Macy's Next Partnership and Houzz Fuels Success With AR

MACY'S REINVENTS THE THEME OF DEPARTMENT STORES

Few have envisioned a department store comeback - or anything close. While off-price retailers lure customers with steep discounts and e-commerce redefines how consumers shop, department stores are making drastic changes to remain afloat.

Along with the shuttering of 100 stores this year, Macy's has entered into a new partnership with b8ta, a retail-experience startup. Over the next year, The Market @ Macy's will test new formats powered by b8ta's technology and will expand the size of some of the existing pilot locations. B8ta aims to transform profit per square foot measurement to "experiences per square foot", driving the new experiential shopping model for department stores.

The acquisition marks a new chapter for Macy's, who has been utilizing new technologies to drive its e-commerce and fulfillment operations. B8ta's focus in home and consumer electronics spaces could also potentially bring new product categories to select Macy's stores.

CO-WORKING FOR RETAIL?

If it wasn't hard enough to keep rampant shopping habits at bay during the work day, office spaces are now adding retail elements and partnerships. Shopping during lunch, anyone?

As companies such as WeWork, Co-Optim and NeueHouse bring retail into their spaces, it's prompting some to wonder if the changing nature of work is giving rise to a new kind of retail experience. In February 2018, WeWork and LinkedIn announced a partnership with J. Crew that included panel events, a new work-focus collection/campaign from J. Crew featuring WeWork members, and J. Crew pop-ups exclusively for WeWork members.

The co-working giant also has plans to turn its recent purchase, the former Lord & Taylor space, into a New York headquarters that will house a smaller footprint Lord & Taylor.

HOUZZ FUELS SUCCESS WITH AR

Houzz’s "View in My Room," an augmented reality mobile app feature that includes 3D images of more than one million products, has proven to be extremely successful. More than two million shoppers have used the app in the process of making a purchase since the capability launched in May 2017.

Consumers who use the AR features are 11 times more likely to make a purchase than those who don't. The feature is largely based on the suggestions of Houzz users, including users’ stories of furniture-buying remorse. A costly mistake we've all made...

"If you want to see what a new sofa would look like in your living room, you can now do that on your phone," says co-founder and president Alon Cohen. "It’s getting to the point where the e-commerce experience is offering you a better experience than you can get in stores."

WALMART GETS INNOVATIVE

Walmart has stepped up as an innovative player with a number of e-commerce buys in the past few years and the addition of its founder Marc Lore to the executive team. It is adopting technology to drive efficiency and improve employee conditions, thus reducing turnover and operational costs.

The company's efforts are fueling its growth, with mobile upgrades including integrated store maps, (now in 165 locations). Mobile updates will now allow shoppers access to in-store services, appointment scheduling, and recreational activities like checking if a movie is available at their local Red Box.

On the backend, Walmart is using robots to facilitate time-consuming tasks like inventory tracking, restocking, and restoring lost or misplaced items.

THIS WEEK'S BRIGHT SPOT

This year, the typical "blank" t-shirt is in — to boost retailers and music festivals offerings to consumers.

Music festival goers are setting quality and style standards for music paraphernalia, increasing the demand for blank t-shirts from manufacturers. As concert merch evolves from souvenirs to fashion statements, merch-like pieces are emerging from luxury brands including Gucci, Balenciaga and Vetements. “The demand is absolutely higher than when I started doing this six years ago,” said James Allen, the director of merchandise for Goldenvoice.

The surge in the blank t-shirt business in definitely a bright spot for manufacturers and retailers alike, but the bare t-shirts will stay a compelling business long after "concert merch" loses its fashion cred.