This Week In Retail Marketing Innovation - July 22, 2019

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H-E-B pilots autonomous grocery deliveries in San Antonio, Texas

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H-E-B has partnered with self-driving vehicle developer Udelv to launch a test of grocery store delivery vehicles in San Antonio, Texas near the end of 2019. H-E-B will be one of the first grocers (aside from giants like Walmart, Kroger, and Target) to utilize self-driving cars for grocery delivery services

The test will feature their first delivery vehicle called “Newton” to deliver groceries to local customers in the Olmos Park neighborhood. Customers can sign up to receive the autonomous deliveries during the first week of the test period. 

Newton can store up to 32 grocery orders of varying sizes, and travel at up to 60 mph, according to Retail TouchPoints. The vehicle can also travel a range of about 400 square miles, which far exceeds the previous model, which was only able to travel with 18 grocery orders at 25 mph within the range of 60 square miles

These impressive updates to the current model have caused Walmart and grocer Farmstead to also partner with Udelv and update their own automated delivery services.

For the first portion of the testing phase, H-E-B will have a driver accompany the self-driving vehicle to ensure all deliveries are completed smoothly and safely. 

“At H-E-B, we continue to evaluate and utilize innovative technologies in all parts of our business,” said Paul Tepfenhart, Senior VP of Omnichannel and Emerging Technologies at H-E-B. “As a digital retail leader in Texas, we will continue to grow our partner population as well as technology presence to complement our store operations, enabling customers to choose how they shop, pay for and receive products.”

H-E-B’s new autonomous vehicle delivery will be added to their current delivery services, through acquisition of Favor Delivery, H-E-B Curbside and H-E-B Home Delivery. These two programs will be available in over 200 locations by the end of 2019

Data collection through wearable smart technology continues to impact retail

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Data collection through smart devices has allowed brands to know their customers on a personal level, and provide them with offers that are relevant to their day-to-day lives. This data can be crucial to creating effective marketing campaigns and establishing brand loyalty. 

However, wearable tech has breached the realm of consumer privacy on multiple occasions, including Fitbit’s tracking of users’ sexual activity and location tracking for military personnel in secret military bases

Despite the diminishing trust in wearable tech, retail brands continue to explore the world of IoT (Internet of Things). L.L. Bean is still threading smart tech into coats and boots, and Under Armour revealed their production of smart fabric shoes.

Customers are concerned that the collection of biometric data, which gathers information based on a person’s physical traits and identity, may be too invasive. Brands need to tread carefully and remain aware of emerging privacy regulations, even if the data they want is available to collect. Failure to honor privacy concerns, according to various sources, will not only damage brands’ reputation, but also open them up to legal liabilities. 

Smart fabrics are predicted to make their way into the sports and fitness, automotive, military and defense, health care, and other sectors, according to a January 2016 Transparency Market Research report

The fabric products and wearable devices aren’t currently required to comply with HIPAA regulations, but companies will need to pay attention to U.S. state and international data breach regulations, according to Suzanne Widup, senior consultant for Verizon’s RISK Team.

In order to use the biometric data wisely, companies need to single out what kind of data is most useful to them, and stick to it. While collecting any and all data on customers may be tempting, it’s more likely than not to violate privacy rights and end in a lawsuit

According to Widup, it would also be wise for companies using smart textiles to appoint a chief privacy officer who would ensure the company isn’t violating users’ privacy. This tactic would establish brand trust, making customers more likely to buy.

According to the 2018 Thales Data Threat Report's Retail Edition, 75% of retailer respondents said they experienced a data breach in the past, but only 26% of respondents said they implemented encryption protections. On top of that, a 2018 IBM study found that the global cost of data breaches was $3.86 million, up 6.4% from the year prior.

As IoT wearable tech continues to make its way into retail and data breaches continue to rise, it is essential for companies to put the security concerns of their customers first in order to secure positive brand recognition and loyalty.


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L'Oréal launches virtual make-up try-ons on popular app WeChat

L'Oréal has officially launched its first mini-program for Tencent’s WeChat, allowing users to try on their various makeup products virtually, according to an announcement shared with Mobile Marketer. 

L'Oréal’s Giorgio Armani Beauty brand is the star of the mini-program, where users can try on their multiple beauty products using AR, and buy them directly through the app. Users can also compare “before and after” views of their looks through the app, save them as screenshots, and share them on social media, according to Retail Dive.

With the Tencent WeChat app, the brand has the potential to reach more than 1.1 billion customers. Giorgio Armani Beauty is not alone in taking advantage of WeChat’s large audience -- other luxury brands such as Louis Vuitton, Bulgar, Cartier, Coach, Tiffany, and Burberry ranked highly for embracing WeChat, according to researcher Gartner L2

“Smart mirror” AR technology (both in-store and online) continues to take the retail and beauty industries by storm. According to the International Data Corp (IDC), worldwide spending on AR and virtual reality is forecast to grow 68.8% to about $20.4 billion in 2019, and online retail showcasing will drive $558 million of spending this year on the technologies. 

L'Oréal’s integration with WeChat is a reflection of the company’s acquisition of AR tech company ModiFace last year. "The acquisition of ModiFace in the first half is also a major milestone in transformation of L'Oréal into a digitally augmented beauty company," said Chairman and CEO Jean-Paul Agon on the company's second quarter 2018 earnings call.

This Magic Mirror integration is similar to a deployment created by Perch and MAC. We designed a virtual try-on solution with the goals of exhibiting MAC’s commitment to revolutionizing the customer experience, increasing customer engagement, identifying in-store buying trends, and creating a seamless and hygienic experience that would accelerate the buying process. Once a product has been selected, the customer then has the opportunity to purchase through WeChat.

L'Oréal plans to add ModiFace’s AR technology to Amazon, giving shoppers the capability to virtually try-on products before making direct purchases through the retail giant.

Sounding Smart by The Retail Water Cooler

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