TE A T Ü Ü R
FUTURE OF SP O RT S RE TA I L SY N E R GY BETWEEN THINGS, DATA AND PEOPL E
TALLINN 2017
Department of Machinery MED70LT
FUTURE OF S P O RT S RE TA I L SY N E R GY B ETWEEN THINGS, DATA AND PEOPLE S P O R D I JAEMÜÜGI TULEVIK – ASJADE, ANDMETE JA I NI MESTE VAH E L I NE SÜ NERG I A Master Thesis
Student: Tea Tüür Student code: 143993 MADM Supervisor: Martin Pärn
TALLINN 2017
Author’s Declaration Hereby I declare, that I have written this thesis independently. No academic degree has been applied for based on this material. All works, major viewpoints and data of the other authors used in this thesis have been referenced.
“........”........... 2017 Author:
…………………………… /signature/
Master’s thesis is in accordance with terms and requirements. “........”........... 2017 Supervisor: …………………………… /signature/
Accepted for defence: “........”........... 2017 Chairman of theses defence commission: ……………………………………………………………………….............. /name and signature/
Master’s Thesis task 2016/2017 academic year 5th semester Student: Tea Tüür 143993 MADM Field of study: Design & Engineering Supervisor: Visiting professor, acting head chair of Design, Martin Pärn Master’s Thesis topic: Future of Sports Retail – Synergy Between Things, Data and People Spordikaupade jaemüügi tulevik – asjade, andmete ja inimeste vaheline sünergia Tasks and timeframe for their completion: No
Task Description
Completion date
1
Preliminary research, finding a field of opportunity
09.09.2016
2
Research, presenting findings, creating a brief
20.09.2016
3
Concept proposition
23.10.2016
4
Concept development, validation, feasibility analysis 16.12.2016
5
Finalising Master’s Thesis
09.01.2017
Design and Engineering problems to be solved: The aim is to research what technology-enabled intelligent sports retail environments of the future could look like by defining the possibilities and limitations of new technology and analysing customers’ behaviours and desires. Defence application submitted to deanery not later than 19.12.2016 Student Tea Tüür /signature/
Date ………….………........
Phone +372 5332 3934
E-mail: teatyyr@gmail.com
Supervisor Martin Pärn /signature/
Date ………….………........
Phone +372 620 3250
E-mail: martin.parn@ttu.ee
AB STRACT
The aim of the thesis is to research what technology-enabled intelligent sports retail environments of the future could look like by defining the possibilities and limitations of technology and analysing customers’ behaviours and desires. Usercentred design tools are used to determine weak spots in the current system and space for opportunity. Emerging from the research, the focus is set on multi-brand brick-and-mortar sports stores, which have the opportunity to offer customers credibility and variety that is hard to get from branded stores. The core offering of the enhanced experience is set on the process of fitting. The new brick-and-mortar concept is designed around customers, using economically beneficial IoT functions as an enabler. The meaning of physical shops in the age of IoT is redefined along with the roles of sales assistants. Through an iterative process of developing and testing, the enhanced service concept is refined until the final design outcome is reached. Using creative techniques, individual service components are developed in detail and as a whole to ensure that these link together to form a holistic offering. The final concept is visualised through the eyes of a consumer, showing her thoughts and feelings throughout the new, improved experience.
CON TE N T S ABBREVIATIONS ............................................................................. 08 INTRODUCTION ............................................................................. 10 1 | METHODOLOGY ....................................................................... 1.1 Research Aims ................................................................... 1.2 Design Approach .............................................................. 1.2.1 Discover ................................................................ 1.2.2 Define ................................................................... 1.2.3 Develop ................................................................ 1.2.4 Deliver ................................................................... 1.3 Structure ............................................................................
12 13 14 15 16 17 17 18
2 | TRANSFORMING THE RETAIL EXPERIENCE ............................ 2.1 Holistic Offerings Superseding Products ........................... 2.2 Customisation Commoditised ........................................... 2.3 Influential Social Force ...................................................... 2.4 The Value of IoT Functions for Retailers ........................... 2.4.1 Minimising Risks ................................................... 2.4.2 Self-Checkout or No Checkout .............................
20 22 26 28 30 30 32
2.5 The Seamless Experience ................................................. 2.6 Multi- Versus Single-Brand Innovation .............................. 2.7 Breaking Down Sales Channels ........................................ 2.8 Insights on Transforming the Retail Experience ................
33 37 39 40
3 | USER RESEARCH ........................................................................ 3.1 Questionnaire, Observations and Interviews .................... 3.2 User Journey Mapping ..................................................... 3.3 Persona ............................................................................. 3.4 Stakeholder Map .............................................................. 3.5 Insights From User Research .............................................
