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Alexa: Do these mud-caked jeans make my butt look big? The BloomReach Relevance Report

Is it Friday? Why it seems like it was Friday just, oh, a year or so ago. But the weekend is here now. Get it off to a good start with a read through the BloomReach Relevance Report.

The future of retail is, well, retail

Apple logo hanging in the window of the Palo Alto Apple Store

We’re long past the debate about whether brick-and-mortar stores are going to go away. They’re not. The fashionable debate now, of course, is what are physical stores going to turn into?

One theory that’s been around for awhile is that stores will become more like showrooms — smaller operations with one of everything that people can check out before ordering the item online.

Old news? Not entirely. Retail Dive has taken a deep, well, dive into the notion of showrooms and says the concept is moving into areas such as apparel, which didn’t seem like prime candidates even recently.

The piece is worth reading, as it sifts through the challenges for certain retailers and talks about missteps, including trying to go halfway with the showroom idea.

As for apparent success stories, consider the example of Zvelle, a once-online-only shoe seller, that recently expanded into jazzy brick-and-mortar stores, as reported by Retail Insider. The Canadian outlets look like a cross between an Apple store and a Virgin America cabin.

Founder Elle AyoubZadeh tells Retail Insider that having physical stores is a way to provide a unique experience while showcasing the distinctive brand. It is also a way to deliver a level of personalization that is different from online personalization.

There is no question that something has to give. Business Insider reports that the decline in traditional retail is beginning to ripple through the economy after having for years rippled through the lives of retail workers who are losing their jobs.

While many had hoped (OK, we hoped) that the loss of brick-and-mortar jobs would be cushioned by an increase in e-commerce jobs, life is not that clean and easy, they New York Times says. It’s the common story of a mismatch between job location, requirements and numbers and skills.

So, showrooms is an idea. Who else has ideas?

You there. Experience, you say? How about creating unique experiences to draw customers into brick-and-mortar stores and keep them coming back?

Well, the Dixie Outlet Mall in Canada is dipping its toe into the experience pond. The mall’s landlord has built a multipurpose area that can be used for pop-up shops, meetings and events, Retail Insider reports. Take a look, it’s better than it sounds.

The experience idea is a thing, alright, reports CNBC. Although, again, maybe harder than it sounds. Retail writer Krystina Gustafson talked to an outfit that helps retailers cook up experiences and they said that sometimes stores don’t think these things out all that well.

The key thing is to think hard about what it is you’re trying to accomplish with the experience you’re creating. Does the experience line up with that goal?

And while experience can help, it’s not the only important thing, which we all probably saw coming, right? Gustafson points out that it’s also important to have good products.

Who knew?

Others talk about going beyond gimmicky experiences and shooting more for a holistic kind of experience, a feel. Apple recently talked about something it’s been hinting at for some time: Making its iconic stores into community centers.

In a de facto sense, many have served that role, with shoppers just stopping in to check things out, showing up for classes or dropping in to check email on a computer that’s better than the one they have at home.

Now Apple is going all in, making some design changes (including adding live trees and conference rooms) and launching a series of classes. Oh, they’re also changing the name of the Genius Bar to the Genius Grove. We don’t really get it. It must have something to do with adding the trees.

It will be interesting to see if the the Genius Bar itself changes. If we were to be honest — and it’s something we do strive for at the BRRR — we’d have to say that most of the genius advice we’ve got at the GB boils down to, “Buy a new one.”

Alexa: The blue tie or the gray tie?

Oh great. As if we’re not judged enough on our fashion sense. Now Amazon’s Alexa is stepping up her game, Internet Retailer and others report, by keeping its eyes on us. Yes, eyes. The newest Echo, called the Echo Look (available only by invitation) comes equipped with a camera and the ability to snap a photo or take a video when asked.

Echo Look

Amazon says the Echo Look let’s you “see yourself from every angle with the companion app. Build a personal lookbook and share your photos,” IR reports.

Every angle?

Yes, you’re own little fashion assistant dishing out advice like a dear friend. (“Hey Mount Chinmore: You might want to go with the turtleneck.”)

Anyway, as Retail Dive points out, this could all be about something more than Amazon helping us with our fashion knowledge. Think of the possibilities for e-commerce, says RD. Amazon’s continuously learning machine can get to know a consumer’s likes and dislikes and, of course, Alexa can kindly offer to order up that outfit that looks simply smashing on you.

Oh, and, if Echo really is a learning system, no doubt it won’t be long before it learns the answer to that eternal question: Do these jeans make me look fat?

The answer is “no,” every single time.

Surprise: mobile is growing like crazy — OK, not a surprise

Hey, this mobile thing is really catching on.

Why, yes, we could write this item every single week, but we like to wait for some eye-popping statistic published by some reputable source.

shopping apps on iPhone

Chuck Martin, of MobileShopTalk writes that the percentage of consumers using mobile to buy stuff has skyrocketed in the past two years. Good word, that skyrocketed. By the end of 2015, Martin writes, 73 percent of computer users had used a desktop device to make a purchase. That compared to 46 percent of consumers who had used a mobile device to buy.

The percentage who have bought with a mobile today (or when a recent survey was taken, anyway) is at 53 percent. The desktop figure is 58 percent, MobileShopTalk reports.

The figures add up to more than 100 percent, because the users are not mutually exclusive. In fact, the figures reflect reality. Consumers buy what they want the way they want. Sometimes using a mobile device makes sense. Sometimes a desktop is the way to go.

The bigger story here is that all this talk about multi-channel shopping and the move to mobile has obviously not been a bunch of mumbo-jumbo, to use the technical term. Consumers are apparently becoming more comfortable with purchasing on a phone.

In fact, the idea of being more worried about the security of a phone than the security of a desktop seems almost quaint. As shoppers have tried mobile purchasing and found it to work without harm, they are more likely to try it again.

We’ll also speculate that brands and retailers’ increased attention to the mobile experience is making a difference. In fact, the recent findings are all the more reason to continue to improve the mobile experience.

It seems consumers are ready to use their phones to buy. Why let a lousy shopping experience stop them?

You don’t sell to businesses, you sell to people

CMSWire comes to us with a cautionary tale and a reminder that B-to-B businesses need to be every bit as aware of their customers’ intent as do companies selling directly to consumers.

Anita Brearton, founder of Cabinet M, which helps businesses manage marketing technology, writes about how a marketing agency exec recently wrote to her to ask for the phone numbers of marketing technology vendors that appeared on her company’s website.

He wanted to be able to recommend some of them to his clients.

Light bulb moment: Why do some B-to-B companies make it so hard to do business with them?

Brearton goes through what might be a familiar tale. The frustration of trying to talk to the right person in an organization. They gauntlet of digital forms to fill out. The sense of starting from scratch every time you contact a business etc.

It happens all the time to consumers. And it happens to those who are shopping for products or services for the companies they work for, too. That sort of treatment isn’t going to fly anymore — not in consumer markets and not in B-to-B markets.

Consumers, whether shopping personally or for an enterprise, expect you to know them. They expect you (as a business) to understand what they want to accomplish and where they are in the continuum of figuring out the best way to accomplish that.

You’ll hear plenty in the world of digital commerce blather on about “the customer experience.” This is what they’re talking about. Making sure you understand the individual needs of a customer at a particular moment in time.

We’ve entered an era where it has to move beyond talk. As with so many things — mobile accessibility and performance, delivery options and speed, buy-online-pickup-in-store — customers are demanding it.

You know what’s inevitable? Death and taxes

Retailers can’t quite call it a day when it comes to lobbying against the idea of a federal border adjustment tax.

There was reason for celebration among those opposed to the tax earlier this week when the Trump Administration released a brief tax-alteration proposal that did not include the much-talked-about border tax.

