Insights 2013 offers research, observations and compelling points of view from subject matter experts to students of life, to help us all see the path we're on a bit clearer, so the next step feels a bit more confident.
There is nothing so terrible as activity without insight. –Johann Wolfgang von Goethe
TABLE OF CONTENTS OE O.E. represents exclusive content which is only available in the online version.5 WELCOME TO INSIGHTS 2013 47 how sensors are connecting 91 GAMIFICATION AS A DIGITAL STRATEGY OE TREND 4 Alan Herrick the world and THE implications Mohammed Iqbal, Syed A. Suffiyan Globalization: The Global Marketer for experience design OE and the Rise of the Global Consumer 7 IN-STORE DIGITAL RETAIL: Benno Schmidt 96 Media-Sapiens: Using Social Instincts THE QUEST FOR OMNICHANNEL to Explain, Predict and Influence 165 Understanding eCommerce in China Hilding Anderson, Rachel Zinser 52 invisible brand interfaces OE Desirability in the Digital Age Robert Wang with Rebecca Prettyman, Lauren Egge Daniel Harvey Melissa Read 171 FUTURE OF COMMERCE: LIFESTYLE SOCIAL 21 2012 Digital IQ Excerpt 56 is there a terminal velocity for 101 Rebuilding Trust: How Banks Can COMMERCE GOES BEYOND PINNING OE L2 Think Tank youth and digital? OE Reconnect With Consumers Jeff Blais, Sushobhan Mukherjee Omaid Hiwaizi Chris Baker, James Buchanan, Omaid Hiwaizi25 TRENDS: FOUR TRENDS SHAPING 175 CHASING THE GLOBAL CHINESE LUXURY MARKETING PRIORITIES 61 RESPONSIVE DESIGN 101: TREND 3 CONSUMER: A CONNECTOLOGY APPROACH Hilding Anderson, Todd Cherkasky, OPTIMIZING FOR MULTIPLE SCREENS Continuous Experiences: How Companies David Thorpe, Jake Wheeler Donald Chestnut Dan Israel, Mayur Gupta Are Blurring the Online and Offline World 181 GLOCALIsATION AND THE ANTHROPOLOGY TREND 1 TREND 2 109 STORYSCAPING: BUILDING WORLDS, NOT ADS OF GLOBAL MARKETING OE Real-Time Control: New Consumer- Predicting Desire: Building the Infrastructure Gaston Legorburu Megan Bannon Oriented Devices and Data to Anticipate Consumer Needs in Real Time 113 Brand as Channel: 187 Five Challenges to Tomorrow’s29 FUTURE OF TV 69 Predicting Desirability— Today’s “Always-On” Messaging Global Marketing Leaders David Hewitt, Lucy Devassy Lessons From a Teen Genius Alan Schulman Hilding Anderson, Freddie Laker Sheldon Monteiro35 CUSTOMER EXPERIENCE IS ON THE MOVE 119 Adapting to a Fragmented 190 INTERNATIONAL ecommerce expansion Nigel Vaz 75 The Future of Business Insight Media Environment Don Shields OE Lee Woodard, Chris Handley David D’Alleva, Peter Colapietro39 MOBILE PAYMENTS: 194 International Perspectives THE FUTURE OF MONEY 81 The “Big Data” Era: 124 the future of content experience US Perry Chan Learning to Act in Real Time and how to design for it UK James Buchanan Kevin Nichols Germany45 The Economy of one: Russia The consumer as producer, 86 DIGITAL LUXURY 101: HOW TO ENHANCE 130 I CAN SEE CLEARLY NOW ... India influencer and purchaser OE THE CUSTOMER EXPERIENCE OE ACROSS THE ENTIRE EXPERIENCE: Singapore Dan Israel, Perry Chan Hazel Reed THE ANALYTICS MATURITY MODEL OE Japan Jennifer Patterson, Dave Kane China Australia 136 Valuing Fanatical Engagement Scott Petry 217 NOTE FROM THE EDITORS Hilding Anderson 142 MEASURING GERMAN MULTI-CHANNEL: Lauren Nguyen Cohen APPROACHES ANd IMPLICATIONS OE Uwe Tueben 149 THE CMO TOOLKIT: WHAT EVERY MARKETER SHOULD KNOW OE Gary Shannon, Omaid Hiwaizi 156 Retail Goes Rogue: How digital convergence will revitalize the in-store experience Charlie Sayers, Rob Milstead
WELCOME TO “It is the function of creative INSIGHTS 2013 man to perceive and to connect the seemingly unconnected.” Written by Alan Herrick, President and CEO, Sapient Corporation –William Plomer When history looks back on this think about creativity and what can Or that a ski resort would be one Our thinking is stretched daily to season of robust innovation and happen to a compelling idea when it’s of the first to introduce RFID help bring brand stories to life in progress, I think it is likely to amplified by the scale of technology technology as a way to enhance their relevant ways across the consumer remember it as one of the most and personalized by the intimacy of guest experience on the slopes and ecosystem. As consumer, retail and significant paradigm shifts in, not human interaction. way beyond? We had the honor of communications landscapes continue only daily life, but in the business helping Vail Resorts innovate a way to stretch and evolve, we will continue of relevance in daily life. We are To that end, we believe that a brand’s to connect skiers to RFID tagging to to wake up in the morning propelled perpetually challenged to connect ability to innovate is not just about social media so that they can track by the challenge. technology. It’s about combining and share their Vail stories across technology with powerful ideas and