E-COMM

The Experience Factor

The pandemic has expedited retail’s shift from physical stores to digital commerce by approximately five years, per IBM’s U.S. Retail Index. That means new earnings jargon for retailers—and new routines for shoppers. 

Speaking of retailers’ first priority...the Harris Poll exclusively shared an August survey of 1,962 U.S. shoppers’ attitudes toward e-comm with Retail Brew. 

The results reinforce that the summer of “acceleration” will become a lifelong shift. 71% of U.S. shoppers surveyed by Harris Poll said they’re satisfied with purchasing items online that they used to buy in stores. 

• It’s a matter of convenience. "Not only have companies delivered the essentials with speed, efficiency, and relative ease,” said John Gerzema, CEO of the Harris Poll, “but now Americans have realized that they can get goods they once thought they would only buy in-person with just a few clicks."

But online’s not perfect yet. Pixelated product images make shoppers nostalgic for petting the cashmere table at their nearest J.Crew. 47% of U.S. shoppers say they still miss the “general experience” of shopping in a store—but not for the cash register small talk.

• 40% of women and 41% of men miss seeing and testing products.
• 43% of women and 32% of men miss browsing items that weren’t on their shopping lists.

Francis Scialabba

How to deal

Sephora can’t teleport moisturizer samples to me before I hit purchase quite yet. But Gerzema noted two areas that can help retailers scratch shoppers’ itch for capital-E experiences.

• Customer personalization. Retailers can inject their brand persona into e-comm pre-order (with algorithmic product recs) and post-order (with branded packaging).   
• Digital reliability. Shoppers want to know the site won’t crash when they hit order and that a chatbot can answer their fit questions. So refining storefront tech is a must. 

Looking ahead...Black Friday and Cyber Monday are ~90 days away. Retailers are guaranteed to drive more online sales than usual this year—but the brands that honor shoppers’ requests for better digital experiences will stand out.

STORES

No Swoosh for You

Nike is reportedly severing ties with nine retailers in its distribution network. 

• Who goes: A mix of regional department stores (Belk, Dillard’s), online retailers (Zappos), and athletic boutiques (City Blue, EbLens). 
• Who stays: National chains including DSW, Famous Footwear, and Dick’s Sporting Goods.

Warnings that Nike would downsize its retail partnerships were first reported last fall, and Nike terminated its Amazon partnership shortly after. Then in June, Nike confirmed it would shave down its partner network as part of an online-focused restructuring plan. 

The why’s simple. Taking as many retail partners as possible is a 1990 growth strategy. As the “hottest brand in the world,” Nike doesn’t need to be everywhere basketball shorts are sold to reach customers. Plus, the coronavirus economy placed an even higher premium on direct sales. 

And Nike has room to grow online: Its clothing unit averages 568,000 site visits/month to competitor Lululemon’s 6.3 million, per SimilarWeb.

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Rein In the HR Irony

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This results in some pretty unironic things, like a lower chance of data errors and more free time for everyone to focus on the business.

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FASHION

NYFW Hits a New Lowe's

In the biggest fashion crossover curveball since Crocs and my closet, Lowe’s revealed a major collaboration with next month’s New York Fashion Week. 

• Designers Christian Siriano, Jason Wu, and Rebecca Minkoff will integrate Lowe’s products into their upcoming outdoor presentations next month. 
• Lowe’s will livestream each designer’s show on its Twitter account. 

The Lowe’s logic: A quarantine surge in home improvement sales made living rooms “an epicenter of fashion,” said Lowe's chief brand and marketing officer Marissa Thalberg.

• Meanwhile, apparel sales haven’t quite recovered from record lows. That may have dented designers’ show budgets and opened the door for an unexpected partner. 

Here’s the thing: Home and apparel crossovers work best when brands with overlapping audiences or aesthetics co-create items. But the Venn diagram of Lowe’s target customers and NYFW regulars is two separate circles. If the Lowe’s items plugged into designers’ shows aren’t personalized to their brands, the tie-in will ring inauthentic. 

Designers are also chasing media impact value, a key metric for measuring a fashion show’s success, by airing their shows on the Lowe’s Twitter account. But the retailer's not topping any must-follow lists: it only has ~280,000 followers on Twitter.

WHAT ELSE IS BREWING

• Best Buy’s online sales surged 242% in Q2. 
• Dick’s Sporting Goods grew its online sales by 194% in the same period.
• Facebook launched a Shop tab, further sharing features with Instagram. 
• Zappos CEO Tony Hsieh stepped down after 20+ years with the company. 
• Madewell updated its “Insider” loyalty program with a points system, its first upgrade in four years.
• Alibaba is courting U.S. fashion brands to sell in China, Vogue Business reports.

SWAPPING SKUS

Today’s Retail Brew was powered by my first pumpkin spice latte of the season. Whether you live for pumpkin spice products or despise the seasonal beverage flywheel, the PSL is a lesson in customer loyalty...and brand associations.  

• How the PSL became an aromatic lightning rod—and why it’s triumphed over Internet backlash. (The Goods)
• Proust had the madeleine. Modern consumers have the PSL. That’s to say: a heap of sensory nostalgia trained consumers to adore the drink. (Psychology Today)

TRIVIA

In Monday’s edition, I wrote about how retailers are adopting flexible time off policies so their employees can vote in the 2020 election. It’s a movement that’s picking up steam this year, but Levi Strauss executive vice president Marc Rosen told me that Levi’s first offered employees time off to vote during a much earlier presidential election.

Which election was it? Here’s a hint: It wasn’t long after Levi’s released its first blue jeans.

Keep scrolling for the answer. 

ICYMI

I get it: Sometimes you miss a Retail Brew story or two. Start your catch-up session here.

• The 10 Fastest-Growing Athleisure Brands by Online Traffic
• An Interview With Warby Parker Co-CEO Dave Gilboa
• The Best Tips for Developing New Products From Home

TRIVIA ANSWER

Levi Strauss (the person) first gave employees Election Day off in 1864. That year, Abraham Lincoln was elected President.