But as the Washington Examiner points out, administration officials and House members have said there is much good about the idea, which would effectively tax imports. The Examiner says it’s possible the proposal will be back in modified form.

The Examiner says retailers would have the most to lose under the tax code modification. And The National Retail Federation and Americans for Affordable Products, which represents Wal-Mart Stores and Macy’s among many other companies, have been among the most outspoken critic of the tax plan, which echoes one of President Trump’s campaign themes.

“The plan would work by excluding exports from taxable income but preventing companies from deducting export sales from their taxable income,” the Examiner explains. “That would in effect place a tax on imports.”

Stay tuned.

That’s one ugly mudder of a pair of jeans

Nordstrom muddy jeans

OK, and this, just because these Retail Dive guys kill us.

Retail Dive’s light Friday feature today looks at mud-caked jeans. Yeah, we know, they’ve been all over social media, but we don’t get out much. We actually have a pair of jeans exactly like these $400-plus guys. Ours are in the garage with the paint clothes. We’re waiting for a chance to sneak them into the washer without our significant other noticing.

They look like they could do some serious damage.

Anyway, problem solved. We’re putting them on eBay. High bid wins.

Quote of the week

“I’m extremely proud of what we’ve accomplished at HSN and believe that the company is well positioned for the future. It has been an honor to work with such an inspired team over the past decade as we transformed the business to lead the future of boundary-less retail.” — HSN CEO Mindy Grossman to the Tampa Tribune regarding her move to Weight Watchers CEO.

Photo of Apple sign and shopping apps by Mike Cassidy. Photo of Echo Look courtesy of Amazon. Screenshot of muddy jeans from Nordstrom website.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.

Man on a Dutch Railways platform

Listening to customers molds Dutch Railways’ digital experience

A Dutch Railways train passing a house

When your company has been around longer than the internet, building a digital customer experience can require a bit of a transformation of the way you do business.

The Dutch Railways (formally Nederlandse Spoorwegen) has faced this transition head on — taking an 180-year-old company and infusing it with digital initiatives that makes the lives of its 1.2 million daily passengers a little easier every day.

I sat down with Fokko van der Schans, product owner online at the Dutch Railways, for a Q&A about the recent digital push it has been making — and how travelers across the Netherlands have responded.

Q: The Dutch Railways has a customer journey where the online and offline experiences are very interwoven, how do you bridge the two to create a 360-degree view of your customer?

A: We’re not the only company tackling this problem, and also not the only one to run into the challenge of combining the online and offline while being very mindful of users’ privacy. So the way we get the data to make that well-rounded view of our customer is by asking them and motivating them to share by offering handy services in return.

For example, through our loyalty program, NS Extra. All our travelers check-in and check-out of our train stations with a personal card, which generates enormous amounts of useful data. Unfortunately, we are only allowed to use these data on an aggregate level. Through NS Extra we incentivize our customers to share their travel data with us, so we can service them back in return.

For example, if we notice they forgot to check-out we’ll send an email that makes it easy to remedy this and avoid any unnecessary journey fees. The more benefits like this that we can offer our users, the more they understand how sharing the right data is a win-win. Especially through our journey planner app where we can deliver very personalized services.

Q: You’ve had great user feedback on the Dutch Railway digital experience this past year. Are there key initiatives or aspects that your customers have responded to?

Fokko van der Schans at BloomReach Connect

  • Dutch Railways’ Fokko van der Schans will be among a line up of experts in artificial intelligence, e-commerce, content, venture capital and technology speaking at BloomReach Connect in New York on May 4.
  • Connect banner

A: Yes, a lot of response and a lot we’ve learned from the feedback. In December 2015, we went live with the redesign of our new website, which also included a redesign of our online journey planner. We had put that journey planner through many focus groups and we’re excited to put it out in the world, but when users got their hands on it — they just didn’t like it. It wasn’t as intuitive as they needed, and the new horizontal interface was simply not the way our travelers wanted to use it while on-the-go.

So we listened, we learned and we improved. And we had to do this quickly. We redesigned the journey planner in eight weeks, incorporating the feedback of our users — including returning to a vertical interface. And over the past year we’ve seen very positive results in our feedback score. It was a very successful turnaround of a critical user service.

Q: What advice would you give to more traditional industries who want to focus on creating an exceptional digital experience?

A: Keep it small. Or at least, start small. I think this applies to everyone looking to focus on new digital projects, but especially in more traditional industries which tend to be larger.

One of the main pitfalls of big companies is the rush to do it all at once, with everyone wanting a piece of the cake. On one end, this is great, because everyone is positive about digitization but with everyone wanting to add in their opinions … it gets muddled.

So start small, with one focus at a time. And finding the first step to focus on is usually pretty easy. It is what urgently needs to change. For us, this was our website. It wasn’t responsive and, honestly, we just couldn’t get away with that anymore. The world around had changed and we had to change with it.

Q: What’s next for the Dutch Railways? What upcoming innovations and projects are you excited about?

A: A pretty cool thing about the Dutch Railways is that one of our biggest targets, and a main driver as a whole, is our customer satisfaction score. We use Usabilla to ask our customers how each of our online channels is performing and the feedback they give is the motivator for our digital initiatives.

It’s great because we can see where our score is, gather the comments, identify the pain point, and improve. We’re currently finishing up a pilot of a new initiative that makes it easier for our passengers to give feedback via an app and helps improve and close the feedback loop by contacting them once a week with the improvements we made based on their feedback.

We also just went live with our new personal account program, “MyNS” — a completely renewed account program that includes features such as a new dashboard to track your progress in a gamification project we launched.

Train photo by Rob Dammers published under Creative Commons license. Photo of man on platform with train courtesy of Dutch Railways.

To hear more about the digital transformation of the Dutch Railways, join us May 4th in NYC to see Fokko van der Schans and other innovators take the stage at BloomReach Connect.  

 

reporter's notebooks in a trash can

BloomReach Relevance Report: Valentine’s Day shopping data edition

Industrial Mop bucket

 

Listen up, significant others of other significant people: When it comes to Valentine’s Day, you’re falling down on the job.

OK, not completely. The National Retail Federation says you still spent in the neighborhood of $18.2 billion on the day of gift-giving that there is really no way around. But that is down from nearly $20 billion in 2016, according to the NRF, which relies on an annual consumer survey conducted before Valentine’s Day.

“Valentine’s Day continues to be a popular gift-giving occasion even if consumers are being more frugal this year,” NRF CEO Matthew Shay said in a written statement.

Frugal. Sounds so much better than cheap. “I wanted to get you that diamond anniversary ring, honey, but I was being frugal. I’m saving money for both of us, really.”

Anyway, at the BRRR, we’ve always found how we spend money and when to be every bit as interesting as how much. The types of gifts that Valentine’s Day shoppers spent on is hardly a shocker. The NRF says the love-struck shelled out for candy, cards, a night out, flowers, jewelry, clothes and gift cards — in that order.

Greeting cards were No. 2? Really people?

Anyway, the BRRR took a look at BloomReach customer data across our e-commerce customers and found that folks really got serious about Valentine’s Day shopping — about 24 hours before the big day.

Chart of overall conversion on Valentine's Day

Overall digital purchases on Feb. 13, also know as Holy Crap tomorrow is Valentine’s Day Day, were at a high for the month. The day racked up 39.2 percent more conversions that the February day with the fewest conversions. What day was that? Feb. 5, which was Super Bowl Sunday.

Super Bowl Sunday. Think of it as the anti-Valentine’s Day.

But, of course, data-wise, looking at all BloomReach retail customers gives us millions of data points when it comes to conversions, but it also introduces some noise.

You could make the argument that people buy all sorts of things for the ones they love on Valentine’s Day. (The BRRR looks back fondly on the mid-February day some years ago when our love presented us with one of those big mop buckets on wheels. Que romantico!)