their personal networks. The result In this edition of Insights, insightful perspectives on human was more than 100,000 social photos SapientNitro thought leaders offerOur thinking is stretched daily to moments to create highly relevant shared, yielding approximately 12 you approaches and tools that helphelp bring brand stories to life in ways to connect. million social impressions for photos navigate this completely digitized, alone, and that’s in just the first borderless world—to be used as arelevant ways across the consumer Who would have anticipated that one season. Vail Resorts empowered flashlight of sorts. It offers research,ecosystem. of the most esteemed luxury car 150,000 people living the Vail Resorts observations and compelling points brands in the world would create a story to tell the Vail Resorts story to of view from subject matter experts mobile app that allows consumers an audience of 12 million? What once to students of life, to help us all see to virtually build their entire car— might have begun as an ad for a ski the path we’re on a bit clearer, so the the dots between our brands and from the very first bolt to the last vacation has become a panorama of next step feels a bit more confident. the daily lives of our consumers in drop of paint? experience that lives in perpetuity. meaningful ways. Thank you for your interest and Or that a 125-year-old British sports It has been our privilege to support of SapientNitro, and with As stewards of brands and purveyors gaming company would be the one to participate in these and many continued resolve, we invite the of ideas, we are both humbled pioneer a combination of analytics, other breakthrough changes that challenges of our time, walking and exhilarated by the impact of social media and mobile technology reinvent the definition of “idea” and alongside partners connecting in new technological innovation on how we to drive a record surge in betting? unfetter the boundaries of creativity and creative ways to their consumers. for new pathways of connection.
IN-STORE DIGITAL RETAIL: KEY THEMES THE QUEST FOR OMNICHANNEL The goal of this research was to Just as ecommerce spurred the evaluate the digitization of physical evolution of a new type of shopping spaces. Our hypothesis was that experience, in-store retail is poised to most retailers—particularly in their undergo the same type of disruptive marquee New York City Fifth Avenue evolution—transforming itself into Written by Hilding Anderson, Sr. Manager Research + Insights, Washington, DC & Rachel Zinser, Sr. Associate stores—would have made substantial something so different it requires Research + Insights, Chicago, with Rebecca Prettyman, Associate Research + Insights, Chicago investments, and the investments a new name: Connected Retail. A & Lauren Egge, Associate Government Services, Washington, DC would have been made here prior Connected Retail experience2 is a to other cities. fully integrated, digitally enhanced The Adidas store, not part of our formal Over the past decade, retailers of all exploring in-store self-checkout with experience that engages the customer evaluation, included a display obviously added onto the in-store experience. sizes have been driven by disruptive smartphones. We discovered that simply “adding in both the virtual and the physical“Of the 71 retailers, technologies and the changing digital” is not the answer for retailers— worlds. It enables stores to exploit only 4 emerged with consumer to make major investments To measure the degree to which yet that was an approach too often and extend their unique advantages in digital channels, particularly retailers are successfully building links taken. As you’ll note in the scores, into the digital realm. ‘baseline’ scores. ecommerce and mobile platforms. between their digital and physical stores, brands that simply bolted on a screen Effectively, in-store But now, more retailers are starting to SapientNitro independently conducted a or added a tablet did not score well. In To understand the implications of embed sophisticated interactive tools— four-month audit of specialty retailers. digital experiences from digital displays to interactive We evaluated the physical locations of 71 our view, the retail store must focus on tools that help sell in-store and extend the research, we focused on several questions we expect retailers to ask today are only weakly exhibits—into the store layout itself. retailers across 7 key criteria, gathering the visibility of both the customer and and developed six key findings based integrated with in-store over 500 points of data (See Methodology the sales associate into the digital space: on them. Ecommerce investments used to be & Approach). product reviews, near-infinite inventory goals and activities.” focused on simply complementing and a much broader