Store Operations - Retail TouchPoints - Retail TouchPoints Sun, 25 Aug 2019 15:23:20 -0400 RTP en-gb Target Hits Halfway Point Of 1,000-Store Remodeling Goal, Doubles Same-Day Services Revenue Target Hits Halfway Point Of 1,000-Store Remodeling Goal, Doubles Same-Day Services Revenue

Target’s $7 billion investment initiative into its stores is in full swing, with the retailer revealing it has remodeled 500 of the 1,000 stores it committed to updating by the end of 2020. In total, Target expects to remodel 300 stores in 2019. The company also has opened 100 small-format stores since the investment plan was established in February 2017.

The small-format shops average 40,000 square feet in size, or one third of a full-size store, with smaller locations having only 15,000 square feet of space. Target reaffirmed that it is still on pace to open 30 small-format stores across the U.S. each year, particularly in urban areas and college campuses, with the intent of localizing the merchandise the stores will offer.

Like top mass merchandise competitor Walmart, Target had a great showing in Q2, seeing comparable sales increase 3.4% (ahead of 2.9% growth estimates by Refinitiv)and online sales climbing by 34%. In total, Target Q2 sales rose 3.6% year-over-year to $18.2 billion, while net earnings increased 17.4% to $938 million.

Same-day fulfillment continues to be a growth driver for the retailer, further justifying Target’s massive brick-and-mortar and supply chain investments. Revenue from Target’s curbside pickup, in-store pickup and Shipt delivery services has doubled from a year ago, accounting for nearly 1.5 percentage points of Target’s overall comparable sales growth during the quarter. In Q2, these services represented one third of digital sales for the retailer, according to John Mulligan, EVP and COO of Target in an earnings call.

“Q2 could not have gone better for Target,” said Charlie O’Shea, VP and Lead Retail Analyst at Moody’s in commentary provided to Retail TouchPoints. “Every measurable metric demonstrates continued acceleration and validates the company’s strategic shift articulated in February 2017, proving that short-term pain can generate long term gains if the strategy is well executed.”

Target also has beefed up its grocery business with the introduction of its private label grocery brand Good & Gather. Good & Gather products are scheduled to hit Target store shelves Sept. 15, and by 2020 the brand will offer 2,000 products. Grocery sales represent approximately one quarter of total revenue for Target.

In the earnings call, CFO Cathy Smith said Target projects $3.5 billion in capital expenditures for the full fiscal year, driven mainly by the remodel program but also including investments in new stores, supply chain and technology.

]]> (Glenn Taylor) News Briefs Fri, 23 Aug 2019 14:27:28 -0400
Robotics Move Beyond Warehouses To Stores And The Last Mile Robotics Move Beyond Warehouses To Stores And The Last Mile

Robotics technologies deployed within retail, food service and hospitality already are reducing the number of humans needed to perform their jobs. But the growth of these technologies also can provide help for employees handling a wide range of functions — whether it’s tracking inventory, identifying where a store aisle needs to be cleaned up or even assisting on last-mile delivery.

The latest change comes in where robots are being tested and deployed. While retailers have been using robotics for years within warehouses and distribution centers, advances in the technology are extending use cases into stores, where there are multiple opportunities to automate tedious, repetitive tasks. In fact, a survey from Bossa Nova Robotics indicated that:

  • 76% of retailers say the introduction of robots in stores would improve employee productivity; and
  • 74% said that while inventory accuracy would improve as a result, increased profits would be another direct result of introducing in-store robots.

At this stage, a select few major retailers are on board with robotics pilots of their own, with merchants such as Walmart, Ahold Delhaize’s GIANT and Stop & Shop chains, Albertsons and Lowe’s all implementing the technology at different points within the retail ecosystem.

MIT Professor: Don’t Fret Retail Job Losses

During a presentation at eTail Boston, Dr. George Westerman, Senior Lecturer at MIT Sloan School of Management, noted that using robots is becoming much more than a nice-to-have within retail environments, especially if retailers are committed to transforming their store operations.

“Here’s one thing people hate to do — ‘Hey, I have this screw, can you help me find it on the shelf somewhere?’” Westerman said. “Can you imagine what a horrible thing this is for an associate to do? But it happens to them all the time in both The Home Depot and Lowe’s — so Lowe’s has the Lowebot. You show this screw to the Lowebot and it says, ‘Come here, sir’ and walks you right over to it. This is replacing people in jobs where people don’t want to do that job anyway. What I mean is it’s not about the robots, it’s the transformed process. It’s using it the right way and changing your company for the better because of the technology.”

