How Text & Chat Gets Satisfaction

The Washington Post: “The biggest shift in customer service since the 1-800 number is underway. Some 20 million businesses now use Facebook Messenger each month to talk with customers. Apple is leading companies as diverse as Lowe’s, Marriott and Wells Fargo into taking service queries, scheduling deliveries and even paying for purchases over iMessage. And Facebook’s WhatsApp, already used by 3 million businesses, including many outside the United States, is building a business around charging companies to better serve us over chats.”

“Business messaging isn’t the same as chatbots, which are programs that try — and often fail — to provide automatic answers to questions. This is about talking to real people, though some companies blend both automation and humans. Messaging a business can bring new kinds of frustrations. Not every company is prepared for 21st-century customer service; some put the newbie employees on chat duty — others rely too much on robots.”

“LivePerson, a company that makes support software used by 18,000 companies, says when given the option, 70 percent of people chose a “message us” button over a “call us” button on a company website or app. And it says customer satisfaction rates are 25 percent higher for chatting and messaging than for calling.”

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Meal Kits: The Complexity of Simplicity

The Wall Street Journal: “Meal kits may make cooking easier, but getting a box of pre-portioned ingredients and instructions to a customer’s door is one of the most complicated logistics riddles in the food business. Companies have poured millions of dollars into solving such questions as how to stack fish and fennel in boxes. They’re also investing in systems to reroute shipments during snowstorms and algorithms to predict what customers want to eat during the summer months.”

“Meal-kit spending by consumers has grown three times as fast as spending in established food sectors such as restaurants and grocery stores since 2015, according to Nielsen … But companies that sprang up in garages or test kitchens are getting a close look at just how expensive and complicated it can be to deliver millions of boxes a month to customers’ homes or to supermarkets. Startups have had to devise workarounds for everything from heavy weather to diverting trucks around highway accidents, and company founders have lots of war stories, especially from the early days of their operations.”

“To help keep a lid on costs, Sun Basket, whose meal kits target health-conscious consumers, has gone so far as to set up a Midwestern distribution center in a converted limestone cave—a cheaper way to keep its products cold than spending millions to convert a conventional warehouse in the region for refrigeration. The temperature inside the underground facility remains stable regardless of whether it’s hot or cold outside, so the company spends less on electricity.”

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Alibaba Puts Tech in ‘FashionAI’ Boutique

Axios: “Everything is automated and powered by artificial intelligence — or soon will be — in a new fashion shop opening tomorrow in Hong Kong. From the time you enter, using an app to open an electronically locked sliding glass door, to the time you leave, you may never see another human apart from other shoppers …the objective is to merge e-commerce and brick-and-mortar retail — to make shoppers see them as one organism.”

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How Moosejaw & Walmart Make Music

The Wall Street Journal: “Walmart is betting that even under its umbrella, Moosejaw and other brands like the feminist-leaning ModCloth and men’s fashion clothier Bonobos can remain convincingly hipster. But Walmart has such a distinct culture; will it be able to maintain an appropriate distance or will executives from Bentonville swoop in, forcing everyone to wear those iconic blue big-box vests? … Some suppliers of high-end gear abandoned Moosejaw’s shelves to avoid doing business with its new parent.”

Yet: “Moosejaw’s loyalist shoppers appear unfazed. While there have been reports of social-media backlash against Walmart ownership of firms like ModCloth, Walmart’s overall e-commerce sales have picked up … Moosejaw will soon have a rolling pop-up store pulled across the U.S. by a semi truck—another innovation private-equity backers may not have sponsored. With access to Walmart’s shipping rates, Moosejaw.com offers free two-day shipping, which is increasingly expected by online shoppers.”

“Then there is the beer cooler. Much has been made of alcohol policies at Walmart subsidiaries, and Moosejaw’s victory in this category is notable. Before the acquisition, Bentonville executives noticed a padlocked beer cooler at its Madison Heights, Mich., headquarters … Shortly after the deal … Chief Executive Doug McMillon concluded that because Moosejaw had responsible policies, the cooler could stay. At this month’s shareholder meeting Mr. McMillon gave analysts a glimpse of why he’s bending the rules. He carries a list with him of top retailers from decades gone by, a sobering list that includes struggling Kmart and Sears that reminds him of the fleeting nature of success. Yesterday’s retail kings die ‘because they don’t change,’ he said.”

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eMacy’s Rises, While eSears Sinks

The Wall Street Journal: “Among a crop of five retailers analyzed by Edison Trends, including Sears, Kmart, Kohl’s, Macy’s, and J.C. Penney, Macy’s has seen the strongest online growth in 2018, climbing 28% in monthly order volume since January. Meanwhile, Sears’s online order volume fell 25% from January to May. Penney looks only marginally better than Sears. Though it, too, operated a big catalog business, Penney failed to make the necessary digital investments to stay ahead.”

“As Sears shutters stores—it announced another 60 closures last month—e-commerce could have been the company’s future. Instead it has fallen far behind traditional retailers, and is way, way behind its big competitors, Walmart and Target . Maybe Sears should have stuck with the catalog.”

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Lord & Taylor’s New ‘Flagship’: Walmart.com

The New York Times: “Lord & Taylor is teaming up with Walmart to create an online store on Walmart.com that will offer about 125 fashion brands, including Tommy Bahama, La La Anthony, H Halston and Effy. Billed by both companies as a ‘premium’ shopping destination, the new online store reflects Lord & Taylor’s desire to reach a wider audience and Walmart’s hope to attract a different type of customer.”