But the truth is, some BloomReach customers tend to feature products that would be considered more traditional Valentine’s Day gifts. And so we thought it would make sense to look at a subset of customers that shoppers would be likely to turn to for Valentine’s Day gifts.

Yes, there is a certain subjectivity involved.

That said, looking at the subset presents us with the notion that there might well be two types Valentine’s Day gift buyers: The planners and the panic-ers. We’d thought about calling them the thoughtful and the last-minute grabbers, but it sounds so judgy.

We mean, what’s wrong with being that love-struck Romeo or Juliet standing in the Safeway line at 6 p.m. on Valentine’s Day with a bouquet of $20 roses that looks like it’s been through the spin cycle?

Anyway, a look at traffic to e-commerce sites aligned with Valentine’s Day shows a significant spike on Feb. 7, one week ahead of the holiday. (Thanks Google Calendar notifications!) And it shows another spike on Feb. 13., which is, well, the day before Valentine’s Day.

Chart of Feb. 2017 site visits

In fact, Feb. 13 has just a slight edge in traffic over Feb. 7, but both are well beyond any other day in February.

And while the visits a week before and a day before are quite similar, there is strong evidence that many of those looking on Feb. 7, held off on buying. A comparison of conversion rates, a way to look at web traffic compared to purchases, shows a much lower rate on Feb. 7 — less than half — compared to Feb. 13.

conversion rate in Feb. 2017, graph

Another strong indicator of buyer intent — the browse vs. buy index — also shows that Feb. 13 is the day that buyers get serious. And Feb. 7? Not so much. But it introduces a little encouragement for those who think last-minute shopping indicates a certain lack of sincerity.

The browse vs. buy index considers the average number of products that were viewed for each purchase on a given day. The thinking is that the more products viewed, the weaker the intent to actually purchase.

It turns out that on Feb. 7, shoppers looked at 29 products for every purchase. On the day before Valentine’s Day, the number was less than half that — 14, to be exact. That’s interesting as far as it goes, but the romantic in us would like to offer a defense of the Feb. 7 browsers.

Graph of browse vs. buy behavior in February
Couldn’t it be that they were simply being more thoughtful — considering one gift and then another before pulling the trigger? Hey, we can dream.

Speaking of pulling the trigger, what did buying behavior look like in the two weeks leading up to Valentine’s Day, when we narrow our data down to retailers that seem a good fit for Valentine’s Day shopping?

It turns out that there was a huge spike in purchases on the day before Valentine’s Day. (Stop us if you’ve heard this one before.) In fact, the number of purchases on the day before Valentine’s Day reached 8½ times the number on the day in February (so far) with the lowest number of purchases.

Daily online conversions in February chart

And so Valentine’s Day, it seems, exposes not only the most human of emotions, but perhaps the most human of habits.

You think there’s any chance they’ll rename it Procrastination Day? It’s got a nice ring.

Mop bucket photo by Terry Ross published under Creative Commons license.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com. Follow him on Twitter at @mikecassidy.

 

UncommonGoods takes a novel approach to measuring success

David Bolotsky, CEO of UncommonGoods

CEO David Bolotsky and the rest of UncommonGoods works out of a nearly 100-year-old former Army terminal in Brooklyn.

Nothing is inevitable, but the idea that David Bolotsky would end up being a founder of a New York-based e-commerce company comes pretty close.

From the time he was a little kid, growing up on Manhattan’s Lower East Side, the CEO of UncommonGoods was drawn to entrepreneurship and retail. His grandfather owned a candy shop that he’d visit regularly. What’s not to like?

And the internet? He’s been fascinated with its potential since the moment a friend described it to him over dinner in 1994, at the dawn of the digital revolution.

“I thought it was the most interesting thing that I’d seen in my life, in terms of changing the world,” Bolotsky says.

And yet there were turns and twists along the way to the top of UncommonGoods. Today Bolotsky, 54, sits in a cramped fifth-floor office at the end of a hallway in the hulking Brooklyn Army Terminal — a sprawling, concrete, fortress-like complex that in the first half of the 20th century served as the place from which the military shipped out supplies and soldiers, including one Pvt. Elvis Presley.

From that office, overlooking an industrial section of Brooklyn, Bolotsky runs a retail business that is uncommon for reasons beyond the unusual gifts, crafts, jewelry, home goods and accessories that populate its catalog. UncommonGoods is a B Corporation, a designation presented by a third-party outfit that assesses companies’ social responsibility based on policies on workers, sustainability, governance and community involvement.

For UncommonGoods, that means the company has its own minimum wage — nearly 30 percent higher than the state minimum after a recent increase in the state guideline — and a progressive paid family leave program. It means that it offers modest scholarships to college kids studying art and design and that it donates $1 from purchases to various non-profits on customers’ behalf. It means that it has policies in place to minimize its environmental impact.

Those programs are described on the website, sure. But they’re also front and center in the 100-plus-person company that grows to many more than that during the holiday season.

“I’m super proud to work for this organization,” says Heather Thompson, a senior product manager, who’s worked at UncommonGoods for almost seven years. “It’s super awesome that I know that my work isn’t just about driving the bottom line for our business.”

But there is a bottom line. And UncommonGoods is a business — a business in the bare-knuckles retail industry, where department stores and others are closing locations and scrambling for new models; and where pure e-commerce companies, like UncommonGoods, go up against Amazon every day.

Moving from Wall Street to e-commerce

So how did Bolotsky, a guy who grew up on the Lower East Side, studied poly sci at the State University of New York, Binghamton, and went to work on Wall Street, end up switching careers and starting an online store in 1999?

Remember, there was the love of retail and the fascination with the internet. And, it turns out, the Wall Street gig had something to do with it. From the late 1980s through the 90’s, Bolotsky was an investment researcher at Goldman Sachs, leading a team covering retail.

As the internet became a thing, it became clear to him that it was about to turn the retail industry upside down.

Back in his Army Terminal office, Bolotsky reaches over to a bookcase and plucks an old Goldman Sachs report off his bookshelf. It’s called  “Cyber Retailing 1997: Not yet ready to turn stores into dinosaurs.”

Yeah. He wrote it.

“I quickly came to the view that this was a big deal that companies ought to pay attention to,” he says of the 1990s internet. “What I said in this report was that it was going to catch 15 to 20 percent of the retail market. That was a bold statement then. I think it’s going to end up being conservative.”

UncommonGoods operates out of the Brooklyn Army Terminal built at the end of World War I.

UncommonGoods operates out of the Brooklyn Army Terminal built at the end of World War I.

Sure, at the time some scoffed.

“I remember getting grilled by the management of Borders Group about how I was a cheerleader for Amazon,” he says, “and how I didn’t have a healthy perspective.”

Of course, Borders went out of business. And Bolotsky sits in his fifth-floor office, running a privately held e-commerce business that saw sales increase faster than 15 percent last year.

The retail idea had been rattling around in Bolotsky mind for awhile before he launched UncommonGoods in 1999. The question was, what would he sell? What would he care about selling? The answer came when he heard about an upcoming Smithsonian Institution craft show in Washington D.C.

Bolotsky turned to one of the keys to retail success: Listen to the voice of the customer. When evaluating a retail investment idea, his first step was always to visit the store, he says. So, he went to the show.

Listening to customers pays off

“And this craft show was packed with customers, which is always the most important test of the viability of a concept. Are people shopping there?” Bolotsky says. “And I talked to a bunch of the customers and almost to a person they talked about how they were looking for something different than you’d find in a mall or in some mass-produced store.”

They said they were looking for gifts that reflected both the recipient’s personality and individuality as well as their own. Beyond the entrepreneurial opportunity, the artisan and artistic crafts business also appealed to another part of Bolotsky’s being.

Selling artisans’ and artists’ work via the internet would provide a new chance for those being excluded from economic opportunity — including those in developing countries and in remote areas, who created beautiful and inspirational objects, but who had no practical way to bring them to market.

