Store Check: Why is TJ Maxx Doing So Well?

Editor’s Note: After reading news stories about the struggles of Macy’s, Kohl’s, Sears and JC Penney, I visited a TJ Maxx yesterday (Norwalk, Conn.) to see why it is doing so well. It’s just an ordinary and ostensibly boring strip-mall store. The location is nothing special. The store itself is not new, but it is neat and orderly, well lighted, and well maintained. The sight lines are clear from one end of the store to the other, and the aisles are wide. Racks are marked, by (low) price signage, and all items are also clearly marked, with prices in large digits. Tags include a comparative retail price.

Name brands are easy to spot. A big sign on the wall lets you know that they have the same brands you’ll find at the mall, for less. Lots of displays with attractive, unusual items (treasure hunt). In addition to extensive men’s, women’s and children’s apparel (most of the store), there’s luggage, handbags, household goods, bedding, beauty care, toys, etc. Everything looks like someone just put it back in its proper place.

Oh, and restrooms are marked with a big sign, and the men’s room was not only clean, but decorated. Checkout, bordered by shelves of impulse items, is a single, long, snaky line, but moves quickly. Sure, there’s a world of complexity under its hood that makes the TJ Maxx experience what it is, but to the shopper, its magic is as plain as a sugar doughnut. PS: I do think their logo could use an update.

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Fast Fashion: How Zara Does It

The Wall Street Journal: “A black, high-collar women’s wrap coat, fastened with a metal ring … The garment’s journey from design workshop in Spain to retail display rack in Manhattan … offers an inside look at the fast-fashion model that has made Zara’s parent company, Inditex SA, the world’s biggest fashion retailer by sales.

“A designer and pattern maker at the Spanish company’s headquarters, in the small industrial city of Arteixo, took five days to fashion a prototype of the loose-fitting winter coat … A second pattern maker, cutters and seamstresses then worked 13 days to produce 8,000 of the coats. Over the next six days they were ironed, labeled, tagged, checked for quality, then trucked to Zara’s logistics center in Zaragoza and from there to Barcelona’s airport. The next day one of the coats was on a truck from John F. Kennedy Airport to the Fifth Avenue store, to sell for $189.”

“Every creative decision about the women’s wrap coat—as all other Zara garments—flowed quickly from impromptu discussions at Inditex headquarters, in an open workspace slightly bigger than a soccer field. Designers and commercial staff sit side by side there, in electronic and telephone contact with Zara store managers around the world. Store managers, often flown in to consult, viewed a mock-up of the coat and helped shape its design … The women’s wrap coat is one of more than 50 of its kind shipped to the Fifth Avenue store in small batches this fall … To give shoppers a sense of exclusivity, Inditex says no more than 25,000 of the coats will be made, even if they sell out.”

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Neiman Marcus Rents a Runway

The Wall Street Journal: “In a strategy that sounds counterintuitive but is a push to bring in younger shoppers, Neiman Marcus has invited the rent-a-dress company Rent the Runway to open locations within its stores … Neiman Marcus hopes that Rent the Runway, which is popular among 20-something shoppers, will serve as bait for a generation that hasn’t taken to department-store shopping the way their moms did … Neiman Marcus executives are also looking forward to collecting shopping data to study how these young dress renters spend in other areas of the stores.”

“The partnership will enable Rent the Runway members to try on clothes in Neiman Marcus stores. Customers will also be able to rent online from Rent the Runway and pick up or return the clothes to a Neiman Marcus … Neiman Marcus executives hope that over time, those 20- and 30-something shoppers will return to buy again and again, becoming the next generation of Neiman Marcus customers.”

“Rent the Runway’s 3,000-foot boutique within the store will have a mix of rentable clothes and Neiman Marcus shoes, bags, jewelry and other items, including underpinnings like bras and Spanx. Stylists employed by Rent the Runway will work with shoppers to assemble outfits, working with sales associates from the department store when needed. There is a cosmetics counter where shoppers can get their makeup done.”

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The Landweb: Saks Deconstructs & Reinvents

The New York Times: At Saks Fifth Avenue Downtown … product displays are inspired by websites that encourage shoppers to browse. Where traditional department stores keep handbags separate from clothing … an edited range of goods is organized by designer label, with handbags, ready-to-wear and jewelry commingling on a circular path intended to inspire surprise finds.

Saks President Marc Metrick comments: “We wanted to de-compartmentalize the department store. That’s not how she shops anymore … we lay things down flat on tables, just like you’d see on a website.”

