeah. It was always an embedded part in the way we worked. So prior to MG2, I was the founder of the Lionesque Group. Prior to that, I worked on Wall Street. So I always was somebody who listened to the data and saw the trends. Back in my Wall Street days, it helped to inform the kind of investments our clients should make. And when we were at Lionesque, we were always working with digital natives to figure out what was the point of a store for them. And, so, just pulling that forward in a deeper way, because what we continue to see from the day I started Lionesque, 2012, all the way to today, if not more so, the consumer's ever evolving. So whether it's the consumer in retail, whether it's residents and multifamily, whether it's the patron and hospitality, we're always evolving in the way we live our lives. And the acceleration of technology evolution is just furthering that, which is happening at an extremely rapid pace right now. So, we have to always stay curious. We always have to understand how are the changes that are happening in larger dynamics, those bigger drivers economically, technologically, all of that reshaping how we intersect with our everyday lives so that that can inform, well, what are the customers that our clients want to create experiences for? What do they want? When we say the word community, how does that manifest? When we talk about culture, what does that mean? When we say we want to integrate technology, how? What's successful? So there are so many different aspects that we have to stay curious about. And having worked with design teams since day one, Lionesque and then MG2, and now Colliers Engineering Design, I think it enables me to kind of walk that balance of understanding what they're going to have to deliver in that portion of the scope of the work and then how our research and insights can be a partnership to that. So we're always taking that data driven approach to support those creative outputs.
And this isn't your first time conducting research around Gen Z, as I understand it. I remember hearing, I think maybe a year, year and a half ago, some groundbreaking retail design data. And in prep for this, having actually reviewed that content myself, I'm curious to get into the data here now. You're looking... It looks like you can start to get some time series data on how Gen Z starts to think about the evolution of how this demographic, or maybe their psychographic evolution of how they think and how their tastes change over time. What's spurring this particular checkpoint and this time to refresh?
Yeah. I think we've been saying year over year, two years felt like a good mark. Sometimes when you do it on a yearly basis, you don't get enough new data, but you also see in every demographic, there's a cusp that they start to go over, right? So next we're going to study is Alpha because they're starting to become teenagers, right? So they get to this next life stage and you can be bucketed in generations, but then it's where in your lifespan are you as a generation, which is also going to influence change as well. So, you have a lot of that coming to age with Gen Z, you have a lot of them... They've been in the workforce, they're evolving to other stages of that. So we wanted to have this conversation. And furthermore, the first study was much closer to coming out of COVID. This is years after coming out of COVID, right? And so all of that reshaped behaviors that then get reshaped again. And we also recognize that this is the generation that's often just been clustered in groups. Gen Z is "this," and it is a very complex generation with a lot of different behaviors and variables. So we wanted to be able to dig in deeper into all those nuances.
Yeah. I'm glad that you brought up those intricacies because I know, like, I'm a millennial. I started in this industry when everyone was talking about millennials and trying to bucket them or define them in a very batch-and-blast way, so to speak. And what was interesting to me about this particular research is, you really let those nuances and complexities really shine through, maybe not just at the demographic level, but at the individual level. And one area that really shines through for me is the, I guess, tug of war of sorts between value and values. And I think that's something that we're all kind of feeling, that tension, a little bit. So, we know from the data that Gen Z does consider sustainability and the ethics of an organization, but price is important. Value is still important at a financial level. So, is this something you think will become more prevalent? Can you unpack some of the data here that kind of shows and illustrates that tension?
Yeah. I mean, so the way we framed it a bit is "aspirational values," because, I think in the past there's so much conversation. They talk about sustainability, and then that gets discounted because, "Oh, they care about it," but they don't put their wallets behind it. So, you know, there's nothing to do there, but that's actually not the opportunity. So when we think about aspirational value per our report, we had just over a thousand respondents, 94% of them shop with values in mind, right? Authenticity, transparency, humility are all key aspects of it, but so is sustainability. The reason why it doesn't always win their wallet share is because economics still matter. But if there's a great desire for it -- and later in the survey, in the report, we talk about how we surveyed, "Who do you think is the most responsible for helping you achieve that?" Themselves and retailers and brands came in number one and two. So, if a brand or retailer can get it right and enabling it, there's a big opportunity there because they're helping consumers live those aspirational values. And there's something really powerful in that. So, it's really digging into it deeper; "Okay, well, how can we get there in a more effective way?"
