Electronic innovations are providing entry to the future of retailing.
Technology is blurring together the online and off-line worlds. The result is what one might call "extreme shopping," a 24/7 experience where speed, convenience and connectivity dominate.
Women can immerse themselves in the world of fashion anywhere at any time. They can see the gray flannel strapless jumpsuit Britney Spears wore out to the clubs the night before, find it in the mall nearby or order it online at forever21.com or net-aporter.com; they can snap a photo of themselves in the latest outfit wherever they might be—Sri Lanka or Shreveport, La.—and automatically post it to their own blog or flickr.com, where friends around the globe can see it and comment on it.
Instead of ignoring the global conversation, designers and retailers are hitting the refresh button with striking concepts. At Polo Ralph Lauren, the store window is a touchscreen to transport passersby to Aspen, Colo., the U.S. Open or Wimbledon. The glass is coated with a transparent foil that responds to touch. A rear projection screen displays the images.
Shoppers can order merchandise from the window 24 hours a day. The transaction is completed by cell phone or e-mail the next day. So far, Polo has put up the temporary displays in London, Chicago and New York. The most recent event took place in London in June to coincide with Wimbledon.
Inspired by social technology, in March Nanette Lepore set up a "magic mirror" in Bloomingdale's that let shoppers interact with the clothes and faraway friends. The shopper could try on an outfit, and the mirror would take the shopper's photo and transmit the image to a cell phone, e-mail address or Web site such as MySpace.com. Friends could see the outfit and offer their opinions, which were displayed on the mirror as if it were a computer screen. The mirror could also project images of matching items and superimpose them on the shopper's reflection.
The concept was designed by interactive agency IconNicholson of New York, which also helped create the futuristic Prada store in SoHo.
"Technology is driving most of the changes in business, all the way from the supply chain to the customer experience," says Tom Nicholson, the agency's chief executive. "The nature of the Internet and the Web and what's going on there is pretty profound. What we see as the next big step and what social retailing is all about is bringing that experience to the physical world."The new retail brings shopping to the consumer wherever she is. Web-enabled devices like iPhones play fashion videos or can be used to buy things. In the upcoming months, a search engine or online store will be able to alert a customer when a favorite item arrives or goes on sale, and she will be able to instantly buy the item by texting the retailer from her cell phone.
Stores like Gap and Bloomingdale's have brought their service up a notch to match what customers are accustomed to online. The technology is simple but effective. At Gap, for example, customers in the dressing rooms can press a button for assistance. In Bloomingdale's new lingerie department in its New York flagship, customers can pick up a phone in the dressing room and request additional sizes and styles.
Retailers are also making sure the right sizes and styles are in-house when shoppers want them.
"One of the most frustrating experiences when I go shopping is when you get there and they don't have what you want—it's either the wrong size or the wrong color or they don't have it at all," says Mark Thomas, RFID marketing manager for Avery Dennison, which makes garment labels as well as tags for inventory and security.
Retailers such as Marks & Spencer in the U.K. and Liverpool, Mexico's largest retailer with 61 stores, are solving the problem by using radio frequency identification (RFID) tags on apparel that comes in many different sizes and styles, such as suits, jeans and lingerie. Each garment is tagged with a microchip that contains a unique identifying number. Store employees can quickly take inventory by moving a handheld scanner over the shelves rather than tediously scanning each barcode on every price tag by holding it up close to the scan gun.
Because inventory can be taken in two hours rather than two weeks, the store knows when a size is running low and can replenish it before it runs out. In addition, unobtrusive tag readers can be set up on each shelf or table, so if a shopper throws down an item in the wrong place, it can quickly be relocated to where it belongs so other shoppers can find it.At Liverpool, which tested the new system on Levi's jeans, the tags increased inventory accuracy from 80 percent to 99 percent, said Thomas. Out-of-stocks dropped to 1 percent from 5 percent, and with merchandise being readily available, sales also grew faster than average.
At Mitsukoshi department store in Japan, each shoe on display has its own RFID tag. Shoppers can scan a shoe to find out if it's available in their size, rather than waiting for a salesperson to check the stockroom. The store has halved the average service time per customer from 12 minutes to six minutes, and has increased sales by about 10 percent, according to store executives. Tests of the concept were so successful the retailer has outfitted a number of stores with the technology and is also researching its use in other departments, such as cosmetics.
Another option is that a salesperson could check if a size is in stock simply by phoning or texting a clerk in the stockroom, rather than leaving the customer on the selling floor.
