In the wake of the retail apocalypse, brands are turning to data to create more customized in-store experiences…
Some stores are rising up out of the retail apocalypse. According to the New York Times, the recent spate of bankruptcies and store closures may have just culled competitors that weren’t quick enough to adapt to young consumers’ demands, because some retailers are seeing revenues rise once more. Target, Nordstrom, and Walmart have all reported expectation-beating sales growth in the past quarter. Why? “[S]uccessful stores are now a cross between a fast-food drive-through and a hotel concierge,” with services like curbside pickup for mobile orders, drop boxes for returns, and “personal shoppers.”
With so many young consumers integrating their phones into their shopping behavior, some retailers are finding ways to make in-store buying more like the online experience. Click and collect programs are most common, allowing shoppers to buy online and have the closer-to-instant gratification of picking up at a nearby store same-day—but others are taking online/in-store mashups further. High-tech tweaks are ushering in a new in-person shopping era, where convenience and customization are king, and data is being used to optimize the store. As Nike, one of the brands at the forefront of this trend, puts it, “The future of brick-and-mortar retail counts on engaging, personal shopping experiences that respond as quickly—and as personally—as its digital counterpart.” Here’s how three brands (Nike included) are creating the data-driven retail future:
Nike is taking customization to the next level with a store that stocks styles based on local tastes. BuzzFeed reports that in their new L.A. store, 50% of apparel and 25% of footwear stock are chosen using consumer data from online purchases and Nike’s apps, to focus on products that are most likely to sell. Nike plans on “borrowing from the digital to do in the physical,” and refresh the store inventory based on local interest every two weeks. If that’s not data-based enough, anyone on the Nike app will get a personalized push notification with curated offers when they pass the store. But that’s not their only data-driven retail experiment. Nike’s new NYC flagship store “House of Innovation 000,”—which Ad Age calls the store of the future—puts mobile use at the center of the experience. According to the brand, “Inside, the promise of living retail comes to life.” Using geo-fencing, Nike knows when a customer walks into their 68,000 square foot space and changes the app accordingly. Users can see tailored content and offers, book styling appointments on-site, scan mannequins to have product delivered to their dressing room, and more. Based on the success of similar stores in L.A. and Shanghai, Nike execs hope their new flagship will build up Nike’s Brandom, and drive app downloads in the process.
H&M is counting on in-store data to customize their inventory and combat slow in-store sales. According to the Wall Street Journal, analyzing purchase data at one Stockholm location led the fast fashion giant to cut 40% of their inventory and beef up their female-focused stock, from floral apparel to crockery and surprisingly high-end accessories. One H&M exec explains that they “can now be sharper, more accurate and hyper-relevant, not have one solution that fits all.”
The North Face’s new “retail lab” is testing tech for future stores. At the Williamsburg, Brooklyn “Prototype” store, customers’ movements are tracked using heat mapping, so that the brand can measure how much time they spend in certain sections of the store versus others. The brand tells Digiday the store is “curated, personalized and fluid, meaning it won’t look the same way from one month to the next.” They also nixed checkouts, instead equipping their employees with portable point-of-sale systems so shoppers can check out anywhere within the store. The North Face plans to use their learnings from the experimental outlet to design more data-driven stores.
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