Boyd’s: Retail’s Past as Prologue?

The New York Times: “Like the Liberty Bell and the stone Rocky Steps, Boyds is a Philadelphia landmark, and one equally impervious to the shifting seasons. For 80 years, the family-owned business has outfitted lawyers, bankers, doctors, politicians and famous athletes … The store is where a young man goes to buy his wedding suit, and returns 30 years later, grayer, wealthier, thicker in the middle, this time bringing his son to buy his wedding suit … in this age of dressing down and click-and-buy, in an environment where the big chains have killed off the mom-and-pops and Amazon is killing off the chains, Boyds now feels like a shopping experience out of time … Out-of-towners who happen into this retail anachronism tend to react first with astonishment, followed by a sigh of pleasure.”

“It’s very possible that Boyds isn’t just one of a dying breed of old-fashioned retailers, however. Given its scale (50,000 square feet of selling space over four floors), and the level of service it provides, and the tailor shop and complimentary parking lot, and the near century of independent operation by the same family, it may be the only clothing store of its kind anywhere in the country … To understand how Boyds has avoided oblivion thus far, it’s instructive to spend an afternoon on the selling floors … The operation has a choreographed precision. Chris Phillips, the 43-year-old men’s tailored clothing manager, on this day stood near the elevator. It was his job to greet customers, determine their needs and spin them to the right salesperson.”

“Generally speaking, the men who come to Boyds aren’t there to browse. Overscheduled high earners, they view clothes shopping as one more task to be efficiently completed, an attitude to which every Boyds employee is attuned … Marc Brownstein, the president and chief executive of the Brownstein Group … dates his first Boyds shopping trip to high school, back in the ’80s, and now especially appreciates its delivery service to home or office, and the text messages he gets from the store when a brand is going on sale.” He comments: “The family just outthinks other retailers. They’ll deliver to your house, to your office. You park for free. You know what parking costs in the center of Philadelphia? They’re going to outwork and out-service everyone else.”

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Take a Chance or Fly Air France

The New York Times: “You open what looks like an in-flight care package to find 50 feet of Sudoku puzzles on a tapelike roll, Champagne-flavored gummy candies and a scratch-and-sniff patch that smells like boeuf bourguignon. In a time of low-cost airlines, where your ticket might not include an edible hot meal or free access to electronic entertainment, the box reminds you of what could be if you shell out a little more on Air France. That’s the idea behind the airline’s new ‘Take a Chance or Fly Air France’ campaign, which will begin showing up in American digital ad space this week.”

Dominique Wood, Air France’s executive vice president of brand and communication, comments: “We want to remind our clients and our future clients that there is another way to travel, even in economy, where everything is included. You’ve got a very comfortable seat, you’ve got a hot meal and a full complement of entertainment, and if you can have it — if you’re the right age — a glass of French Champagne.”

“The Air France campaign will mostly be a digital one, but visitors to the Grove mall in Los Angeles on Saturday can win pairs of round-trip economy tickets. The Sudoku puzzle tape, gummies and scratch-and-sniff patches will also be given away, and will be available in an online sweepstakes.” Henry Harteveldt, the founder of Atmosphere Research Group, comments: “As airlines have unbundled their product, they almost don’t want to remind you of what it’s like to fly them. What Air France is doing is a smart marketing move, but it’s also a brave marketing move.”

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Apple Stores: The DMV of Retail?

Business Insider: “Apple Stores have become an almost mythical part of the tech giant’s brand. Now, they could be killing it … if you’ve visited an Apple Store recently, you may have found that you weren’t visiting a magical tech utopia after all. Many customers are now comparing their Apple Store experiences to those they’ve had at a different place: the dreaded DMV.”

“Customers’ top complaints are focused on crowds and wait times, which can last for hours. Simply put, too many people need assistance at Apple Stores — and employees don’t have the time to help everyone immediately … Irritated customers tired of waiting for simple assistance tend to be less than impressed by Apple Stores’ unique design. Some say they feel Apple has prioritized artistry over customers’ needs.”

