OCTOBER 8, 2015 At Old Spitalfields Market, in the heart of London s tech and financial center, a modern lifestyle concept store for men The Dandy Lab recently opened its doors. We visited the store, which fuses fashion, lifestyle and technology, and were given a private tour by one of its co- founders, Julija Bainiaksina, who demonstrated to us a shopping experience that combines retail with technology. WHAT IS THE DANDY LAB? The Dandy Lab opened in mid- August as a pilot store in East London that specifically targets men who are 28 45 years old, many of whom work in the financial and technology industries. Selling exclusive and contemporary British brands, The Dandy Lab features products that range from clothing and leather accessories to grooming and lifestyle items. Most of the products are made in the UK, and some, such as Alfie Douglas s leather goods, are made in London. Co- founders Bainiaksina and Peter Jeun Ho Tsang both come from creative backgrounds, and after helming a successful contemporary menswear pop- up shop in London s Covent Garden, they teamed up with retail and technology experts to create The Dandy Lab. University College London is one of the supporters of the concept store, and two of The Dandy Lab s advisors are affiliated with the university: Dr Nadia Olivero, who has expertise in consumer experience, and Dr. Alastair Moore, who is Deputy Director at the Centre for Entrepreneurship. 1
Currently, The Dandy Lab sells approximately 700 products in- store and 200 300 products online. The ratio of in- store to online sales is approximately 80/20. The Dandy Lab is a physical store directly selling to consumers, but it also operates as a test lab for partners such as Cisco and Snap Fashion to trial products and services in- store. There are four core elements that The Dandy Lab emphasizes in the store experience: Discover Learn Shop Share DISCOVER At The Dandy Lab, customers are encouraged to spend time discovering new brands. Visitors to the store may initially be surprised by the unusual, futuristic layout with touch screens on the walls. Soon, however, it becomes clear to shoppers that they can touch and buy the products, albeit in a store with functions they might not have seen elsewhere. Many of the products come with a near- field communication (NFC) tag, which gives brands a chance to tell the brand story through the learn function of the shopping experience. And Britishness is a key focus in product labels and product designs, many of which emphasize the traditional and classic features of British fashion. LEARN Through technology, The Dandy Lab s customers can learn about the products and brands. Interactive touch screens on the walls of the store allow customers to scan products with NFC tags and see further product information. Customers can find out where the product was made, browse through different color options (in case a particular color is sold out in- store) and learn the story behind the brand. 2
Customers can also search for matching clothing or for accessories for a piece of clothing by using color- recognizing technology. With the help of Snap Fashion software for clothing and footwear pairing, shoppers can browse through a selection of products with similar or matching colors by holding a piece of clothing in front of a camera. With a Snap Fashion app, users can snap any image and choose brands and retailers that match the product they have chosen. Thanks to the smart mannequins in the window display, customers can get information on products even when the shop is closed. The Dandy Lab mannequins come with beacon technology provided by Iconeme that allows customers to receive product information on their smartphones. Customers are required to download the Iconome app in order to receive information on prices, find offers and order products via their mobile device. SHOP Having discovered and learned about the products and brands at The Dandy Lab, customers can, of course, then choose to purchase a product. The Dandy Lab s pilot store targets men and, as we learned, its customers do indeed value being able to discover new brands and products by learning about the uniqueness of the brands. So far, the concept looks promising, as many products have sold out and new product lines are being added. From the growing selection of British brands, classic leather products wallets especially have been particularly popular. The Dandy Lab offers lifestyle products such as wall prints and candles, along with some more quirky goods, such as terrariums self- contained, miniature ecosystems housing plants that do not require regular upkeep. 3
SHARE At the social café downstairs, The Dandy Lab experience continues. The space mainly functions as a social area for customers, but there are products on display and interactive screens to play with there, too. There are also wireless charging stations in the café, so customers can charge their phones in the café. In addition, The Dandy Lab hosts events at the social café, such as workshops on how to make your own terrarium and talks on relevant topics such as the Evolution of Elegance in British Menswear. PARTNERS In order to create a unique fusion of fashion, lifestyle and technology, The Dandy Lab has teamed up with industry experts, some of which are trialing products and services in the retail space. Below is a short list of the partners and sponsors. Aircharge offers a variety of wireless charging solutions for office, home and public spaces. At the social café, customers can charge their phones using Aircharge s wireless charging stations. Cisco provides expertise in networking that transforms how people connect, communicate and collaborate. Partnership with The Dandy Lab is part of Cisco s research on the Internet of Things. Fagerhult provides the lighting solutions used in The Dandy Lab. The company is one of the largest lighting manufacturers in Europe, offering cutting- edge lighting solutions. Hoxton Analytics is a startup with a system that can accurately determine a person s demographic category based on the clothes they wear specifically, their footwear. By the entrance of The Dandy Lab, a Hoxton Analytics footfall analytics tool collects data on customers footwear. Iconeme is a specialist in visual merchandising. The company s VMBeacon enables customers to receive details via their smartphone about the clothes displayed on shop mannequins, and allows retailers to engage directly with consumers. The Dandy Lab mannequins are equipped with Iconeme beacon technology. Snap Fashion lets customers search and shop for an item of clothing or a pair of shoes from a photo. On The Dandy Lab s interactive walls, the Snap Fashion tool can assist customers in matching clothing. University College London, one of the world s leading universities, is a sponsor of The Dandy Lab and provides advice in the fields of customer experience and entrepreneurship. CAN THIS FORMAT MAKE IT INTO THE MASS MARKET? We were impressed by the innovative retail shopping experience offered by The Dandy Lab. Do we see similar functions of fashion, lifestyle and technology being applied by mainstream retailers? Many of these characteristics do exist in other shops, but not to the same extent. Small and medium- sized retailers might question the cost effectiveness of such additions to the retail experience, and applying and keeping these systems up to date could be too costly even for many larger players. However, we do believe that a technology- enhanced retail experience is becoming more common, and that consumers are generally willing to pay premium prices for products they have learned more about through in- store technology. For lower- to mid- market retailers, investing in deeper brand storytelling in- store might not be imminent. But for retailers in the high- end market, and particularly for high- end brands that are now charging into omni- channel retailing, these kinds of store features could well enhance the luxury experience. 4
Deborah Weinswig, CPA Executive Director Head of Global Retail & Technology Fung Business Intelligence Centre New York: 917.655.6790 Hong Kong: +852 6119 1779 deborahweinswig@fung1937.com Filippo Battaini filippobattaini@fung1937.com Marie Driscoll, CFA mariedriscoll@fung1937.com John Harmon, CFA johnharmon@fung1937.com Aragorn Ho aragornho@fung1937.com John Mercer johnmercer@fung1937.com Shoshana Pollack Shoshanapollack@fung1937.com Kiril Popov kirilpopov@fung1937.com Jing Wang jingwang@fung1937.com Steven Winnick stevenwinnick@fung1937.com HONG KONG: 10th Floor, LiFung Tower 888 Cheung Sha Wan Road, Kowloon Hong Kong Tel: 852 2300 2470 NEW YORK: 1359 Broadway, 9 th Floor New York, NY 10018 Tel: 646 839 7017 LONDON: 242-246 Marylebone Road London, NW1 6JQ United Kingdom Tel: 44 (0)20 7616 8988 FBICGROUP.COM 5