Photo: iStock / vectorikart
Are Retailers Boring the Heck out of Shoppers?
A recent Wall Street Journal article explored “how shopping got so boring” and placed the blame for a lack of retail innovation on fallout from the pandemic and retailers playing it too safe.
Reasons given for the apparent bland offerings at retail included:
- Vendors in the early stages of the pandemic shifted resources away from innovation amid significant uncertainty with some focusing on addressing shortages;
- Pandemic-driven supply chain disruption eventually led to widespread excess inventories in the marketplace;
- Remote workplaces stifled collaboration and brainstorming for new ideas;
- Inflationary pressures and the potential downturn led retailers to order conservatively and vendors to emphasize safer bets.
The Journal said that retailers recognize new items give shoppers a reason to buy, but it takes “months, if not years” to develop products.
Amanda Mull, writing for The Atlantic, blames the ”sameness” seen in fashion on industry consolidation, making it more challenging for smaller, creative designers to compete. The success of fast-fashion, she said, has also led the industry to rely more on data and trend forecasting that lead to safer, algorithm-driven offerings at the expense of bold designs.
Shawn Grain Carter, a professor of fashion business management at the Fashion Institute of Technology, told The Atlantic, “The days of the designer saying, ‘Look, this is what I’ve done, and this is your choice or forget about it’ – those days have gone.”
Many retailers coming out of the holiday quarter delivered cautious guidance for 2023 and stressed inventory discipline and expense controls amid a possible downturn. Target and Urban Outfitters were among the retailers touting the benefits of newness.
Nordstrom said it plans to maintain increased reserves against buy plans to be opportunistic while planning for inventory turns to increase to at least 10 percent over 2022 to drive newness and flow.
“Our strength is around newness and inspiring our customers to try something new and introduce new brands to them. We’ve had a lot of success over the years. And it’s not necessarily exclusive products, but it’s brands that aren’t up and aren’t widely distributed,” Erik Nordstrom, CEO, told analysts on the company’s fourth-quarter call.
-
That Style, Again? How Shopping Got So Boring — The Wall Street Journal
-
Stores are stocked with copycat designs. It’s a nightmare. — The Atlantic
-
Target (TGT) Q4 2022 Earnings Call Transcript — The Motley Fool
-
Will Target’s ‘commitment to newness’ continue to drive growth? — RetailWire
-
Urban Outfitters, Inc. (URBN) Q4 2023 Earnings Call — Seeking Alpha
-
Nordstrom (JWN) Q4 2022 Earnings Call Transcript — The Motley Fool
Discussion Questions
DISCUSSION QUESTIONS: Is a lack of product innovation at retail a short-term hurdle or a systemic problem? What advice would you have around maintaining inventory disciplines amid macroeconomic concerns versus the risks of playing it too safe?
Poll
Loading …BrainTrust
DeAnn Campbell
Head of Retail Insights, AAG Consulting Group
Lucille DeHart
Principal, MKT Marketing Services/Columbus Consulting
Innovation is not a short-term initiative and it cannot be turned on and off. Creative process and development must permeate and be rewarded throughout an organization and not seen as an expense and a place for cost savings during challenging times. Brands are unique because of their promise to deliver consistently and this includes product, service and user experiences. Part of the problem is the decline in importance of high fashion and runway inspirations and the shift to influencers and micro-personalities. Designers create, influencers share.
Create vs share. Love it!
Boring is never the solution–ever. There’s a huge difference between avoiding risk and managing risk. Risk can be a brand’s best friend. It’s a differentiator. It’s an attention-getter. But it’s still risk and has to be managed accordingly. Risk avoidance to the point of sameness is a glide path to bankruptcy.
And fast fashion is no excuse for sliding into safe algorithms. To heck with the algorithms. The beauty of fast fashion lies in testing and high turn inventory. Very short concept-to-on-floor time windows. Being data driven. Those are all reasons for closely managing risk, not reasons to eliminate risk. You’re not guessing nine to 12 months out. You’re data driven, weeks to a couple months out. That’s license to take measured risk.
“NEW!” still gets shoppers’ attention. (Got yours, didn’t it?) With real-time inventory in place–my mantra, of course–the excuse of “inventory caution” for not introducing new styles gets old fast. In the stores, products lack excitement because any “quick” innovation is staying online. But retail is theater, and you have to supply the right costumes for the play. Getting it right is a combination of data and gut feel and what is lacking is two-fold: the people to analyze the data and the vision and budget to apply it. Retailers need to conduct a market scan and develop a maturity model that positions them against the best-in-class retailers and provides them with a plan to close the gap. Then call in the creatives–remote or in person–to design some great new products to sell.
