This Week in Retail Marketing Innovation - April 15, 2019


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The First Iteration of “Story at Macy’s” Goes Live


Stores now need to evolve into locations that delight and engage their customers. "I don’t think physical stores are dead, but as more routinized purchases are made online, people are going to seek more reasons to go into the store,” said Barbara Kahn, a marketing professor at the University of Pennsylvania’s Wharton School.

After acquiring Story one year ago, Macy’s is now launching at scale Story concept shops in 36 stores across 15 states, including Herald Square.

The first iteration of Story at Macy’s is called “Color” will be live April 10-June 26, and will be rotating 5-6 times per year. “The Story at Macy’s experience feels a lot like a real-life version of scrolling through Instagram,” said Rachel Shechtman, founder of Story and Macy’s brand experience officer. The narrative experience of Story gives customer a fresh reason to visit stores and a reason to keep coming back to see what is new.

As part of the experience Story will include products from over 400 small businesses, and large brands like MAC, Crayola, and Levi’s Kids who will be contributing special events and merchandise during the initiative. MAC will be offering “Make Your Own” palette stations, as well as on-site beauty classes from experts, Crayola is offering hands-on workshops designed to inspire inventive uses of their products, and Levi’s Kids will preview exclusive merchandise that will be available in mid-2019.

This initiative is emblematic of Macy’s continued commitment to create engaging, digital rich, limited time experiences, and is inline with the growing number legacy retailers who are developing more authentic brand messaging to connect with their clients.


7-Eleven and Sam’s Club take on Amazon Go


Americans spend over 37 billion hours a year in line in retail stores. Studies have shown that time waiting in line leads consumers to have negative perceptions of the overall shopping experience prompting them to shop online to avoid the discomfort. It is for this reason that retailers are prioritizing cashierless checkout to remove another piece of friction in the shopping experience.

Amazon made headlines in 2016 with their answer to this problem, Amazon Go stores, where shoppers use an app to enter the store, get what they want, and walk out without stopping at a register. This implementation is disrupting the convenience store and grocery market, and in response companies like 7-Eleven and Sam’s Club are implementing their own solutions using AI and computer vision.

7-Eleven has “Scan & Pay” which allows customers to pay for their products using the 7-Eleven app, also allowing users to accrue points for the 7Rewards loyalty program. The initiative is currently live in 14 stores in the Dallas area, and allows customers to pay for all merchandise except for hot foods, financial services, and age restricted products. 7-Eleven has also launched an “innovation focused” lab store where new initiatives will be tested and rotated frequently. As part of this lab they are testing made to order beverages, craft beers, and baked goods made in-store daily.

Sam’s Club has implemented the “Scan & Go” technology in their mobile app as well, and has deployed it in over 600 locations. They have reported that over 90% of users who use the Scan & Go functionality become repeat users. Sam’s Club is leveraging the purchase history from these users to provide product recommendations, and guide shoppers to those products in-store through the mobile app.

Bloomberg reported that Amazon is considering opening up to 3000 cashierless stores by 2021, but plans on addressing regulatory concerns before implementing in mass. As “scan & go” technology continues to be implemented, concerns about discrimination toward the unbanked, who account for for 6.5% (8.4 million) of U.S. households, has become a roadblock in the expansion. In response to these concerns, Amazon plans on incorporating government subsidized SNAP benefits and allowing users to add cash to their digital accounts through stores like 7-Eleven and CVS.


Google takes on Amazon Web Services

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Google announced “Google Cloud for Retail” at their “Google Cloud Next 2019” event, with the intention of taking on Amazon Web services head on. Their strategy is to go after retailers like Walmart and Target who do not want to contribute to Amazon’s growing retail operation, and provide those brands with an alternative cloud solution.

The solution suite will use Google’s analytics and AI to create personalized retail experiences, including:

  • Visual Product Search - Shopper will be able to use image search to browse retailer/brand catalogues.

  • E-Commerce Hosting - Allowing for flexible and scalable hosting.

  • Real Time Inventory Management and Analytics - Improved visibility across shelves, aisles, and stock rooms.

  • Recommendations - AI powered tools allowing for personalized recommendations.

Retailers currently leveraging the solution suite include: IKEA, Bed Bath and Beyond, Kohl’s, Shopify, Target, Home Depot, and Ulta Beauty.


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