“In 2016, Apple retail boss Angela Ahrendts told Business Insider that the company needed ‘to open incredible places that almost behave like a town square, like a gathering place’ … For some, Apple Stores have become a site of frustration, not community mingling. However, the company is renovating dozens of stores across the US in an effort to better achieve its ‘town square’ goals. These revamped stores are larger, which could help with concerns of overcrowding. They also feature a new approach to the Genius Bar with the ‘Genius Grove,’ which allows a section of the store to be focused on repairs and assistance without involving lines.”

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Retail Equation: Returns from Hell

The Wall Street Journal: “Every time shoppers return purchases to Best Buy Co. they are tracked by a company that has the power to override the store’s touted policy and refuse to refund their money. That is because the electronics giant is one of several chains that have hired a service called Retail Equation to score customers’ shopping behavior and impose limits on the amount of merchandise they can return.”

“When a consumer makes a return, details about his or her identity and shopping visit are transmitted to Retail Equation, which then generates a ‘risk score.’ If the score exceeds the threshold specific to the retailer, a salesperson informs the consumer that future returns will be denied and then directs them to Retail Equation to request a return activity report or file a dispute.”

“It isn’t easy for shoppers to learn their standing before receiving a warning. Retailers typically don’t publicize their relationship with Retail Equation. And even if a customer tracks down his or her return report, it doesn’t include purchase history or other information used to generate a score. The report also doesn’t disclose the actual score or the thresholds for getting barred.”

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Bad Apples Spoil Bean’s Return Policy

Business Wire: “It used to be that customers could bring back items bought at L.L. Bean’s stores and online any time they felt it didn’t live up to their expectations. The guarantee covered the item’s full lifetime. Now, the policy extends for one year only. After that, customers can only return an item if it proves defective. In another change to the policy, customers will also now need to provide a proof of purchase for a return or exchange.”

“L.L. Bean relayed the news to customers in the form of an emailed letter from Shawn O. Gorman, the company’s executive chairman and great-grandson of founder L.L. Bean. In the letter, Gorman wrote that it was people who took advantage of the generous return policy that forced the company’s hand.”

He wrote: “Increasingly, a small, but growing number of customers has been interpreting our guarantee well beyond its original intent. Some view it as a lifetime product replacement program, expecting refunds for heavily worn products used over many years. Others seek refunds for products that have been purchased through third parties, such as at yard sales. Based on these experiences, we have updated our policy.”

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How IKEA changed the shopping experience

The Washington Post: IKEA, “which has 412 locations in more than 40 countries, has become an international empire. Its sprawling stores with their tortuously winding routes have continued to thrive in an era of hurried online shopping. Analysts say Ikea has been successful in not only getting shoppers to linger for hours, but also getting them to come back, over and over, whether for mattresses or meatballs.”

Warren Shoulberg, a consultant, comments: “Before Ikea came along, furniture shopping was a laborious task that a lot of people dreaded because they felt like they were making a decision they had to live with for 30 years. Then Ikea showed up and said, you can buy something and use it for a couple of years — or you can keep it longer — but this isn’t necessarily something you’re going to pass down to your kids or your grandkids. That was a remarkable transition.”

“The retailer has also been successful, he added, in creating a shopping destination. Traditional furniture stores may line up all of their sofas in one section and beds in another, but Ikea displays items by room, so shoppers can see how different pieces might look together … Its success has also given way to a cottage industry of businesses that specialize in assembling Ikea furniture. Ikea itself has gotten into the fray: In September, it purchased TaskRabbit, a start-up that providers contractors for odd jobs, to appeal to a generation of time-strapped consumers who want Ikea furniture without the hassle of assembling it.”

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‘Stealing’ at the Amazon Go

Nick Wingfield: “There were a little over 3.5 million cashiers in the United States in 2016 — and some of their jobs may be in jeopardy if the technology behind Amazon Go eventually spreads. For now, Amazon says its technology simply changes the role of employees — the same way it describes the impact of automation on its warehouse workers … Store employees mill about ready to help customers find items, and there is a kitchen next door with chefs preparing meals for sale in the store. Because there are no cashiers, an employee sits in the wine and beer section of the store, checking I.D.s before customers can take alcohol off the shelves.”

“At Amazon Go, checking out feels like — there’s no other way to put it — shoplifting. It is only a few minutes after walking out of the store, when Amazon sends an electronic receipt for purchases, that the feeling goes away.”

