Lessons in Retail Reinvention From Indigo’s Heather Reisman

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Indigo CEO Heather Reisman. Photo: Daniel Ehrenworth

Over 30 years, Heather Reisman built Indigo into one of the world’s pre-eminent booksellers, with more than 200 stores across Canada. As competition from Amazon and e-readers forced other chains into bankruptcy, Reisman undertook an ambitious plan to move beyond books and expand its offerings of general merchandise.

Indigo opened a design studio that develops exclusive products for the chain and also signed a partnership to operate American Girl boutiques across the country. So far, the plan is working. Revenue increased by 11% in fiscal 2016, while online sales grew by 15.3%. The company also turned a $ 28.6-million profit compared to a loss in the previous year.

Your new Toronto store at Sherway Gardens is Indigo’s first large-format location since 2010, and the first built around your concept of turning a bookseller into a “cultural department store.” How did the idea develop?

The store is the realization of an idea I’ve had almost since I launched Indigo. When I put together an initial memo to myself about the store, I wrote down, “A book lover’s cultural department store.” I always thought that the more shopping I could do in a bookstore, the happier I would be. So even in our first store, we had a paperie; we had a small gift shop; we had music and movies; we had a flower shop. But the real work of imagining a cultural department store started at the same time we launched our e-reading effort with Kobo. We knew it was time to reimagine the core bookstore experience. As people and consumers, we are evolving. There are some people who will long for the old-fashioned dusty bookstore, but most people don’t. In the 21st century, people are “phygital”—that is, they do some things digital and some things physical. So what role does the physical environment play?

As part of this reimagining, you’ve entered into partnerships with American Girl, Fitbit and Rifle Paper Co. How do you decide which brands are a good match with Indigo?

The products come second. It’s the ideas that come first. We have an opportunity to bring into the foreground the big ideas that are influencing us right now. So unplugging is a big idea. Early literacy is one. Eating real food is a big idea. We have seven or eight big ideas we’re constantly cycling through as we plan each season. We consider the big ideas we can amplify and use to connect with the customer. We have this crazy opportunity, because there’s nobody who’s written a book who won’t talk to us.

So it still starts with books?

Exactly.

Who decides which big ideas are worth focusing on?

Anybody at Indigo can say, “I’m really into this thing.” And then we look at it, and we say, “Is it a fad?” So adult colouring books are a fad. But what’s behind that fad—the desire to unplug, the desire to build our hand-brain connection in a different way—is bigger than colouring. And we have a process. We think of Indigo like a magazine. We put out nine “issues” a year—that is, the store turns over nine times per year. And online even more.

Once you’ve chosen your big ideas, how do you pick products to match? There’s a risk the store will lose some of its identity as you expand the selection.

You can always find things that are beautifully designed, but they have to amplify one of our big ideas. Otherwise the store will get full of stuff, and then you don’t know who you are. I would rather have fewer products in the store. Our merchant team will get upset because they’ll show me something and say, “This is selling—it’s really selling.” And I’ll say, “But do we all agree this is really ugly?” And they’ll say, “It’s not that nice, but it’s selling.” And so I say, “Let’s go find a better one.” Because there’s enough junk in the world.

Your partnership with American Girl has proven successful. I confess, I never quite understood how that connected with your core business.

Oh, but the American Girl doll books are unbelievable! Every one of them has an embedded life lesson. So well before we did the shops, we were huge on the books.

When you started expanding beyond books, children’s products were one of the first things added. What are the big ideas in that area?

We’re launching a big focus on teaching kids how to code. Coding will become a second or third language. So we’re selling littleBits, which are electronic building kits, and have other items coming in.

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