“I thought, wow, the internet is perfect for this,” Bolotsky says. “You can have your craft show open 24/7, 365 days a year; the artists can focus on what they do best, which is creating their work; we can handle the marketing, selling, shipping, what have you; and only keep it in one physical location, much better than a chain of stores, which has to keep at least one piece on hand. So, I thought, this was a great idea.”

For Bolotsky, it was never just about selling, or even just about business success. From an early age, he focused on social issues. He became a vegetarian at 11 years old and volunteered at animal shelters. He’s been a strong advocate for workers rights — higher minimum wage, better family leave policies — an odd position for a CEO in corporate America. His LinkedIn profile lists his long-held board seat on a non-profit that helps disadvantaged high school kids and his founder position with Friends of Gulick Park — along with his Goldman Sachs stint and his time at Credit Suisse.

Bolotsky points to his dad, who worked at the United Nations, and his mom, a social worker, for inspiring him to think about the world beyond himself.

“She was somebody, who as a 22 years old, took a bus down to Montgomery and participated in the bus boycott,” he says of his mother. “She was always somebody with a very strong social conscience and drummed that into my sister and me.”

And there were the bullies. Yes, Bolotsky was bullied as a kid. He says he empathizes with the underdog and those who are mistreated because of it.

“I was a skinny kid with long hair, who looked a bit like a girl,” he says. “And I was a vegetarian, so I was definitely different. And I wasn’t apologetic about it. My dad always taught me not to take any crap from anybody. So, if anybody gave me crap, I didn’t back down, and I got into fights as a result of that.”

UncommonGoods is doing well while doing good

Social awareness is an ethic Bolotsky brings into his business, which is why you’ll find him working in support of more generous family leave policies in New York and the country. And why he spends time thinking about how he can be most effective in influencing public policy.

UncommonGoods is a craft show that stays open 24/7, Bolotsky says

UncommonGoods is a craft show that stays open 24/7, Bolotsky says

“We have been very active in trying to get certain laws changed, or created, and so years ago, I was more active on the federal front,” Bolotsky says. “I’ve learned there is a much bigger ROI to focus on the state of New York. It is a big state. It can have a big impact. As a business here, our voice is heard.”

And it’s an approach that inspires many who work for the company. Thompson, the product manager, says when she thinks about pushing UncommonGoods revenue higher, she is thinking about more than the bottom line.

Her thinking: The bigger the business grows in terms of revenue, the more powerful Bolotsky’s voice when he speaks up on social  and economic issues whether at the state house or the White House.

Jillian Brendlen is a site merchandiser who’s been at UncommonGoods for three years. She says that the social responsibility that the company displays was definitely part of her decision to take a job there.

“I really liked that aspect,” she says, noting not every retailer embraces social responsibility.

Still, Bolotsky doesn’t lose sight of the fact that UncommonGoods is a business, with all the requirements that businesses have.

“Do I want the business to be successful,” he asks? “One hundred percent. I care deeply about our return on capital investment. At the same time, having a positive effect on people, at the end of the day, means a lot more to me than what the business is valued at.”

Sure, he says, doing good and doing well in business can at times be colliding ideals. But the equation is more complicated than some make it out to be. Consider UncommonGoods’ decision to pay warehouse and seasonal workers a minimum of $14 an hour, when the state requires only $9.70.

“I do believe there is often enlightened self-interest, where you can pay people more and you get more from them. There is greater loyalty. Hey, if we’re paying above market, that person is less likely to want to quit their job. They might even work harder because they feel valued by you and respected by you.”

Some of those results are hard to measure precisely, though Bolotsky has another gauge by which he governs his minimum-wage strategy.

“I’m not a believer in socialism or communism,” he says. “At the same time, I think business owners have a responsibility to treat people fairly. And part of it is, I believe strongly in equality of opportunity and providing an opportunity for folks to start out with a seasonal warehouse job and work their way up or get an opportunity elsewhere.”

UncommonGoods is a retailer, not a political platform

All that said, Bolotsky is not interested in using UcommonGoods — neither the website nor the company — as a political platform.

“I want this to be a big tent,” he says. “Just like I want our country to be inclusive, I want  our company to be inclusive. And if you’re a conservative or a liberal, I want you to feel comfortable shopping here and working here. At the same time, I want us to be sensitive to people from all walks of life.”

Late last year, as the November presidential election approached, Thompson began thinking about adding to the post-election home page some acknowledgement of how exciting it was that the country had elected its first female president.

“That was my assumption,” she explains. So she brought the idea up with Bolotsky.

“Dave said, ‘Not everyone loves Hillary Clinton.’”

But, Thompson says, Bolotsky was willing to listen and explain his thinking, though the answer was no. But not just no.

The day after Clinton was defeated by President Donald Trump, Bolotsky sent Thompson a note. In it, the boss included a quote from Martin Luther King Jr.: “The arc of the moral universe is long, but it bends towards justice.”

It was his way, Thompson says, of lending support and encouragement.

“We went back and forth,” she says of the pre-election debate. “There was a lot of back-and-forth. He opens the door and allows for that kind of dialogue.”

Bolotsky has helped foster an atmosphere of openness. Though the company is privately held, he shares detailed quarterly financials with employees.

Thompson describes the atmosphere as being like a startup — a business where people are expected to try new things, move out of their comfort zones and speak up.

“The smartest people I’ve ever met are here,” Thompson says. “You work with incredible people and creative people. If you don’t have a solution, it’s, ‘Let’s figure one out.’ It’s really fun.”

For her part, Jillian Brendlen was surprised that Bolotsky interviewed her before she was hired. Her initial assistant merchandising coordinator position at the company, after all, was “kind of like low man on the totem pole.”

UncommonGoods' CEO David Bolotsky talks with PR person Jennifer Coleman

Bolotsky talks with PR and Social Media coordinator Jennifer Coleman about an upcoming New York Paid Leave Coalition event.

“I thought that said a lot about how much he cares for the staff and his team members,” she says. She soon found herself steering a big initiative to help create an UncommonGoods’ feature under which customers can pre-order items before they’re available for sale.

“I think he noticed that I was kind of stressed out,” Brendlen says. “He called me into his office and said, ‘Just come directly to me if you have any questions.’” As Brendlen left his office, Bolotsky leaned out the door to tell his executive assistant, “If Jillian Brendlen ever needs anything, make time for her.’”

“And that just made me feel, one, they’re very committed to this program, and two, they’re very committed to me leading it,” Brendlen says.

Committed is a good word for Bolotsky and his mission with UncommonGoods. He knows he faces unrelenting competition from upstarts, marketplaces and most of all Amazon. He’s still has a lot of faith in technology as a way to stay competitive.

“I’m a huge believer in technology. If I weren’t, I wouldn’t have started an internet retail business that is built on technology,” he says. “So we are always looking at technology to make us more efficient, make our team members and our customer experience better.”

But technology alone is not enough to fend off Amazon.

“They’ve largely taken over e-commerce and they certainly are setting the standard for customer expectation,” Bolotsky says. “They keep getting bigger and they keep getting better. They’re a ferocious competitor that I have a lot of respect for.”

Bolotsky’s approach to Amazon is to focus on minimizing UncommonGoods’ disadvantage in areas where the Seattle behemoth is hard to beat. Think speed and price of delivery. And then he focuses on ways to set UncommonGoods apart.

“I think you can compete against them by having differentiated product and differentiated customer experience — and we work hard to do it.”

The internet that Bolotsky saw in 1994 has indeed changed the world — in ways predicted and unforeseen. It spawned Amazon, which arguably has changed retail in ways unlike anything since. But Bolotsky is ready to take on that challenge from his fortress in Brooklyn.

After all, in many ways, when it comes to e-commerce, he remains that kid in the candy store.