I think humility is an interesting one to call out because it's not one that I think retailers or especially direct-to-consumer brands and founder-led brands often think of as a core tenant, core value. But I think founder-led brands in particular, especially ones that are starting to look toward retail as an emergent channel for them or opportunity channel, tend to do that by nature on social media. And so, I find that to be an interesting driver. I just thought I'd call that out because it tends to be a social media strategy, especially if it's a founder-led brand. I'm interested to know how those things align at scale as you start to get larger and larger. And when it's no longer founder-led, how something like humility comes through in a much larger-scale brand.
Yeah, it's interesting because there's definitely a lot more, I think, articles out now about the importance of founder-led and why it has that resonance with the consumer. And I think it's at scale, it's being really prudent and responsible to, like, any brand work, making sure that you're extracting, "what are our value propositions?" "What do we stand for?" "How do we speak about that?" "What is our voice? What is our tone?" You have to maintain that even when the founder's gone and that's a hard thing. So oftentimes you see the founder still sits on the board or has some sort of involvement. I think when they totally leave, you do start to feel that difference and shift. But you can't discount that, because that is what's allowing your brand to stand apart from the rest, is that people are buying into that founder promise just as much as they're buying into other aspects of the brand or the products themselves. So, I think the important thing is that they stay involved in some aspect. But, they tend to be known, also, when you have that founder approach, there's a level of transparency that's in the approach too. They're showing behind the scenes and the making of how we got here, why I believe in these things. And that's the human side of it. And when we're living in this constantly digitally connected... Where there's fleeting trends or there's like microseconds of interaction on a TikTok or whatever, right? The things that are going to have more of those lasting, stickier impressions are going to be the more human aspects of it. I think what we're talking about is that layer.
I think it's a really great transition to this idea of Gen Z wanting to be co-creators because even though there's a really strong founder story, and that brings them into the brand, makes the mission, values, and story really clear for the consumers. Once there's this connection, there's this level of investment that isn't just dollars-based, right? It's very emotional, it's participatory. It's like, "I feel connected to this brand, so I want to be part of it." And what ways can brands enable that? So, my question for you is how is this showing up in the physical realm? Because, obviously in the digital world, we have social media, we have ways that they can participate in content and co-create. So, how is this translating into the physical realm?
Yeah. So I think there's a lot of different ways you see brands doing that. And validation, this is one of the areas that we investigated in there, you know. How do you wanna engage with brands and co-creation three out of four? That was one of their responses that they wanna be co-creators and collaborators in the brand journey, store design, product customization. I think we more often see product customization, right? You see that with Levi's, you see that with Coach, you see that with a a lot of brands. We are working on a project now that we can't announce yet that's gonna be a new flagship destination for a client. And we were like, "Okay, how do we have the customization station worked into this?" And so, whether it's a pop up or a permanent store, you see that. When years ago when we did one for toothpaste, people wanted to bling out their name on their Better Than Sex Mascara, you know? So people want that aspect. It makes it feel a little bit of their own and they had a hand in it, but you don't see it often in store design. I think you see collaborations with an influencer, but I think there's a real opportunity because you're getting validation buy in. And I think you unlock more brand evangelists that way as well when they're getting the opportunity to come to the table and have a part of it and be able to tell people that they've done that. And I also think that brands and retailers make a lot of assumptions. Bubble, right? Beauty brand. One of the things that Shai has done really well over the years is having focus groups of thousands of individuals that vote on the coloration, the packaging, the messaging, what stores should she be sold in. And so it won't always be 100% what makes it successful, but I think it furthers that. And I also think that you cultivate this group of people who really stand behind the brand in a different way because they had a different level of interaction with you.
Yeah. You've listed a bunch of canonical examples of co-creation. We have talked for many years about a brewing force of co-creation that already exists with consumer based tools around AI that has been sort of bubbling beneath the surface.
Yeah.
