While the famed “merchant princes” of retail may be long gone, the innovations and technologies driving business today aim to do what they did best: sell compelling fashion by offering top-notch service in a way that delights customers.
And where yesterday’s merchandisers relied on intuition, today’s retail leaders are making data-driven decisions to boost sales and margins as well as increase shopper loyalty. And it is not just at in-store and online. The entire supply chain is being enhanced and empowered by artificial intelligence, predictive analytics and data science.
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Here, WWD spotlights some of the leaders behind these innovations in technology who are helping to reimagine the customer experience.
First, it is important to note that of the most dramatic shifts in the industry has been around personalization and how brands interface with consumers as well as growth in the rental, resale and consignment segment. With rental and resale, the segment is poised to swell to more $50 billion in the next year or so, according to several industry analysts.
For Ashwini Asokan, founder and chief executive officer of Vue.ai, the success of the rental industry is due to changes in consumer behavior. Millennials and Generation Z simply don’t want to own a thing. “We’ve gone from discount-driven shopping to living in a Marie Kondo world, where everyone wants to enjoy many different experiences in life, without the clutter and hassle of having to own, manage, store it all,” Asokan told WWD earlier this summer.
For Andy Ruben, ceo and founder of reverse logistics firm Yerdle, the rental and resale market is evolving rapidly, and catching many industry veterans off-guard as they try to catch up.
A former Walmart exec with a product-focused sensibility, Ruben told WWD this past July that the resale market is having its “mainstreaming moment” this year. And Yerdle is likely at the heart of these changes, helping companies and brands build efficient, cost-effective resale platforms. Yerdle’s brand partners include Eileen Fisher, Patagonia, Rei Co-op and Taylor Stitch, among others.
Repurposing and reselling fashion apparel is not a new concept. It was first practiced in response to textile shortages in World War I. But it was frowned upon by traditional retailers, who demanded their customers (not “consumers”) buy the latest fashions. And that means new.
But resale and rental is now wholeheartedly supported by consumers who want to have access to luxury goods without the heavy price tag. Millennials and Generation Z also view resale and rental as a sustainable practice. It’s good for the wallet and for the environment. And because of technology, such as what Yerdle offers, the market is on fire and experiencing accelerated growth.
With the subscription model, technology also plays a critical role. And data is king. But as Yosef Martin, ceo of Boxycharm, asserted recently, connections with customers is essential. “Build relationships, don’t see them as numbers — get to know them, see them as people,” Martin said during a WWD event this past summer. “They are going to bring a lot of value.”
The “human connection” is also one of goals of Guesst, which is a co-retailing business model driven by a technology platform that is designed to connect direct-to-consumer brands with customers in a physical, and pop-up space. “Think ‘matchmaking’ for retail,” explained Jay Norris, founder and ceo of Guesst. “Our platform and technology provide scalable opportunities for ‘guest’ brands to be placed in like-minded ‘host’ stores and our proprietary software handle all sales transactions, payments, inventory tracking, taxes and reporting, making the operation seamless for both parties. We enable brands to test the waters without immediately swimming at the deep end of the pool.”
Norris added that “like the typewriter, the pop-up method is outdated and ineffective. A pop-share [co-retailing] can be both a short and/or long-term solution for numerous brands, retailers and landlords.”
Norris’ bold take on the outdated-ness of the pop-up model is notable because of his passion for offering innovative solutions. That same degree of passion is what fuels Amit Sharma, founder and ceo of Narvar, to deliver exceptional customer experiences for online shoppers. The company has garnered success by working with brands on post-purchase customer experiences. And this past summer, Narvar is looking at the other end of the consumer’s shopping journey.
Last month, Narvar said it is expanding its platform to include the “pre-purchase consideration” phase of a shopper’s journey. The idea is to connect this portion of online shopping with Narvar’s post-purchase data. The goal is to help consumers make “better-informed decisions that help drive conversion, increase customer flexibility and satisfaction, and reduce delivery uncertainty for consumers,” the company said.
Sharma said delivery and product returns “have become integral to the overall shopping experience, which means they play a key role in consumers’ decisions of whether to purchase or not. Now, retailers can give customers confidence that the post-purchase experience is something they do not need to worry about.”
Improving the ease of shopping is also behind the latest fintech solutions. For Sebastian Siemiatkowski, founder and ceo of Klarna, creating a “smooth” experience via alternative payment options for customers was sorely needed in the industry. For digital retailers, having pay-later option tackles a variety of consumer pain points such as product returns as well as size and fit. Siemiatkowski felt that for fashion apparel, shopper need to “experience the merchandise” and ensure the proper fit.
Klarna said its solution is resonating with shoppers, and the company is growing as a result.
Last month, Klarna said it raised $460 million in an equity funding round, which has a “post-money valuation” of $5.5 billion. “This new valuation ranks Klarna as the largest private fintech in Europe and as one of the largest private fintechs globally,” the company noted. “This funding will help Klarna to continue its rapid rise in the U.S. market, where it is currently growing at an annual rate of 6 million new U.S. consumers. The uniqueness of Klarna’s consumer offering, providing a healthier, simpler and smarter alternative to credit cards, with the addition of multiple services to smoothen the shopping experience, online and off-line, is clearly resonating with the U.S. consumer.”
Michelle Bacharach, ceo of FindMine, is also helping brands build loyalty and conversions with technology that touts a brand or retailer’s point of view. The company’s “Complete the Look” automated platform “shows shoppers how to use each product, while staying true to the brand, and increasing your revenues by tens of millions,” the company said.
Clients of FindMine include Adidas, Perry Ellis International and John Varvatos, among others. Scott Lux, vice president of e-commerce and digital marketing at John Varvatos, offered a testimonial on FindMine’s site that said the deployment of the platform “increased revenue, the efficiency of our merchandising team, and engagement from our customers during their site experience.”
“Each retailer or brand has an opportunity to offer unique expertise to help a customer be successful with what they’re buying,” Bacharach said in a recent WWD guest column. “Fashion and home decor brands and retailers can offer style guidance. Home Depot helps me get the right drill bits and screws to match my drill and the purpose of my project. Michaels is an expert at crafting. FootLocker can help me be the best athlete I can be.”
The ceo went on to say that it is this expertise that sets retailers apart from one another. is part of each of these retailers’ brands. “Both retailers that sell only one brand and multibrand retailers have a brand point of view,” Bacharach explained. “Saks and Neiman Marcus have very different style ‘points of view’ even if they sell many of the same products. This expertise is also one of the only remaining things they have to uniquely differentiate them from Amazon. If I want a pair of Stan Smiths, I can get them on Amazon. But if I want to be a cooler more streetwear savvy version of myself, I’m going to buy them from adidas.com or an Adidas store because they’re the absolute only authority on the ‘Three Stripes Life.’ Amazon will never get to own that ‘Three Stripes Life’ feeling because that’s part of the brand identity of Adidas.”