UncommonGoods is a BloomReach Compass customer.

Photos by Mike Cassidy

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.

 

NRF Round Up

American Girl; pumpkin spice latte; Wal-Mart toys: The BloomReach Relevance Report

OK, the long-awaited, long weekend is here. Plenty of time to read the BloomReach Relevance Report. But why wait?

She’s an American girl

American Girl Dolls

If you’ve been the parent of an American girl at any point in the last 40 years, then you know the American Girl doll.

We have been; and we do.

We’ve lived the joy of unwrapping Kit Kittridge’s rolltop desk on Christmas morning and the stress of sending Molly McIntire off to the doll hospital for head-replacement surgery. Today the little dolls’ footprint has grown larger.

Starting this month, Toys R Us will be a place where you can buy certain American Girl dolls and soon 100 or so stores will be home to shop-in-shop American Girl outlets, the Associated Press reports.

The move is huge in toy circles. It’s the first time American Girl dolls will be available outside of the 20 American Girl Stores and the Mattel-owned franchise’s website, according to Marketplace, which you can hear below.

The expansion is part of a strategy to encourage the pricey dolls to pull their weight. AG doll sales have been slipping, down 8 percent last year, and down 19 percent in the latest quarter, The Wall Street Journal says.

You could say, then, that when it comes to American Girl, Mattel is taking baby steps. Though that would be a horrible pun. See, American Girl is not moving its entire line into Toys R Us. Instead, it will start out selling WellieWishers there. No, we don’t know what that is either.

The Chicago Tribune, though, tells us WellieWishers are smaller than the OG AG dolls and come with smaller price tags than their American Girl doll relatives. The idea is to target a younger demographic. American Girl aims for the 8-and-up crowd. WWs are for the 5- to 7-year-old set.

In October, and in time for holiday shoppers, the store-within-a-store concept will roll out and Toys R Us will begin selling the $115 Truly Me dolls, Fortune and others report. The idea behind the Truly Me dolls is to apparently end up with a doll that looks like you.

While some have warned that American Girl might be diluting its brand by moving distribution beyond its carefully controlled and choreographed stores, the BRRR believes the company has shrewdly insulated itself from that problem.

Many of the dolls with real star power will still be available only online and at AG stores, typically located in high-end malls and shopping districts. The stores are a temple to customer experience, some including features like American Girl doll restaurants, theaters for plays, styling salons, museum-like displays and the like. Going to the American Girl Store is an outing as much as it is a shopping stop.

It’s safe to say, even with the Toys R Us expansion, there will be plenty of reasons to visit the old-school American Girl Stores.

Ho-ho hoo-boy

Yes, the holiday season has pretty much started for the nation’s retailers. Wal-Mart Stores, for instance, has come up with its list of the top 25 hottest toys this holiday, according to the Pittsburgh Post-Gazette.

Yes parents, you can start stressing. And non-parents? You can start wondering, “Who names this stuff anyway?”

Wal-Mart creates its list by letting kids play with stuff. Then they ask the kids which toys are the best toys.

via GIPHY
 

Topping the list, according to USA Today, is My Life as a Food Truck, which doesn’t sound like an aspirational play thing. There is Doc McStuffins Hospital Care Cart for kids who have a little more ambition, career-wise. And the list includes FurReal Friends Torch — My Blazin’ Dragon, Hatchimals, Sky Viper Streaming Drone and on and on.

Anyway, the point here is that retailers take the holiday season very seriously, as a disproportionate amount of retail sales occur in the last two months of the year. It can also be a time that helps retailers look into the future.

Trends that have been building tend to be amplified during the year-end shopping frenzy. For instance, the move to mobile and post-Christmas shopping were magnified during the 2015 holiday season.

The season also gives retailers a chance to stress test their year-round strategies and an opportunity to latch onto newly acquired customers and keep them. So yes, the preparation in store and online starts early.

The National Retail Federation says the work could pay off. The NRF is predicting that retail sales will be up 3.4 percent this holiday season over last. That’s a slight uptick from the organization’s earlier 3.1 percent prediction. The portion of spending that includes online shopping will be up in the 7- to 10-percent range, the federation said. That’s also an increase, which is based on improving housing and job markets and better wages, the NRF’s CEO said.

Some are also pointing to a robust back-to-school season as a good sign for the holiday, though drawing conclusions from one season to the next can be tricky.

Sometimes you just have to wait and see.

Fall is officially here, well Pumpkin Spice Latte is, anyway

Starbucks Pumpkin Latte

It’s here. The day the world stops — and sits down for a long-awaited Pumpkin Spiced Latte at the local Starbucks. (And let’s face it, no matter where you are, you’re no more than 500 feet from a Starbucks.)

We couldn’t help notice that PSL comes with some other crazy nonsense this year: The Chile Mocha, which is, well, we have no clue. It does come in a chocolate version, though, and apparently combines warmth, spice, apple pie and cinnamon — or things that conjure up those flavors, according to a Starbucks person quoted by CNBC.

The truth is, the BRRR is not a fan. We like to be contrarian. But for those of you who are fans? We’re happy for you.

That said, doesn’t it seem, like many things winter-holiday related, that pumpkin spice is foisting itself upon us earlier and earlier in the year? In fact, yes, says Fortune, which also has a nifty graphic showing the “PSL creep” of recent years. But as Fortune points out, Starbucks and others wouldn’t be serving it if people weren’t drinking it. So, cheers.

Oh, and before we forget: Go ahead Twittersphere: Lose your mind.

 

 

#A little help here

Instagram_AppIcon

As our lives continue to move from the real world into the tiny computers we hold in our hands, more retailers are figuring out more ways to be where their customers are — to sell stuff, sure, but that’s not all.

Luxury Daily reports that Lord & Taylor and Anthropologie have joined retailers that let customers get ahold of them through Instagram. Both retailers have placed “contact” buttons on their Instagram profile pages so customers with issues can get in touch while scrolling through filtered photos. (We’re partial to Crema.)

LD spoke to an e-commerce expert who noted that with the holidays coming up, it’s time for retailers to up their customer service game. Marci Troutman, of SiteMinis, figures that online shoppers are also probably heavy social media users, so retailers should use the big social networks as communication channels. Two-way communication channels.

And she suggested that setting up a social media contact button, but failing to adequately staff the operation, would be a big mistake, which makes sense.

Of course, customers have been using social media to complain about and question companies for years. In fact, I was kind of surprised to see my old buddy and New York Times reporter Vindu Goel chastised for using Twitter as a customer complaint line.

The point is, customers are going to make it known when they feel they’ve gotten lousy service, have been misled or unduly inconvenienced by a retailer or anyone else with whom they do business. So why not create a channel specifically for that and see to it that you can effectively and efficiently deal with problems that arise.

The Forbes story linked above points out a number of big advantages for retailers who formalize Twitter as a customer service channel:

  • First, companies that have done so are showing a 19 percent increase in customer satisfaction.
  • They are saving money. A Twitter response costs $1. The average cost of solving a problem through a call center is $6.
  • Companies with a separate customer help handle (Forbes cites @HiltonHelps) get 10 times better response than those that don’t.

It’s hard to argue with the results. Though, if you have a dedicated customer service button on your social media accounts, somebody just might try.

Color me: Looking for an edge

Sears store

It’s no secret that Sears has been having a tough time of it lately. A lot of department stores have been.

In an effort to get its edge back, Sears is bringing back Easy Living, which hasn’t been its recent experience. Easy Living, of course, is paint and it will be among the brands that Sears’ is bringing back into its stores.

The iconic retailer will also be returning the Weatherbeater brand to its shelves. Sears stopped selling paint in 2014, USA Today says. But it’s now trying to take advantage of a housing boom and a related surge in home improvement.

The BRRR is pleased, given that almost every interior wall in our house is coated in Sears paint. (OK, sure, maybe it’s time to repaint.)