Walmart Will Deploy 350 Mobile Robots In Stores To Monitor Pricing, Out-Of-Stocks

Walmart has been one of the first to deploy autonomous mobile robots (AMRs) from Bossa Nova Robotics in 50 Walmart stores across the U.S. The AMRs roam up and down store aisles, checking for pricing issues, product out-of-stocks and shelf irregularities. For example, they can identify whether a slot within a shelf is empty or full, correctly identify which SKU is in the slot and identify the price associated with the slot.

After the success of the initial pilot, Walmart is increasing the presence of the AMRs to 350 stores by the end of 2019. Martin Hitch, Co-Founder and Chief Business Officer of Bossa Nova Robotics, told Retail TouchPoints that the larger implementation within a closer subset of stores will further enable Walmart to test the support infrastructure of the robots and learn more about scalability. “There is a requirement to get to a statistically relevant store sample size that will inform what scale looks like in my chain of stores,” Hitch said.

Walmart provides just one example of how retailers are continuing to adapt to the technology both in and out of stores.

“In order to respond, traditional retailers with stores also will have to become more efficient,” said Martin Ford, futurist and author of Rise Of The Robots: Technology And The Threat Of A Jobless Future in an interview with Retail TouchPoints. “Walmart and others have been testing robots for taking store inventory by counting the things that are on the store shelves. Part of the nature of robotics is that it’s easier to make one designed just to observe something, versus building a robot that physically does something like pick up a box. Eventually, however, robots will be unloading trucks or putting items on shelves, particularly in areas where the products are standardized. That’s probably inevitable.”

Cleanup On Aisle 6: ‘Marty’ Robots Patrol Stores For Spills, Shopper Safety

Ahold Delhaize has launched nearly 500 robots at its GIANT and Stop & Shop stores to patrol the aisles for spills and, eventually, out-of-stock items. These six-foot-three machines have been outfitted with “googly eyes” and nametags that read “Marty” to deliver personality within the store.The robot’s functions also are expected to expand to include planogram compliance.

The robots are equipped with the same type of navigation system as a self-driving car, allowing them to accurately map and navigate the store. They can detect and travel around unexpected barriers and can differentiate these obstacles from shoppers: when Marty observes a person walk within several feet, it stops and waits for them to get out of the way before resuming its patrol.

“Retail has initially invested in robotics for back-of-the-house or even supply chain with great success,” said Joanne Joliet, Senior Director Analyst within Industry Advisory Services, Retail at Gartner in an interview with Retail TouchPoints. “We’ve seen absolute optimization in supply chain practices including fulfillment. As tech continued to evolve and as retailers were trying to evolve the customer experience in-store and create a differentiated experience, that has shifted a little further back toward the operational side, where we’re seeing more robots being used to understand out-of-stocks within the store and taking care of maintenance issues.”

Last Mile Delivery: The Next Robotics Frontier?

The most recent (and thus, least studied) area of retail robotics implementations has come outside the store and distribution center in the form of autonomous last-mile delivery, with examples such as the FedEx SameDay Bot pilot and Amazon’s Scout delivery system being piloted in 2019. Originally developed for the Pacific Northwest, Scout expanded to select Southern California test neighborhoods earlier this month, for deliveries Monday through Friday to Prime members during daylight hours. Of all the technologies in deployment, these are the ones that likely need to undergo the most tests, according to Joliet.

“I’ve had a conversation with the head of Scout and they looked at every permutation and test for that before rolling out, and that’s what I mean when I say test and test again,” Joliet said. “To remediate an issue down the road is going to be challenging as you roll out and have more places to fix it beyond the pilot markets. Now I’m in the Carolinas, and there are some rural parts around here — is Scout appropriate to go into rural areas? Likely not. So again, you have to look at the technology and still determine how it can best serve a specific environment and roll that out.”

For any last-mile robotics delivery initiative to be successful, Joliet pointed out that retailers will have to take operational factors into account including battery life, monitoring and security concerns, such as whether a delivery recipient puts an unauthorized item back on the robot. Of course, these technologies must integrate with their environment without becoming a nuisance to others.