Retailers’ bandwidth is focused on navigating big issues like technology updates, finding enough staff and streamlining operations to survive inflation, so they can be forgiven for neglecting product innovation. While consumers are concerned about price, brands and retailers do have to double down on optimization to take costs out of their budgets to preserve as much of their profit margins as possible, which often means creativity takes a back seat. But this is a short term situation, and as the cost of automation and the economy begins to stabilize over the next 24 months, the pendulum will swing back to getting more innovative around products.
We have been talking about the “sea of sameness” in retail stores (especially apparel) for well over a decade. Well over. It has nothing to do with the pandemic and everything to do with sourcing product a half a world away from the point of demand.
Long journeys like that tend to require large orders to be economically feasible. Large orders made so far in advance are a “bet.” It’s a rare merchant that will be bold when placing such large bets.
And so, the result is a sea of sameness. This has nothing to do with the pandemic and everything to do with fear of making mistakes.
I’m going to call out Gap here. It has been selling the same jeans and striped sweaters forever. Don’t customers want something new?
Well they sure didn’t want those innovative trash bags, did they?
Good point. LOL!
You can have the most innovative product around but ignoring the customer experience and training on how to do better at it leaves many products on the shelf. How “innovative” is a phone, a toy truck, a black dress, or a pair of work boots? Rarely are shoppers considering a purchase where someone in a store gives a damn, is rewarded for selling it, and is eager to engage. Yes, customers want to come in and discover something new but what they really want to feel is good about their purchase and feel confident in how it helps their lives. That help and passion is sorely missing in many of these examples.
Sameness at retail, boring assortments, and risk-averse merchandising didn’t just happen as a result of the pandemic. These are trends that have been rampant for at least a decade, as retailers seem to discourage risk-taking. And a smattering of newness just looks like overassortment (see: Nordstrom) — it’s no substitute for taking an aggressive stand on big new ideas.
The pandemic and its aftermath have made things worse because of the rapid shifts in consumer behavior (work from home or back to the office?) and supply chain convulsions. Stores that were forced to sell 2021 “packaway” goods during the past holiday season did themselves no favors in their customers’ eyes.
Shoppers in the U.S. and elsewhere are somewhat jaded with the shopping experience. Some of this is because of a general “blandification” of propositions, some is because of the uniformity of chains, some is because ranges don’t change much, and some is because innovation is scarce. However from our data, the feeling is not universal; some retailers score better than others. The luxury players in general do well, Target (although its score has fallen within home and apparel) is seen as fairly fresh, niche retailers like Camp are very different, and Dick’s scores well, especially for its new concepts. All of those players balance the need to be operationally disciplined with the need to experiment and innovate. Both should be a part of the business plan.
Let’s be honest: Retail right now IS boring. It was boring before the pandemic.
We get excited about stores with big, shiny things. Aliens on the sales floor, ball pits, and robot designers on the roof and in windows. These things are fun the first few times we see them, but after that the merchandise and merchandising better be good. We haven’t seen real innovation since STORY opened in NYC, and we all know what happened after that.
There are good examples out there. Rich and I led a group of retailers on a Retail Adventures Bus Tour in Columbus last week. Vow’d Weddings knocked us out. The store we visited was beautiful, right down to the restroom. This store innovates through design and merchandise and wonderful service. RH is a true immersive experience, we felt like we were shopping in a mansion. Samson in the Short North neighborhood is a beautifully appointed and beautifully stocked men’s store. The best part is the owner had never been in retailing before he opened his store.
Williams-Sonoma makes me want to cook; housewares in the Macy’s branch stores I have visited do not. The new Banana Republic stores make me want to buy clothing; Ann Taylor houses clothing on racks. Camp is awesome, but Ben Franklin Crafts & Frames in Redmond, Washington has been doing similar things for 30 years, with less fanfare and props.
If retailers want to get people excited about shopping again then shopping needs to become less of a chore. When shopping for apparel is on the same level as shopping for groceries you know you are in trouble. Some retailers have phoned it in for too long. Pull your head out of the data and do something customers will respond to – not on paper – every day, on the sales floor.
You are spot on with your assessments, Georganne!
We are far removed from many retailers even approaching “surprising and delighting” customers. Other than the luxury sector and a handful of DTC brands like Nike and Lego, very few retailers are inspiring consumers with amazing experiences. This is all unfortunate, as Gen Z and all other generations are not glued to their phones 24/7 and view going to a cool shop or store for an experience and connecting to the community as an escape from the digital matrix.
Nike is a unicorn. Its stores deliver on design AND merchandise!