product assortment. the traditional retail store footprint. In the end, what we found was In that world, shoppers would browse surprising. Of the 71 retailers, only online, compare prices through their 4 emerged with “baseline” scores. KEY FINDING 1: PC and ultimately end up in the store to Effectively, in-store digital experiences Digital In-Store Displays Are Powerful purchase. It was a linear journey. today are only weakly integrated with Tools—But Too Often Poorly Executed in-store goals and activities: The But increasingly, new ecommerce tools content and functionality (if it exists at are able to directly influence the in-store all) of these experiences struggle to When done well, in-store digital can enhance the experience, it lacks shopping experience. This is reshaping support in-store goals and activities. branding added tremendous energy interactivity. We saw little content the traditional role of the store: What and engagement to the retail shopping focused on product information and One example of well-integrated digital used to be a key step on the path is now In most stores, digital has a limited experience. Unfortunately, most digital utility, and even fewer interactive merchandising was the Bloomingdale’s optional on the way to the purchase effect on the visit—mobile, kiosk or experiences suffered from major experiences designed around user in-store in-wall displays. Not interactive, they still were well-executed and supported through a digital platform. tablet-based ecommerce and digital shortcomings, if they existed at all— goals and actions. the brand goals in the store. display screens could be removed 40 of the 71 retailers evaluated had no Smartphones have reinforced this entirely from the shopping process visible digital displays. Interestingly, What worked: UNIQLO’s in-wall transient behavior. Now, search and and there would be little change. Yet many of the best in-store experiences— screens were tightly integrated with the price comparison is happening in the despite the sad state overall, there were Chanel’s sleek runway video and physical design of the store and visually store aisles, and a new behavior of interesting examples that were doing Clinique’s iPad skin evaluation— compelling. In larger stores, consistent test-and-buy-elsewhere are becoming one category very well. For example, appeared to be created in positive usage of digital display as part of much more common.1 Nordstrom, Coach and Crate & Barrel partnerships between vendors or the brand experience was essential earned high scores in inventory visibility suppliers and retailers. in creating the desired impact. For In response, retailers are increasingly and fulfillment, UNIQLO had fantastic in- example, Bloomingdale’s had screens embedding digital experiences into their store digital displays and merchandising More troubling is that few retailers throughout the store, which was physical locations, and applying connected and Bloomingdale’s had great digital embraced the interactive element in stark comparison to other large thinking to enable consumers throughout brand and merchandising examples in of digital. Screens are great, but our retailers that often had a single, and their journey with the brand. Examples the cosmetics section. JCPenney and expectation is that in-store digital must sometimes difficult-to-find, screen for include mobile apps with built-in scanners Macy’s also offered distinct Levi’s digital move beyond glorified wall hangings an entire floor. Digital entertainment LEGO’s in-store augmented reality experienceThe Nike Store, while not formally evaluated has received considerable buzz in the digitalas part of the research, offered some of the to discourage showrooming, inventory touchpoints (the Denim Bar and Levi’s and deliver content and functionality for kids is an interesting concept; both space. But like many experiences in our audit,most immersive digital experiences. visibility and tools to enable cross-channel kiosk respectively) and sales associates that supports2 users in the shopping Abercrombie and PS from Aéropostale lack of support (in this case, the display was not shopping (e.g., wish list management). were enabled with iPads. process. Many of the screens focused featured digital displays at kids’ operating) hampers the use of these devices. Retailers such as Walmart are also solely on branded content; while this heights, which offered a distraction for The LEGO store was not part of our formally evaluated retailers. 1 59% of smartphone owners report having used their phone to find a better price while in-store. InsightExpress, Q1 2012, “Digital Consumer Portrait.” Jan 25, 2012 2 For more information on Connected Retail, see “Retail Goes Rogue: How Digital Convergence Will Revitalize the In-Store Experience” in the Trend 3 section of this report.
