Has Staples Launched the Omnichannel Store of the Future?
Staples Inc. last week launched its first two omnichannel stores, a smaller concept featuring a range of kiosks that extends the amount of merchandise a customer can select to more than 100,000 items.
Located in Norwood, MA, and Dover, DE, the stores are roughly 12,000 square feet and carry about 6,000 to 7,000 of the retailer's best-performing SKUs. The office-supplier retailer's typical stores range from 18,000 to 24,000 square feet and carry between 7,000 to 8,000 SKUs, a Staple's spokesman told Internet Retailer.
Staples claims to be the world's second largest internet retailer with online sales representing 42.2 percent of revenues in 2012.
Employees are also being armed with tablets to offer shoppers further product information and to check inventory availability. The kiosks orders come with free, next business day delivery to more than 98 percent of North America.
Another significant feature of the store is The Business Lounge, a meeting space that features a conference table and charging station surrounded by copy and fax machines, printers, computer workstations and Starbucks coffee. Lounge customers can view online product on a 55-inch screen.
Other features of the concept include consultation areas for small business customers who need help from Staples EasyTech and Copy and Print associates, and also offers reserve online/in-store pick up capabilities.
The concept reflects the initial learnings of Staple's Velocity Lab, an innovation center opened last August.
Overall, 45 of its more than 1,500 stores will be converted to the new smaller format this year. While saving rent, Demos Parneros, Staples president North America stores and online, told The Boston Globe that the smaller stores will still retain 95 percent of sales of its typical, much larger store. He stated, "We can get away with a smaller store because we have the capacity to offer one hundred thousand products online and offer pick-up in store or delivery overnight."
At the same time, Parneros also believes Staples clearly benefits from its brick & mortar foothold. He said, "What sets us apart from the Internet retailers is you can come in and hold and touch the product, there's an interplay of the retail network and online."
- Staples' Omnichannel Stores Showcase the Future of Retail – Staples
- Staples redesigns its stores for the Internet age – Internet Retailer
- Staples looks to fend off its online rivals – The Boston Globe (tiered sub.)
- Staples Velocity Lab Now Open in Cambridge, MA as Company Focuses on Online Growth – Staples
Discussion Questions
What do you think of Staples’ omnichannel concept? Do you expect digital kiosks in stores will be fairly common across other retail channels in the years ahead? How do you envision the omnichannel store of the future?
This is a concept and to me, that means “early.” Staples is smart to keep their key merchandise mix in the stores and offer more ways for the shopper to look directly (via kiosk) while they are in the buy mode. When a shopper is looking for something and the sales rep at a store says “you can get that online” then the shoppers desire to BUY fades. With a kiosk, that sales rep is trained to close the deal via kiosk and then they can sell more. A trick will be to entice the shopper to the kiosk and close the deal. Maybe a promo or free shipping—if the shopper orders TODAY at the store.
Shoppers want good deals and if the kiosk is the doorway to good deals, shoppers will “walk through it.”
Provided that you don’t have immediate need for a product that is not carried in-store, Staples’ omnichannel store is a great idea. It allows the company to operate with smaller footprints, reducing the cost of rent, while offering a full line of products.
This format could work for retailers that have the same consumer buying patterns: highest selling items in-store with immediate availability, thousands of other items available tomorrow, with free delivery.
Digital kiosks will become a common fixture within the brick & mortar environment. The initial phase will simply be the retailer’s website, using a large interactive screen. Unfortunately most all of the customers already have that available when they walk across the threshold in the form of their mobile device.
Staples is taking active steps in the right direction. Moving forward in response to the retailing reality is a major step in the right direction—a direction leading to survival and remaining relevant. The store itself needs to evolve next. Creating a store environment that competes with Starbucks is fantastic. Walk into most Starbucks and there are business people conducting business. It’s their mobile office. Staples is doing the same thing. The next stage is using the environment to expose and train these same folks on new innovations that will help them and increase their efficiency, etc. Meeting/conference rooms would be an obvious next step. Cross-channel media production and delivery services also come to mind.
Staples will learn a lot from this test, and a lot of other big-box retailers may learn valuable lessons, too. It’s an issue of how to leverage the convenience of brick-and-mortar locations in a more productive footprint, while finding ways to compete more effectively against web-only retailers like Amazon.
