What's new in retail technology? A whole lot.
With NRF 2019 just around the corner, I was inspired to research New York City’s oldest and most iconic retailers to gain a better understanding of how they got their start, what they’re doing to stay relevant, and how they’re providing meaningful customer experiences that build trust, value, and loyalty in an age of hyper-competition.
But before we delve into these iconic retailers, let’s take a trip back to 19th century New York, a metropolis with no shortage of nicknames.
Gotham is the moniker given to New York City by Washington Irving, the author best known for the headless horseman and Rip Van Winkle, an American colonist who falls asleep under a tree for 100 years and wakes up to see King George’s portrait replaced by President George Washington in his local tavern.
From New Amsterdam to Gotham
New York City was changing rapidly in the 19th century. With the creation of the Erie Canal and Fulton steamboats, the city became more accessible to people hungry for work and new opportunities. In the mid-1800s New York City’s population doubled every decade; this workforce explosion combined with industrialization, expanding government, and a freshly minted police department, set the scene for new retail players and was the catalyst for the Gilded Age that followed.
What set these three retailers apart?
They saw the big changes happening around them and acted fast to meet (and exceed) shifting customer expectations.
How did they do it?
New York’s oldest and most iconic retailers took advantage of the technology available at the time and used it to align their retail strategy with their culture.
Retailer # 1: Brooks Brothers – Founded 1818
This iconic retailer is the oldest men’s clothier in the US and opened its doors a year after the New York Stock & Exchange Board and the Staten Island Ferry were established. A new class was emerging: The New York City bourgeoisie, merchants, industrialists, and bankers. They were changing the city’s landscape and needed a new look to match their capitalist powerhouse images.
Henry Sands Brooks must have been aware of these changes when he opened H. & D.H. Brooks & Co. He was a merchant whose claim to fame is introducing ready-to-wear men’s suits to American customers.
His ready-to-wear concept was a breakthrough because back then almost everything was bespoke. A tailor would measure and make a suit from scratch to a customer’s exact specifications. Not only was this super labor intensive, but it also took a long time and was expensive; it also meant multiple trips back to the tailor to make sure the fit was perfect. The Brooks' design cut down the time and cost of alterations for customers.
Brooks changed the retail game with ‘off-the-rack’ suits and captured the spirit of a new type of customer. His sons would take over the business and would even go on to dress President Abraham Lincoln and other prominent US figures - not bad for a guy who got his start at the corner of Catherine and Cherry Streets in Manhattan.
How Brooks Brothers has adapted…
While the origin of the polo shirt is unknown, John E. Brooks, the grandson of the clothier’s founder, was in England on a buying trip. He was at a polo game when he was inspired by the players’ collars that were buttoned down to prevent them from flapping around in the wind. He brought This ingenious idea back home with him, and the button-down shirt was born in 1896.¹
In other words, Brooks Brothers has never stopped innovating in the fashion space. Today the brand has expanded both their in-store and online presence and continue to stay relevant over 200 years later.
What Brooks Brothers is doing right…
- Dressing influencers - celebrities and politicians - both President Trump and former-President Obama wore Brooks Brothers coats during the 2017 inauguration.²
- Injecting their brand into popular culture - Brooks Brothers dressed virtually everyone on “Mad Men” and even created a limited edition suit for the show
- Engaging customers and getting the most value out of every touchpoint - technology alone isn’t enough; it’s just an enabler. Brooks Brothers uses technology to keep their in-store associates in the know and empowers them to provide more personalized service.
- Creating in-store experiences driven by technology - store associates can pull up a customer profile and see AI-driven product recommendations for that customer based on what they like and their purchase history.
- Evolving from a broad brush approach to sophisticated, personalized strategy - Brooks Brothers is able to provide white glove service because they have backend systems and technologies that build customer profiles (both in-store and online), these, in turn, enable their salespeople to make color and style suggestions and provide above and beyond customer service.³
Retailer # 2 Lord & Taylor – Founded 1826
Lord & Taylor opened the year after the Erie Canal, a route connecting the Hudson River to the Great Lakes was completed. This led to rapid development in western New York State and cemented the Big Apple as the world’s commercial center - it’s no surprise then, that one the oldest and most iconic retailers emerged on the scene a year after this monumental engineering achievement.
Samuel Lord and George Washington Taylor launched the mid-to-high-range women’s specialty store to meet the growing demands for off-the-rack fashions. Like then and now, the department store is known for its incredible Christmas window displays that draw throngs of native New Yorkers and tourists alike.
Why Lord & Taylor isn’t seeing success in today’s retail economy…
Lord & Taylor like Brooks Brothers got their start on Catherine Street and quickly expanded across Manhattan to Ladies’ Row and to their iconic 5th Avenue location - celebrated for its animated windowscapes and holiday displays, but the retailer didn’t stay relevant enough for customers.