Consumers want to either create of their own accord or to interact with a media that is not necessarily authorized material created by the brand but is genre specific to a brand. For instance you saw a couple years ago the Balenciaga X Harry Potter send ups. and there's something really appealing or entertaining about that type of media that we find appealing. And so we created a piece of print, a book called The Multiplayer Brand, where we theorized at Future Commerce that more brands would sort of be pushed in a direction of co-creation, whether they like it or not. And so whether it's physical co-creation or digital co-creation, Nike has this new AIR Imagination tool where AI enables you to imagine something. It's what people want. It makes them feel like they have some sort of say in what the brand creates. And so it's no wonder that the data says what was it again? Three out of four?
Three out of four.
Do you have data that shows that tracking up over time?
I believe it was an upward trend. I mean, it's not a new thing that people want the level of co-creation that they want today, but I think the newer part of it is how we were able to dig into how they want that co-creation and it not just being from a product level, which I think is always the assumption and the missed opportunity, or maybe the newer opportunities. They also on the journey, the store layout, on the store design, on the store programming. So there's other ways that consumers can be partners and co-creation with brands and retailers.
There's another interesting sort of modern effect that I see playing out here is how educated consumers are today too, because of explain-ifier content. We're constantly being told and educated how the world works. There's TikTok, and Instagram, and YouTube that tells us how the world works. We have brand creative directors, and we have fashion experts. We have people that are telling us... Grocery store layout design experts. There's people who are telling us what brand psychology is and how it works on us. And I think that makes us want to be more participatory in this way. And I think that that's so fascinating and possibly one of those things that sort of start to come out in the data as we become more informed, too, that we have a say-so. And that's why we tend to want to speak back. So I believe that social media and participatory media make this democratized to some degree. It means that we can speak back. And I love that we're starting to see that play out in the data, too.
No, absolutely. I mean, social media has had a huge impact on the dynamic of the relationship between the consumer and the brand, whether it's TikTok or Instagram or any of the platforms, depending where the generation is. But yes, it gives everybody a voice. And also, we're talking about Gen Z today, but the teaser of Gen Alpha after the level of education they have and their fluidity with AI and technology and being able to be creators, I think it's only going to get further accelerated.
In the study, what were the sort of parameters for Gen Z?
Yeah, so this was a pretty good split between male and female. So it was 50% female, 49% male, 1% non binary. And then from an age perspective, it was pretty split. We had 18 to 26. So 47% were in the 18 to 22, and then 53% were 23 to 26. You know, and then there was a variation in working full time or other vocations. So full time, part time, student, right? Because depending on where they spell in that age spectrum. And then the other layer that we added into it was just understanding how they shop today in store online with an equally, etcetera. So we had a little bit of that context brought to it as well.
This is an age group that I've become a bit familiar with, probably not by choice. A tweet of mine back in 2022 went mega viral because I defined something called Anemoya, which BuzzFeed decided to put on its homepage for about a week, which Anamoya is a phrase which describes having nostalgia for a time you never lived in. And I wrote a very long think piece of, 3,005 words about why Gen Z was watching The Office or watching Friends when they didn't really live in a time where they grew up working in an office at a paper company or how they could identify with such a thing.
Sure.
Subsequently, Gen Z lit me up all over social media for about a month and a half. Every six months or so, it comes back.
Well, I wanna know what you... This is your interview, but I have a question for you. When you said they lit you up, what does this mean? I need to understand this.
For whatever it's worth, don't be an old man talking about the children on the Internet. That's... {laughter}
Okay. Stay in your lane. Okay.
Yes. Exactly. Stay in your lane. But, no, just generally you could be any age and engage with any piece of media. It doesn't mean that you're instantly nostalgic for it. I do think that there is the deeper portion of the piece, which nobody would have ever taken time to read, it was a tweet promoting the longer piece, which nobody is gonna get the full context of, is that there is a type of sort of Corecore-esque media vibe. There's a resurgence of Polaroid film. There's a resurgence of analog disposable film. There's a resurgence of vinyl and tapes. And there is a resurgence of physical analog media too that were predominantly popular forms of media that took place in a time they did not live. And I hear it from my own kids who are Gen Alpha, who are 13 and 14 years old now, who actually talk about, "I wish I could have lived in the time that you lived because it sounds like it was a simpler time. It sounds like it was an easier time to live." And now I curiously, I watch Back to the Future with my kids, and they opined for the poodle skirts too. So I'm sure every generation has this.
