Just like everyone else, airports are being squeezed in this economy, and to make up for shrinking airline rent and landing fees, they are investing in retail. Roger Yu at USA Today details the new approach that airports are taking to encourage spending from passing travelers.

“Their goal is not only to reflect a unique local feel, but to distinguish themselves amid intense competition for air service and a need for more revenue. And, some say, it’s paying off.”

Yu describes an interest in positioning the airport as a postcard for its host city that includes adding local restaurants and retail shops throughout.

“There is more of an approach to make (airports) a visitor center,” says Bill Hooper of Gensler, an airport architecture firm. “If you can make terminals feel more comfortable and interesting, people do (account for that) in making decisions on what airport they want to fly to.”

Spot on.  MSNBC recently ran a list of top airports for shopping.  Their list reviews airports all over the world and goes well beyond newsstands.  Amsterdam airport houses an H&M outlet.  Dubai airport’s duty free shop has your standard fare, cologne and cognac, plus 30 superstores in their award-winning contemporary retail space.  Heathrow has a Gordon Ramsey restaurant and a spa in addition to expansive retail offerings.

It seems the airport is a ripe retail frontier.

“This is not going to be a novelty. It’s going to be a sea change in how retailers transact and interact with customers.”

That’s a pretty big prediction from Ken Nisch of JGA speaking on the impact of the iPad in the retail environment.  We’ve long been talking about how to integrate digital into the shopping experience.  Next was how to integrate social media.  It appears that the iPad has provided a way to do both that’s easy, cool and cost effective.

In an article for the Calgary Herald, Sandra Jones profiles many ways that retailers are integrating the iPad into the shopping experience.  Everything from using it to source inventory from the sales floor to executing transactions.  And we’re not talking the cool, hipster kids who are trying this.  Burberry and Things Remembered were among the retailers she listed who are prototyping in-store applications for iPads.

Click here to read the Calgary Herald article.

Back at Christmas a local Atlanta developer decided to create a pop-up shopping district in some available retail space.  It was a genius idea.  Anyway, one of the stores was a pop-up coffee shop.  I stopped in and ordered a cup at the makeshift counter and after the guy made my coffee in some sort of press, he swiped my card on his iPad.  I was a little leery at first that he might be storing my information for his own thievery (I checked my account later), but it’s actually a brilliant tool for mobile merchants and the other awesome retail trend, pop-up stores.

Just two weeks ago I found myself in an insane travel quagmire at JFK airport in New York.  As I schlepped my carry-on, and stuff, through the airport, I was shocked when I walked into the Delta terminal.  It was like a waiting wonderland.  There were all different styles of waiting space, bar tops, booths, and of course the traditional airport seating.  But coolest of all, there were iPad stations where you could play games, watch the news, order food and all manner of other things some of which cost a small fee.  But I thought, what a creative use of the iPad and I’ll always fly Delta.

So while, I’m conservative and would have to be very sure in order to call something a “sea change,” Nisch may not be far off.  The iPad may be changing retail and business to consumer relationships forever…forever, ever?

Most retailers believe that more is better because customers want choice.  However the work of researchers Sheena Iyengar and Kanika Agrawal suggest the exact opposite.  In an article for Strategy + Business magazine entitled, “A Better Choosing Experience” Iyengar and Agrawal detail their observation of consumers who are consistently overwhelmed by too much choice.  According to them, “there are neurological limits on humans’ ability to process information, and the task of having to choose is often experienced as suffering, not pleasure.”

“Choice overload,” as they call it, occurs when shoppers become frustrated with trying to compare and contrast a variety of products, particularly more than seven.  As a result, shoppers will either choose the thing with which they are most familiar or choose nothing at all.  In an analysis of 401(k) plan participation for one company, researchers found that when presented with only two fund choices, 75 percent of eligible employees participated.  The rate of participation dropped to 61 percent when plan offerings were increased to 59 choices.

Iyengar and Agrawal suggest four solutions to the problem of choice overload:

• Cut the number of options.
• Offer expert or personalized recommendations.
• Categorize product offerings
• Condition consumers by gradually introducing complex choices.

The article gives excellent examples of how retailers and manufacturers have employed one or all of these tools to help customers overcome choice overload and ultimately increase sales.  A worthy read with surprising insight into the shopper mind.

In New York, an old cathedral, which has had many reincarnations including a nightclub and a drug rehab center, has been turned into a shopping center.  Limelight Marketplace aims to capture the interest of the cathedral’s history and architecture to make it a destination shopping experience.  According to the New York Times, the effect is questionable but the idea is no doubt a reach for retail innovation.

In another part of New York, Grand Opening, treats retail like art.  The concept is that there is no concept.  Periodically, the long narrow box of a store is completely changed and merchants are rotated like gallery artists.

In Texas, Kuhl-Lipscomb, has made their 70,000 square foot store into a tourist attraction by offering a unique and eclectic mix of wares that are periodically re-merchandised to create a seemingly new environment.

 SlowRetail has compiled a pretty distracting (in that I spent over an hour following they’re links) list of innovative retail concepts from all over the world.  Maybe the next big trend in design is no trend at all.  After the mall and after big-box, maybe people want to be inspired when they shop and have a little experience to show for it.

Although the next generation doesn’t place a high premium on privacy, they also don’t appreciate feeling violated by marketer invasions.  Global Retail Executive posted an interesting perspective by one of their millennial employees.  On the issue of privacy, he noted that millennials do have some boundaries that must be respected.

“Don’t bombard us with emails. Don’t call us (Domino’s Pizza started calling me with offers a few years ago after I ordered a pizza from them – Guess what? That was the last pizza I bought from Domino’s). And, for God’s sake, DO NOT text us advertisements if we didn’t ask for it. It comes across as invasive and needy, and we will avoid you out of spite.”

This is an important distinction that marketers have to grapple with as they begin to consider and employ technology. Anything that has a ‘big-brother’ feel to it is likely to be rejected.  And if something like that is integrated into the entire store experience, that means shoppers could reject visiting your store altogether. 

For instance, consider walking into a store and based on a remote scan of your face and body, which can detect things like age, weight, race, etc, media in the store start to push ads targeted at you as you walk by. Or what about neuroscience?  Last year we posted about marketers developing technology that can perceive your brain activity and market to you based on that. 

All of these things sound super cool.  But as technology evolves, we’re finding that there’s a thin line between cool and creepy (think robot dogs). Understanding the intended shopper and their nuanced use of technology is critical to its successful activation in the retail environment.