“When crossing the street, how would it integrate with the traffic lights and the cars so that it doesn’t create an unsafe situation for anybody?” Joliet said. “How does it yield to a pedestrian or a child or a dog on a sidewalk? The technology is all there, but it’s about putting it together in a cost-effective way before retailers can roll this out.

‘Stores As DCs’ Gives New Meaning To Robotics Implementation

With robotics technologies now being tested on the last mile, it’s clear that retailers are taking steps to continue improving shopper experiences from the warehouse all the way to product delivery. But now that more iterations of these technologies exist, retailers have the opportunity to blend how they approach robotics for store employees across the organization. Bossa Nova’s Hitch noted that as retailers continue to turn stores into distribution centers, robotics technologies of all kinds will be valuable throughout the physical retail ecosystem, and merchants must treat them as such.

“People have been talking about it for a long time, but the reality is there’s an awful lot of brick-and-mortar assets around the country that put any of those retail brands closer to the customer, and leveraging that is key,” Hitch said. “This to me is where we’ll see a lot of evolution across multiple technologies. I don’t think there will be one single winner. There will be a combination of different robotics technologies that will be required to shift stores to distribution centers. Having 10% of a store as a stockroom right now clearly isn’t the right model if you want the store to act as a distribution center. There will be a shift in how much is floor space, and how much is warehouse space, to determine what technologies will go into that.”

]]> (Glenn Taylor) Trend Watch Thu, 22 Aug 2019 12:04:16 -0400
Report: Avenue Will Close, Liquidate All Stores Report: Avenue Will Close, Liquidate All Stores

Women's plus-size fashion retailer Avenue plans to close all its stores in the coming weeks, employees were told Friday in a conference call, according to Retail Dive.

The New York Post reported earlier this month that Avenue had 60 days to find a buyer, or it would have to shut down its 260 stores.Store-level managers at two separate Avenue stores reached out to Retail Dive with information about the notice to employees, and employees at two additional stores independently confirmed that they found out all stores were closing. 

There has been no public confirmation of the store closures, and it is unclear whether the e-Commerce site will be affected. The plus-size retailer is working with Hilco Global to conduct its going-out-of-business sales through September. Employees have been instructed not to accept customer returns or sell gift cards, the report said.

In April, Avenue underwent a “strategic recapitalization” with a $45 million loan from PNC Bank, meant to finance the retailer's capital needs and strategic initiatives. Avenue's owner, private equity firm Versa Capital Management, also provided a new, undisclosed amount of capital at that time.

There have been recent rumblings of individual store closings from local media outlets in recent months. New Jersey document filings confirmed that Avenue will let go of 152 employees, effective Sept. 30, related to the Rochelle Park, N.J. location. 

Versa acquired Avenue in a bankruptcy auction in 2012, when the retailer operated 433 stores. In May 2018, Avenue named a new CEO, Mark Walsh, a board member who had been advising the company since 2017.

Avenue’s difficulties are likely similar to other retailers such as Ascena Retail’s plus-size Lane Bryant and Catherine’s businesses, or bankrupt-and-back FullBeauty. As more consumers want diverse, inclusive clothing options and sizes and more major brands increase their sizing spectrum in response, brands that specialize in specific size ranges lose their point of differentiation.

]]> (Glenn Taylor) News Briefs Tue, 13 Aug 2019 17:41:39 -0400
Betabrand Turns San Francisco Store Into A Podcast Studio Complete With Live Audience Betabrand Turns San Francisco Store Into A Podcast Studio Complete With Live Audience

Betabrand is no stranger to forward-thinking experiential retail: the company leverages a crowdfunding platform that enables online shoppers to decide what clothes get designed, manufactured and sold on In 2019, Betabrand has expanded on its experiential roots with a very nontraditional store feature — a “Podcast Theater” that hosts podcasts in front of a live audience.

The company brings small- to medium-sized podcasts to its San Francisco store every Thursday and invites nearly 100 guests to listen in, well above the average of 20 to 30 people who visit the store on a typical Thursday night. Podcast booking became so popular that Betabrand ended up with three months of shows programmed in just three days, booking through the summer.

“Podcasting is the new blog, and everyone either has one or is considering launching one,” said Chris Lindland, Founder of Betabrand in a statement. “We put out a call for performers on Facebook and had three months of shows booked in under 10 days — with some traveling from as far away as New York to perform."

Lindland said that the podcasts and related social posts introduce Betabrand to an audience 100X the number of shoppers who’d visit the store on any given evening.