“For Walmart, the partnership is the latest attempt to reach a more urbane shopper. As part of that effort, Walmart has made a string of acquisitions over the past year, purchasing the clothing sites Bonobos and Modcloth and starting its own bedding and mattress line, sold exclusively online.”

“The Lord & Taylor online store on Walmart.com is expected to open in the coming weeks. Lord & Taylor will be responsible for shipping the clothing to customer’s homes. It will continue to sell the same brands in its stores and on its own website at the same prices as it does on Walmart.com … Lord & Taylor executives referred to their site on the Walmart website as a new kind of ‘flagship’ store.”

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Waiting in Line: There’s No App For That

The Wall Street Journal: “Every day, Mitchell Burton orders and pays for an Italian B.M.T. sandwich on his Subway mobile app, so the sandwich is waiting at the counter. When he arrives, the 32-year-old Baton Rouge, La., parks and recreation worker frequently heads to the back of the line, to avoid seeming rude to less tech-savvy fellow customers. Line skippers sometimes ‘get the stink eye,’ he says, because fellow patrons don’t understand that there’s an app to order ahead.”

“Various ways to skip lines have gained momentum in recent years, as businesses ranging from retailers to movie theaters have come up with ways for customers to avoid a wait, often with mobile apps and ordering kiosks … In theory, order-ahead technology should appeal to everyone.” But: “Some line lovers say technology gets in the way of the personal touch. That’s why Al DiSalvatore sometimes puts his phone down and lines up the old fashioned way at coffee shops in Philadelphia. He likes when the baristas remember his name and order—something that reminds him of his time living in smaller cities.”

“Lining up is part of a gauzy nostalgia for the days before smartphones, which also includes professors banning laptops in class, people stopping at the register to write checks and shoppers skipping shopping online … Erik Fairleigh, 38, who works in communications at Amazon, also has a simple reason for sometimes joining the line. ‘I like to pay in cash,’ he says … Ashleigh Azzaria, a 34-year-old Palo Alto, Calif., event designer, typically chooses to wait in line for coffee at Starbucks, even though she has the mobile app installed and skips the line for bigger orders. ‘It’s my break,’ she says. ‘It’s my time to just kind of decompress, to not be on the phone’.”

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E-urope: Amazon Struggles With Apparel

The Wall Street Journal: “Amazon.com Inc. might look like it’s taking over the world. But it hasn’t conquered Europe. Two decades after the internet behemoth’s first international foray into the region, it’s still working to gain traction selling apparel and footwear. That weakness in a major, growing market illustrates Amazon’s challenge as it expands abroad and tries to replicate its U.S. dominance of e-commerce.”

“To explain Amazon’s struggles in conquering apparel in Europe, retail executives and analysts point to an absence of top fashion brands, a website they say isn’t conducive to browsing for clothes and a fragmented market full of plucky competitors.”

“They say Amazon is like a chaotic, online department store where there is little control over brand presentation. By contrast, Zalando, ASOS and other specialty apparel sites are like an upscale online mall where brands are given more control and presentation is sleek, retail executives say … Amazon’s philosophy is that a large customer base attracts brands, while executives at Zalando and other competitors try to attract brands that will bring customers, said Barbara E. Kahn, professor at the University of Pennsylvania’s Wharton School of Business.”

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Short Staff + Long Lines = Retail Meltdown

The Wall Street Journal: “Over the past 12 months, 86% of U.S. consumers say they have left a store due to long lines, according to a survey conducted by Adyen, a credit-card processor and payment system. That has resulted in $37.7 billion in lost sales for retailers, Adyen estimates.”

“Retailers typically set staffing as a percent of sales, but a growing body of research suggests it should be based on foot traffic. The problem is twofold: Many retailers don’t track traffic and even if they do, they are reluctant to add labor, which is already among their biggest costs.”

“After installing cameras last year, Cycle Gear Inc., a 130-store chain that sells motorcycle apparel and accessories, noticed sales dipped during the afternoon at its Orlando, Fla., store even though it was packed with shoppers. ‘That told us the salespeople were overwhelmed,’ said Rodger O’Keefe, a vice president. ‘We added two more salespeople during those hours, and sales have been up since then’.”

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Branding The Brandless Brand

Business Insider: Brandless, “which sells food and consumable essentials all for $3 and pitched itself as the “Procter & Gamble for millennials,” first launched in July … The brand is now moving into the physical world with a pop-launching in May, called ‘Popup with a Purpose.’ It will be a ‘three-dimensional experience of the values of what Brandless is really about,’ according to CEO and co-founder Tina Sharkey. The Brandless brand will be on display, but no products will be for sale. Instead, the 3,500 square foot location on Melrose Avenue in Los Angeles will be offering samples, and opportunities to “live, learn, and love with intention,” according to a press release.”

“The pop-up will be interactive and there will be panels, workshops, and talks by experts in the fields associated with the areas of food and wellness that Brandless has staked out. Along with the pop-up, Brandless is also launching a lifestyle blog that will be focused on educating consumers of the claimed benefits of, for example, ‘tree-free toilet paper’.”

“Sharkey sees Brandless as filling gaps where the ease of shipping and low point of entry can allow people to try new things — like gluten-free baking mix — that would otherwise be either too expensive or just hard to find locally in some areas … The B.more membership program, which previously only lowered the free shipping order threshold to $48 dollars, now makes all orders ship free. The company has since started focusing on offering B.more to repeat Brandless customers.”

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