Saks also “has rolled out applications from the retail technology company Salesfloor that enable online visitors to live-chat with a sales associate at a nearby physical store. After browsing product suggestions online, shoppers can make an appointment to meet their sales associates in person, to continue shopping. And even after the in-person visit, the shopper can follow up with the very same sales associate again, online.”

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Lord & Taylor’s ‘Fast Fashion’ Play

The Wall Street Journal: Lord & Taylor is taking a page from Zara. This summer, when an Isaac Mizrahi off-the-shoulder top nearly sold out days after hitting its stores, the department-store chain had the blouse back in stock in six weeks. It used to take nine months.”

“The quick turnaround was the result of a partnership with New York-based Xcel Brands Inc., which owns the IMNYC Isaac Mizrahi brand among other labels and is trying to make a business selling fast-fashion tricks to traditional brick-and-mortar retailers. Here is what it looks like: Xcel keeps stockpiles of unfinished fabric, so it is available quickly to be dyed, cut and sewn into the latest trend.”

“Lord & Taylor is able to procure the goods at a lower price by eliminating intermediaries and buying directly from the factories. That helps to offset the higher cost of shipping some items by air. Xcel, meanwhile, collects a royalty fee from Lord & Taylor based on retail sales.”

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Busted: Simons Immortalizes Its Shoppers

The Globe and Mail: “As many ponder retail’s future, Quebec-based brand Simons is pushing the boundaries of what a bricks-and-mortar space can offer … Simons is hosting 3-D scanning and printing booths in its stores in an effort to immortalize customers; the project will culminate in some 1,500 busts that will be showcased in 2019 at Simons’s forthcoming Yorkdale location in Toronto.”

Douglas Coupland, the artist behind the project, comments: “I think if you want to succeed in any kind of retail store, it has to have a touch of Christmas morning to it. There has to be that feeling of, ‘Ooh! What will I find at the bottom of the stairs?’ That’s the sort of magic that retailers really need to stoke the fires with.”

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The ‘Give’ Registry Embraces Survivors

Slate: “The Give Registry is a brilliant new gift registry and ad campaign from Australian department store chain Myer and agency Clemenger BBDO Melbourne that uses the model of a wedding gift registry to provide linens, cookware, dishes, and other household basics to domestic violence survivors.”

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Macy’s: Putting the ‘AI’ Into Retail

The Washington Post: “Macy’s … has teamed up with IBM Watson to use artificial intelligence as a customer service tool in 10 of its stores. The retailer dubbed the pilot program ‘Macy’s On Call,’ and it will allow customers to type in questions on their phones and receive answers. Unlike some chatbots that can only regurgitate pre-programmed responses based on keywords, IBM Watson will learn over time to give better answers that are customized to individual stores.”

“Macy’s move is an acknowledgment of what a habit it has become for consumers to swipe and tap on their smartphones while they’re on the go. And it’s a bid to figure out how to channel that behavior into an advantage — not a threat — to in-store shopping.”

“Macy’s is not the only retailer that is experimenting with some use of artificial intelligence. IBM Watson has already dabbled in using its tools to power other shopping experiences such as a collaboration with outdoor apparel brand North Face on a website that helps shoppers find the right jacket.”

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Selfridges Stages ‘Refashioned Theater’

The Stage: “London department store Selfridges is to launch a 100-seat theatre that will allow customers to watch a Shakespeare production being rehearsed and performed. The department store has also teamed up with drama school RADA to provide two weeks of workshops and masterclasses for shoppers. Called the Refashioned Theatre, the venue will have a traverse stage, a box office, a designer royal box and a bespoke lighting rig from White Light.”

“The theatre company will offer audiences the chance to watch rehearsals, which Selfridges compared to the experience shoppers get while looking at its own window displays. The play will feature nine actors, plus five “digital cameos”, where digital images will be projected on to mannequins.”

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Auto Boutique: Tesla @ Nordstrom

USA Today: “Tesla opened an electric-car boutique in the men’s section of the Nordstrom store that could become the model for others. Tesla has had its own stores in malls, but not one inside of a department store. Not only could it potentially cut the automaker’s real-estate costs, but it could also help Tesla attract more customers who discover the car just by walking by.”

“Reached for comment, the automaker issued a statement stressing that the two companies have a lot in common”: “Tesla and Nordstrom share a relentless drive to engage and delight customers with new and innovative shopping experiences,” it said. “The Nordstrom shopper embodies a lifestyle that parallels that of many Tesla owners –- people who are forward-thinking, savvy, and curious to explore the latest and best trends.”

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