Lab stores: a must-have retail playground

As consumers’ appetite for new physical and digital experiences continues to grow, innovation is the key to survival for retailers. One of the most effective ways to explore innovation and stay ahead of market trends is through a lab store—the new must-have for retailer experience portfolios. As stated in JLL’s latest Future Vision research, shoppers still want a human touch in their retail journey, and lab stores promise a unique experience in a physical setting.

One of nine formats in JLL Design Solutions’ experience portfolio framework, a lab store is an experimental space in which a retailer can test new products, services and technologies in a controlled environment. Some are internal spaces where employees can develop and test new ideas, and possibly invite customers in for beta testing before launch. Others are external “stores of the future,” inviting consumers to shop as video cameras, sensors and other research tools track their behavior in the new environment. Still others have both internal and public purposes.

For a lab store to succeed, it should be viewed as an investment, not as simply a place to experiment with random ideas. The ideal approach is to follow a clear test-and-learn roadmap, with goals based on a singular focus and progress measured against specific key performance indicators (KPIs) aligned with the strategic purpose. In contrast, a lab store that is disconnected from the consumer journey and fails to provide a great experience that creates return visits will become an expensive indulgence, rather than a potentially lucrative investment.

It’s clear that retail innovation in the physical setting is a sound strategy. In JLL’s 2024 Experience Matters survey, 67% of shoppers in 10 countries said they prefer shopping in person to shopping online. A lab store gives consumers an added layer of personalization and interactivity that they won’t find in your traditional brick-and-mortar store.

Starbucks Hacienda Alsacia

In 2023, Starbucks announced plans to develop a new sustainability learning and innovation lab at Hacienda Alsacia—the company’s global headquarters for agronomy research and development, located in Costa Rica. The lab will serve as a hub for hands-on and virtual learning opportunities for Starbucks employees, students, researchers and industry leaders, and a place to innovate and scale sustainable solutions.

Focused on the sustainability of coffee, Hacienda Alsacia has been Starbucks’ only company-owned and operated coffee farm for more than a decade. This new lab is expanding its capabilities to cultivate positive social and environmental change beyond coffee, advancing Starbucks’ environmental promise to give more than it takes. The sustainability and innovation lab is expected to physically open within the next three years.

Nike Innovation Kitchen

Nike’s Innovation Kitchen is where innovations like the original waffle sole and self-lacing sneakers originated through a process of unconventional problem-solving and iteration. The Innovation Kitchen was designed with a singular focus: to listen to athletes and build them the resources and inspiration needed to reach their full potential.

It’s also a safe space where employees can push the envelope without fear of judgment or failure. With its open format designers, engineers and developers can see each other’s desks, providing more serendipitous opportunities to spark ideas and share thoughts on each other’s work.

Lab stores for four Gap brands

After several years of reducing its brick-and-mortar footprint, Gap Inc. needed a strategy for testing new store technologies, consumer experiences, and product innovations to drive growth. In 2022, Gap unveiled four lab spaces for its Old Navy, Gap, Banana Republic and Athleta brands at its San Francisco headquarters, as well as a “maker studio.” Situated on the ground floor in a tower of 15 floors of flexible, creative office space for Gap associates, the co-lab maker studio gives consumers a peek at creative teams at play. Gap Inc. built the space after benchmarking other lab spaces and identifying which tools were needed for rapid prototyping, innovation and white-space thinking. The space is now used for testing new store technologies, consumer experiences and product innovations.

Amazon Operations Innovation Lab

Situated an hour’s drive from the Italian Alps, Amazon’s Operations Innovation Lab is an internal hub for technological experimentation focused on improving employee working conditions, enhancing the consumer experience, and making Amazon processes more sustainable. Established in 2019 as part of an Amazon fulfillment center, the lab is a testing ground for new sustainable packaging and a training center for Amazon robotics operators. In 2023, the facility added a visitor center, with public tours scheduled to start later this year to allow consumers to take a closer look at the advanced technologies being developed and tested.

7-Eleven Evolution Store

7-Eleven debuted its original “Evolution Store” concept in 2019 and has since opened Evolution Stores across the United States. These lab stores are larger than the typical 7-Eleven and serve as an experiential testing ground where consumers can try the latest products and innovations.

While all stores feature a restaurant and updated checkout design, no two locations are exactly alike, as the retailer continues to tweak the experience and product assortment according to consumer feedback and behavior. The Evolution Stores are testing such ideas as expanded beverage offerings, like customizable self-serve espresso and cold brew coffee, sparkling water and even wine, as well as mobile checkout and on-demand delivery.

Walmart Intelligent Retail Lab

Perhaps the most overtly laboratory-like example of a lab store is Walmart’s Intelligent Retail Lab (IRL), built in Levittown, New York, in 2019. The 50,000-square-foot grocery store has thousands of artificial intelligence-enabled cameras and sensors, coupled with a massive on-site data center, signaling Walmart’s belief in the potential for AI in the physical store environment.

The IRL team is using real-time data to explore potential ways to manage product inventory more efficiently to benefit associates and consumers nationwide. For instance, the team created a mobile app that automatically sends automatic out-of-stock notifications that alert associates to restock items. Consumers, likewise, can interact with interactive and responsive displays throughout the IRL store. The technology improves associates’ jobs by removing mundane tasks and making their core responsibilities more interesting.

With unprecedented and ongoing change in retail technologies and consumer preferences, continuous test-and-learn solutions are the only way for a retailer to truly remain competitive. To be successful, however, a retailer needs a singular focus on innovation that will add value to the experience of employees, consumers or both; clearly defined metrics to track the lab’s success and support data-driven decisions; and a roadmap that guides an ongoing cycle of testing and learning. The secret to successful innovation? A strategy.