To measure the degree to which retailers Retailers’ physical stores were evaluated weary parents and kept kids engrossed. video footage, but didn’t add to the visit. METHODOLOGY are successfully building links between their digital and physical stores, SapientNitro across seven criteria: Visibility, Content, Functionality, Brand Translation, Social The Levi’s Denim Bar at JCPenney was well designed and reasonably well Over and over, we saw stores that had clearly not thought through the & APPROACH independently conducted a four-month audit of Sharing Integration, Mobile Experience specialty retailers. In-Store and Cross-Channel Inventory integrated. Converse—not on our list— digital, omnichannel environment. We & Fulfillment (See Methodology Chart). offered digital tools to allow consumers encountered many examples of poor Our research approach consisted of And ultimately, each retailer received an to customize their shoes in-store and placement including a digital display in-person visits to the physical properties of Omnichannel Score based on its composite walk out with one of many designs tucked under stairs and another hidden 71 retailers, focusing on flagship and other score (See Omnichannel Scorecard). printed on their sneakers. This is a behind a rack of clothes. One store had prominent locations in New York City.3 Researchers assessed each store’s digital strong example of a tool that adds value seven-foot-high kiosks, which were offering(s) while equipped with Android and to the in-store shopping experience, is both broken and awkwardly placed at iOS smartphones. relevant to in-store purchasing and can’t an exit and in the middle of a crowded be replicated at home. clothes section. Another beauty and skincare store mounted a touchscreen Definition of Categories 60+ Excellent What didn’t: In smaller stores, such computer to the wall, but left the outlet 50-59 Good Visibility: To what degree are digital elements Social Sharing Integration: How well is as Lindt and Bath & Body Works, large and cables clearly exposed. 40-49 Average clearly visible in the store? Is digital integrated cross-channel or social sharing (e.g., email, screens behind the checkout displayed 30-39 Fair throughout the shopper’s path? Facebook, Twitter) enabled? 29 and Weak below Top Scores: UNIQLO received a five in this category—the highest possible rating—for its Top Scores: Sephora earned a four because many of its touchpoints supported easy email KEY FINDING 2: dynamic, visually stunning store experience. sharing, and there was some social integration Poorly Planned Digital Is Worse though it was not seamless. Overall, a category Than No Digital At All Several retailers integrated scanningMethodology Content: Is the content relevant to the brand average of 1.4 out of 5—which excluded the and its products and services? How well is the 40 retailers that received a 0 score—indicates capabilities into their mobile apps, but content tailored to the in-store experience? significant room for improvement across our attempts to scan were mostlyStore Experience 70% Digital is a key component of the What didn’t: JCPenney had great all retailers. unsuccessful. The scanning software Visibility 15% Top Scores: No brand received a five, but shopping journey, but retailers that experiences at the Levi’s Denim usually worked, but the mobile app was Content 20% Ethan Allen and Sephora secured a four by Mobile Experience In-Store: Does the retailer rush to extend digital to the physical Bar and had iPad-equipped sales unable to look up the barcode. Functionality 20% Brand Translation 15% offering product information and exploration have a native mobile app with functionality store experience won’t win the race. associates, but the overall experience to support the in-store shopping experience. relevant to the in-store experience (e.g., push Retailers must plan for the long-term; was hampered by broken price-checkSocial Sharing Integration 10% notifications, barcode scanner)? Functionality: Are digital tools interactive? this includes technology support and kiosks and two broken “findmore”Mobile Experience sales associate training in how to use the touchscreen kiosks. Display errors To what degree are the functions relevant to Top Scores: No mobile experience warrantedIn-Store 10%Cross-Channel shoppers’ goals and the in-store experience? a five. Most apps were singular in function if they worked at all. However, Bloomingdale’s tools and in the value they provide. Staff shouldn’t be surprised when shoppers on Guess’ touchscreen overshadowed any value the content could provide. Retailers’ DigitalInventory & Fulfillment 10% Top Scores: No experience garnered a five, but Sephora’s digital touchpoints, including did earn a four; in addition to the product scanner provided by its Big Brown Bag app, use smartphones to scan a barcode or Several retailers integrated scanning Assets (Content)Each retailer was scored