Head up to the second floor of Puma’s first-ever North American flagship store and one of the sights sure to catch your eye is a pair of sleek cockpits mounted on hydraulics. In front of them looms a large screen underlined by multiple smaller screens. Just behind on a stand are an iPad and a panel beckoning, “Scan your race ticket here.”
The machines are F1 racing simulators—the same as professional F1 teams use, a spokesperson informs me during a press preview of Puma’s store. They rumble and roar (quite loudly) as your car accelerates and hurtles through turns, and the experience is intense enough that someone prone to motion sickness might opt to skip it. When the store officially opens today, shoppers will be able to slide in, buckle up, and race at high speeds around a course in New York City that ends at the store’s address of 5th Avenue and 49th Street. Before they enter, visitors may only be vaguely aware, if at all, that Puma is involved in motorsport. But they’re likely to know it by the time they leave.
Sneaker and clothing labels opening new flagships in New York are practically in an arms race to see which one can give shoppers the most immersive experience of their brand. Puma’s new store offers stiff competition. In the soccer section is a room with video simulations that put you through drills coached by Puma soccer stars. To highlight its big push back into basketball, Puma set up a space where shoppers can hang out on mini bleachers and play the latest NBA 2K video game. One section is dedicated to Puma’s collaborations with other brands, including an area where brands or artists can offer customized products and hold demonstrations, starting with New York label Chinatown Market, which will be in-store through Sept. 7.
It’s not clear how much these diversions will help sell clothes and sneakers, though of course, there are lots of those available too, from Puma classics such as the Clyde to new hits including the popular RS-X line. “There’s a business component to this store, right? So that’s first and foremost,” says Bob Philion, CEO of Puma North America. “But I think bigger than that is the visibility that 5th Avenue in New York City brings to us—not just for the New York-based customer but certainly the international contingent—and the impact that a store like this can have.”
That impact can go well beyond sales that happen directly through the store. To start, there’s the so-called “halo effect” physical stores have in driving online traffic and sales for a brand.
Doug Stephens, a retail expert and futurist, also argues that physical retail stores are a media channel in themselves, like advertising on Instagram or television, only more powerful. “I’d go so far as to argue that they’re now the most manageable, tangible and measurable media channel available to a brand,” he recently wrote in Business of Fashion (paywall). The impression they give can be negative, as in the case of a dismal department store lingering in a dying mall. But if they offer the right experience in the right location, they can be one of the key ways a brand promotes itself. To some degree that’s always been the case, but as online shopping has become more prevalent, it’s only become more vital for stores to have a function beyond being a place to carry out transactions.
It helps to explain why Germany-based Puma chose to open its first North American flagship on the second most expensive retail corridor in the world at a moment when stores around the US continue shuttering in large numbers. “It feels to me like it’s new retail, and by new retail, there’s some components of this store that we feel like have never been done and separate itself from the pack,” Philion says, pointing to the different experiences he hopes New Yorkers and the record numbers of tourists being drawn to the city will connect with.
Puma hadn’t previously opened a flagship in North America, according to Philion, because it couldn’t get the ability to make the investment line up with finding the right location. It’s a big investment, he admits, and the timing was always off. The company remained opportunistic, and finally everything clicked.
The timing certainly looks good now. Puma doesn’t break out its North America sales separately, but it reported strong growth in the Americas more broadly for 2018 and through the first half of 2019, during which sales rose another 18.1%. (Foot Locker has called out the Puma RS-X line as a strong seller.) The company has made North America a top priority because of both its dollar value and cultural influence. It recently set up a regional headquarters in Boston and is planning to open a distribution hub outside Indianapolis next year.
The new store was in the works for about two years. From the start, the company wanted to make sure it did retail differently. So far so good—until the next thing comes along.