What’s Trending in Retail?
BY: MARY FEILD
JULY 6, 2017
With headlines of a struggling retail industry hitting the news every day, brick-and-mortar stores are finding their footholds in a myriad of unique strategies and emerging technologies. Here are a few that caught our attention.
- SELLING AN EXPERIENCE
The boom of ecommerce and the waning of large department stores have taken over headlines in recent years. The unique advantage that ecommerce has over brick-and-mortar is a virtually boundless selection of products at highly competitive prices.
When a study by GPShopper looked deeper into the motivations of the digital customer, they found that 86% of shoppers enjoy “experience stores” where they can handle products and finalize purchases on mobile or online.1Yet, 33% of shoppers reported that they “feel nothing” when asked about their initial reaction after shopping in a store.2 When there is a lack of an emotional connection between shoppers and a brick-and-mortar store, shoppers will settle for price as their main influencer.
Some brick-and-mortar stores are really focusing on boosting that emotional connection. Take for example, Bonobos and Nike, which have great customer experience built in their DNA.
- Bonobos refers to their 30 brick-and-mortar stores as Guideshops and train their sales staff to tailor their services to meet the customer’s needs. Staff are encouraged to spend 30 minutes to an hour with each customer until they’ve found the pieces they want. 3
- Nike hosts training sessions and running clubs in their stores for their online shoppers, cementing the customer’s experience with the Nike fitness brand.
2. ECOMMERCE IS BRINGING THE RETAIL EXPERIENCE TO YOUR HOME
While some brick-and-mortar stores are acting inward to improve their customer’s experience, ecommerce is acting outward by bringing the shopping experience to the home. Amazon has recently announced plans to diversify their fashion retail products for Prime Members by offering a wardrobe subscription service with major brands like Adidas, Levi’s, and Hugo Boss.4 Customers can now order a wardrobe of products, try them on at home, and have seven days to return the pieces they don’t want.
The “try before you buy” strategy has been gaining traction since the early implementation by other online retailers, like Stitch Fix. Whereas Amazon looks to use their massive scaling and aggressive logistics, Stitch Fix uses artificial intelligence and full-time stylists to select the products in a wardrobe.5 Such services place greater pressure on brick-and-mortar stores to expand their service offerings.
3. BRICK-AND-MORTAR STORES AS A BRANDING TOOL
When you imagine yourself sipping a cold drink, chances are you’ve pictured a Yeti mug. The brand is famous for their legendary cups that keep liquids cold (or hot) for more than 24 hours. Unfortunately, these cups tend to be the focus of their brand and they’re finding it difficult to connect with shoppers outside of these items.
Yeti wants to be more than just mugs. They want to break their brand into the outdoor lifestyle sphere, so they’re changing the layout of their flagship store into a “Yeti Museum” where shoppers can interact with the brand and its products.
“Any brand that’s going to make an investment in a store has to have a pretty wide set of goals,” says Lucas Lane, an Account Executive for the Yeti brand. “One of the challenges of something like this is how do you create a store that embodies your brand to where it’s intriguing and great for people who love your brand, and in our case, are avid hunters and fishermen and outdoorspeople, but also not be so elite and exclusive that someone who’s just walking down the street won’t be incredibly bored when they walk in.”6
4. BLOCKCHAIN FOR GREATER SUPPLY CHAIN TRANSPARENCY
Managing a supply chain the size of Walmart’s has always been a remarkable challenge with vendors in over 70 countries and more than 4,000 stores in the United States alone. Retail giants place a great deal of trust in their vendors with a complex web of digital communications to ensure that all products are meeting their destinations on time, from the manufacturer to the shopper.
Last year, Walmart began a trial partnership with IBM and Tsinghua University in Beijing to strengthen the transparency within their supply chain using blockchain databases—distributed databases that duplicates and spreads information across a network. Unlike other databases, information isn’t held in a single location, making records verifiable across multiple entities. For massive enterprises, this holds supply chain data to a higher standard of accuracy.
In an interview between Fortune Magazine and IBM’s global supply chain expert, Paul Chang, he explains, “In the event of a foodborne outbreak, Walmart should be able to receive the data and respond quicker, possibly even pinning down the issue to a single pallet or package.” Blockchain database technology improves the efficiency and flexibility of massive supply chains for a more cost-effective order fulfillment.
Change is never easy, but brick-and-mortar are feeling the pressure to start now. Whether you’re a giant like Walmart or a booming brand like Yeti, all levels of brick-and-mortar stores need to invest in the things that bring them value if they are to survive. How are your stores communicating change throughout your network? Every day, we help retail enterprises build metrics around enterprise-wide programs giving them visibility into what works and what doesn’t. Interested in learning what we could do for your organization? Contact us.
- Lauren T. “Retailers’ efforts to lure shoppers to stores with experiences still missing the mark”. Yahoo! Finance. https://finance.yahoo.com/news/retailers-apos-efforts-lure-shoppers-111215353.html
- Caitlin K. “Selling The Personal Touch, Menswear’ Bonobos Expands Again”. Forbes. https://www.forbes.com/sites/caitlinkelly/2016/10/25/selling-the-personal-touch-menswears-bonobos-expands-again/2/#77cae75613b7
- “Amazon Fashion”. Amazon. https://www.amazon.com/b/ref=tbyb_surl_lm?node=16122413011
- Margaret M. “Who Styles You? Meet the Stitch Fix Stylists!”. Stitch Fix. https://blog.stitchfix.com/inside-stitchfix/meet-the-stitchfix-stylists/
- Dan S. “Instead of a Retail Flagship Store, Yeti Decided to Build a Brand Museum. Here’s Why. Fast Company. https://www.fastcompany.com/3068308/instead-of-a-retail-flagship-store-yeti-decided-to-build-a-brand-museum-heres-why
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