James Curleigh, clad in Levi’s 501 jeans and a black leather jacket, strode onto the stage at the National Retail Federation’s annual trade show this week singing The Beatles.
“You say you want a revolution, well, you know,” Curleigh, president of Levi Strauss & Co., crooned.
The revolution to which Curleigh was referring, as he kicked off a talk about how retailers must reinvent the store experience to thrive in the digital age, was on full display at the four-day show, which was expected to draw some 33,000 attendees.
Three themes that vex the industry consistently emerged:
What retailers should do with the massive amount of customer data that technology has enabled them to gather, and how to protect it.
How to cater to shoppers who expect to be able to buy whatever they want, whenever they want and how ever they want.
And how to appeal to the game-changing consumer group known as millennials.
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The event took place as retailers awaited official sales results from the holiday shopping season, due Wednesday.
What follows are three snapshots from the show:
Levi’s Curleigh compared the role of physical stores to concerts in the music industry: They’re where the most memorable moments happen.
“Our challenge is simple,” he said. “How do we re-create that moment more often?”
For Levi’s, that has meant standing by the brand’s icons while surprising customers with new initiatives. The recent launch of Levi’s 501 “custom tapered” jeans, a response to the fact that tapering was the second-most requested alteration after hemming, has had one of the company’s fastest rates of sale, Curleigh said.
The opening last year of Levi’s Stadium, the new home of the San Francisco 49ers and considered the first “smart stadium” that engages fans on their smartphones, was another way to innovate.
“Give them what they expect but bring the unexpected,” Curleigh said.
The emotional connection shoppers feel with brands is keeping physical stores alive and well, said Baljit Dail, chairman and CEO of supply chain software company JDA, who was on the same panel.
He said 95 percent of retail sales are captured by stores with a physical presence. Seventy-eight percent of shoppers say they prefer to shop in stores, and when they do, they spend six times more than when they shop online, Dail added, citing a survey from the International Council of Shopping Centers.
But retailers also are dealing with a shopper whose power in the relationship is “unprecedented,” Dail said.
“I’d like to introduce you to your new boss,” he told the audience. On the screen popped an image of a young woman in a little black dress holding shopping bags while she chatted on her smartphone.
“They demand a frictionless shopping experience with immediate visibility and purchasing of product,” Dail said of today’s shopper.
And those smartphone-wielding shoppers, he said, wield large social media networks.
The luxury market can no longer rely on a customer base that buys Gucci just because it’s Gucci.
Armed with the ability to research products like never before, shoppers “are looking for the category more than the brand,” said David Seliger, CEO and co-founder of Rich Relevance, a San Francisco retail data services company.
Millennials present a particular challenge, as they tend to care less about brands than when, why and how something was made, said Ken Nisch, chairman of JGA, a retail design and brand strategy firm.
Their spending patterns also are different, as most millennial luxury shoppers fall into a category called HENRYs — an industry acronym for high-earner not rich yet, defined as those earning $100,000 to $250,000 — for whom renting luxury is often preferable to owning.
But there also is opportunity there.
Millennials, said Matthew Woolsey, executive vice president of digital at Barneys New York, are “natural luxury customers.”
“Luxury is about where it was made, how it was made and the inspiration behind it,” Woolsey said. The challenge to luxury brands and retailers is how to use big data to introduce customers to the brands’ stories and engage them with editorial content, he said.
The new “connected” Rebecca Minkoff shops in New York City and San Francisco have been lauded as the stores of the future — though some take issue with that characterization.
“I think it’s the store of today,” said Healey Cypher, head of retail innovation at eBay Enterprises, which provides the technology that powers the stores. “I don’t think we are exceeding customers’ expectations, I think we are meeting them where they are.”
It begins with the massive mirror that greets shoppers when they enter the designer women’s clothing and accessories boutique. The mirror, also a digital touch screen, acts as the home page where shoppers can browse products, find outfit inspiration, have items sent to a fitting room or order refreshments that are brought to them by an associate.
All items in the store are embedded with radio frequency identification codes, a wireless tracking technology. In the fitting rooms, sensors detect what items have been taken inside and pull up product details on the touch screen mirror, allowing shoppers to choose different sizes and colors or find items to complete the outfit.
They also can choose different lighting, such as “Brooklyn morning” or “Soho at night” in the New York version, to get a sense of what the outfit would look like in different environments.
The technology aims to bring the immediacy and robustness of the online experience to the physical store, while maintaining the human relationships that make in-store shopping relevant and pleasurable.
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Nordstrom and Bloomingdales are testing eBay’s connected fitting rooms at some of their stores. .
The technology, Healey said, is intended to address real challenges, such as the greater likelihood that customers leave the store empty-handed when checkout lines are too long or items they try on aren’t quite right.
Is the technology coming to Chicago anytime soon?
“Minkoff is opening more stores,” is all Cypher would say.