I would still like to see the big box office supply stores leverage their brand equity more successfully to offer virtual business services—not just paper, printers, ink and related merchandise. Staples and OfficeMax offer links to cloud storage and web domain suppliers on its websites, but have more opportunity than they have exploited so far.
Let’s see…Staples is offering their customers more selection and at the same time saving on rent and personnel, and making inventory control more efficient. It sounds like the old “win/win” to me.
Any retailer that does not look at this seriously has blinders on. This is the future.
Yes they will increase, although the form factors and experiences will vary greatly from the traditional view of a “kiosk”—watch for integration into fixtures, A/R, gesture, etc.
Staples is re-balancing physical and digital for the omnichannel future. This is something almost all retailers are/will need to be doing. However, the correct balance will not be universal.
In many ways, offering the tens of thousands of products online, delivered next business day for free, is the easier part. The harder part will be keeping the physical stores relevant with the SKUs that will be in stock for immediate trial and/or purchase.
As we’ve seen in recent retail stories, consumers like to be empowered with their own information to shop, so kudos to Staples for listening and implementing something that is of benefit to shoppers. Employees having tablets to give detailed information is also key. I agree with Parneros; people do like to physically see products before some purchases, especially electronic, so they might have the best of both worlds here. The next day shipping is competitive to online retailers such as Amazon, and will add value to online purchases.
Digital kiosks are definitely a key feature of retail stores in the future and omnichannel solutions is a concept other retailers will have to get behind to remain competitive.
Staples is changing to fit the needs of its customers, and this strategy seems on target for its market. I can’t say kiosks will work for every retailer, but it seems reasonable for Staples.
And unlike JCP, its actually testing the concept before committing to a large rollout. Sound approach.
Demonstrating once again the continuing Convergence of Online, Mobile and Bricks (COMB) retail. It is all one thing—Warby Parker and others incorporating bricks (Getting Physical – Online Retailers Move Offline), “everybody” moving online, and kiosks, tablets and smartphones gluing the others together.
We’re seeing a small group of retailers moving to implement this kind of “endless aisle” strategy. Restoration Hardware also comes to mind. Staples pilot is one of the more fully realized versions that I have heard about. This is definitely a wave of the future, so other retailers would be wise to observe these early trials closely and use them to inform their own efforts.
There is a win win here, however, I can see one more step that they should consider. If the customer has gone to the trouble to walk into the store, they either really need the thing or maybe need help selecting something; you get the picture.
Arm the SAs with tablets to look up inventory, yes, but also make sure the tablet has the capability to ‘easily’ let the customer complete the transaction.
Maybe the SA pulls up the item on the tablet, the customer says yes, let’s get it, and they simply have to enter a pass code of sorts that communicates their Staples account, credit card, address, etc., to complete the transaction. Easy peasy!
My first thought was: Does Macy’s tell Gimbels? Why tip off others with the launch of a a concept store?
Then I went looking and read the news today (oh boy) about an unlucky retailer that’s trying to make the grade…(SPLS, check out seeking Alpha: “Doomed By Amazon Or By Young People?” for a harsh assessment).
So what do I think? I think in this case, the message is the message—they want folks to keep hope alive and they are pretty aggressive. We shall see.
I always liked Staples. They’ve been a pioneer in both retail online and store design. Their category is one of the most vulnerable, so their urgency to figure it out is the greatest. That means they can provide insights on designing omnichannel and how to figure out how one designs omnichannel.
I went looking for reviews; none yet, but that is where the voters (I am not talking Romney) may provide some early insights
There are thousands and thousands of products available for public ownership that require more than a casual familiarity to reach a successful investment. Some of the dangers of buying are eliminated with regulation and government controls as we see with medications, automobiles, food products, home construction, and many, many more materials and consumables.
But as we move away from life decisions, so too we leave government investment protections. Computers don’t think and have no rationalization capabilities whatsoever. So for the next couple of few hundred years we will need to work with human experts to compile pertinent information to support a necessary buying of products and or services we know little or nothing about.
That said, the idea of people-less retail is just that, only an idea for the foreseeable future.
I think Staples has taken a step in the right direction when it comes to using kiosks to bring their various channels together. Book stores, for example, have had similar setups for years, and have found them to be a valuable resource in salvaging a sale when the product the customer is looking for is not in stock.
As for whether I believe this is the future, I think that this is merely a step in the right direction, and that digital channels will become even further integrated with physical retail locations as mobile technology advances.