And while the BRRR is celebrating the news, other pundits are wondering whether Sears is trying to paint over some serious problems. Sorry, that was just too easy.

The Street points out that the paint gambit might be too little, too late. It says that consumers have become quite the penny-pinchers since the Great Recession. And it reminds us that when people do shop, they tend to shop online.

We understand The Street’s argument, but we’re not sure the analysis applies in any large way to the paint market. While not exactly a necessity, there comes a time when a home could use a fresh coat. It’s the sort of thing that is going to get done at some point.

And while it’s quite possible to buy paint online, it seems like the sort of thing that most consumers would make a trip to the store for — all the better to see the actual color, plan out the tools that will be needed and maybe get a little advice.

Who knows? Maybe paint is the thing that will bring shoppers back to Sears.

Food for retail thought

Barnes and Noble

As brick-and-mortar stores continue their rapid evolution, a school of thought is emerging that the way to a consumer’s wallet runs through his or her stomach. Barnes & Noble, once known for selling dead-tree-version books is now in the bar and grill business.

The Dallas Morning News reports that B&N will open one of its five bookstore-bar-and-grill combo stores in Plano in March. The move is in keeping with the notion that shopping has become all about the experience.

OK, well, maybe not all about the experience. Retailers are still interested in getting people to buy things. But the developer of the Plano mall that will house B&N said the store will give consumers the opportunity to stop in, browse some books, meet some friends and have a glass of wine, which sounds pleasant enough.

And then there is Ikea, which has always been known as much for its meatballs as for causing Saturday afternoons to devolve into a fury of curse words and fruitless searches for the Allen wrench.

Ikea is upping both its culinary and DIY game, according to Time. The build-your-own home goods store will launch a pop-up restaurant in London, where shoppers can cook their own meals. (Wait. Doesn’t that sort of defeat the purpose of going to a restaurant?)

You do get a sous chef and a maitre de working for you, which is probably a little different from cooking at home.

Ikea says the idea is to celebrate the joy of cooking and eating together, since no one eats or cooks together anymore. So there is that.

Maybe the most interesting thing in the whole Time account of this latest Ikea initiative is this little tidbit: When it comes to Swedish meatballs, Ikea is the bomb. The retailer “sells a billion balls a year,” the story says.

Roll on Ikea. Roll on.

Quote of the week

“Retailers always have robust contingency plans, but this degree of uncertainty is making it challenging to put those plans in place.” — Jessica Dankert, of the trade group, Retail Industry Leaders Association, told the Associated Press, regarding shipments stranded by the Hanjin shipping line bankruptcy.

Starbucks pumpkin photo by Chris Breeze, Barnes & Noble photo by Mike Kalasnik and newspapers by Jon S. published under Creative Commons license. Photo of Sears store courtesy of Sears, Instagram logo courtesy of Instagram. Photo of American Girl dolls by Mike Cassidy.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.

Department store ups and downs; Amazon marches on: The BloomReach Relevance Report

They say the days are getting shorter, but actually they don’t get any shorter at all. You still have plenty of time to read the BloomReach Relevance Report. Dig in.

Department store fortunes are compartmentalized

Macys future

Maybe you’ve been reading about the trouble with department stores. Maybe you’ve been living the trouble with department stores. Foot traffic is down, comparing same-store sales is giving retail execs stomach aches, etc.

But the truth is, not all department stores are created equal. Look at this week’s news from JCPenney vs. this week’s news from Sears, the two stores that competed wildly for share of our parents’ sneaker wallet when we were growing up (while all the cool kids were getting Converse). Remember Jeepers? Of course you don’t.

Anyway, Penney had a good week. In fact, JCPenney is killing it. Bloomberg reports that the chain says that only 10 of its 1,000-plus stores are not profitable. That’s a far cry from Sears, which lost $395 million last quarter and has been closing stores like crazy. (More than 160 in the past 10 years according to a chart accompanying the Bloomberg story.

Closing definitely seems to be the thing to do. Macy’s, you may recall, just announced plans to close 100 stores.  But to paraphrase our dear mother, JCPenney figures that when fate closes a store, it opens a window.

The retailer has been negotiating with mall operators who have lost anchors in the Sears, Macy’s etal bloodbath, Bloomberg says, and landing good deals to move in and start doing business.

The retailer has also taken a good look at its core customers and sharpened its focus on “beauty, home goods and special sizes,” Bloomberg says. It will also up its e-commerce game and improve its customer service, the news service says.

The glowing report seemed unlikely only a few years ago when former Apple stores guru Ron Johnson took the JCPenney helm and did away with discounting among other things. His reign is pretty much recognized as a disaster for the retailer.

That was then. This is now. Stay tuned.

Ikea is the new Comedy Central

Ikea store

Ah, Ikea, you slay us. First, it was the BookBook and now, now it’s stars of the Ikea catalog.

The Swedish retailer just keeps rolling out hilarious advertising campaigns, this one listening in to the hopes and dreams of the people who stand among the hard-to-build furniture pieces for sale in Ikea’s product catalog.

The retailer is definitely an industry leader when it comes to using content to attract customers and encourage shoppers to buy. One key to Ikea’s success is not taking itself too seriously and tapping into cultural touchpoints.

The BookBook schtick is a spoof on Apple’s inclination for self worship when it comes to products.

The stars spot is another laugh-out-loud promotion starring sober and self-absorbed actors celebrating their big break of being in Ikea’s big book. We admit it makes us want to run out and buy a Gronadal rocking chair.

The retailer’s embrace of humor seems to inspire its customers. Sure, it’s an old favorite, but this user-generated video not only gives Ikea’s polished ads a run for their money, it might actually be funnier. Enjoy.

And no, we didn’t write this whole item just so we could get the “Hey Donna” video into the BRRR again. OK, yes we did.

Amazon eyes book-stacker of the world for next brick-and-mortar outlet

Amazon bookstore

Amazon’s brick-and-mortar empire apparently has its eye on Chicago as the next territory it intends to conquer, the Chicago Tribune reports.

You’re no doubt familiar with the Seattle behemoth’s back-to-the-future strategy of selling books out of little shops that you can stroll through and touch stuff. It was a thing back in the day.

Now, there has been some back-and-forth about whether Amazon is really going to open 400 stores and Amazon doesn’t say much about anything it’s doing — anything. It opened its first store in Seattle nearly a year ago.

And even though The Everything Store is opening stores that have books in them, they are not exactly like ye old book stores, as Fortune points out. The physical stores make plenty of use of data, which Amazon has plenty of. The New York Times Nick Wingfield took a tour of the place, if you want a better idea.

Forbes chalked the Amazon idea up to the current thinking around combining online and offline shopping and experiences into one seamless shopping excursion, which a lot of retailers are working on and struggling with.

And the fact is, given Amazon’s vast pile of data on most of America, the e-commerce giant might find some creative answers that are applicable to all sorts of retailers. That’s the good news.

The bad news: Amazon will find them first and scale them up at dizzying speed, potentially leaving the other retailers wheezing and collapsing on the race to the top.

For now, though, Chicago. The newest store, which as with most things Amazon, is a rumor, will open in the city’s Lakeview neighborhood — a very long fly ball from another throwback: Wrigley Field.

Holiday shopping will be more digital than ever

Macy's holiday

Are you ready for the slew of news stories about the holiday shopping season? Spending is up; it’s down; holiday has gone mobile; the store plays a role; the store is irrelevant. Yeah, we’re not ready either.

But here’s an early blast: Marketing Daily reports that Kantar Retail is expecting a 3.8 percent increase in holiday spending this year, which is in line with predictions for last year’s growth.

That’s newsy, as news goes, but the real news is that Kantar, a big consultancy, says that e-commerce will grow 16 percent over last year during the holiday season. A boost in digital commerce is hardly a surprise, but what’s interesting is the rate of growth.