- They didn’t use technology to differentiate their offering - the flagship store didn’t carry clothing, accessories, or products that couldn’t be found at any other retailer; they didn’t focus on their “Why”
- They didn’t give shoppers what they want from retail technology - technology is an enabler, but data without strategy is unactionable. Lord & Taylor didn’t use technology to improve their customer and worker experiences and is seeing the consequences with dozens of brick and mortar closings.
- They faced stiff competition in a crowded retail market - Bergdorf Goodman, Macy’s, Nordstrom, and a plethora of mid-to-high level retailers are saturating the New York City and US market. Additionally, many of these brands are using the latest technologies to bridge the in-store and online experience.
- They didn’t stay true to their heritage identity - History isn’t a bad thing. Over the years, Lord & Taylor shed its legacy identity throughout a series of behind-the-scenes power shifts, which eroded the brand's upscale reputation.⁴
Why retail strategy matters and what Lord & Taylor can do to keep moving forward...
- Use technology and backend systems to build customer profiles and make better recommendations to customers shopping in-store and online
- Rediscover their why; ask tough questions and figure out how to weave their heritage identity and differentiate their brand in a saturated retail market
- Invest in raising brand awareness and create new associations for present-day shoppers. Or, if they go the “mass appeal” route, use technology to send more consistent messages across their digital properties
- They must become early adopters of the retail technology of the future - Augmented Reality(AR) enables you to envision clothes on an avatar or see your dream couch in your living room, Artificial Intelligence (AI) can serve online shoppers the right recommendations at the right time; in other words, to survive and thrive, Lord & Taylor needs to be at the forefront of innovation like they once were
Retailer #3 Tiffany & Co. - Founded 1837
Who can forget the iconic scene where Audrey Hepburn pulls up in a yellow taxi and emerges dressed in a stunning black Givenchy dress, cascading pearls, elegant evening gloves, and haute eyewear to indulge in a glazed pastry and coffee at one of New York’s most decadent retailers: Tiffany’s.
The stuff legacies are made of... but long before Holly Golightly marveled at a dazzling window display, Tiffany & Co. had built and earned a reputation for luxury.
In 1837, Charles Lewis Tiffany and John B. Young opened “Tiffany, Young and Ellis” in Lower Manhattan. Their store sold fine stationery and fancy goods to the emerging New York bourgeoisie class, but the store didn’t get its reputation for jewelry until 1853. That year, marked the name change to Tiffany & Co. due to a new emphasis on jewelry.
The brand’s legacy for luxury and taste started in 1878 by Mr. Tiffany’s purchase of a rare canary diamond measuring over 128 carats. Officially named The Tiffany Diamond, it’s still regarded as one of the world’s largest and finest yellow diamonds.⁵
The Blue Book
In 1845, Tiffany published Blue Book, an annual publication of the brand’s jewelry collections; he chose robin’s egg blue for the cover because of the popularity of turquoise with Victorian-era brides. Tiffany Blue would later go on to be used in other promotional materials like the iconic Blue Box.⁶
Today, Tiffany Blue is also featured on the company’s website and social media channels and is a symbol of enduring brand identity.
How Tiffany & Co. has adapted and is doing right…
- Location. Location. Location. - Tiffany is dominating Google search results, including visuals (images) for jewelry. The company is investing in SEO and has a strong online presence for most all things jewelry.
- Transitioning in-store white glove service to luxury digital marketing - Tiffany is a pioneer in the digital marketing world, featuring celebrity brand ambassadors and new campaigns that celebrate diversity and romance through emotional storytelling.
- Social media - Not only does Tiffany do a great job of choosing beautifully shot, compelling content, the brand is also among the most responsive and has built an engaged community of followers and advocates.
- Embracing apps and AR- Tiffany launched an app that enabled its users to find their ideal engagement ring and choose different ring styles, stones, and carat weights. Users could take selfies of their hands and go virtual ring shopping.
- Modernizing its flagship 5th Avenue location - In 2018, Tiffany started to completely renovate its flagship store to create a brand-new experience for shoppers - no doubt it will feature the latest and greatest in-store technology for an even more seamless flow between the brand’s physical and digital properties.
Like New York City itself, these three iconic retailers have undergone dramatic shifts - some have fared better than others, but it’s a spirit of experimentation and innovation that has characterized their evolution.
With biometrics and facial recognition becoming more widespread and big department stores evolving to smaller brick and mortar models like pop-ups, it’s interesting to speculate about the future of retail. Brick and mortar stores aren’t going to disappear, they’re going to be reimagined as data and systems become more integrated and backend artificial intelligence enhances in-store white glove service.
One thing’s for certain, while the need for retail technology investment is virtually accepted by all, investing in a quality workforce is just as important and shouldn’t be ignored. Anyone can do retail, but not everyone should. Because while technology enables your business to do more, it’s your culture and people that deliver amazing experiences.
Catch Appirio on your favorite social media platforms and tell us about YOUR favorite iconic retailer and why. Or, let us know which retailers you’d like us to cover next.
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