Betabrand has a long history of turning its flagship storefront into a social spectacle to spread brand awareness. Some of the company's less serious, but more attention-grabbing experiments to drive consumers to the store have included posting billboards across San Francisco seeking help finding a “lost cobra” and offering $35 “platypus eggnog” during the holiday season.

The podcast idea is an alternative to a lot of experiential concepts established within stores today, which can range from services as simple as in-store makeovers at Sephora to grandiose virtual reality experiences such as a “bike through Provence” at L'Occitane En Provence, where shoppers can ride stationary bikes against a scenic French background. As part of Macy’s second experiential STORY iteration, 36 stores host community-focused event programming such as indoor gardening workshops, barbecue cooking classes, terrarium-making classes and even outdoor activities such as kayaking on the Hudson River. In total, STORY at Macy’s will program more than 250 events.

]]> (Glenn Taylor) Store Operations Mon, 12 Aug 2019 14:05:39 -0400
Walgreens Will Close 200 U.S. Stores, While CVS Plans To Slow Store Expansion Walgreens Will Close 200 U.S. Stores, While CVS Plans To Slow Store Expansion

Walgreens plans to shutter 200 stores in the U.S., revealing the closures two months after parent company Walgreens Boots Alliance said it would close approximately 200 Boots drugstores in the UK.

The new store closures represent less than 3% of the retailer’s approximately 10,000 U.S. locations, Walgreens said in a statement, adding that it anticipates retaining the majority of employees in other nearby locations.

Less than a day after the Walgreens store closure announcement, CVS said it would slow the pace of its annual store expansion by opening only 100 locations this year instead of the expected 300. In 2020, CVS will cut openings down to 50 locations.

In May, CVS said it would close 46 underperforming stores as part of an effort to resharpen its focus on top-performing stores. The pharmacy will redesign 1,500 stores into HealthHUB concepts by the end of 2021. CVS could close more unprofitable stores as it evaluates the 500 leases that come up for renewal every year.

Walgreens aims to save $1.5 billion in annual expenses by 2022 in what it’s calling a “transformational cost management program.” Walgreens expects to record a $1.9 billion to $2.4 billion earnings hit related to real estate, severance and other costs, the company said in a regulatory filing.

The announcement marks Walgreens’ largest round of closures since 2015, when it also closed 200 stores. Walgreens Boots Alliance, which bought 1,932 Rite Aid locations in 2018, has since closed 631 of those stores and plans to shutter another 119.

The latest closures come after a fairly rocky quarter for the pharmacy giant. Q3 sales increased 0.7% to $34.59 billion from a year earlier, with net income of $1.03 billion, or $1.13 per share, down 12.1%. Comparable sales at U.S. drugstores fell 1.1%, which Walgreens attributed to its “de-emphasis” of tobacco products. Walgreens is raising the minimum age to buy tobacco products to 21 in September. At the same time, Walgreens said rising prescription drug prices led to a 4.3% increase in U.S. pharmacy sales.

Walgreens has entered more than a dozen partnerships with companies such as Kroger, Birchbox, FedEx and LabCorp, mainly aimed at driving more traffic into its stores. But with both Walgreens and CVS maintaining such a large footprint throughout the country, it’s difficult to forecast what impact these partnerships will have on the retailer’s bottom line.

]]> (Glenn Taylor) News Briefs Wed, 07 Aug 2019 11:44:53 -0400
How AT&T Brought Game Of Thrones To Life In Flagship Stores How AT&T Brought Game Of Thrones To Life In Flagship Stores

Retailers and Quick Service Restaurants often use pop culture tie-ins as a way to amplify consumer excitement about a blockbuster movie or TV show. The risk they face, particularly when it’s a QSR investing in toys for giveaway, is that the film will flop when it’s actually released.

AT&T faced a different challenge when the retailer linked up with HBO’s Game of Thrones, a popular show that dominated consumer conversation even among those who didn’t watch it. In order to stand out and create unique brand interactions at four of its flagship stores, the retailer and experience design agency Twenty Four 7 had to “tease” the events of the final season without knowing the specific story lines, or which characters would survive. (Game of Thrones has a notoriously high mortality rate.)

On April 1, Twenty Four 7 transformed AT&T flagship stores in four cities (New York, Chicago, San Francisco and Boston) into Game of Thrones emporiums, with authentic costumes from the various “houses” and characters in the series showcased ahead of the show’s eighth and final season.

