When Dining Enhances the Experience…and When it Doesn’t

After spending three weeks travelling Japan, exploring both traditional and modern retail spaces, I developed a fresh perspective on the practice of combing shopping experiences with dining. While diversification is often seen as a way to boost revenue, increase dwell time and enhance in-store experience, my trip left me questioning whether dining in retail is actually providing any real value to the customer or is it simply an add-on that misses the mark.

From renowned brands like L’Occitane to Armani, I observed various attempts to integrate cafés and restaurants into stores to create a multi-sensory experience. However, in Japan, a country renowned for its impeccable service and curated shopping, I often found that dining in retail fell short of expectations, failing to elevate the overall shopping experience. In most cases, the dining spaces felt like an add-on rather than a seamlessly integrated part of the journey.

These observations revealed several key principles on how and when to integrate dining into retail in ways that genuinely enhance the customer experience. Here are my main takeaways:

1. Store layout can elevate or erode the experience

The most effective retail spaces create a seamless flow that subtly guides customers through various zones, including dining. In some cases, the retail and dining components were wisely separated by floors or distinct areas, ensuring that each maintained its own identity. For example, Itoya, a 12-story stationery store in Tokyo, illustrates how a well-planned design encourages exploration. The store integrates cafés and unique experiences, such as an indoor farm and art galleries, along the pathways and stairways, allowing customers to engage with the space fluidly.

So what? When dining feels like an organic part of the customer’s exploration of the store, the experience is elevated rather than fragmented.

2.         Quiet, dedicated spaces cultivate comfort:
Successful dining spaces often serve as peaceful retreats within the retail environment, offering customers a break from the energy of the store. By positioning these areas in quieter, more secluded spots such as upper floors or tucked-away corners, retailers can create a calm and intentional atmosphere that complements the shopping experience.  A prime example is RAU Patisserie, located in Kyoto’s Good Nature Station. Here, diners enjoy tranquil views of luxury retail from a serene café situated in a corner of an upper floor.  Thoughtful separation between dining and retail is achieved through the use of natural elements, including seating shaped like tree trunks and counters inspired by rock formations. This design enhances the overall experience, making dining feel like a natural extension of the store’s ambiance rather than a competing activity.

So what? Creating tranquil dining environments transforms the shopping experience into a journey of rejuvenation increasing the likelihood of spontaneous purchases as shoppers feel more relaxed and open to exploration.

3.         Choosing the right locations for dining is critical:

Not every retail store benefits from integrating dining. In high-density areas, such as central business districts (CBDs), where excellent eateries are already in abundance, the addition of a café may not create the desired impact. Retailers must evaluate whether introducing dining enhances their customers' journey or if focusing on strengthening their core retail offerings makes more sense.

So what? When a retail store is surrounded by exceptional dining options, doubling down on retail-focused experiential design might be the more strategic choice.

4.         Ambience is key to crafting memorable experiences

Dining within retail spaces must go beyond the functionality of providing food; it needs to evoke a sense of place and atmosphere that resonates with the brand's ethos. Whether through artful lighting, aesthetically pleasing design or even a view that invites customers to pause and reflect, ambience plays a crucial role. In Japan, I encountered several stores where dining areas were open to beautiful outdoor landscapes, providing a holistic, sensory experience that mirrored the brand’s overall aesthetic.

So what? When the ambience is aligned with the brand’s identity, it enhances the entire experience and reinforces a cohesive sense of place.

5.         Consistency in service creates lasting impressions

A café within a retail store must uphold the same standards of service as the retail side. Poor service or lacklustre food offerings can diminish the brand’s reputation and feel like an afterthought, leaving customers less likely to return. The brands that succeed create dining experiences that mirror the polish and care customers expect from the retail environment.

So what? Service consistency across both shopping and dining is essential to ensuring the entire customer journey feels intentional and memorable.

6.         Strategic partnerships with culinary experts lead to success
For retailers whose core expertise does not align with gastronomy or does not provide opportunities for novelty around food, partnering with well-established food operators can be the key to success. Crafting a unique dining experience requires specialised knowledge and collaborations with culinary experts ensure that the food offering is of the same high standard as the retail experience.

So what? These partnerships allow retailers to focus on what they do best while offering a premium dining experience that complement rather than distracts from the brand.

7.         The grocerant advantage:
Retailers with grocerant sections have a distinct advantage in seamlessly incorporating dining into their offerings. By integrating dining zones and grocerant products, they create a cohesive experience where food becomes an organic extension of the brand narrative. Thoughtful placement and appealing merchandising transform food into a central element of the store’s story rather than a mere add-on.

So what? When executed effectively, this strategy enhances the overall theme and aesthetic, inviting customers to engage with both the retail and dining experiences in a unified manner as they move throughout the store.

In today’s retail landscape, simply offering products is no longer enough. The most successful retailers understand that they are selling more than merchandise, they are offering a holistic experience that connects deeply with their customers. Every aspect of the store, from layout to additional services like dining to museums, should work together to reinforce the brand’s identity and add meaningful value.

Retailers that prioritise seamlessness and intentionality in their design whether by incorporating dining, museums or focusing on their core offering are best positioned to create memorable, cohesive experiences that foster long-term customer loyalty.

Are you a retailer or property developer aiming to transform your retail space into a destination that seamlessly blends multi-sensory experiences and creates memorable moments for your customers?

RetailOasis can help! Our team specialises in customer-led strategies for retail environments that cultivate intentional atmospheres and elevate the overall shopping journey.

RetailOasis is your trusted external business strategy department - Contact us to discuss how we can bring your vision to life.