Right. That's the first thing I thought of. I was like, "Well, that's us with the fifties."
You know?
You know? My fortieth was The Great Gatsby theme. You know? Yeah.
Of course. Yeah. But it looks like you're sort of talking about this convergence in this study to some degree because I think you talk about nostalgia. And there's maybe this authenticity and nostalgic comfort where Gen Z is actually using... Brands are maybe finding home in a design language that Gen Z tends to resonate with. What are you finding in the study that speaks to that?
Yeah. So we ask questions like, "What brand categories have the strongest opportunity to bring back past campaigns or make products feel relevant today?" There was definitely, when we asked what era, the 2000s and Y2K came up the number one, but some of the things that they also talked about was Zara's window displays that have cassette tapes and wall phones and Sporty and Rich has their vintage inspired athleisure wear and they've become more and more popular. You're seeing more collabs with food and beverage whether it's an isolation or collaborating with apparel brands or video games, Pizza Hut with Pac Man and you brought up Balenciaga, the footwear with Nike, and you're seeing lifestyle flats like the Mary Jane's come back in like super cute ways. So whether it's like product development or window displays or categories they're gonna shop, activations, experiential events I think we saw there's a lot of opportunities across categories, apparel and F and B kind of being the top of the pack there, but also from a generation standpoint or generation is not the right word, but like years, right? 2000 and Y2K was one. We also ask things like, "What makes an in-person brand activation feel worth showing up for?" And the other thing is that they want something interactive. And I think that leans into them wanting to be co-creators, but it gives them something to actually do, not just scroll. They could just have that watch to scroll like in their hands all the time from the minute they wake up and go to sleep, but now they can do something interactive or it also taps into something that they have interest in or value or care about like creativity and wellness. So when you think about not just that there's a nostalgia aspect, it's what's the decade. That's the word I was searching for. What's the decade? How does it manifest, right? And what does it tap into? And what does that engagement look like?
I think it kind of ties to this larger theme that we're really seeing come to the forefront, especially in brick and mortar strategy. I'm reading press releases and earnings calls, and it seems like culture and community are like...
They're coming up in the earnings calls. I know. I know. And experiential.
The optimist in me is like, "Oh, this is great. People are finally talking about the things that are always front of mind for us." And like they're prioritizing the things that we have been saying for years. Like, "No, you have to get embedded into the culture." But then anytime things come more to the forefront, it's more of a probing question of like, "Okay, well are you really doing those things? Or is this just like a statement in a press release or just a line item that you just tick the box and you moved on?" So my question for you is because you have such experience helping brands through that process and finding those adjacencies and matchup points, how can they do this intentionally and achieve that cultural relevance and that community connection in a way that one, makes sense for the brand itself and their products, but two also authentically makes sense for the demographic in this case, Gen Z? Are there any key parameters or considerations that brands need to be walking through consistently?
Yeah. I mean, that's why the constantly curious is critical. You have to have a team and that's what, at MG2 Advisory, our mission is to be able to do that not only for our clients, but for our designers, right? You have to always understand like that's the geist. And you have to always understand how generations are evolving and you have to understand the different drivers that are shaping behaviors and interests because it's not a one size fits all answer that's gonna remain static. When you talked about earnings, it's like, "Okay, they're finally adopting it. It's coming into earnings calls, and investors understand that there's a halo effect. It's not just about what happened in this quarter. What's the lift that's going to happen? By the time they adopt it, then we have to be thinking about what's next probably, right? Because they're like at the end of the curve when it comes to that adoption. And yes, culture, community. I mean, there's so many buzzwords that show up over and over... Engagement. And so you have to really understand, and maybe that ties back into kind of that founder mentality too, is okay, what does that mean for us? Because very few things in isolation are unique, right? I mean, you go and you see, I loved Fanatics Fest. I had a great time there, right? But how the bodega shows up has got to be authentic to the brand. How the subway car has got to show up, it's got to be authentic to the brand. How the barbershop's showing up. It all pop ups in isolation you've seen before, right? So if it's gonna feel fresh and different and unique, it has to be authentic. You really have to do that homework and say, "Okay, well how is this manifesting for us? What does that mean for the way it looks and feels and the touch points, the way we're curating the products?" All of those aspects. And I think you have to have one, a very disciplined approach to studying back your north star. Does this match and track the way we talk as a brand, our unique aspects of our brand, our value proposition, our voice, our tone, and all of those things? And then secondly you gotta think about the audience too, right? You can't just steal what everybody else is doing and just think it's gonna land for the audience that you have that's coming to your brand for certain things. So I think those are the key aspects of it. And if you're constantly curious and you're constantly studying I think you can layer that together because it's not just taking those broader brushstrokes and kind of canvassing TikTok and seeing what's trending. You then have to take that back too to your brand say, "Okay, well, what does that mean for how it should manifest for us?"