“In this example, AT&T came to us and said, ‘How do you create a premium retail experience and associated marketing campaign to celebrate this final season?’” said Mimi Lettunich, President and Executive Creative Director of Twenty Four 7 in an interview with Retail TouchPoints. “For us, there’s an objective that they’re interested in, but we want to identify the barriers that get in the way first. We couldn’t know anything about what was going to happen this season, so how do we inspire the future by using the past?”

As many as 15 to 20 team members worked with the AT&T and HBO teams to brainstorm and implement ideas for the store experiences. The stores featured “limited-reveal video content” from the new season, along with digital games and VR/AR experiences. At three of the stores, AT&T introduced the Magic Leap One virtual retinal display VR goggles, where visitors could play “The Dead Must Die,” a game that lets consumers confront a White Walker, a particularly formidable Game of Thrones antagonist.

AT&T stores and its web site also sold Game of Thrones paraphernalia, from smartphone cases and wireless chargers to wine tumblers and water bottles.

“We have people that will walk into these locations and say, ‘What will you do next?’” Lettunich said. “It’s about programming and keeping it fresh, and not doing a ‘one and done.’ I think a lot of people look at it as a moment versus something that is part of your ecosystem as a whole. Entertainment is core — it’s not just about selling entertainment, it’s about being entertaining.”

When developing takeovers for these stores, Lettunich said that her company is careful in how it analyzes shopper data, particularly since it’s easy to fall back on traditional metrics. Instead, Twenty Four 7 uses a behavioral science-focused strategy designed to analyze metrics related to customer obsession and irrational fandom.

Interactive Store Takeovers Provide Experiences That Online, Mobile Still Can’t Deliver

The Game of Thrones takeover was the latest in a string of pop culture takeovers that Twenty Four 7 has installed within AT&T stores; the agency previously created installations based on Justice League and Fantastic Beasts. Twenty Four 7 also helped create the “Connected Life Experience” in AT&T’s San Francisco store, to immerse consumers in an interactive journey focused on the human movement of IoT technologies.

“We’re focusing on all the things that a consumer can’t get anywhere else,” Lettunich said. “With retail access being so prolific, there are so many channels for people to get basic product and service. We’re trying to provide access to the things that seem hard to get, and the things that make the experience a little bit more intimate. These experiences should feed the superfan on one hand, and on the other hand, we’re looking to figure out how to gain an entry point that attracts the novice to the conversation.

AT&T Celebrates Pride Month In Three Flagship Stores

In June, AT&T and Twenty Four 7 celebrated Pride Month throughout three flagship locations in San Francisco, Chicago and Boston. The stores showcase the colors of the LGBT flag via larger-than-life “links,” joined together in a sculptural representation of this year’s Pride theme: Generations of Strength. The interactive experience drew people into the retail locations where they could create their own digital “link” to share their personal story of hope, determination or inspiration.

Submissions become a colorful chain of names, organized by decade, in support of LGBT rights. Multiple 3D “links” are positioned throughout the space, sharing important turning points in LGBT history. A series of social posts, highlighting key LGBT milestones in key cities, pushed the campaign global.

“Customer satisfaction is great,” Lettunich said. “It’s something that everybody wants and it suggests that your interaction went well. But we’re focused on inspiring consumers. It’s the idea that we’re in their mind far beyond that moment of time they had that interaction.”

]]> (Glenn Taylor) Store Operations Mon, 05 Aug 2019 08:57:54 -0400
Brooklinen Goes From Pure-Play DTC To Pop-Up Retailer In Four Weeks Brooklinen Goes From Pure-Play DTC To Pop-Up Retailer In Four Weeks

Generally, when a brand decides it wants to open a pop-up store, team members have months to plan and some idea of how to carry it out. But with the lofty goal of opening a 2,000-square-foot pop-up shop in under four weeks, the Brooklinen operations team had to move quickly. Before opening the pop-up in New York’s SoHo neighborhood in November 2018, the Brooklinen team managed both to find the ideal location and centralize its merchandising efforts to deliver the right products to its shoppers.

Brooklinen, a direct-to-consumer brand selling luxury bed sheets, pillows, comforters and blankets, had been an online-only seller since its inception in late 2014. Co-founders/husband-and-wife duo Rich and Vicki Fulop launched the company on Kickstarter, and within two years grew it to $25 million in revenue. But in late 2018, the retailer found a “great real estate opportunity that we couldn’t ignore and we had to jump on it,” and decided that it was a necessary move to get a minimum number of viable products in front of its audience.

