For retail brand owners, such as Burberry and others, I think that instead of trying to protect themselves from the threat of Amazon and other online stores, they should embrace the technology and adapt their operating model.
Just like the music industry adapted from music concerts as promotion to grow album sales, to songs becoming promotion towards generating concert sales. Brands should also adapt by making stores the promotion towards online sales. Free standing stores should become a place where the brand is elevated and customers can interact with it in a more personal level.
I think that Burberry is doing is just that. By becoming digital, the brand will be able to interact with the customer from the point he/she enters the store to any time later in the day by staying connected digitally. Driving in-store sales should not be Burberry’s priority, but instead create a brand loyalty and bond that will lead to subsequent sales online by any of the existing online marketplaces.
As for creating their own social network “the art of the trench”, I am interested in knowing how much of the sales growth was due to that initiative. I feel that promoting your brand among existing customers might not be as effective as using existing social networks to target new customers who are not yet aware of the brand. When it comes to showing off a luxury brand, people usually like to show it off among people who don’t already have the brand.
I found this article interesting. As you mention, mid-priced watches are currently at a tough position where they are starting to feel the pain from the introduction of smartwatches.
When apple first launched the apple watch, it launched three different versions. One of them was the Apple Watch Edition, which was made from gold and it cost 10,000 USD. The watch was not successful and was discontinued at this price point after just one year. One personal lesson for me was that high-end luxury watches need to stand the test of time, and something that has software, will almost never last on the long run. Existing software will always be outperformed tomorrow and the watches will become useless.
One big challenge with companies such as Tag trying to go “smart” is that closed systems such as the one in the iPhone do not currently allow third party watches full access to the phone. Currently they will only allow limited features such as notifications, but connecting to existing third party apps in the phone is not currently possible and I don’t see Apple changing this policy any time soon.
As a Philips hue owner, when I purchased the product I was very excited for my purchase. I thought that it was a game changer and would ultimately save me some time by giving me the option to turn on/off my lights from the convenience of my phone. After almost two years since I purchased the product, this is my experience.
First, at $200 USD for only three light bulbs, it is truly a difficult pill to swallow. I bought it because I am a big fan of new technologies like this one. I did not buy it because I thought it was going to save me money on the long run.
Second, I am not the only one in my apartment who turns on/off the lights. While my wife could also download the app and connect it to the light bulbs, she doesn’t really like the idea of opening an app and going through quite a few screens and clicks to get to the right bulb and just to turn a light off.
Third, if someone was physically turned off the lights, you won’t be able to turn them back on from your phone. This can be frustrating, which eventually makes me just use the physical switch every time.
Forth, while I usually keep my phone at an arm’s reach, this is not always the case. For those cases, you will still need to physical switch.
The only time where I have found it very useful is when I in bed and I don’t want to get up and turn the lights off.
After all this time, as the other posts have mentioned, I don’t think it is going to be a game changer for Philips unless it can bring the bulbs to price parity with other LED bulbs. Until then, I don’t think I will be buying more Phillip hue lightbulbs.
I think this is a very interesting article. It shows how one of the mayor retailers is trying to counter the increasing threat from online marketplaces. When I look at what it is happing with retail stores, companies such as Tower Records come to mind. A company that was not able to adapt quickly to disruptive threats.
One of the mayor advantages of Macy’s is their physical presence and reputation and by pursuing what I would call a “digital fitting room” the company can offer something that online stores are currently not able to.
The previous comment surfaces a problem with having to accurately manage inventory so that the person in the fitting room doesn’t have to wait more than 30 seconds, I think that there is a way to mitigate this risk. By notifying the customer when the picked clothes are ready to be fitted in the fitting room, the customer would be able to continue browsing the store.
While this is a step towards becoming more digital, I think that Macy’s needs to find other ways to appeal to lost customers to Amazon and other online retailers. Digital fitting rooms alone will not do the trick. It is a tricky path to pursue given that if you educate customers more and more on digital tools, they will end up switching to 100% digital and will eventually switch to the stronger online players.
Shopping is a social experience and that is something online retailers are not able to offer. Companies such as Macy’s need to find a way to exploit this matter. I don’t really have an answer right now, but this is where I think Macy’s needs to work on.
As shown in the data provided in the article, looks like M&S is in a position where it is fighting for survival. M&S, just as many other retail stores are now struggling in the fight against online retailers and they are trying to play catch-up.
While most of our purchases will in fact now come from online pages, I believe that the need for a physical store will always be there. As mentioned in a video by Erika Serow: Why Stores Still Matter in an Online World, “shopping is a social experience, where customers like to interact with a sales person, touch and feel the product before buying. However, I do think that this will not be the case for every segment of the apparel retail business.