in eachcategory from 0 (not present) to 5 the Scentsa fragrance finder, netted the retailer a four. the “Bloomingdale’s @ 59th & Lex” app offered interactive floor maps for its flagship store. interact with a touchscreen. Floor plans have to be redesigned for digital displays capabilities into their mobile apps, but few worked seamlessly and Grow More Critical(best). The scores were weighted to and interactive elements. consistently. Guess’ sales associatescreate a composite index, and then Brand Translation: Is digital well integrated Cross-Channel Inventory & Fulfillment: Does intercepted us as we tried the style into the physical space? Do digital the retailer provide store inventory visibility in “The content owners that will multiplied by 15 to achieve an easy-to- What worked: UNIQLO is a prime selector, and in American Eagleread overall score from 0 to 75. See the touchpoints enhance the brand image other channels? How well does the retailer thrive in this digital ecosystem example of a store designed with digital Outfitters, the sales associate wasn’tOmnichannel Scorecard for the results. and store experience? support cross-channel shopping and fulfillment? in mind, but even stores like Saks Fifth aware of the mobile app’s barcode are the ones that understand Avenue and Ralph Lauren that had fewer scanner. Even several Sephora the need to deliver seamlessly Top Scores: Bloomingdale’s, especially its Top Scores: Coach, Crate & Barrel and cosmetics experience, and UNIQLO’s spaces Nordstrom allowed shoppers to easily check displays with little to no interaction employees provided misinformation across every possible platform.” were clearly designed with digital in mind, in-store availability via the website and mobile executed what they did have well— about the Beauty Studio tool. –eMarketer 80 earning each a five. site and offered an option for in-store pickup, displays were integrated and smooth. which plays up a physical retailer’s advantage of immediate fulfillment and no shipping costs. KEY FINDING 3: It Isn’t Just the Hardware: Content and Software Matter % Great digital signage and interactive match the hardware. In our research, Companies that optimize their digital elements require great material. we found many examples of large-scale mobile web content outperform Nothing emphasized the gap between runway videos, but were left scratching those that don’t by 80% in the promise and the reality better than our heads about the lack of other year-over-year increases in the lack of software and content to stories. Where were the stories about web traffic.4 3 71 retailers were audited. Of those, we evaluated one or more locations in New York City for 68 retailers and locations in Chicago for three retailers with limited or no presence in New York City. 4 Aberdeen Group “The Business Value of Adapting Web Content For Mobile Devices,” 2011
how a great design came to life? Where several years, but is a solid tool, was the product information, or even promotional material? delivering personalized product recommendations based on users’ skin KEY FINDING 5: types and key concerns (e.g., acne, Retailers Should Focus On In fact, Sephora’s tools, Clinique’s redness). It is integrated with email— Supporting User Tasks skin evaluation, Macy’s Levi’s kiosk, which worked—and usually a printer, JCPenney’s Levi’s Denim Bar and Ethan and was a popular tool at Macy’s, Well-designed, task-based tools Magic Mirror, which allows shoppers to Allen’s Express platform were some Bloomingdale’s, Nordstrom, Saks“Based on of the only software implementations Fifth Avenue and Lord & Taylor. While emerged as being few and far between quickly try on many new glasses styles in our research. We found that the while still being able to see the styles SapientNitro’s focused on in-store tasks. In-store tools most had the Clinique iPad propped leading examples included wedding properly wearing their own. need to offer more than something a up in a very basic (likely standardized) work in the space, shopper can do at home. freestanding base, Bloomingdale’s registry kiosks, mobile barcode scanners and product explorations like the skin What worked: Crate & Barrel included we have found a went a step further to integrate the evaluation and fragrance finder. both a wedding registry kiosk and a significant increase— There are hundreds of potential stories iPads into a custom counter. mobile app that allowed users to walk for strong brands, and digital in-store But much was left on the table. While the store and scan items to add to their on the order tools offer the opportunity to tell them. What didn’t: Barneys had over a dozen 43% of brands had some sort of registries. Clinique’s iPad tool delivered of 10% to 40% in The failure to highlight and feature these iPads placed consistently throughout functionality supporting in-store tasks, personalized product recommendations, stories is a key gap for many