This is a question that has been on many minds over the last few years as e-commerce – and now COVID-19 – brought thousands of retail stores to their knees. And it is not just your local stores that have been affected. Macy’s has announced the looming closure of 100 of its 650 stores while JCPenney plans to close shop in 138 locations. Now, factor in the small and medium-sized stores that have gone down in the past year and it would be hard to not be apprehensive about the future.
What Does This Mean for the Lighting Industry?
Lighting manufacturers, many of whom depend on retail stores to move their products, are obviously concerned about the industry’s decline. But as Phil O’Donnell, Cooledge HQ’s senior VP of global sales says, only creativity can guarantee survival. “The (lighting manufacturers) that will succeed are going to de-emphasize the products that go into slowing markets and will find new opportunities for things they can do,” he says.
It is, however, not all doom and gloom. The demand for lighting in certain sectors of retail such as high-end malls and grocery stores remains higher than ever. These sectors are surprisingly still thriving despite the far-reaching social changes.
“There will be less retail space, but chain stores and shopping mall tenants are, for the most part, not the type of clients who are installing high-end lighting systems. And while there’s this battle between e-commerce and brick-and-mortar, there are always people who want that physical shopping experience,” O’Donnell says.
Innovation is Key
To remain competitive in a fast-evolving marketplace, manufacturers and designers will need to get creative in their product presentations and leverage the reach of social media platforms like Facebook. To paraphrase Caprice Johnson, Coordinator of Marketing at Focus, the next era of lighting will be about creating “moments that people want to share online for social currency.” The smart brands will of course, subtly integrate some brand and product placement into the design of the said moments.
Pop-up stores are also worth the considerations of lighting manufacturers looking to drive up their sales. The temporary nature of the stores means the lighting does not have to be anything fancy – generic and adjustable will do quite well. The challenge, however, will be to determine what sort of light to put since, unlike fixed stores, pop-up stores don’t follow any display rules.
Opportunities in Smart Lighting
The earliest manufacturers to get into IoT will also gain a massive edge. There’s an increasing number of retailers using smart, connected lighting to reduce energy costs and appeal to the tech-savvy base. A notable example is the smart energy management system being piloted by Simon Property Group at its Westchester Mall in New York. The system was developed by GE Current and is touted to be a game-changer in retail, as it allows retailers to monitor energy usage in real-time.
On the tribulations of the retail industry, Ashmi Pancholi, Current’s product marketing manager, opines that good customer service will be important to the long-term survival of many retail brands. To create the type of experience that will effectively drive customer loyalty, retailers will need to capitalize on the wealth of available data and intelligence.
Smart lighting presents endless possibilities to the retail industry. For one, the ability to directly monitor every spot in a store will help manufacturers map out the hot spots and subsequently create more personalized shopping experiences.
Indeed, there are already a number of smart lighting solutions in the market, one of them being the Indoor Positioning System from Acuity Brands. The system is built on two existing technologies, Bluetooth and VLC (Visible Light Communication), and allows customers to easily search and locate items in a store. The app can also help you simplify your overall shopping experience by showing you the fastest route around the store once you input your shopping list.
And that’s not all….
Vinod Kashyap, Acuity’s director of IoT, reveals that the app can also inform store employees when you need their help and when you don’t. This will particularly catch the ears of high-end retailers, especially the jewelry stores, many of whom can’t seem to find the right moment to engage with their customers.
The Indoor Positioning System also provides retailers with plenty of actionable data and analytics that can inform their short and long-term planning. For instance, it can show retailers all the hot spots within their stores, (both the high and under-performing sections of the store) allowing them to create a more holistic shopping experience for their customers.
It further allows advanced item tracking, where high-value items particularly, can be “tagged” with Bluetooth and thus give new employees much clearer ideas of where to place things. The increased efficiency will inevitably translate into actual cash savings (for the retailer) in the long term.
While manufacturers are much better placed to reap the rewards of retail’s shift to connected lighting, designers too have a role to play, according to Paul Mercier from Lighting Design Innovations. In essence, designers should familiarize themselves with the latest developments in the spheres of smart lighting management and sensor technology so they remain in good positions to convey informed advice to their clients. “We have to tell clients that when they’re installing fixtures with sensor technology that they can actually expand its use,” were Mercier’s words when LIGHTFAIR”s “Thought Leader” series caught up with him.
Generally, IoT will shake up the lighting industry (as it will the bigger world), which has for the longest time survived on clearly defined job descriptions. For instance, lighting designers who have always been viewed as the creative brains of the industry will have to considerably shore up their technical knowledge if they wish to remain competitive. This means that in addition to engaging with the clients on the designs, they must be able and ready to guide the clients on how the data aggregation and IoT integration aspects will play out on the projects.