Recently, Bloomberg reported that Macy’s is predicted to lose the top spot as a U.S. clothing retailer to Amazon by 2017, and Macy’s is fighting back to retain their lead.
The prediction was made by a team of analysts at Cowen, led by John Blackledge, who predicted in July that “We estimate AMZN’s US retail Apparel GMV [gross merchandise value] grows from $16 BN in ’15 to $52 BN in ’20, with US market share rising from 5% to 14 % and comfortably passing Macy’s in ’17.”
To keep up with Amazon, Macy’s is upgrading its fitting rooms with high-tech gadgets to engage customers on a physical level – one of the few advantages brick-and-mortar retailers still have over online rivals, according to Bloomberg.
“That is the one weapon they have against Amazon,” according to Bridget Weishaar, analyst at Morningstar Investment Services. “When you’re shopping for certain things, you’re going to want to try it on and see it on you.”
The new low-tech gadgets are aimed at improving the in-store experience for customers in the fitting rooms, and include aids like smartphones, tablets, and chutes.
“Customers told us that it’s frustrating to stand naked in a fitting room with a wrong size at hand and not being able to quickly request a larger or smaller size,” said Nadia Shouraboura, CEO of Hointer. “They also told us that once they are in the fitting room, they want to try on many things and be done and they don’t like going back to the shop floor. Also lugging piles of clothes is no fun.
“We learned that some apparel items are all about grab and go, like a t-shirt or a pair of socks, and those items are easy to buy online,” she said. “Many other apparel, like bras or swimsuits or jeans or shoes are much easier to buy when you can try them on and find the perfect fit.”
The smart fitting rooms are being piloted at a store in Manhattan Beach, California, where facilities in the women’s swimsuit and athletic department allow shoppers to browse products displayed on mannequins and use a Macy’s app on their smartphones to request a particular item in a selected size, which is then delivered to their fitting room via chutes.
Then customers can request additional items or sizes via the same app while in the fitting room, with the goal of providing more options to customers to find the right size and style while keeping them from rummaging through racks. That means more time selecting clothing and less time being frustrated, which Macy’s hopes will translate to higher completed sales.
Macy’s spokesman Jim Sluzewski said that the trial will most likely be expanded to lingerie, as well, and that the swimwear pilot had “a fair amount of use.”
Clothing, accessories and cosmetics account for 84 percent of Macy’s $28.1 billion in department-store revenue.
“E-commerce will win on simple things, and apparel is not simple. It has too many size dimensions and feel dimensions. Online they look exactly the same and you can’t differentiate at all,” Shaouraboura told Bloomberg.