It sure didn’t help to have Macy’s and Bon-Ton consolidate all those dynamic regional brands – Detroit was different from Dallas in the 1980s but not anymore. Eliminate dozens of competing regional laboratories at the altar of efficiency and risk reduction and why should we be surprised? When clothing manufacturers consolidate in the face of retailer mergers, and outsource to the same nests of offshore production, all in the name of margins, why should we be surprised?
A new generation of hyper-local merchants and designers, coupled with local, digital weave-to-order production tools, is what will create novelty and innovation to drive what is left of the “mass market” in the late 20s-early 30s.
“I want my Dayton’s back” is the call – the Dayton sons might just do it with their local Askov Finlayson brand here in Minneapolis, for instance.
Of course they are boring their customers. All the points in the article are correct. The issue is the boredom of seeing nothing exciting throughout the stores. Racks half full, tables with holes in the assortment. No rotation of product to keep customers looking. Yep. Stores can be pretty boring when left to mediocrity.
The traditional product development process has evolved over the past few years, yet few retailers have adapted their operating models to take a more innovative, agile approach to design products. In what has become an “attention economy,” retailers and brands must leverage every possible channel to connect with customers and influencers.
A successful product design process is collaborative now, where influencers, customers, and brand ambassadors provide insights into what new product launches will be successful. To mitigate the risk of inventory overload, it’s critical for brands to leverage TikTok, Instagram, and other social channels in our new immersive commerce world to gain insights into what is resonating in the fashion industry beyond what is available in the transactional records. Additionally, this collaboration could provide an opportunity for influencers to engage with product designers on future rollouts.
People, purpose, and passion can be an antidote to boring retail. In this labor-challenged market, it can be hard to find the right people in the store that align with your brand, believe in it, and use the product. When you as a consumer interact with these associates, you can get inspired and buy into more of what the retailer has to offer.
A perfect example is REI vs. other sports retailers. REI succeeds and remains popular because they have perfected “outdoor theater” — the retailer brings new items in but it is really about the buzz and the people there. Innovation alone can’t be the answer to make retail exciting, you have to have engaged associates too.
Ah yes, theater. Lest we forget that theater has been a critical part of the retail equation for centuries. And throwing tech and digital at the business may or may not add to the theater. Maybe CX is the way we talk about theater these days, and there are more moving parts to theater than there used to be, but theater is still a backbone of the business.
Blaming this on the pandemic and associated changes in workplace behavior is apt, but when was the last time department stores were really interesting? It’s more than just their mix of products, their day-in and day-out discounting, and their lack of service. To use a website design expression, their UX plainly needs an overhaul.
There is no “selling” happening, no “magic” no “discovery”….this is a systemic problem…when was the last time you went into a store just to go in because it looked like “fun”?
Where are the merchandisers, the marketeers, the salespeople? Oh–there they are, hiding behind the accounting department.
What platforms do Merchandise Buyers currently use to get pulse of a region?…at what points can consumers weigh in (earlier), before the merchandise is sent to store?
Consumers don’t see the process, much less feel heard… e.g. How did Macy’s decide on 153 SKUs of women’s solid black t shirts, or 928 pink dresses online?
Is the process for apparel proactive?
Or is it more like trade or fashion shows where items are presented, and boxes checked off on order form? (Those examples being extreme ends of a complex multi-factor process!).
Consumers see where corners are being cut (dresses w/o any sleeves, bling that falls off instead of stitching detail) but don’t see where the inspiration/Store POV starts.
Messaging of new product is usually “the season” (meaning weather). But weather is less predictable; and people are back to traveling across climates.
For small retailers, the benefit of conversing with shoppers is huge…so are the stakes of misjudging.
Superstores tend to be boring because they are very predictable, such as Walmart and Target. Nothing very new and different, no novelty. Especially Walmart in groceries and men’s clothing, for example. But that is not necessarily bad. I think a lot of shoppers including me want and expect to see and buy the same products in same shelf locations over time. Depends on the merchandise. Clothes styles should rapidly change, IMO, and not just women’s. Rearranging the store is not enough.
Big box retailers like Walmart and Target, among others, have mastered the game of inventory optimization and have complete control over their supply chain management. Their goal is to attain real-time accuracy and provide rapid inventory availability across all channels.
In my opinion, the issue lies in the fact that most retailers lack knowledge of their current inventory across different locations and have limited ability to make sales from wherever the customer is present. Retailers must be omnipresent in order to sell more merchandise, and to do so they must “bring the stores to the customer.”
The same goes for the fashion industry. It is critical to understand that “lack of retail innovation” is a supply chain issue and not a design issue. Even fast-fashion retailers prioritize time-to-market strategies for their products over new designs. So blaming outdated designs for lack of sales is just an excuse.