retailers. the multi-level store, but the content the majority were digital displays. Even helping shoppers narrow down the additional in-store Content needs to be integrated into was generic dot-com material (typically fewer (22%) brands had interactive options at the point of sale. Macy’s sales—relative the development of digital in-store linked to the blog “The Window”). ALDO tools, which support those user tasks. mobile app included a barcode scanner experiences, and content is a powerful was even worse—they mounted tablets And we saw none of the digital try-on that worked, although it returned a to other stores.” tactic within a larger omnichannel next to the shoes, offered no content technologies that various publications higher price online than in-store. strategy. Content must tell a story targeted at consumers and even had have lauded. Not only did we not see consistent with the brand. sales associates scold shoppers when virtual fitting rooms, but also some What didn’t: Bath & Body Works’ they attempted to scan the shoes of the experiences that the industry mobile app included a scanner, but What worked: Clinique’s iPad skin themselves. raves about, like iPad kiosks, failed every attempt to scan a product evaluation has been out for to deliver. We also failed to find any resulted in an error—this issue was future-thinking examples similar to common across retailer apps assessed. Marks & Spencer’s touchscreen co- Guess’ app also promised to look up KEY FINDING 4: browsing experience (see image to prices and customer reviews, but also threw an error. And we already noted The Right Tools Generate Positive ROI the left) recently rolled out in Paris, or examples such as LensCrafters’ ALDO’s “tablet trap.” New, Creative One of the key questions to consider unique advantages: immersion, direct Retailing Models prior to in-store digital investment is ROI. The cost of installing and support of sales associates, immediacy and focus, social elements and the KEY FINDING 6: Are Proliferating supporting these tools is significant, opportunity for fun. It makes sense to The Omnichannel Battle Has Begun but the question of a positive return invest in the channel that represents “ The highly targeted assortment is too often unknown. Based on more than 90% of most retailers’ and short-term leases are a We awarded three retailers a five in the channel purchasers. Across the seven low-risk way for Walmart to SapientNitro’s work in the space, we sales (even as ecommerce continues Cross-Channel Inventory & Fulfillment categories we evaluated, more retailers have found a significant increase—on to grow). reach new shoppers and capture category. This is the only category that were awarded top scores (4 and 5) in the order of 10% to 40% in additional shopping occasions it may not had more than two top-scoring retailer Cross-Channel Inventory & Fulfillment in-store sales—relative to other stores. What worked and what didn’t: and reflects, we believe, a growing than in any other. otherwise have access to.” These benefits are primarily due to Obviously, our audit of in-store interest in this area and increased –Instoretrends.com, referring to Walmart’s decreased lost sales, the ability to ship- experiences couldn’t determine retailer awareness of cross-channel We also examined the flexibility of 2011 Holiday Pop-Up Store Strategy 130 to-home, improved in-store shopping the direct impact of each digital behaviors. This is the first of a series of cross-channel shipping. The abilityThe Marks & Spencer Paris location by enabling co-browse with sales experience. What we’ve found in our to check store inventory in multipleoffered co-browsing for associates and steps towards omnichannel thinking. associates, and brand contribution. work in the space is a significant ROI channels is highly relevant to the %is a move towards the “endless aisle,”particularly important in the most Retailers with a physical presence increase in well-designed convergent We assessed how well retailers are omnichannel shopper. Additionally,profitable high-traffic, small need to play up the benefit of in-store retail tools such as in-store kiosks facilitating cross-channel shopping three retailers pushed the bar higherfootprint stores. experiences. Quite simply, sales connected to the right technology on behaviors, specifically from the web to support cross-channel fulfillment. conversion is much higher in the retail the back end. (and mobile web) to the physical Coach, Crate & Barrel and Nordstrom store than anywhere else. It also offers store. With the large number of gave shoppers the option to purchase consumers that research online and an item online and then pick it up at The increase in online sales buy in-store, retailers have a significant a nearby store that had the item in over 3 months after Tesco’s opportunity to support these cross- stock. Though it does not offer the South Korean commuter campaign was 130%.