42 43 45 46 50 50
4 | BRIEF .......................................................................................... 52 5 | CONCEPT DEVELOPMENT ....................................................... 6.1 Redesigning Brick-and-Mortar .......................................... 6.2 Redefining the Role of Sales Assistants ............................ 6.3 Recognising the Visitor ..................................................... 6.4 Reaching Beyond Products ............................................... 6.5 Remaining in Customers’ Minds ....................................... 6.6 Conclusions From Concept Development .......................
54 55 59 63 65 65 66
6 | DESIGN OUTCOME ................................................................... 70 6.1 Final Concept ................................................................... 71 6.2 Customer Journey ............................................................ 74 7 | CONCLUSION ............................................................................ 80 REFERENCES .................................................................................. 83 LIST OF FIGURES AND TABLES ...................................................... 88 APPENDIXES ................................................................................... 92
ABB REV I AT I ON S
ANT – Actor Network Theory AI – Artificial Intelligence AR – Augmented Reality CRM – Customer Relationship Management ICT – Information and Communications Technology IoT – Internet of Things IP CCTV – Internet Protocol Closed-Circuit Television NRC+ – Nike+ Run Club NTC+ – Nike+ Training Club RFID – Radio Frequency Identification SKU – Stock-Keeping Unit VR – Virtual Reality
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I N TRO D U CT I ON
Figure 1.1: Man in Track and Field. Source: pexels.com
The retail industry has undergone a significant transformation over the past few decades due to the introduction of information technologies. The number of consumers researching or shopping online is growing steadily all across the globe, with the mobile phone as a purchasing tool getting more popular than ever. Now, the blending of physical and digital – the Internet of Things – has the potential to cause an even greater disruption in every industry. IoT has induced a lot of hype, but is now mature enough for the opportunities and limitations to be apparent. The uses of IoT in retail could have an economic impact of $410 billion to $1.2 trillion per year by 2025 (McKinsey&Company, 2015). It is now up to the retailers to respond to the changing technological advancements in order to benefit from that potential. The emerging possibilities are reshaping consumer expectations. This means enterprises need to innovate in order to survive and prosper. Often times, systems are designed around the technological capabilities of hardware or software tools, focused on business goals or fancy features. When taking a different approach and designing systems around users’ existing beliefs, attitudes and behaviours, the new product or service would offer a more efficient, satisfying and userfriendly experience. The aim of the thesis is to research what technology-enabled intelligent sports retail environments of the future could look like by defining the possibilities and limitations of new technology and analysing customers’ behaviours and desires. The expected outcome is a conceptual system presenting a new and enhanced customer experience. A human-centred design approach is taken, which means looking for changes in people’s mindsets to find insights into what is meaningful and what offers value for consumers. The new concept should enable technology platforms that will change the way people live and experience their everyday lives. The Future of Retail research had its start in fall 2015 as a collaborative Design Studio project between the Design and Engineering Master’s students and the international fashion retailer Baltika Group AS. The created research paper focused on the impact of IoT in fashion retail, more specifically the social aspect of shopping (Kenkre, Sepp, Tüür, 2015). In 2016 I had the opportunity to do an internship with the sports retailer Adidas AG in their headquarters in Herzogenaurach, Germany. The internship gave me a unique insight into the world of sports apparel from creation to sales, as well as the values and behaviours of the consumers of sports products. This, along with my personal passion for sports and apparel, has helped me define the focus for the thesis. The core value of the work does not claim to be the proposed new concept itself. The purpose is not to launch a new sports retail brand, nor an innovative product to sell to existing retailers. The thesis aims to act as a guideline and inspiration for sports retailers, helping them identify relevant trends and opportunities, explore the possibilities enabled by technology and understand the desires and behaviours of consumers.
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1 | ME TH OD O LOGY
Figure 1.2: Lines on Tennis Court. Source: pexels.com
The methodology chosen for the thesis is largely based upon the service design principles and tools of Marc Stickdorn and Jakob Schneider. They have put immense emphasis on the iterative nature of service design. This means that at any point of the design process, it may become necessary to either take some steps back, or even start from scratch. It is also important to make recurring steps between designing in detail and designing holistically. In their methodology, the first step of service design is actually designing the design process itself (Stickdorn, Schneider, 2011). This chapter explains in-depth the theoretical background of the chosen methodology and describes the design process, objectives, used methods and tools. It also gives an overview of the structure of the thesis.
“While colloquially the word design is used to refer to the appearance or styling of a particular product or outcome, the proper meaning goes far beyond that. In particular, the approach of service design refers to the process of designing rather than its outcome. The outcome of a service design process can have various forms: rather abstract organisational structures, operation processes, service experiences and even concrete physical objects.� (Marc Stickdorn & Jakob Schneider)
1.1 Research Aims The aim of the research is divided into four main areas, as illustrated in Figure 1.3, page 14. Firstly, analysing wider economic trends and researching how technological advancements are powering change in the retail industry. In order to design a better retail experience for the customers, it is necessary to pinpoint weak spots in the current system, as well as to define all the stakeholders, including their roles and interests. The relevance of brick-and-mortar stores is questioned as retail is continuously moving towards online channels (PwC, 2015). The research aims to understand whether stores will gradually disappear, or if and how their function will change. As the focus is on sports retail, it is necessary to understand how the sports industry itself is changing with advancing technologies, and how it affects people’s shopping habits.
