The flagship store of the future will be nothing like the industry has seen before

A flagship store that is simply a larger version of its standard store — but with more inventory — doesn't cut it anymore. Customers are increasingly favoring a more curated shopping experience.

Brands such as Bonobos and Everlane have created demand for this "less is more" shopping experience with their so-called guideshop stores that stock a limited amount of inventory.

Legacy brands are taking notice of this. In a recent interview with Business Insider, H&M's US president Martino Pessina said the company is well aware of the downsides of overdoing it on inventory.

"If you treat it just like a normal store but bigger, it becomes really overwhelming," he said. "We need to find ways to fill the stores creatively and not just with garments."

Read more: H&M's US president reveals the retailer's plan for the future — and it includes a lot less discounting

The purpose of a flagship store has traditionally been to promote the brand image and tell a story, and this hasn't changed.

"Flagship stores bring a brand's true personality to life," Jaime Bettencourt, SVP of business development at Mood Media, told Business Insider. "They not only reach and connect with their customers at the moment they are shopping, but they also have a halo effect on the entire brand."

Brands such as Glossier and Lively are finding innovative ways to tell their brand's story and educate the customers about the product. Lively, for example, offers customers the chance to attend events and talks in the store.

"It's bringing marketing and retailing together," CEO Michelle Cordeiro Grant told Business Insider during a recent interview. The company wants shoppers to come in, experience the product, and spread the word on social media.

Read more: A company that's taking on Victoria's Secret with $35 bras just opened its first store. Here's what it's like to shop there.

Many retailers are offering extra in-store services to give customers more reasons to visit the store. These also help to build a brand's image.

Last year, Nordstrom opened its new men's-only flagship store in New York. This micro-department store offers in-house tailoring and shoe-shining services, and it has a restaurant and bar.

Read more: Nordstrom just opened its first store just for men — here's what it's like to shop there

Flagship stores should showcase the retailer's most advanced technological services, combining all aspects of the in-store and online shopping experience, experts say.

"Nike is doing an amazing job of this," Mikhailov said. The brand's new flagship store encourages customers to engage with the brand by offering enhanced services and store experiences if they use the app.

"This is the future of relevant flagship spaces," she said.

Read more: Take a look around Nike's enormous new flagship store in New York City, complete with the world's largest for-sale collection of Nike shoes

Digitally native retailers, which have more leeway to test and trial new store concepts, are reminding us that stores need to continue to evolve to stay relevant.

"There used to be this idea that a retailer would spend thousands of dollars on a flagship store and then it is done forever. Today you're going to see a lot of continuous iteration cycles," Casper's cofounder and chief operating officer, Neil Parikh, told Business Insider last year at the opening of its first store in New York.

Read more:Wildly popular mattress-in-a-box startup Casper is opening 200 stores across America. Here's what it's like to shop there.