level of immediacy that in-store pickup usual specs like size or color, as well provides, some retailers also offered a ship-to-store service, which, when as “nearby” through which users can set a location and narrow products by CASE STUDY: MACY’S offered for free, might appeal to the store availability. large number of shipping fee-averse Across nine floors and over two million during our audit. Though the five- shoppers.5 What didn’t: Among the surprises were square feet of retail space, the Macy’s inch LCD screens were not a vision H&M and UNIQLO, which did not have flagship store in Herald Square had of beauty, the kiosks provided basic What worked: Crate & Barrel had ecommerce offerings in the U.S. and more in-store touchpoints than any product specifications along with price, clear inventory visibility as well as the provided no visibility into store inventory. other store evaluated. Yet it was clear in which shoppers clearly saw value. option to see if larger furniture pieces And while several large department it was optimized for an analog world; There was a missed opportunity to were on display at a nearby location. stores provided at least some level of digital displays had limited functionality further engage, cross-sell and delight They also provided in-store pickup inventory visibility—including Macy’s, and the visibility of the tools in such a customers at this already frequented services as well as an option of free JCPenney, Bloomingdale’s and large store held the retailer back from touchpoint. The Clinique skin evaluation in Macy’s shipping to a store. Nordstrom offered Saks—it was a surprise to see a few achieving a “Good” designation. offered clear instructions and a clean innovative functionality on its mobile exceptions, including Neiman Marcus Other areas of opportunity included the interface, but was also featured at most of site, allowing users to filter by the and Lord & Taylor. Top experiences included the Clinique digital branding and merchandising their competitors. skin evaluation iPads—Macy’s most displays throughout the store, whichScentsa’s design ubiquitous (available on three separate weren’t as integrated as, for example,invited shoppers to try it out. CASE STUDY: SEPHORA floors) and successful implementation, Bloomingdale’s. In addition, the single although not unique to Macy’s. The gift registry in the ninth floor luggage sleek display of the Levi’s touchscreen department worked, but seemed While no brands achieved the The location made the touchpoint less kiosk in the kids’ department, while oddly placed. Users could search for a “Excellent” status in this inaugural inviting to passersby if the station was tucked among the racks in the girls’ registry, but the output was a several- omnichannel index, Sephora did in use, but those that ventured to check denim section, drew attention. Users foot-long, receipt-style printout of emerge as a leader among its peers. it out found how-to videos and tips, an could browse very basic product products. Sephora had a seemingly well thought overview of available in-store services, information related to kids’ denim out strategy for digital in its physical social content from Sephora’s networks styles and snap a pic with the digital As a whole, the Macy’s digital in-store spaces, in addition to a relevant mobile and more. Shoppers could also share photo booth. Finally, the Macy’s mobile experience has established several key offering and cross-channel—both dot- content via email or social networks, app was a strong point with a scanner pieces of a complete offering: cross- com and mobile—inventory visibility. though some speed and system issues for price comparison (although it channel inventory visibility, a mobile were encountered when we attempted returned a higher price than the scanner and the beginnings of in-store Inside the store itself, the Scentsa to do the latter. physical tag) and its “find in-store” digital content. Developing tools that touchscreen kiosk served as a function. enhance the brand and truly support centerpiece in the fragrance space. Sephora’s mobile app also offered shoppers’ in-store activities remain a The best-in-class interactive display shoppers a scan feature, providing Price-check kiosks were easy to find significant opportunity. Beauty Studio iPads linked let visitors explore fragrances through easy access to additional product info and were used frequently by shoppers shoppers to tutorials, social multiple paths, such as by brand or and reviews, which could help with content and available services. by fragrance note. The touchscreen purchase decisions. The Macy’s Levi’s was responsive and easy to navigate, kiosk was visually striking. and offered shoppers helpful product Each touchpoint hit the mark across information. When a shopper found several criteria, but the overall The Macy’s The Levi’s kiosk something of interest they could email experience still fell shy of “Excellent.” mobile app was easy to it or scan the QR code to pull up the On reflection, we felt Sephora missed included a use, but product product on their phone. The screen making the final strong connection basic scanning information was also prominently displayed Facebook between shoppers’ in-store goals and capability, as limited. links, but didn’t follow through with experience. Scentsa helped shoppers well as the ability to scan and social sharing capabilities. wade through the overwhelming add items to aSephora offered A second touchscreen kiosk, Sephora’s number of fragrances, but after finding registry.email through its Skincare IQ, offered a very similar the perfect scent on the screen, howtools (see emaillink in top-right experience catered to skincare needs. does it make its way to their cart?corner of image). There was no indication of whether In addition, Beauty Studio iPads were the fragrance was on the shelf at that positioned along the vanity mirrors at moment and no assistance locating it. In-store scanning Sephora’s makeover stations. with the Sephora app surfaced helpful reviews. 5 When asked the main reasons they don’t make online purchases, 36% of consumers cited the shipping costs. That made shipping costs the second-most common reason they balk at buying online, only slightly behind the 37% who prefer to see and touch an item in person before purchasing. (Internet Retailer 2012)