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Human-centered techniques are used to analyse changes in people’s mindsets regarding shopping; their issues and needs. It is important to ascertain which of these issues could be addressed through design. Understanding users’ motives and values helps to determine what makes for a holistic shopping experience and whether the sports retail system needs to be designed differently from any other retail experience. To put it all together, the biggest question will be how enterprises can create memorable shopping experiences for their customers while sustaining their business and remaining profitable.
context – sports
customer store retail economy
Figure 1.3: Research Areas
1.2 Design Approach British Design Council’s Double Diamond diagram developed in 2005 is a simple graphical way of describing the taken design approach. The model consists of four distinct phases – Discover, Define, Develop and Deliver. At the end of the Define phase, a brief is constructed, construing a clear direction for the project. Five key principles of service design thinking presented by Marc Stickdorn have been followed in the course of the work (Stickdorn, Schneider, 2011). These are: •
User-centred: services should be experiences through the customer’s eyes;
•
Co-creative: all relevant stakeholders should be included in the service design process;
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•
Sequencing: the service should be visualised as a sequence of interrelated actions;
•
Evidencing: the service should be visualised in terms of physical artefacts;
•
Holistic: the entire environment of a service should be considered.
Technology Design Principles for Service Design from the design ethos of Design4Services are considered for ensuring that the technology-intensive service maintains its human-centeredness (Interaction Design Foundation, n.a). These are as follows: •
Technology should always be used to enable a service, it should not be the driver of a service;
•
Technology should be pulled into a service design rather than pushed into it;
•
Technology design is to be flexible and agile enough to allow fast modification in the face of changing customer requirements.
RESEARCH
Discover
INSIGHTS
Define
IDEATION
Develop
PROTOTYPES
Deliver
Figure 1.4: Double Diamond Diagram. Source: British Design Council
1.2.1 Discover Every design project begins with an exploratory phase where insights and inspiration are gathered. The ultimate goal of this phase is not to find solutions, but to identify the underlying problem, opportunity or need that could be addressed through design, as well as some of the boundaries of the solution space (Table 1.1, page 16). This exploration uses qualitative and quantitative research methods to gain insights into people’s mindsets and their problems by engaging with the customers. This, together with secondary research to analyse wider social,
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economic and technological trends, helps to build a rich knowledge base. The information will help with further stages, acting as a guide and inspiration.
Objectives •
identify the problem, opportunity or needs
•
define the solution space
•
gain insights into people’s mindsets and their issues
•
get to know the industry, trends
•
build a rich knowledge resource with inspiration and insights
Tools and Methods •
questionnaire
•
observations
•
interviews – customers, retail industry workers
•
user journey mapping
•
literature and desk research
Table 1.1: Discover Phase – Objectives, Tools and Methods
1.2.2 Define While the discovery phase opens up and explores a range of opportunities and problems, the define stage channels these into actionable tasks. The complex and intangible processes should be visualised for simplification. The load of ideas and findings are analysed and structured into a reduced set of problem statements after which decisions need to be made on which to take forward. The outcome is a clear definition of the fundamental challenge or problem to be addressed through a design-led service (Table 1.2).
Objectives •
analyse the outputs of the discovery phase
•
visualise the findings to simplify complex and intangible processes
•
synthesise the findings into a reduced number of opportunities
•
define a clear brief
Tools and Methods •
user personas
•
stakeholder map
•
brainstorming
•
design brief
Table 1.2: Define Phase – Objectives, Tools and Methods
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1.2.3 Develop The development phase takes the design brief and through an iterative process of developing and testing, refines the service concept until it is ready for implementation. It is all about testing and retesting concepts and ideas. Using design and creative techniques, individual service components are developed in detail and reviewed to ensure that these link together to form a holistic experience. The develop stage is not about avoiding mistakes, but rather making as many mistakes as possible, as early as possible, to learn from these before the implementation and adoption of new concepts. The final product or service will incorporate all the feedback gained in the development phase (Table 1.3).
Objectives •
develop the initial brief into a product or service for implementation
•
design service components in detail and as part of a holistic experience
•
iteratively test concepts with end users
Tools and Methods •
system maps
•
experience prototyping
•
brainstorming
Table 1.3: Develop Phase – Objectives, Tools and Methods
1.2.4 Deliver While usually in businesses the delivery phase means launching the service or product to the market, then in the frame of this thesis the delivery phase will feed back lessons from the process, sharing the knowledge, insights and ways of working. The final concept that is addressing the needs of the customers, which were identified in the discovery phase, is communicated using storytelling and customer journey (Table 1.4).