I couldn't agree more. I mean, there's probably no two greater abused buzzwords than culture and community, especially in the last four or five years as so many brands have become... We went through a digitally native brand sort of boom and bust. And culture and community, I think, were both sort of digital in nature, digital first. And I think now we're at this sort of tail end of that. I'm curious if those things are in flux and being redefined now as we're in an AI age. I was recently just speaking, and it's my own, this is my own, working out of my own thesis right now, Melissa. But we're currently doing our own research. And I was speaking on a stage last week here in London. But there's this famous sociologist Robin Dunbar whose work was made popular by Malcolm Gladwell in his book Outliers about the maximum number of human relationships that any one person can sustain, which has been theorized as being a 150. And sociologically, anthropologically, human relationships should be capped at some level because we just can't sustain more than that. And I don't know. Ipsa facto, that's why everyone's stressed out because of social media. There you go. Because we shouldn't be exposed to as many people as we are. But it's not just human relationships that we have to balance. It's also brand relationships that we now have to balance, and brands are also vying for part of the one fifty. Brands are also relationships that we also manage in our life. And now we have AI relationships that we also have to balance and manage that we turned to. And some people, like we saw in our VISIONS Summit recently, are forming very close and intimate relationships with AI agents. And so I think that that also is its own sort of interesting twist on how... And brands are starting to use AI. So maybe that's an interesting food for thought for those out there in the brand ecosystem too about the way that this research will change even more in the future. But from a retail design perspective, you're helping shape physical environments. And I'm curious which technologies are serving consumer needs right now and which ones are sort of, like, looking more like novelty because there's a lot of technology online that's being used ad nauseam that's novelty. I've been doing that in ecommerce for twenty years now. I'm sure there's analogs in the physical retail space. What might those look like today?
Sure. So I'll go into technology, but I wanted to touch upon really quick what you've mentioned about relationships, because I read those too. And it's interesting. It's also, it evolves. I think the younger you are, the more relationships you have. So the way in which you can interact with that younger generation, because they have other different life, they don't have the same life burden as the older generation might have too, right? So younger, you have a wider net, but they're also more surface level relationships. And then as you get older, that net becomes tighter, but the relationships become deeper. And I think that's also indicative to how brands are in your life too. I was thinking about that this morning as I was ordering yet another thing from Sephora. That one's a deep relationship for me. You know, that is my beauty partner. I go to them multiple times a year. I've had that loyalty four years and I think about, well, what have they done effectively to be able to do that? And it really is their app more so than their stores for me, because it remembers my past history and can make recommendations. It tells me when things are back in stock. If something's not in stock, it'll suggest another product. And then there's others where like, I've been totally seduced by them when they launch and I become really loyal for like three or four purchases and then I'm onto the next brand. And I think there's always a balance of that. And so that's why too, I think brands have to understand too what the dynamic they most likely are gonna have with the consumer because they could layer that into their purview. When it comes to technology, it depends. Because you have to really step back and thinking like, "What am I furthering by integrating this technology into a store environment?" And there's different avenues for that. So one avenue that we study is the operational side of utility that it's fulfilling there is efficiency and convenience. And so, you have to think about the aspects that have the least amount of friction that are, innate to existing behaviors, and then when should it be in the palm of the store associates hand? And when is it something that the consumer is interacting with? Maybe sometimes it's both. And you have to really think about that lens because I think there's an opportunity for that in most things. But for example, we just opened Nordstrom Local Williamsburg last week, and that's a destination that furthers the value proposition of buy online, pickup in store. But if you think about it, technology there has to help further the convenience of that. There's other aspects of that store experience. But if I'm doing that, then ideally wanna know when my package is available versus like arbitrarily showing up for that, right? I wanna know if I made a return when that money is back in my account. So there are things about what are the right things you need to communicate? How do you make things more seamless? But it's also great if I can, have the store associate understand more about me or my past purchase history, or what are more customized or personalized recommendations for me. So there's that whole operational aspect of it. And I think a lot of the times brands and retailers have focused on the consumer, but