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Demystifying omnichannel retail in New Zealand

  • News
  • June 18, 2015
  • Sarah Dunn
Demystifying omnichannel retail in New Zealand

At the breakfast, Onceit’s Jay Goodey told the story of the rapid rise of his fashion ecommerce site, explaining how he built it on the back of a “life is short” moment and $20,000 in savings when he was 22. The site sells designer clothing and lifestyle items at a hefty discount.

“Every brand said ‘No’ at least once,” Goodey says. “Everyone’s default answer, including my own, is no.”

The first label to agree to have its stock resold at a discount through Onceit was Sabatini. The site, which was members-only when it first launched, had around 2000 people signed up when it went live, but grew rapidly, doubling every year for the first four years.

“There were some testing moments with that kind of growth,” Goodey says. “The website crashed more times than I like to remember.”

Goodey plans to explore manufacturing on demand like Australian shoe label Shoes of Prey next. The field is in its infancy, he says, but from a retail perspective it could be “quite disruptive”.

He will be focusing on getting Onceit’s delivery process up to speed over the next few years, saying the site could quite easily implement a system like Uber’s Rush network.

Andrew Howson was at the talk on behalf of Sitka, a Canadian surfwear label which arrived in New Zealand in 2010. Sitka has an unusual challenge in that its target audience actively resist mobile technology. The label targets socially-aware, environmentally conscious outdoor types.

“They hate smartphones,” Howson says. “It’s a pain in our backsides.”

Despite this aversion, Sitka’s customers often seek out the label’s North American stock and inquire at the Kiwi store about it. This has lead Howson to establish a display table with samples from the US and a touchpad next to it so they can order online in the store.

“This has given us an opportunity to go, ‘Well, hang on, how much stuff can we load onto this touchscreen that’s [also] in our shop?’”

Cate Bryant founded Ecommerce New Zealand as an online industry association last year. It is now a consultancy business. At the breakfast workshop, she shared insights from her experiences with established brands seeking to get online.

Bryant says there is a difference between superficial “flashy front-end tech that makes people excited and makes you feel cool,” and real digital adaption. She says stock management is key to long-term benefits, describing the area as  “boring but important”.

She introduced The Iconic as a case study, saying the Australian online fashion giant found through its NPS that its best investment in growth was through improving delivery. Introducing free delivery prior to Christmas meant that its seasonal peak did not taper off until after Christmas eve. Same-day deliveries also helped.

“Once you think The Iconic can send you something in three hours, you think they can do just about anything,” Bryant says.

Bryant cautioned that there would be bumps in the road ahead. She said Barkers had once had a feature on its website which allowed users to see when stores had a particular item in stock. The feature eventually had to be “backed out” because even though Barkers’ stock system talked to the ecommerce system in real time, it couldn’t account for anomalies such as customers considering an item in store at the same time as website users searched for the same item. The website users would turn up to complete the sale, only to find the item had been bought by those who had picked it up in the shop but not yet made their purchase.

Click and collect is popular because it’s convenient to customers, allows them to avoid paying delivery fees, and means that they can reserve fast-selling items. Bryant recommends retailers who aim to enter omnichannel retailing to offer click and collect as it allows them to make “attachment sales” of accessories and “little extras” when the customer visits to pick up their item.

“Use that purchase process and get them in the store,” Bryant says. “Never underestimate the power of having stores and of the people in your stores.”

She also spoke about US retailer Hointer, which has successfully automated its beta retail store in Seattle. The system is “phenomenally efficient but super low engagement,” Bryant says.

Hointer founder Nadia Shouraboura spoke at the Retail Australasia Summit last month via video link. She said she invented the Hointer stock management system because as a retailer, she became frustrated at how messy the store became as customers browsed the clothing on offer.

To clean up the store, she shifted all but one representative item from each line to a small warehouse at the back of the building. The remaining items are on display in the shopfront, and customers can order items in their size by scanning a special tag and using an app on their smartphones. Their choices arrive directly in the fitting room through a chute, and can be rejected with a similar chute.

Shouraboura said the system dramatically increased the number of items customers tried on, as well as deterring shoplifting and reducing staffing costs. She quoted a 30 percent increase in overall revenue at her store.

She told the summit attendees that she had just finished installing the Hointer system in a “very messy store” – Macy’s.

​ ​

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