Objectives •
share lessons from development process
•
communicate how the concept will change the experience for the consumer
Tools and Methods •
customer journey
•
storytelling
Table 1.4: Deliver Phase – Objectives, Tools and Methods
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1.3 Structure Chapters 2 and 3 are summarising the qualitative and quantitative research conducted in the discovery phase. Chapter 2 argues that experience offerings are gaining momentum in the economy. It discusses the creation and management of experiences by companies and the competitive advantage it results in, with examples of proof brought from the sports industry. The social and cultural meaning of sports and sports products for their consumers is analysed to help understand what creates real value in the retail context. The chapter disputes that although people are looking for more authentic, human experiences, it does not mean excluding technology. The three main value points for customers are their desires of self-actualisation and transformation; ability to connect with each other and to have a sense of belonging; and the power to enter magical worlds that were locked before the rise of ICT. The financial value of IoT functions for retailers is dissected, emphasising on inventory and storage optimisation and the automation of the checkout process. Chapter 3 gives an overview of the user research done and analyses the key findings. The results from the questionnaire, observations and interviews are presented summarily. The aim of the user research is to gain insights into people’s mindsets – what role sport plays in their lives, how often they shop for sports products and what are their expectations regarding the process. Customer journey maps are drawn to define various types of experiences customers have and to find areas for improvement. Sports consumers are identified and categorised into seven different types. A stakeholder map is drawn, incorporating the interests and motivations of each stakeholder. The chapter is concluded with insights gained from the user research. Chapter 4 concludes the insights gained from user and secondary research, frames them as opportunities and creates a guideline for the further stages of concept development. It defines brick-and-mortar multi-brand stores as the field for the new concept and fitting process as the central problem. Chapter 5 describes the design process of developing a new multi-brand brickand-mortar sports retail experience. Through an iterative process of developing and testing, the service concept is refined until the final design outcome is reached. Using design and creative techniques, individual service components are developed in detail and as a whole to ensure that these link together to form a holistic offering. The layout of brick-and-mortar stores in the age of IoT is redesigned. The vast changes result in the need to redefine the role of sales assistants. As the new retail experience aims to draw the customers into their field of sports and each customer is different, the possibilities of personalisation are explored further. The concept development phase tries to define not only how to create a better experience but also how to drive repeated sales and visits, how to linger in the customers’ minds and create the same kind of loyalty many single-brand retailers have achieved.
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Chapter 5 will end with a conclusion that analyses the success of the concept development phase and gathers learnings for the final outcome, presented in Chapter 6. The final concept will be visualised as a new holistic brick-and-mortar experience and through the eyes of a consumer named Claire, showing her thoughts and feelings throughout the new, improved journey.
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2 | TR A N S F O R M I N G TH E RE TAI L E X PE RI EN CE
Figure 2.1: Woman Jumping. Source: pexels.com
As the topic of this thesis centres around the creation of experiences in the sports retail sector, it is necessary to define what is meant by ‘experiences’ and why it is taken as the aim. The word has many definitions – ”the conscious events that make up an individual life”; “direct observation of or participation in events as a basis of knowledge”, etc. (Merriam-Webster Dictionary, n.a). We cannot help but to have experiences all the time. In this context another, more businessfocused definition is adopted – an experience is an interaction between a company (brand/product/service) and a customer, which is being shaped by the characteristics of the customer and those of the product, company or brand, and is always influenced by the context or environment in which the interaction takes place (Same, Antero, 2012). This chapter discusses the creation and management of experiences by companies and the competitive advantage it results in. Examples of proof are brought from the sports industry. An argument is introduced, stating that customers are now looking for more holistic offerings, which is especially relevant in the field of sports. Authenticity does not have to exclude technology though. Technology has the power to enable people to discover their real needs, to amplify the interactions they have with each other and to pull them into worlds of wonder. People’s everyday lives are changing, along with their values. Now, it is extremely important for sports retailers to understand these shifts in order to come up with meaningful value propositions and to connect the dots in a way that has not been done before. The chapter also aims to define the trends and new opportunities in retail created by technological advancements, especially IoT functions. The goal is not to only determine what is possible, but rather what would create true value for the retailers, the customers and the rest of the stakeholders. Major trends are identified and examples are brought from various retail areas. There are two major sources that have contributed immensely to the conduction of this research. One of them is the Future of Retail 2016 Report and related articles published by PSFK Labs. These aim to help retailers look beyond identifying the trends of today’s retail landscape and to create relevant, engaging and vibrant experiences for their customers. PSFK identified 10 pillars “that can be leveraged to create a comprehensive strategy for driving increased engagement, repeat sales, word of mouth and lifetime loyalty (PSFK, 2016).” The second is a research paper created in June 2015 by McKinsey Global Institute, which aims to determine clearly how IoT applications create value for companies, consumers and economies. Their estimation is that the uses of IoT in retail could have an economic impact of $410 billion to $1.2 trillion per year in 2025 (McKinsey&Company, 2015).
