Big retailers are opening smaller-format stores in major U.S. cities, and IKEA is no exception: It is intending to bring a “Planning Studio” to Manhattan this coming spring. And it will have a considerably smaller footprint than other IKEA locations — while IKEA’s mainline stores can cover 300,000 square feet, its upcoming Big Apple digs are said to be only 17,530 square feet.
The store, which will be located in the Upper East Side, will be the first of its kind for IKEA in the United States. It will be geared toward smart products that are designed for smaller spaces and urban living. There will also be an omnichannel twist: Shoppers will be able to have IKEA purchases sent to their home, “which is what urban residents want and need,” the company said in an announcement. (Shoppers reportedly won’t be able to buy an item on the spot to bring home, however.)
IKEA’s move comes as it has sought to bolster its eCommerce offerings with “new lower priced shipping and delivery” as well as assembly services from TaskRabbit, a company that IKEA acquired last year. The company, however, is looking to bring stores to the “heart of urban areas” with 30 touchpoints in three years as it seeks to be closer to its shoppers. Already, the retailer has opened a Planning Studio across the pond in London in October.
In the announcement, IKEA Retail U.S. Country Manager Lars Petersson said, “We recognize that we are in a rapidly changing retail environment, and to be fit for long-term growth, IKEA is transforming in a way that lets us meet our customers where they are.” He noted that New York was a “natural choice” as it is “the most vibrant, dynamic city in the US.” Yet the move comes as IKEA has curtailed its planned new stores, having canceled planned locations in North Carolina, Arizona and Tennessee amid a shift to eCommerce.
Younger shoppers, however, are still seeking out places like IKEA even in the age of online shopping: A Home Furnishing News survey found that brick-and-mortar stores provided 63 percent of indoor furniture purchased by millennials. CityLab, too, reported that the company’s market research found those who live in the Big Apple continue to like to shop in stores for furniture. (They just don’t want to schlep their sofas and bed frames home.) And those items could be delivered to homes in the future, as future city locations in Los Angeles, San Francisco, Washington and Chicago are reportedly in store.
In Other Brick-And-Mortar News
Pizza Hut plans to acquire online ordering software provider QuikOrder. Terms of the deal were not made public, but Pizza Hut said in a press release that the company is one of its biggest acquisitions. The quick-service restaurant (QSR) said QuikOrder’s online ordering capabilities would enhance its ability to offer a personalized ordering experience and accelerate digital innovation at its over 6,000 U.S. restaurants.
QuikOrder is no stranger to Pizza Hut: The company has worked with Pizza Hut U.S. for close to 20 years. And the quick-service pizza chain said that roughly half of its U.S. sales were processed via the QuikOrder platform so far this year. The acquisition is said to encompasses Pizza Hut’s current digital ordering platforms, systems and services in addition to QuikOrder’s in-restaurant technology and ancillary services, as well as its future-generation products and programming.
And Amazon is reportedly experimenting with the concept of using its cashierless checkout technology in a larger store format with a space in Seattle that is said to be set up to be like a big store. Amazon declined to comment per The Wall Street Journal. As it stands, Amazon Go stores in Seattle, Chicago and San Francisco use the cashierless technology.
Each current Amazon Go store has less than 2,500 square feet and offers groceries and drinks, among other products. And, while the technology has worked well in a smaller store format, the paper reported it’s harder to use the set-up in bigger spaces that have higher ceilings and more products. Those challenges aside, the paper said it’s not clear if the idea is to use the technology in Whole Foods.
In other news, two Safeway stores in Arizona now have artificial intelligence-powered medical clinics via an Akos Med Clinic partnership. The offering uses AR technology to guide consumers on how to collect their own data such as weight and blood oxygen content. Going forward, there are reportedly plans to bring the clinic to 50 more Safeway locations in Arizona by mid-2019, as well as stores in other states. Akos CEO and Co-Founder Kishlay Anand, MD said in a press release, “this partnership will expand our telehealth offering beyond the capabilities of our telemedicine app by placing these clinics where consumers regularly shop.”