As real-world stores become more like their online counterparts, the reverse is also true. Now it is possible to find almost anything for sale online, thanks to the incredibly wide variety of stores that have recently opened or are scheduled to open soon, from tiny boutiques to online-only stores to luxury brands. Shoppers anywhere can now find emerging designers, fast fashion and luxury brands that were scarce outside big cities.
In July, Net-a-porter offered a glimpse of where online retailing is headed with a virtual trunk show that included video interviews and video runway footage, as well as detailed commentary on each look from Net-a-porter editors. Women all over the world could see designer Roland Mouret's comeback collection online 24 hours after it launched to about 200 guests in Paris and could order from the line. In the first four days, more than 250,000 visitors viewed the runway video and customers from 22 countries placed $500,000 worth of orders.
"It's not a brand that's distributed in every store around the world," says former fashion editor and Net-a-porter founder Natalie Massenet. "For customers to be able to get their hands on something that in previous collections sold out very quickly gives them another level of service."In August, Neiman Marcus took a similar approach with an online trunk show and video interview with emerging designer label Rag & Bone. Neiman's online operation continues to experience tremendous growth, with neimanmarcus.com generating $500 million a year in sales.
At Create the Group, an interactive agency based in New York, principals James Gardner and Tony King have been redefining what luxury looks like online. Their list of clients reads like an international who's who of luxury brands and includes Gucci, Prada, Marc Jacobs and David Yurman.
They have discarded two approaches that defined the early days of e-commerce: irrelevant special effects and artless pages of product. Jewelry maker David Yurman's site redesign is as sleek and emotional as a luxury brand should be. Each page has mood shots with models that convey a feeling, and products will be shot on a stylish background rather than blank white.
Some online retailers are mimicking the economics of real-world shopping with free shipping that lets customers order a variety of sizes and send back the ones that don't fit. Contemporary retailer Shopbop offers free overnight shipping, as do shoe stores Zappos and Endless.
And counter to stereotypes the Internet is for discounters, the biggest spenders online have the highest incomes. For instance, in the beauty category, 15 percent of women with household incomes of more than $75,000 shop online, versus 7 percent of women with incomes of less than $35,000.
Sites are taking a variety of approaches to easing fit concerns. Most retailers have extensive size guides. Zafu, for instance, helps customers find their perfect size in jeans and, most recently, lingerie, with easy-to-answer questionnaires that don't require any measurements. Zafu suggests specific styles and makes of jeans or bras in a wide range of looks and prices, depending on what the shopper has specified. The shopper can then buy them online or in the store. Zafu gets a cut of online sales.
The service is particularly helpful for new premium denim brands or styles of bras the shopper may not yet be familiar with, says company cofounder and chief executive Robert Holloway.
Information and interaction is where the Internet shines, and anyone interested in fashion can see what people around the world are wearing, discuss the latest must-haves, find out if a jacket runs large from someone who's bought it or discover what notes make up a particular perfume.Sites devoted to fashion include streetwear blogs like Style Hunter, fashion social networking sites such as the recently launched StyleMob, bookmarking and social shopping sites like Stylehive and an online encyclopedia devoted to perfume called Basenotes, to which anyone can contribute.
New search engines have emerged, including ShopStyle, that are devoted to fashion. ShopStyle takes an artistic approach with large images and a horizontal scroll that makes the site more stylish than traditional search engines. Fashion-specific search engines make it easy to very quickly find, say, all the Marc Jacobs dresses from resources as varied as eBay and discount e-tailers like Bluefly to specialty stores such as Bergdorf Goodman—without having to visit them all. If a shopper finds something she likes, she can ask ShopStyle to notify her the minute it goes on sale.
Nordstrom has borrowed a feature from bloggers called an RSS feed and set it up to do something similar on its own Web site. For example, if a shopper does a search on the Nordstrom site for "blue wool pants sale," Nordstrom automatically sends the results to a Web page. Whenever the results change— because of new inventory or a markdown—the Web page will receive an alert.
Brands have also used the Internet to solicit shopper feedback on product design. At Threadless, for example, artists submit graphics for T-shirts, visitors rate the designs, and the most popular submissions are manufactured and then sold online.
At Iqons, the London-based fashion social networking site, members submit their favorite custom shoe designs from the Nike ID Web site and vote on submissions. This month, the winner will receive the customized shoe from Nike.
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