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2.1 Holistic Offerings Superseding Products The growing integration of social and cultural promises in sports brands’ marketing demonstrates their adjustment to the consumers’ ecological and technological concerns. Sports brands play an increasing role in their search for pleasure, sense, comfort, simplicity, personalisation, authenticity, safety and interaction. To do it well, the brands will have to be more customeroriented, creative and responsible. Consumers seem more fragmented and heterogeneous, forcing the sports brands to quickly identify relevant indicators of new consumer segments and groups. The retailers will have to understand their customers’ social and cultural backgrounds and analyse the ways they perceive and experience the products and services depending on the contexts and situations. They will also have to anticipate the expectations better and to distinguish more clearly the different forms of experiences their customers live. In societies where consumption is largely about identity affiliation, recreation is the perfect reflection of the consumers’ demands – the recreation of their bodies, minds and selves via the consumption of sports brands (Bouchet, Hillairet, Bodet, 2013). Goods and services are no longer enough for the consumers. Businesses must create memorable events and experiences to capture their audience. With an experience, each customer pays for the time spent rather than merely the goods
DIFFERENTIATED Customisation
Customisation
Deliver services
UNDIFFERENTIATED
Commoditisation
NEED OF CUSTOMERS
Commoditisation
Make goods
Extract commodities
RELEVANT TO
Stage experiences
Customisation
COMPETITIVE POSITION
Guide transformations
Commoditisation
IRRELEVANT TO PRICING
Figure 2.2: The Progression of Economic Value. Source: Pine, Gilmore, 1999
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and services acquired. In 1999 Joseph Pine and James Gilmore presented a framework in their “The Experience Economy”, describing product innovation in consumer markets as a five-staged “progression of economic value” that turns commodities into goods, goods into services, services into experiences and experiences into transformations (Pine, Gilmore, 1999). It does not mean that commodities, goods and services will no longer be produced, but the customers are shifting their spendings towards experiences (Figure 2.2). Experiences are unique and individual for customers as they perceive and interpret events in their own terms. J. Margus Klaar has explained this excellently with an example of the gym: “Designing a safe gym for weightlifting is very much like the goods-dominated method of the past. It can be logistically designed and stocked with the best machines and free weights and, as a result, be the perfect gym for the experienced consumer. But the value received depends on the perspective of the consumer, not the gym owner. For many customers, the machines look like torture devices and the free weights are intimidating, because picking the lightest one makes the user look like a wimp and the heavier ones are too heavy. Therefore, “how” becomes more important than “what”.” (Klaar, 2014)
Figure 2.3: Nike+ Application. Source: Nike
Staging personal experiences is an important pillar in many sports retailers’ (Nike, Lululemon, adidas, etc.) strategies. Nike is now offering its’ training classes in gyms worldwide, establishing local running clubs and social events. Nike+ Run Club (NRC+) and Nike+ Training Club (NTC+) applications have conquered the hearts of the users, not because they would like to have more training apps, but because NRC+ and NTC+ turn a training session into a social experience. It
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almost feels as if professional athletes were providing guidance to each individual using the NTC+ application. The experience has its own character, language and style – and it is unified across platforms (Figure 2.3, page 23). Whether working out alone at home or joining a group training class, athletes can identify the brand’s personality throughout the training. With the unveiling of the new Nike+ app, the company aimed to deliver their customers a personalised service that would allow them to book one-on-one appointments with sales assistants and encourage them to sign up for local events. The Nike+ application sends customers notifications about new products arriving to the stores nearby. The notification states that a specific product in their size is reserved in a store for the next half hour (www.nike.com). Nike is pushing hard to tap the experience economy but, at the moment, the central offering is still the products, not the experiences themselves. Spending is shifting from items to experiences to transformations. From the $1.8 trillion spent on luxuries in 2013 nearly $1 trillion was spent on luxury experiences (The Boston Consulting Group, 2013). Joseph Pine stated that “Some part of that trillion is luxury transformations: people looking to recharge, revitalise or to improve well-being in some way.” Wellness resorts, yoga classes, meditation retreats – the wellness market is growing exponentially, proving that consumers increasingly value self-actualisation over physical stuff. In a world where nearly every aspect of our lives involves technology of some sort, experiences that engage our bodies and senses are what people are craving for. But it does not mean that technology needs to be excluded. Skillful use of technology can enable people to discover their real needs, amplify the interactions they have with each other, and pull them into different – often magic – worlds.