I think the study really needs to be also when should it be in the palm of the store associate? And the consumer doesn't really see it, but they feel the benefits of it. And then when is it for the consumer? And then when it's for the consumer, you have to have to study current behavior. I always give this example because I just think it's easier to relate to, but that is why QR codes changed. There was a ton of friction because nobody was gonna with download an a scanner to scan a QR code. But as soon as the phone made it so that the camera could identify the link in the QR code, then that became less friction because that's a common behavior. You like something, you take a picture of it. That is what you would do. So it's furthering what you already do. And those things are critical for success. And then the other side, it's deeper immersion. So you have to think about their consumer might be a little bit more willing to take an extra step or two because they're going to get something cool and different and unique but it also has to be more unique than what they're going to get when they scroll online, Right? So what about it is going to feel more ethereal and more immersive? I just saw F1 this weekend because I wanted to see Brad Pitt because he's amazing. But what was in the movie, right, was that I felt like I was in the car. I felt like I was in the car, the camera that they used with Apple, the way they brought in the sound. I mean, all of it was so immersive. And we're talking about retail right now, but we can think about cinema too. It's like, what are you getting people? Why are they getting out of their house? Why are they getting out of their phone? Why do they feel like they have to engage with this physical experience? And that's what you have to think about in the way that you're programming it and that extra level of entertainment and immersion that you're bringing into the experience.
I love that.
Well, I'm going to go see the movie this evening. So no spoilers.
Yeah. Be ready to vibrate a little bit. It was good, though. It's fun.
I'm ready. I'm ready.
My husband has a Whoop and he checked the tracker after.
His heart rate?
His heart rate was up for a significant portion of the movie.
That's so funny.
Oh my gosh. What I find really interesting too, Melissa, about the role that technology can play is we were referring to co-creation, we were referring to community and culture. Then as you think about the role technology can play, it's kind of the center of the Venn diagram in a lot of ways, right? Because it can create those connecting points and possibly elevate those elements in physical stores. I mean, I've been covering this space for, oh my god, almost fifteen years now. And what has been most exciting for me is to see how brands are testing these different technology components. And largely, at least historically, pop ups have been the platform to test all of these different things, right? Because they want to see whether it resonates with the consumer, whether it actually holds weight. That initial innovation lab, so to speak, or test concept can then scale.
Yeah.
And I'm curious if we're seeing similar activity in the realm of pop ups or how you're seeing that space in general evolve, especially in context of Gen Z. I feel like there's a lot of excitement around these concepts because they are more hospitality forward. They are more rooted in collaborations. But what are the big headlines for you right now in terms of pop ups and how they're evolving as part of retailers and brands toolkits? Because I feel like they're only becoming more critical into like the brand marketing and store experience mix right now.
Yeah. It's definitely a format and a toolkit, right? I mean, I remember when I wrote my book, The Papa Paradigm, around the time we had first met, like this isn't here to stay. How long is it going to last? And it gonna I always said, "I think it's a format that's here to stay in your toolkit." Sometimes it doesn't make sense that you have a location twelve months a year for multiple years. And so it allows a brand to show up in a unique way. I think what makes it stand out or not is really thinking about what is the unique aspect of the way in which you're showing up? So either it's because it's a product drop or it's a new, a new collaboration, or it's just a new way to engage with the brand that you don't normally get. I think luxury brands this summer are doing such a good job at that in the way that they're partnering with hotels and leaning more into the hospitality aspect of it because it's intuitive, right? I think that aspect's always part of the retail experience for luxury, but it's giving an opportunity to people who might not otherwise be able to buy into the brand with their wallet yet. They might not be able to afford that $50,000 bag or whatever it is, but now they maybe can lay at their beach club for a night or something like that. And they feel the lifestyle of it. And they feel like they're getting to be a part of that. And they feel like they're living that for a minute. And that is an entry point into the brand in a different way. And so it's bringing that aspect to it. Even if it's a sample set, whatever it is, think about how this is your opportunity to engage in a way that's differentiated than you're getting to engage with them in your other formats. And I think when you find those ways to be true to that, that's what makes it special. And also that sense of urgency and also the virality of it, right? Because people are excited that they're getting to have that kind of experience with your brand they want to share it with others.
