Physical stores still dominate retail, even as AI reshapes shopping. Offline sales account for roughly three-quarters of total retail revenue, according to research from last year. The gap between digital and brick-and-mortar isn’t closing—it’s widening in favor of in-person experiences that go beyond transactions.
Retailers are responding with bold new concepts. Five formats launched in 2026 that redefine how stores engage customers, from beauty to sports to tech. Each reflects a shift toward experiential retail, where discovery and community matter as much as sales.
Target’s Beauty Studio: A Mass Merchant’s Makeover
Target rolled out its Beauty Studio concept in about 600 stores this month, replacing Ulta Beauty shop-in-shops after the partnership ended in August. The new space curates over 1,600 products from 90 brands—two-thirds of which are new to Target, including Dyson, Sunday Riley, and Boy Smells.
Unlike traditional beauty counters, the studios feature mini samples, product testing stations, and rotating “Editors’ Picks” displays. Dedicated beauty advisers guide shoppers through recommendations, positioning the concept as an “inspiring destination” for trends and discoveries. The rollout aligns with Target’s push to deepen its merchandising authority beyond basics.
Foot Locker’s Crenshaw Rec: A Neighborhood Hub for Sports and Culture
Foot Locker and Nike opened The Crenshaw Rec this summer, a hyperlocal concept blending recreation, culture, and community. Modeled after neighborhood rec centers, it includes an open gym, equipment room, creative workspaces, and a resource center for programming.
The project was co-created with Crenshaw High School, Nipsey Hussle’s The Marathon Brand, and Los Angeles designer Gavin Mathieu. It’s part of a broader retail shift: while Nike quietly closed some of its neighborhood stores (rebranded as Nike Well Collective), Foot Locker, now under Dick’s Sporting Goods, is refreshing hundreds of locations to reduce clutter and improve presentation.
For both retailers, the Crenshaw Rec reflects their turnaround efforts. Foot Locker aims to modernize its footprint, while Nike, under new leadership, is stabilizing after years of declines.
Michaels’ experiential stores and Best Buy’s Meta Labs will follow in the next part of this story.
Related Post: Walmart Mexico to Deploy AI-Powered Store Tech Region-Wide
Michaels’ Experiential Store Model
An updated layout debuted over the summer in three locations, highlighting a segmented approach to hobby retail that blends inspiration with hands-on creation. The stores in Easton, Ohio; Irving, Texas; and Rogers, Arkansas each feature distinct “shopping worlds,” allowing shoppers to wander between dedicated zones such as Knit & Sew, Fine Arts, Floral & Greenery, Crafting & Kids, and a Party Shop.
Each shopping world presents curated vignettes that showcase product ranges and project ideas, encouraging customers to explore techniques before purchasing. The concept also includes a Welcome Center, Framing & Personalization Services, Signature Moments, Seasonal & Trends, and a dedicated space for local community gatherings. By organizing the floor plan around themed experiences, the retailer aims to transform a typical visit into a creative workshop.
Boone emphasized that the format reflects growing consumer demand for analog experiences that inspire and connect. “The new format reflects our customers’ desire for more inspiration and hands-on, analog experiences, while providing a space for the local community to connect, create, and celebrate,” the CEO said in a statement.
The rollout arrives as Michaels seeks to capture market share left by the recent bankruptcies of Joann and Party City. By offering immersive zones and a community-focused atmosphere, the experiential model supports the chain’s broader strategy to broaden its product assortment and attract new shoppers seeking tangible, project-driven interactions.
Best Buy’s Meta Lab Shop-in-Shop
Best Buy launched the Meta Lab offering in fifty stores across California, New Jersey, Ohio, and additional markets during the summer, creating dedicated spaces where shoppers can test next-generation personal technology. The shop-in-shops are staffed by Meta sales specialists who guide visitors through AI glasses, virtual-reality headsets, and other immersive devices.
Visitors can try on AI glasses, experience VR demos, and interact with on-screen prompts that illustrate everyday applications of the technology.
Dick’s Sporting Goods’ Lids Shop-in-Shop
Dick’s Sporting Goods earlier this year partnered with Lids to open shop-in-shops in select stores as a way to beef up its fan merchandise assortment. “Our athletes are increasingly looking for new ways to rep their favorite teams, their style and the latest trends,” David Progar, senior vice president of Licensed at Dick’s, said in a statement. “By partnering with Lids, a leader in licensed headwear, we’ll be able to offer them more choices to meet their needs for sport, lifestyle and fandom.”
In June, Dick’s debuted the Lids concept to nearly 50 of its stores and said at the time that it planned to expand the concept to over 100 locations by the end of the summer. The concepts feature licensed and lifestyle headwear from Lids, and the two retailers worked together on associate training and visual merchandising.