In a world where nearly every aspect of our lives involves technology of some sort, experiences that engage our bodies and senses are what people are craving for. Fitness technology is becoming hyper-personalised, equipping athletes with a new set of tools capable of reading the smallest details about their bodies. Technology plays a huge role in the relationship between sports and people. With evolving tools such as wearables and decreasing production costs, hightech precise tracking equipment is now available not only for world class athletes, but also the everyday sports enthusiasts. Sensor data to monitor workload during training weeks has been used for the time being. Now, vests have turned into chest straps, shrunk into waist clips and compressed to sensors no bigger than a band-aid. Soon it might commonly be implanted under the skin. Increasingly accurate and complex data can be harvested and the biometric patterns that once were hidden, can now be found in individual athletes. Everyone is different – there is a danger for some athletes to get injured when they train too hard; others push through an upper limit and only by training extremely intensively
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can reach a zone where they do not break down. The new possibilities will give athletes incredible control over their bodies. Technology is becoming an integral part of athletes’ lives. Nutrition and exercise tracking technology is improving constantly but even in this modern market, tech companies are starting to understand that great technology alone is not enough. The customers are constantly surrounded by good technology and are not easily impressed. Successful products need to be designed in a way that they would fit into the users’ lives and complement it. The best companies do it in a way that makes customers feel empowered and in control, responsible for their own success. This lesson needs to be adopted by the retail industry as well in order to come up with unique propositions and experiences that would make the customers come back again and again.
Figure 2.4: STYR Labs Products. Source: STYR Labs
A good example is the Arizona-based startup STYR Labs, which has gone a step further from nutrition-tracking applications like MyFitnessPal and developed a system that can analyse customer data and them individual recommendations about specific vitamins and supplements that they should take (Figure 2.4). These personalised blends are then available to order via an application. Instead of selling merely another app, a scale, a bottle or a motion tracker, STYR labs are providing a whole ecosystem that enables customers to take care of their bodies (www.styr.com).
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2.2 Customisation Commoditised A new wave of consumption is on the rise. It is the wave of exclusive, customised products that are tailored to the consumers, suiting their needs and personal style. The enabling of customised manufacturing has an even deeper significance – it can become the connecting link between customers and makers. It has the ability to reconnect people with their clothes – the design concepts, materials and making, the culture of fashion. As Kate Fletcher has juxtaposed designing clothes with the metaphorical meaning of nature (Kate Fletcher, 2007): “In nature, diversity means strong, resilient ecosystems, able to withstand a shock period of crisis. In fashion, it means a wealth of products and producers, different fibres and local jobs. At present, the industry is monolithic, dominated by a large number of similar garments and thematic trends. Though we may think of ourselves as spoiled for choice, most of the world’s population swims in a sea of ready-made similarity. Lack of differentiation leads to boredom leads to consumption.” A great example to illustrate what Fletcher has stated is a small startup called Ethnotek. Their catchphrase “Keeping culture alive, one bag at a time!” is appropriate, as the company unites ethnology and the cultural heritage of Ghana, Guatemala, India, Indonesia and Vietnam with the consumers through the possibilities enabled by modern technology. The company’s website allows customers to choose a bag from a variety of shapes and sizes along with Threads™ – handmade Batik fabric front panels which can be changed at any time (Figure 2.5). This means the customer can get a new-looking bag just by ordering a new Thread™ (www.ethnotekbags.com, n.a).
Figure 2.5: Ethnotek backpack with a Thread™ by a master weaver Vankar Shamji, of Bhujodi-Gujarat, India. Source: Nookmag
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The concept of customisation and co-creation is now enabled by the digital revolution. Customers can add their own touch to their adidas Stan Smith’s, Brooks Brothers suits or Burberry scarves. Nike-iD launched its digital customisation platform already back in 1999 and now generates a significant revenue and a large portion of their total e-commerce business. Yet mass customisation has yet not fully taken off in fashion, especially in the luxury market. Burberry started its’ customisation strategy Burberry Bespoke by offering luxury trench coats priced around $1,800 - $8,800. The offer had to quietly be closed and replaced by the Burberry Scarf Bar, a much more simplified customisation service that lets customers monogram their initials on Burberry scarves, made with the colours, patterns and materials of their choosing (Figure 2.6). The mass customisation platform Tinker Tailor that allowed customers to tweak runway pieces by designers like Marchesa and Giambattista Valli folded after a year in business, mostly due to the challenge of timely production (The Business of Fashion, 2015). It seems that so far the most successful companies that have managed to offer masscustomisation are suppliers of software products, which, however, do not offer an alternative to mass produced material goods. The wave of customisation does not reach only products though. It expands to the entire process of shopping. Retailers are already systematically collecting data about their customers, but so far the demographic information has been used to build generalised profiles, not individual ones. Collecting necessary data about individual consumers is becoming increasingly easier for the retailers (IBM, 2016). This could give retailers the power to make individual suggestions to their customers based on their previous purchases, styles, likes, etc. By integrating the virtual shopping experience with the physical, retailers could make real-time personalised offers that would make each customer feel special.
Figure 2.6: Burberry Scarf With Initials. Source: Burberry
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2.3 Influential Social Force The world is going through a social revolution, which is transforming solo activity into team fitness. Many retailers are tapping the social revolution and are trying to lead the game. Jeff Fromm, consultant from research company FutureCast wrote on a Forbes contributor post that he believes Nike, Lululemon and Under Armour have managed to differentiate themselves from the competitors the best, because they sell more than sports products – rather ideologies, but communities as well. Lululemon, for example, focuses on the idea of creating a community of health, mindfulness and living a life of possibility (Figure 2.7). The indoor yoga classes they are offering do not just help build a local community of brand ambassadors, but foster a sense of community without borders that anyone could become a part of (Forbes, 2016).