“It all came together very quickly,” Rich Fulop said in an interview with Retail TouchPoints. “We had our eyes on a physical retail execution for a long time, and we knew the holiday season would really be the best time to get a sample of the shopper’s appetite. Carrying inventory at our one retail location and all of our future relocations was absolutely imperative to us. We didn’t want to go with the showroom model where we would just ship from a warehouse. We wanted people to be able to take away.”

Brooklinen partnered with Stitch Labs, a retail operations management platform, both to build the pop-up and, ultimately, to learn more about what its customers wanted, what its customer experience should involve, and even how much space and inventory were necessary to operate a brick-and-mortar store. Like many of its online-only counterparts, Brooklinen’s decision to open the pop-up shop came down to being where the customers are, according to Fulop. He noted that whether it’s on Google or through social platforms such as Instagram and Pinterest, it’s all about establishing a presence in front of consumers.

“As the brand has grown and evolved, it has to manifest and grow itself in a physical way,” Fulop said. “We have a much wider breadth of products now than we did even a year again, and much more than two years ago, so it was really an opportunity to showcase that we’re not just a one-trick pony.”

Pop-Up Motivates Inventory Centralization Efforts

To get a pop-up store off the ground, the DTC brand needed to create a centralized replenishment workflow for the entire Brooklinen team.On the operational side, Stitch Labs specifically helped Brooklinen sync its inventory across its e-Commerce platform, warehouse management system and POS solution, so as to not disrupt other areas of its business. Fulop noted that at the time, Brooklinen didn’t have a specific executive in place to head up physical retail, nor did they have a visual merchandiser or a retail operations team.

“We had multiple warehouses that we shipped from, with a pretty complex logistics and supply chain setup between our freight carriers, our shipment carriers and so on,” said Fulop. “We needed some software that could take it to the next level and work well with our infrastructure, to execute on our ideas on how we wanted to run the back end of our business.”

One of the biggest challenges upon opening the pop-up store was understanding how to build a workflow that would allow customers to order a product in-store and have it shipped to their home, or automatically fulfill from the store if the items were in stock. Because the pop-up store doesn’t carry all 2,000 of its SKUs, Brooklinen wanted to acknowledge each customer’s request in a timely manner.By partnering with Stitch Labs, Brooklinen could connect its various disparate sales channels while ensuring that the pop-up store would open on time.

Many Shoppers Were Already Brand-Aware And Ready To Buy

Upon opening the pop-up, Brooklinen discovered that many of the shoppers entering the store already had known about the brand in the first place and came on with an intent to buy.

“If you think about our price point and our categories, it’s not like you’re strolling by and then you suddenly decide to buy a few hundred dollars’ worth of pillows,” Fulop said. “You come there because you were looking for the best pillows. You’ve been wanting to purchase from this brand and now’s your opportunity to interact with it.”

The pop-up store remained open for nearly four months, until late February 2019. The company has since extracted learnings from the SoHo location to further develop its physical store expansion aspirations, which are to “open many stores nationwide,” said Fulop. Given that Brooklinen has achieved much of its success in dense urban areas, Fulop sees many opportunities for the DTC brand in metropolitan markets going ahead.

]]> (Glenn Taylor) Omnichannel / Cross-Channel Strategies Mon, 08 Jul 2019 09:17:46 -0400
Toys ‘R’ Us Reportedly Will Open Six Stores Ahead Of Holiday 2019 Toys ‘R’ Us Reportedly Will Open Six Stores Ahead Of Holiday 2019

Nearly a year after liquidating its assets and closing 800 U.S. stores and its e-Commerce site, Toys ‘R’ Us appears to be making a comeback just in time for the 2019 holiday season. Under the leadership of Tru Kids Brands, Toys ‘R’ Us will open six smaller-format stores in the U.S. and an e-Commerce site later this year, according to Bloomberg.

The stores will be approximately 10,000 square feet, roughly one-third to one-half the size of the chain’s previous footprints. The stores will be more focused on experiential shopping, including play areas, the report said. Toys ‘R’ Us first introduced the “Play Labs” concept after filing for Chapter 11 bankruptcy in September 2017 as a way to encourage families to come in and join their kids to “test” the toys before actually making a purchase.