E-commerce is growing fast.

Still not impressed? Bloomberg reports that by some measures, e-commerce now makes up 14 percent of retail spending — breaking the double-digit barrier that e-commerce hovered around but never cleared.

At any rate, there are a lot of signs pointing to a robust holiday season, including Internet Retailer’s report this spring. The only thing with all that? Predicting  holiday spending can be a tricky business and sometimes reality falls short of early hype.

There will be more predictions in the coming months. It will be interesting to see if they are in rough alignment. And then it will be interesting to see if they were right.

Quote of the week

“Now, from one retailer to another, our customer bases are quite different, so when your customers swear at my little old lady customers, who are just trying to come in to buy an album to protect their war time treasures, it’s a bit of a problem.” — Melbourne shop owner Charlotte Knightley on Facebook after traffic to her store was blocked by fans waiting to get into Kanye West’s pop-up store.

Photo of Ikea store by Seth Werkheiser, Amazon book store by Len Edgerly and newspapers by  Jon S published under Creative Commons license. Photo of Macy’s and holiday decorations by Mike Cassidy.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.

Back-to-school shopping never ends

Back-to-school

You can practically feel the earth shaking as millions of kids plod back-to-school, wearing fall fashions in summer heat and toting new backpacks filled with three-ring binders, two-pocket folders, pens, pencils, calculators and MacBooks.

School is back and back-to-school is a thing. And you know how they say you never stop learning? Well, it turns out you never stop buying stuff for the learning either.

Sure, in much of the country class is in session. But that doesn’t mean that the back-to-school shopping frenzy has ended. In fact, plenty of families will continue their back-to-school shopping for weeks.

The National Retail Federation last week issued a news release pointing out that the average back-to-school shopper had completed 48 percent of his or her school shopping by early August. That, of course, means that half their shopping was yet to come, according to the annual survey NRF conducts with Prosper Insights & Analytics.

Retailers can cash in on the shifting shopping season

All of which is an opportunity for retailers.

“Shopping early and often is a trend we have seen from many budget-conscious consumers over the last few years,” NRF CEO Matthew Shay said in the written release. “In the weeks ahead, parents will take advantage of the aggressive deals that retailers will offer as they get ready to welcome the fall season merchandise.”

The NRF also released the results of a related flash poll it conducted with Research Now to gather parents’ attitudes concerning back-to-school shopping. A sampling:

img alt from entity

Consider that Prosper survey again. Given that it’s nearly September, families have no doubt moved beyond completing just 48 percent of their back-to-school shopping. Still, the back-to-school shopping season is far from over.

Why?

For one thing, the Prosper-conducted survey also found that nearly 5 percent of families plan to engage in back-to-school shopping after school starts. And keep in mind that school hasn’t started yet in some districts.

Be ready for shoppers when they’re ready for you

For another thing, recent trends indicate that the back-to-school shopping season is becoming a season without beginning or end. Yes, the peak spending period will undoubtedly be the late summer for the foreseeable future, but retailers need to remember that consumers are researching and comparing well before and beyond late July and August.

And while all of this is interesting in the context of back-to-school shopping, it is yet another reminder that consumer habits have changed and will continue to evolve, as is evidenced by recent holiday shopping trends.

The fact is, consumers hold the power of commerce in the palm of their hands. They research prices, selection and availability on smartphones. They may begin searching anywhere and at anytime and buy when the price is right, whenever that might be.

The back-to-school season, being the second biggest shopping period in retail, certainly brings those issues to the fore. But they are issues that successful retailers keep in mind year-round, as they plan promotions, inventory and revenue goals.

Infographic and SlideShare courtesy of the National Retail Federation. Photo by Mike Cassidy.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.

Mary Meeker, Alexa and Walmart’s smiley guy: The BloomReach Relevance Report

Almost summertime and the the living is almost easy. Take a load off and read the BloomReach Relevance Report.

Amazon and Alexa look to conquer the world

PR_AlexaFamily_V01

If you’re looking for the next frontier that Amazon intends to conquer, consider CEO Jeff Bezos’ chat this week about artificial intelligence at Re/code’s Code Conference.

He said his company, which you might say is a pretty big player in e-commerce, web services, the publishing industry and the delivery business, has 1,000 people working on its Echo product, which its friends call Alexa.

Yeah, 1,000 people, as in a small town.

You know Alexa, right? It’s the being inside the Echo that keeps your shopping list, tells you the weather, plays your music, challenges you to Jeopardy and basically has you wondering why you need actual people in your life.

Re/code itself reported that Bezos said Amazon had been quietly working on this Echo thing for four years and that we’re all seeing just the tip of the iceberg at this point. Search Marketing Daily detailed how Bezos called this the first inning in the artificial intelligence/natural language processing game — and in fact it may be the first inning with only the first player up to bat.

He said that in the coming decades, artificial intelligence, natural language processing and machine learning were going to change the world in ways we can hardly imagine.

For a look at how such smart agents could help big companies’ bottom lines, check out this piece in the MIT Technology Review.

While Echo is still a somewhat new product, Amazon and machine learning, artificial intelligence and natural language processing no doubt go way back. The three broad engines of innovation are key components of progressive e-commerce operations and Amazon has undoubtedly  deeply familiarized itself with them while building up its e-commerce business.

Speaking of robotics-type stuff, which we were, kind of, it’s become old hat to talk about robots in retail. There is the OSHbot working at a Silicon Valley hardware store. There are chatbots. There are concierge-like robots roaming the halls of hotels. There are digital programs that will help you find the article of clothing that meets your personal style profile.

But you don’t hear a lot about robots working security. The San Jose Mercury News reports that space-capsule-shaped K5 is walking, or rolling, the beat at the Stanford Shopping Center, out near the university bearing the same name (minus the shopping-center part).

 

 

The machine, built by Knightscope of Mountain View, California, has been deployed in a “handful” of places the Mercury News reports.

And why not?

The sight of a robot rolling around the mall is the ideal symbol of the human and machine partnership that is growing in importance in retail and e-commerce. As the Mercury points out, the K5 isn’t meant to handle all security functions at the mall. Instead it supplements the human security force, which relies on its cameras and microphones to pick up on signs of trouble. It also has the potential to act as a deterrent to those with bad intentions, Knightscope’s CEO told the Mercury.

And hey, the thing is only paid $7 an hour, according to the Mercury, though you apparently have to deploy them two-at-a-time. A bargain, nonetheless

Spooning on a dollop of Ikea innovation

Ikea

 

The newest Ikea pop-up shop is something like what retail is going to look like in the future. OK, maybe not the whole tapping-the-wooden-spoon thing, but there are certain elements in the Toronto shop that just make sense.

The store carries only 50 items that shoppers signal they want to buy by tapping a wooden spoon on the shelf on which the items are sitting, Internet Retailer reports. When they get to the checkout, they tap the spoon again and, after making any edits to their order, an Ikea worker hauls the stuff out from the back.

The store specializes in kitchen products, hence the spoon thing, and relies on RFID to make the magic happen. The store has a display offering kitchen cabinets and appliances, Internet Retailer says, and it allows visitors to shop via virtual reality, using Google Cardboard viewers.

Now, we’re not saying that this is exactly what stores of the future are going to look like, but there is pretty wide agreement that the big, traditional stores of today are not going to be the look in coming decades. The future of retail was a big topic at the recent ShopTalk 2016, for instance.

Retail experiments have been popping up (yes, we went there) for some years. Consider venerable online retailer ModCloth’s latest experiment: Taking pop-ups to a new city each month. Next stop: Washington D.C., where the women’s clothier will open a temporary showroom featuring blazers, dresses, swimsuits and bridal gowns, Washington’s Top News reports.