“A big unanswered question is where Amazon plans to take the technology. It won’t say whether it plans to open more Amazon Go stores, or leave this as a one-of-a-kind novelty. A more intriguing possibility is that it could use the technology inside Whole Foods stores … There’s even speculation that Amazon could sell the system to other retailers, much as it sells its cloud computing services to other companies. For now, visitors to Amazon Go may want to watch their purchases: Without a register staring them in the face at checkout, it’s easy to overspend.”

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Late & Great: Fred Bass

Quartz: “Fred Bass, co-owner of New York’s massive used bookstore, fondly known as the Strand, died of heart failure Jan. 3 at 89. Bass transformed his father’s modest store into the four-story bookshop immediately recognizable to New Yorkers and tourists today: The store on Broadway, with its red-and-white awning over $1-book carts lining the southern-facing exterior.”

“There are two basic things a good bookstore can provide: The delightful maze of human-curated shelves, or the satisfaction of efficiently getting the book you’re looking for. Amazon has done its part in taking away business from the bookstore chains that have excelled at the latter, like Borders and Barnes & Noble. The now Everything Store once sold nothing but books, and one way it’s done so successfully is by offering deep discounts. The Strand, though nowhere near as ubiquitous as Amazon.com, has been able to tout dizzying volume at the same time it’s maintained a beloved shopping experience.”

“What Amazon has done well—sell its vast inventory to you for super cheap—Bass did first. And with tote bags. Nearly all the store’s books are sold at a discount, ranging anywhere from a couple dollars off a new title to less than a $1 for a classic or a book that’s run its course … Today clutching one of Strand’s 100 or so bag designs is a proud display of reader identity.”

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How CVS & Aetna Could Change Healthcare

Business Insider: “CVS Pharmacy’s $69 billion deal to acquire the health insurer Aetna — the second-biggest deal of the year — is different. It could actually make treatment simpler and easier for Americans, and it catches a bunch of trends in the market that push costs down. There are two big streamlining ideas at work here. First … Pharmacy Benefit Managers (PBMs) are the gatekeepers between insurers and a patient’s medical treatment, and CVS already has one. Ideally it ensures that the PBM is incentivized to keep costs for the insurer as low as possible.”

“For the most part, though, this doesn’t fundamentally change Americans’ experience when they get sick. PBMs are faceless entities, and insurance is a foreign language to a lot of people. This is where the second streamlining idea in this CVS acquisition comes into play … the company will be ‘promoting lower-cost sites of care’ after this acquisition. That means turning brick-and-mortar stores into treatment centers and hiring medical staff. That’s expensive, but it will keep sick people out of more expensive hospitals, which keeps costs down for insurers and ultimately customers.”

“And unlike a lot of new urgent-care facilities hitting the market to do this very thing (keep people out of hospitals), CVS comes with a ton of brand familiarity. Plus, quarter after quarter CVS has seen that its other businesses are outperforming sales in its retail channel. Turning brick-and-mortar stores into healthcare facilities is one way to make good use of them.”

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Real-Time Retail: Fanatics Seizes Micro-Moments

The New York Times: Micro-moments “happen all the time in sports: A player reaches a milestone, has a breakout performance or is traded to a new team. Apparel companies have traditionally been poorly positioned to meet the accompanying fan demand as it surges. Fanatics … a sports merchandise company … is changing that and, in the process, carving out a lucrative niche in a fiercely competitive online-retail industry largely dominated by Amazon.”

“The company is similar to fast-fashion retailers like H&M, Uniqlo and Zara, integrating design and manufacturing with distribution to fulfill orders within hours. After the Chicago Cubs won the World Series last year, Fanatics used Uber to deliver championship gear to some fans within minutes … As a result, Fanatics has more than doubled its revenue in just a few years.”

“Among the micro-moments that highlighted the new need for speed was Jeremy Lin’s emergence as a sudden star for the New York Knicks in 2012 amid the so-called Linsanity phenomenon.” Fanatics chairman Michael Rubin comments: “When Linsanity happened, within 12 hours to 24 hours, there were no jerseys to get. So you had this huge demand, and there’s no jerseys available. Then you order them like crazy, and by the time they get in, the moment’s over.”

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