Figure 2.7: Lululemon Yoga Class. Source: Lululemon
When looking at training classes like CrossFit, the sense of community is quite unique (Figure 2.8). Unlike training in a regular gym, when an athlete is attending his first CrossFit class, the coach shakes his hand, asks for his name and makes sure he knows everyone in the group. Class by class people get to know one another better and encourage each other to push boundaries. There are now over 13,000 CrossFit gyms worldwide, compared to 13 in 2005 (Pittsburgh Tribune Review, 2015). Many of the CrossFit boxes around the world started in garages, as like-
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Figure 2.8: CrossFit is About the Community. Source: CrossFitÂŽ
minded enthusiasts gathered to try their luck at the website’s daily workout. The sport has become a global phenomena, with social media as the lifeblood of the enterprise (Quartz, 2015). Both, encouragement and competition are enhanced by technology, resulting in greater motivation, harder workouts and regular consistency. Softwares like Wodify, WodShopper, Zen Planner and SugarWOD are helping CrossFit trainers and athletes connect, track their performance, sign into classes, manage billing, run reports and program WODs from anywhere. Another benefit of the rise of the social era is that services, which were thought of as high-end before, are now becoming commoditised and available for anyone. For example, a software service called Aaptiv has developed an application for running, training, cycling and stretching that truly differentiates from competitors as it combines the guidance of a trainer with a playlist matching the workout pace. Every user can feel as if they are guided by a personal trainer and it gives them a fresh motivation to move. This might be a game changing concept, as many people can now choose to unsubscribe from gym memberships and choose a software instead, while still getting the help and level of motivation they need (www.aaptiv.com, n.a). Humans are social beings and get an unprecedented satisfaction out of connecting with others. Retailers have come to take advantage of that. Brands are now hiring editorial teams dedicated to producing content. Instagram is soon
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becoming totally shoppable. Bloggers and social media sensations dominate the influencer marketing scene, and retailers know that over 80% of consumers consider reviews written by fellow shoppers before shopping (Ometria, 2016). Sports is a strong devotion for many across the globe. People can now connect without geographical limitations. Technology does not need to give in to the cliché of people digging their noses into mobile phones and losing a sense of real-world communication. It can enable everyone to share their experiences, and get better together.
2.4 The Value of IoT Functions for Retailers As proven in the previous subchapters, customers are increasingly valuing experiences over products, looking for more individualisation and social interactions. Little has been discussed about how exactly meeting the increasing consumer expectations are remunerative for retailers. This subchapter explains how and why the major value creators for retailers – optimisation of store layouts and automation of the checkout process – could be implemented.
2.4.1 Minimising Risks At the moment retailers and manufacturers need to make a lot of predictions. Sports brands usually start creating their new collections two years ahead of time as the product development and manufacturing processes are timecostly. Consumer behaviour is a complicated and nonlinear area, therefore the predictions are always wrong – especially in a global marketplace where each culture is unique. There will always be waste and financial loss. With the help of artificial intelligence and the vast data collected from consumers on when, what and how they shop, retailers and manufacturers can make smarter predictions, resulting in major financial gain. Retailers can optimise stores layouts by collecting data about the shoppers’ movement and location over time. According to McKinsey Global Institute this could lift productivity by 5 percent, leading to a value of $79 billion to $158 billion by 2025 (McKinsey&Company, 2015). Inditex has been ahead of other retail brands on the aspect of speed for years. Their exceptional business model allows the company to spot new trends and deliver them to the stores in an incredibly short time frame of two weeks. Retail Consulting firm Conlumino’s CEO Neil Saunders said in an e-mail to Business Insider: “If I had to condense the foundations for Zara’s success, I would say it comes down to agility and flexibility. From these things flow a number of advantages: quickly picking up on new fashion trends, accurate forecasting of stock requirements which reduces markdowns, quick turn of stock which keeps customers coming back for new product, good responsiveness to external factors like the weather, and margin maximisation.” (Neil Saunders, 2015) Inditex has rolled out RFID technology throughout the operations of its signature
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Figure 2.9: Zara’s Sales Assistant Using an RFID Reader. Source: Inditex
brand Zara (Figure 2.9). The small chips help keep better track of its’ stock and replenish the clothing racks quickly. Before the chips were used, employees had to scan the barcodes one by one in the course of storewide inventories (Inditex, 2014). Now, thanks to the saved time, inventories can be carried out every six weeks, getting a better picture of what is selling well and what not. Each time a garment is sold, the data from the chip prompts an order to the stockroom to send out an identical item. If a customer can’t find what he is looking for, the salesperson can point an iPod camera at a similar item and see whether it is available in this particular store, a nearby Zara store or online. Although Zara is ahead of many retailers in regards to technology implementation, the system is far from perfect. For example, at the moment a salesperson can get an overview of whether an item is available in the store, but has no information about where the product is situated exactly. Misplaced items can cause a lot of trouble for the sales staff and disturbing visual noise for the customers. Smart shelves could help eliminate this issue. “The opportunity for the smart shelf is to change the shelf’s role within the selling process. Today the shelf is plays a passive role in this process. But a smart shelf can fulfill a much more active role where it understands shopper needs, understands the product or products it is showcasing, and uses enhanced capabilities to participate more fully in the selling process.” (Intel Digital Retail Futurecasting Report, 2016) The American brand QVIT has taken another approach to risk minimisation. Their research showed that an average of 30% of clothes bought online are returned and 79% of customers would be reluctant to buy from an online retailer again if they ordered the wrong size of garment (www.qvit.com, n.a). This means large
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shipping and restocking fees for the retailer. The transportation may result in spillage and diminished item value and worst – unsatisfied customer. Their solution is an online dressing room experience that allows clients to see and feel how garments fit to their body (Figure 2.10). It replicates the bodies of the customers as well as the clothes of the designers (wash, stretch, fabric composition).
