This story originally appeared in the Winter 2021 issue of strategy.

Retail: Urban concepts make a comeback

As the retail sector recovers from the pandemic, it is staring down a financial dilemma not seen in almost a decade: large retail footprints are becoming too costly. That challenge, as well as a necessary shift to e-commerce during the pandemic and a desire to break into affluent – and generally younger – urban markets, has some retailers returning to the idea of smaller store formats.

IKEA has been in the vanguard, experimenting in high-density urban markets with both its urban concept store and Design Studios (image above). Arc’Teryx, meanwhile, launched a micro-store in Manhattan that features its popular designs. And Ren’s Pets launched its first urban concept store in Toronto’s Liberty Village in September.

The new designs harness lessons learned during the last economic recovery – smaller stores are “less overwhelming and more enjoyable” for customers, and “too much choice creates stress for consumers,” says David Ian Gray, founder of DIG360 Consulting, adding that “great retail is about great curation.”

Still, Gray cautions retailers that smaller-footprint stores can have their shortcomings.

“The experiential advantage stores have over a much duller web offering only holds up if there are available and engaged staff, and enticing displays,” he says. Further, “too limited a selection continues to frustrate shoppers who do not understand how a seller of goods can’t have them in stock.

Brand: Strange bedfellows?

As economic pressures and competition have both surged during the pandemic, brands have had to find creative ways to stay top-of-mind with consumers. Many of them have opted to collaborate with each other to make an impact.

An odd crossover brought Wendy’s spicy chicken flavour to Pringles tubes, while Van Leeuwen ice cream crafted a cool combination with Kraft Dinner. Even Nintendo got in on the trend, coupling with luxury watchmaker Tag Heuer for some limited-edition Mario merch.

“One-plus-one can really be three by merging the equities of two brands to create an even better value proposition or customer experience for both,” says Matthew Kelly, managing partner at Level5 Strategy.

A partnership can also “provide access to something new and of value for each brand,” says Andrea Isbester, CSO at Publicis Canada, pointing specifically to the Wendy’s and Pringles partnership, which brought the QSR brand into grocery and other new channels, while Pringles benefitted through “innovation [that] appeals to a younger demographic.”

“It’s the very efficient sharing of brand equity that often makes for a great brand partnership,” Kelly adds.

Agency: The rise of freelance collectives

The marketing world has felt the impacts of COVID-19, particularly with respect to staffing.

A perfect storm of revenue crunches and declining work during the pandemic led some agencies to reduce their overheads – and, ultimately, their headcounts. That, coupled with the widespread embrace of remote working technology, has led more people to consider going into business for themselves. As a result, collectives made up of experienced and senior-level freelancers, such as Toronto’s Yes& and Hustle, have emerged.

“There is a need on both sides of the employment divide for the freelance model,” says Trent Fulton, founder and chief collaboration officer at Yes&. “Freelance, contract-based or fractional work solves a lot of pain points for both parties.”

“On one side, [some] agencies are struggling to manage overheads and pay for senior staff if not utilized and clients want access to senior strategic and creative thinking that is not necessarily tied up with execution [costs],” he explains. “On the other side, senior staff are looking to both control their work-life balance and get paid more directly for the experience and value they bring.”