The idea is to browse, shop and order at the pop-up and wait for the items to be delivered. The store offers more than just a chance to browse, though. WTOP says the stores also offer one-hour sessions with a stylist.

The pop-up efforts appear to be a sign that retailers know there is an answer out there, but that they’re not entirely sure what that answer is. Look for more, and presumably more creative, experiments to come.

As retail moves into the future, online and offline will be blended more than ever and shoppers will expect the kind of convenience and personalized service and recommendations that the online world is beginning to provide more and more.  

Experiments like Ikea’s wooden spoon and ModCloth’s foray into bridal wear and the physical world are just two signs that the evolution is continuing.

Pay as you go

shopping apps

As mobile traffic to digital commerce sites shows no sign of slowing down, conversions — or actual sales on mobile devices — continue to lag stubbornly.

No doubt, the difficulty of tiny keyboards and small screens contribute to the sluggish conversion growth. But mobile also suffers from a disadvantage when it comes time to pay for a purchase. Typing in credit card numbers, security codes and zip codes on a smartphone can be a marathon exercise in frustration.

But it turns out, the Pittsburgh Post Gazette reports, that consumers’ security worries represent a big blocker to mobile commerce when it comes to using smartphones to pay. The PPG cites a study by The Pew Charitable Trusts that found that consumers of all ages worry about identity theft and raids on their accounts that could result from using mobile devices to buy stuff.

Though the Gazette says Pew reported that the concerns “cuts across generations,” there is clearly an age divide on the mobile payment habit. The story says Pew found that millennials and Gen X consumers make up 72 percent of mobile payment users.

Pew says it’s up to banks and mobile payment providers to explain the safety features of their systems and to put consumers’ minds at ease.

That said, it wouldn’t be a crazy argument to make to suggest that consumers will become more comfortable with mobile payments over time. The more positive experiences consumers have making smaller — and initially infrequent — purchases on mobile, the more likely they are to use their devices again and more frequently.

And it’s wise to remember that the mobile payment industry and e-commerce retailers are not standing still. Any number of competitors are offering and working on system to streamline the payment process online, which will no doubt help with mobile momentum.

Of course, a bad experience or widespread security failure could set back the mobile conversion movement.

Mary Meeker has spoken

Mary Meeker deck

You could think of it as the “Old Farmer’s Almanac” of the tech world: Every year venture capitalist Mary Meeker comes out with her report on internet trends and let’s just say she doesn’t kid around.

Two hundred thirteen slides laying out where we all are headed in terms of technology and connectivity. Given that she works for Kleiner, Perkins, Caufield, Byer, one of the most storied firms in Silicon Valley, people and businesses pay attention.

The picture for retail: Mobile is where it’s at, but not necessarily where retailers are spending, Meeker concludes, according to Retail Dive. Meeker focuses a lot on advertising, Retail Dive says, pointing out that consumers spend 22 percent of their time on mobile devices, while advertisers spend only 12 percent of their ad budgets on mobile.

Presumably the 22 percent figure refers to the portion of media-consumption time consumers spend on mobile. (Oh, and, one small correction to the Retail Dive piece: Connect was held in Rancho Palos Verdes, which is in Southern California, not Silicon Valley.)

You can read USA Today’s coverage here.

Another big takeaway? E-commerce is growing fast. OK, maybe you knew that, but Meeker points out, via Retail Dive, that digital commerce sales have grown from 2 percent of the retail biz in 2000 to 10 percent last year.

Another fun fact: Companies are making it to $100 million in online sales faster than they once did. Meeker’s report says that it took Nike 14 years to hit the big figure in e-commerce, while Lululemon took only nine years (through sheer determination?) and Under Armour only eight. (They really stepped it up.)

But Meeker pointed out that the United States has nothing on China when it comes to an e-commerce habit.

Meeker also mentioned one of our favorite subjects: The ways in which text messaging has the potential to propel mobile in a big way. We, of course, think she’s right.

Meeker also touched on the importance of customer experience, pointing out that retailers that were once online only are wading into brick and mortar. Meeker points to Warby Parker, which Retail Dive reports has higher sales per square foot than Tiffany’s, which sells really small and really expensive stuff.

RD notes that, like Apple, Warby Parker creates a retail space where people can noodle around with products (we guess you can noodle with eyeglasses) without feeling pressure to buy. It’s all part of what we were talking about earlier. You know, retailers experimenting and such.

One thing is for certain: We’re in for some fun times as retail finds its way.

Quote of the week

“As retail evolves,” he said, “there are elements that are timeless. Today, as much as ever, our customers need us as their advocate for low prices. Smiley represents that commitment.” — Wal-Mart Stores’ Chief Marketing Officer Tony Rogers to Advertising Age on raising the profile of the retailers iconic smiley face.

Photo of Alexa courtesy of Amazon; photo of Ikea store courtesy of Ikea, screenshot of Mary Meeker’s title slide courtesy of KPCB. iPhone photo by Jason Howie and newspapers by Jon S. published under Creative Commons license.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.

+Aziz, a marketer/musician born for Collision

The Collision tech conference was made for a guy like Aziz Ali.

Aziz is a marketer, who devises strategies around culture. And he’s a musician known as +Aziz, who plays guitar. He is a man who appreciates both the joy of creating art and the discipline of measuring just how his music is resonating.

PlusAziz

“It’s actually very different brains,” he says of his musician side and his strategist side. “You kind of need to be your own manager and that’s when you’re sinking into the world of finance and analytics and where you need to be. And then you have this other portion of you that is the side of you that just wants to play.”

It’s only a bit of a stretch to say Ali personifies Collision, the upstart conference with the hip vibe, that expects to draw 11,000 to New Orleans this week. The conference is focused on technology, but more, with parallel focuses on music, sports and marketing. As it did in Las Vegas its first two years, it works to connect with the community in which it’s held.

And here’s Ali, a proud New Orleans resident, who plays music and tracks metrics and knows a thing or two about data-driven marketing: A Collision trifecta. Naturally, he’s scheduled to talk about the band as a brand at the conference on Thursday.

More Collision coverage

Ali lives the tension that Collision embraces  — the balance between art and science, gut and data, when it comes to running an enterprise. In Ali’s case, he’s an indie rock/world music guitarist, who’s launching a band called Kuwaisiana, a blend of Kuwait and Louisiana.

Some musicians he talks to aren’t crazy about data driving art, Ali says, and he worries himself that the fixation on metrics could detract from the creative process.

“Not a lot of musicians that I talk to are comfortable with that kind of stuff, when I start to talk to them about KPIs (key performance indicators) and measuring and having defined audiences,” he says.

But Ali says he’s decided it’s a necessary distraction in today’s music world. And so, he turns to Google Analytics and services like Reverb. At least once a week, he looks in on his social media platforms, which include SoundCloud, Twitter, Facebook and Instagram.

“Usually what I’m looking for is that there is attention,” he said. “For me it’s about awareness and exposure to more eyeballs. I’m usually focused on expanding to new potential communities.”

Ali has identified his core fans and potential fans as those interested in Middle Eastern music and indie music, world music enthusiasts and people in the Middle East or of Middle Eastern descent.

“Those audiences haven’t embraced me to the same degree that they’ve embraced other people that they’re fanatical about,” he said of the last group.

He’s hoping to appeal to “music snobs” who might write a blog post about his music and expand his market. In the meantime, he’ll keep tracking key metrics.

And he’ll continue to increase his visibility with novel projects, like his mashup with a computer programmer who translated hashtags at one of his concerts into bits of music and his partnership with Lululemon that brought his music to yoga enthusiasts.

And, of course, there are the speaking engagements, like the one at Collision, which is right where he belongs.

Photo by Rushing Haise, courtesy of Aziz Ali.

Mike Cassidy is BloomReach’s storyteller. Contact him at mike.cassidy@bloomreach.com; follow him on Twitter at @mikecassidy.