“We have to talk about who our customer is, and our customer is four feet and under,” said Chuck Luckenbill, Principal at Luckenbill Retail Solutions and former VP, Store Planning and Design at Toys ‘R’ Us in an interview with Retail TouchPoints. “We can talk about grandmas and aunts and uncles, moms and dads — the relatives buying toys for the kids — but if they buy a toy the kid doesn't like and they never play with it, there's a good chance they’re never coming back to the store again.”

Tru Kids is spearheaded by a group of former Toys ‘R’ Us executives, including former Global CMO Richard Barry, who now leads the company as President and CEO. Upon the formation of Tru Kids, the company first revived Toys ‘R’ Us in the U.S. during the 2018 holiday season through a store-within-a-store partnership with Kroger called Geoffrey’s Toybox. The shops opened in 600 supermarkets during the peak season, offering a selection of 35 exclusive toys.

The new store openings on the horizon come at a time when retailers have scrambled to fill the toy sales gap Toys ‘R’ Us left in the first place. Walmart, Target, Amazon, Party CityBJ’s Wholesale Club and Michaels are among retail businesses that either expanded their overall toy collections ahead of the holiday season or increased an emphasis on toy sales.

And after making its return to New York City in the 2018 holiday season with a new flagship store, FAO Schwarz is opening more shops in airport terminals, already having opened locations in LaGuardia Airport and Chicago Midway International Airport.

But while all these companies have filled the toy store gap in some way, 2018 toy sales still dropped 2% due to less overall shelf space, according to NPD Group.

MGA Entertainment, one of the world’s largest toy manufacturers, already has committed to selling inventory to the new Toys ‘R’ Us stores, the report said. MGA CEO Isaac Larian attempted to buy Toys ‘R’ Us’s U.S. and Canadian operations in an $890 million auction bid in April 2018, but the retailer’s legal representatives shot the bid down.

]]> (Glenn Taylor) News Briefs Mon, 24 Jun 2019 11:37:16 -0400
RFID Journal LIVE! Retail Preview: Why RFID Is So Critical To Retail Transformation Mark RobertiRFID may not have lived up to every extravagant prediction about how it would revolutionize retail, but the technology is actually doing very nicely, thank you. It has been adopted (often without fanfare) by a large number of retailers, and it serves as a foundational technology for many key omnichannel functions, including BOPIS, ship-from-store and product recommendations.

This year, RFID Journal LIVE! Retail will be incorporated into the new RetailX event (along with Retail TouchPoints LIVE!), June 25-27 at McCormick Place in Chicago. Mark Roberti, Director of RFID Journal, spoke with Retail TouchPoints Editorial Director Andrew Gaffney about the power of RFID to cost-effectively provide accurate, real-time inventory information, as well as technology improvements that should open up even more roles for RFID in the future.

Retail TouchPoints (RTP): Can you update me about why RFID is becoming such a critical part of retail transformation?

Mark Roberti: We believe that RFID is the foundational tool for digital transformation not only in retail but in other sectors as well, because RFID provides a low-cost way of collecting an enormous amount of information on what's happening in the real world — along with the ability to know exactly how many items you have in the store. So for those looking to buy online and pick up in-store, or for retailers looking to sell online and then deliver from stores, having that real-time visibility is essential — and the only way you can really get it cost-effectively is with RFID.

Then, as you start to transform digitally and begin to eliminate the barriers between the digital and physical worlds, you can use data analytics on all the information you’re collecting. You can even start to apply artificial intelligence, among other things. And of course, you can really begin to improve the customer experience in the store.

A lot of those great ideas don't really work without RFID. Let’s say you have a great matching engine that helps the customer find exactly what she’s looking for — but if the item is not in-stock, then you just defeated the purpose of that investment. To me, RFID is the foundation on which you build all of these other great things that we’ve been talking about in retail.

RTP: In the retail space, RFID has had some, let’s say, false starts. What I mean is that a few times over the past decade, there’s been an expectation where RFID was really going to be a game-changer, something that all retail brands took greater advantage of. Can you tell me why it’s taken longer than some earlier visions had mapped out, and why now is the time when it’s really going to become much more widespread?

Roberti: Well, like all technologies RFID went through the hype cycle, if you want to use Gartner's term, or if you use Geoffrey Moore’s technology adoption lifecycle, it went into the chasm. And it is a more challenging technology than some others — it involves a lot of different things, including physics. And the physics in every single store is different, so making it ‘plug-and-play’ is a little more challenging.