Do you think that the the pop ups are more generationally aligned? Is that something that resonates more with Gen Z?
I mean, I think they like that aspect of being able to discover things. I mean, they're discovering all day online if they're going on TikTok or Insta or whatever they're doing, right? So I think it furthers that sense of discovery, but it also gives them their top response. Well, what makes this an activation where it's showing up for is it actually gives me something to do, right? So it's still feeding into that social currency. I mean, I've talked about that for a while, but part of that social currency is being able to share what they discovered and insert themselves into that discovery. And so I think it feeds into that as well for the Gen Z generation.
It's also something that's been said quite a bit, but this is also, I think, a coastal and probably a city based phenomenon. Right? But you're starting to see this play out in second and third tier cities too.
Oh, in some ways, it's more special in second to third cities because they don't get that. Right? How often is that coming? So you still have to you have to do your research and it makes sense, but let me tell you something, brands would love to pop up in Nashville, for example. And that's not considered a primary city, but it's super successful to pop up there, right? But they also don't get that all the time or they don't get the breadth of it that we're getting. New York is very competitive and somewhat saturated in that aspect. So I think it'll serve a brand well to think about that next, that secondary grouping of cities. And I think the way they show up can be really special.
I think, honestly, we could be talking all day about this because there are so many layers to the research. But I want to know, just based on the findings, the trends that you've been able to uncover here, What are some of the early predictors or early rumblings of possibly new trends, new imperatives for success? Like what's really coming around the corner, like as we consider the future of physical retail? I mean, it's hard to make firm blanket statements, but are there any early indicators of things that we should be watching or taking note of for the future?
I mean, it's interesting because I think that still begs the question of like, what's the point of the store? And there's a varying answer to that. I think the playbook, the format of the playbook of formats is definitely a key conversation that brands need to have. Even if you're a brand that's only gonna open 10 flagship stores, you're gonna need different formats in your toolkit because you're probably gonna supplement that with pop ups, right? And I think the more and more consumers are comfortable with shopping online, and I don't see that going away anytime soon, the more so it's giving freedoms to what those physical environments should be and how we see them as a touch point amongst numerous touch points that consumers are going to have with your brand. And so if co-creation is a key desire, how is the store fulfilling that? How is it becoming a stage for that? How is it cultivating that? You know, I think also the modularity in design and agility in design is gonna be interesting. I think we talk about it right now through modular fixtures, but as AI continues to advance and the ability to study data and to understand how to be more responsive, I'm curious to see how that's going to be more integrated into the store environment as a more responsive environment. I think we have a ways to go, but a lot of it coming together with RFID that we've talked about forever, that's more integrated, right? And the consumer who understands it better, is then engaging with it themselves. Over time, this collection of data and insights is going to be something that allows brands and retailers to be more actionable, more real time in the in store environments. I also, we talked about the store associate and operational technology in the palm of their hands, but what is OpenAI and ChatGPT gonna mean for the store associate and their ability to real time be able to understand the recommendations they should make to the person standing right in front of them. So it's things like that, that I think are gonna be able to continue to further what the store experience becomes.
Well, thank you so much, Melissa. I think that's a great place to leave it. And thank you so much for coming on Future Commerce.
Yeah. Thank you for having me. I enjoyed the conversation.
Yeah. Melissa Gonzalez, from MG2 Advisory. And, Melissa, I know that you host your own podcast. I wanna point people over to it, Retail Refined. I assume it's on Spotify, Apple Podcasts, and all the rest. I'm subscribed. I think everybody else should be as well. And if you can go pick up copies of Pop Up Paradigm. Is that available still?
It's still available. Yeah. You could go to Amazon or Barnes and Nobles. {laughter}
Alright. We're gonna we'll link it up here in the show notes as well. Thank you so much for joining us and thank you for listening here at the Future Commerce.