As you mentioned in your article, looks like M&S is where you go when you want to buy socks, tights and underwear. In this category, I do not see a need for a physical store, given that even now, we buy those products without the need to try them on. There is less differentiation in those products that the need to try them on is pretty useless.
One significant challenge to the whole digital experience inside the traditional retail store is that consumers will need to be educated to how to use these kiosks and it will require a huge amount of resources. It seems to me that the average customer will not want to spend his/her time trying to learn how this kiosk works instead of actually physical browsing the store. I also think that once a customer understands how the kiosk works, he/she will not longer see the need of actually going again to the store if he/she learns that he/she can actually do the same thing from the comfort of a computer at home.
My former employer is a supplier of Walmart indirectly, given that many of the clothes sold at Walmart had labels that were manufactured by us. Given that we where in their supply chain, Walmart dictated many rigorous set of criteria that we needed to satisfy, such as working conditions, GHG emissions and other sustainability metrics. When I first saw Walmart auditors come into our plant, I founded extremely interesting to see how rigorous they were of our compliance. This gave me a very positive image of the company, which cared not only on the sustainability of their operation, but that of the suppliers upstream and downstream their supply chain.
I think that as companies such as Walmart lead the way in creating sustainable processes, other smaller companies will follow. I think that there is a great social responsibility from such firms given their purchasing power and their potential having a significant impact on the environment is enormous.
As an experienced baby diaper changer, I can definitely see how this can be a problem. Currently my daughter needs around 10-12 diaper changes a day. Just imagine how many diapers that means for a year (4,380 per year in my case to be exact). At a price of ~50 USD for a box of 160 that makes it an annual expense of 1,335 USD. In general, parents are concern about this expense, this can be a huge expense for many families and adding a price premium for it to become biodegradable might be a complicated thing for middle class families to digest.
As a parent, I really care about three things: quality, convenience and price. Having to deal with complicated products or experimental products is always a challenge because parents will usually be wary of testing a new diaper that might risk the baby’s health. Reducing the amount of diapers a baby used, quite frankly might be impossible because that is a natural thing. Even if you had a diaper that could have more absorption, I wouldn’t want my baby to be wearing a dirty diaper, even if you told me scientifically that it wasn’t dirty.
There is definitely some great challenges for Pampers to solve, but they need to keep in mind the end used which in my experience might not be fully on board on trying to save the planet before their own children.
I like this post a lot TD21, since I have some experience in the garment industry. My former employer produced all the labels that go into these Levis jeans, from the white label with the washing instructions to the brown patch that goes in the back of the jeans on the belt area. One of the main quality tests that Levis (our customer) did to our labels was washing tests, where they would put our labels sewed to the jeans through many washing cycles to see how many cycles the ink resisted before getting washed out. In order to have this performance on our labels we had to develop an special kind of ink that was solvent based which could potentially be harmful to the environment. If Levis was suddenly able to reduce their criteria on number of wash cycles that our inks needed to resist, we would definitely look for more environmentally friendly inks which could ultimately have a positive effect on the environment as well and could be offered at an even better price.
I really liked how you defined the responsibility of Levis as not just what happens inside the four walls of their production plant, but also what happens upstream and downstream their supply chain process. I think that going forward they could definitely profit from collaborating with their current suppliers to see where exactly they might be also having a negative impact on the environment and work with them to solve the issues.
Great post and definitely like all the different strategies that Procter is following in order to reduce their effects on global warming. In the comment you also mention that Procter has 160 manufacturing sites all around the world. I am not familiar with the current supply chain of P&G, but I was wondering if they had any plants in the future to reduce their footprint and begin the consolidation of production lines. I do think that there is a great opportunity regarding this matter. We could find a way in which we could create clusters of suppliers around this plants and reduce their transportation costs from them as well. I think that when it comes to carbon emissions it is important not only to look at the emissions you are generation in the four walls of your operation, but also from the emissions generated both upstream and downstream the supply chain.
I definitely agree that the quality of service from an on site consultant vs. off site consultant may not be comparable, but telecommunication has been making great strides towards getting closer. While I personally don’t think that we can replace it 100% we can definitely be more effective with the travel. This could be on whether we optimize who travels where based on which office they are based on or reducing the amount of back and forth travel over weekends. I would definitely think that many consultants would not care staying the weekend in their location for and extra lump sum if given the option. Definitely this would not be for everyone, specially those with families to see over the weekend, but many would definitely like the option.