Additionally, RFID involves changing your data systems to be able to deal with serialized data, and it involves changing business processes. Usually, it makes business processes a lot easier, but it still involves cultural change. And so for those reasons it's taken a bit longer than expected. There also have been some legal issues, some patent issues that caused Walmart, for example, to pull the plug on its efforts. But what we're seeing is that it's slowly being used by more and more retailers and brand owners, like Nike, Under Armour, Adidas and so on, for a variety of different motivations. And it's starting to really deliver a tremendous amount of value with technologies that are much more mature than previously. Now you can read tags more consistently, and from further away. We've seen the introduction of overhead readers, which are slowly improving to the point where I would say in a couple more years, you'll be able to get pretty close to 100% inventory accuracy by popping a few readers in your ceiling.

RTP: In the near term, say the next six to 12 months, what would you expect in terms of new activity? Do you expect more major retailers to get behind RFID?

Roberti: Most of the major retailers are doing something with RFID, whether it's piloting or tracking a particular category. Whether we'll see any big announcements that folks are rolling it out to all their stores, it’s hard to say. But I think a lot of companies have taken a view that RFID is a strategic advantage, so they’ve been reluctant to talk about what they’re doing. So there is a lot going on that we're not we're not seeing. According to the tag volumes that we're seeing every year, about 10% of all apparel now is estimated to be RFID tagged. That may go up to 15% or 20% in a year or two, and I think we'll see it grow pretty steadily as retailers do more and more.

RTP: For people who are heading into Chicago for RetailX, what do you expect in terms of the integration of RFID Journal LIVE! Retail there? What are you excited about in terms of some of the programming and technology that will be on display?

Roberti: Most retailers haven’t really seen RFID in action, and some will have heard about some of the missteps we just talked about, so this is really the first time that a large-scale retail audience is going to see RFID in action. We have an RFID supply blockchain demo, and each of the booths will have examples of RFID. Often it’s a real eye-opener for folks when they see how powerful the technology is. I mean, there’s no way other than RFID to take inventory with 5,000 items in a minute, at that level of accuracy.

I think this is an opportunity for the RFID industry to reach a broader audience and begin to educate folks about just how many ways RFID delivers value, whether it’s reducing shrink, reducing counterfeiting, cutting out-of-stocks or enabling seamless commerce between all channels. There’s a lot that this technology delivers.

RTP: Any particular speakers or sessions you are excited about?

Roberti: We have a great program. There are quite a number of retailers on the program, and probably one of the most interesting will be Under Armour, speaking about what they’ve been doing with RFID. This is the first time they’ll be talking about it. Also, we have The Foschini Group from South Africa that has done a very impressive rollout, and they’ll be talking about for the first time internationally.

]]> (Andrew Gaffney) Store Operations Mon, 24 Jun 2019 09:11:23 -0400
Walmart Testing Automated Delivery On Fixed Routes Walmart Testing Automated Delivery On Fixed Routes

Walmart is piloting a new phase in automation with robotic vehicles that automatically pass shipments across warehouses, according to Bloomberg. The retailer is aiming to cut its middle-mile shipping costs in half with robotic Ford delivery vans powered by Gatik self-driving technology.

The vans travel on fixed routes from warehouse to warehouse, or to pickup points where customers can get their order. The routes are often the same ones human drivers have been following for years, minimizing the need for new maps or infrastructure, and their unchanging nature reduces the chance of mishaps.

The market for automating the middle stretch of the delivery equation could reach $1 trillion, according to analysts. Greg Foran, President and CEO of Walmart U.S. noted that going driverless is a “no-brainer” for the retailer.

Walmart already is rolling out infrastructure that could connect stable routes with customers, such as its pickup-only store outside of Chicago. The automated delivery vehicles also could deliver packages to supercenters, where the goods would be available for curbside pickup.

However, Walmart isn’t only focused on middle-mile: the retailer also is testing autonomous last-mile grocery delivery in Arizona, as well as other self-driving car pilots with Ford and Waymo. Other retailers are testing this technology as well: Kroger launched its own Arizona delivery pilot in June 2018, and FedEx has partnered with retailers including Walmart, AutoZone, Lowe’s, Target and Walgreens for its own autonomous delivery test.

]]> (Bryan Wassel) Store Operations Thu, 20 Jun 2019 13:26:58 -0400