NASCAR The blurring of lines across online and experience. The opportunity—to be offline are not just impacting retailers. We work with multiple industries that fair, as yet unrealized—is to surface great analysis and social conversation, CASE STUDY: JCPENNEY Races are addressing the same challenges and to see aspects of the event they to their businesses. From travel and may have missed—without diluting the JCPenney has the opportunity to be was entirely unresponsive. The hospitality to telecom, most consumer- intensity of the real-world experience. Towards among the leaders in relevant digital promotional material promised facing industries are, to some extent, For example, they are considering in-store experience, with several strong media-rich content and social sharing facing similar challenges. However, leveraging digital signage, Jumbotron experiences. But in practice not only options, but we saw little of note. few have pushed as hard or as fast integration, in-venue kiosks and did a majority of digital touchpoints failOmnichannel as NASCAR. NASCAR is one of the premium professional sports businesses, with even mobile ticketing to make the experience richer. Connecting Digitally at Home to impress, too many were inoperative or unsupported. The first touchpoint encountered was A more recent effort—the Levi’s Denim Bar—hit the mark across several criteria. Relative to the kiosks, visibility was improved, with in-store marketing massive reach—hosting 17 of the 20 Similarly, while watching at home, the price-check, a staple in many messages of “a new way to shop most attended sport events—while second screen viewing can extend and department stores. Similar to other for jeans” and a prominent location delivering significant results to increase the richness for consumers. retailers, the design did nothing to adjacent to an aisle. The Denim sponsors’ products and services. With Personalized experiences similar to boost the brand image, but the real Bar—which was only in the men’s over 70 million fans worldwide, it is the ecommerce platforms in retail can issue was that the price-check was department of the location visited—was second most-viewed broadcast sport, allow fans to connect with existing non-functioning. The kiosk display well designed, with the feel of a store- and has the longest sustained season media broadcasts (e.g., follow their indicated that the “Price check within-a-store. iPads were mounted on of any sport. favorite driver’s audio or watch pit system is unavailable. Please see an the Denim Bar, and the interface was row videos), live data feeds (e.g., tire associate.” This message appeared smooth and provided shoppers access iPads at the Levi’s Denim Bar were easy Yet their digital channels have state, fuel state, speed) and education at seven of the eight kiosks we visited to basic information such as available to navigate. traditionally been under-emphasized— and analysis (e.g., history of the track, throughout the store location. styles and washes, as well as video and with no YouTube channel (until live analysis), or even enable social images highlighting the fit. recently), substantial conversation conversation (e.g., Twitter, Facebook) JCPenney’s “findmore” kiosk offered drop-off in the off-season and a fifth on NASCAR’s own platform. a strong visual impression, although Beyond in-store offerings, JCPenney place in online conversation after the the content and functionality struggled. provided inventory visibility through NFL, NBA, NHL and MLB. Building the Brand The kiosk essentially brought shoppers both its dot-com and mobile site, which NASCAR fans are some of the most to the retailer’s website without supports the omnichannel shopper. In addition, their customer base passionate in the world. Part of the specifically tailoring the experience to And though the Levi’s experience is evolving. Their biggest fans are opportunity of digital is to deepen in-store goals. In terms of functionality, and inventory visibility resulted in increasingly connected consumers that connection by bringing great the touchscreen interface on the a slight lift in scoring, it was still who expect to be able to interact with content about the history of the teams, first kiosk was largely unusable—the overshadowed by inoperative kiosks their favorite brands, drivers and teams sponsors, cars and drivers. There is navigation would rarely respond to and price-checkers. through digital channels. incredible richness in the stories, which touch—and the second kiosk tested can be told through these platforms. The solution is to reinvent and And off-season, digital channels offer recognize the strategic opportunity the opportunity to flatten seasonality to evolve to a more connected fan and shape engagement. experience that extends before, during and after events. In summary, just as retail stores have started to consider in-store, Extending the In-Venue Experience NASCAR has started to think about Analogous to the in-store experience, in-stadium and at-home digital attending races used to be dominated experiences. Integration with live by the cars and a basic scoreboard television programming allows deeper with positions. Yet today, NASCAR is engagement—and more opportunities seeing fans arrive with smartphones for lifting the lifetime value of fans. The “findmore” kiosk had a fairly clean who expect a platform to extend their look but was not functioning correctly during our multiple visits.