Figure 2.10: Real-Life vs. Virtual Fitting With QVIT. Source: QVIT
There are many ways IoT functions could improve operations for retailers. Smart shelves, smart CRM, beacons – and much more – would enable inventory and storage optimisation, help reduce shrinkage, improve staff allocation, energy management and maintenance. Intelligent software solutions could help build consumer trust, as proven by QVIT. Well-thought-through investments in technology will pay off largely in the long run.
2.4.2 Self-Checkout or No Checkout Perhaps the biggest benefit for the retailer would come from automating the checkout process. McKinley estimates the value gained at around 40-88% time reduction and 75% cashier cost reduction, which would mean an economic impact of $150-380 billion per year in 2025 (McKinsey&Company, 2015). Checkout is one of the most labour-intensive processes in retail at the moment. Several retail businesses are already giving this task to the customers’ hands. Major grocery chains everywhere are installing their own self-checkout kiosks. Apple has recently developed a software called EasyPay (Figure 2.11), which is using the users’ own phones for checkouts, allowing them to scan products’
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barcodes with their phone cameras and pay for their purchases using credit cards associated with their Apple ID (www.cnet.com, n.a).
Figure 2.11: Apple EasyPay. Source: Pocket-Lint
IoT has the potential to automate the checkout process completely by using inexpensive sensors inside the store and hangtags. This means customers could simply take what they want and walk out of the store, while the wireless payment system debits a respective amount to an account on their smartphone. Amazon Go has already created the first “just walk out� shopping experience, which promises to be accessible to the public at the start of year 2017. This technology could improve the customer experience in many ways (Amazon, 2016). There would be no need to wait in queues, and it would eliminate the hustle for introverts who feel uncomfortable to strike a conversation with sales assistants. Implementing automated checkout would not mean that the role of the staff working in stores would be depleted, but it would change drastically. Instead of doing automatic movements of scanning the products and helping make transactions, they would acquire a more creative role of giving recommendations to customers and introducing the specific benefits of one or other product. To conclude, the automation of checkout could have immense financial benefits for the retailer, create different, likely more creative jobs for the sales staff and relieve the customer from waiting in queues to pay for their purchase.
2.5 The Seamless Experience Today’s consumers are constantly surrounded by information and advertising, which has caused them to tune out most of what they see, hear or have the opportunity to experience. Lynn Matson, an expert in digital signage, electronic merchandising and ambience marketing shares the lessons she has learned
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on how to engage the human senses to drive consumer decision making and spending in her book “See It, Hear It, Experience It, Buy It!”. Her book explains that out of the five human senses — hearing, sight, touch, smell and taste — one is always a dominant one, as proven by psychologists and scientists. This explains why some students learn best by listening to the teacher, while others need visual graphs, or learn by doing. The same applies to the way people consume. When entering the same retail store, various people have different experiences. A visual person may react to a neatly dressed mannequin carrying tags with information about the materials, price, etc. If your customers’ dominant way of learning is by hearing, he might respond the best by hearing the shop assistant describe the benefits of the product. The third dominant sense — learn by doing — means the customer should be able to try the product out, or put it on, in order to be persuaded to buy it. That doesn’t mean customers completely ignore their other senses. “If you communicate one thing through words and a conflicting message through visual imagery, your customers will notice and will not buy. If you give your customers a wonderful visual experience but in an environment that irritates the eye, they’ll notice that too. When it comes to engaging your customers’ senses, you need to connect with customers through their dominant sense — and then ensure that the message communicated through the other senses is consistent (Matson, 2009).” Looking at the interaction between people and the material world, a sociological perspective called actor network theory (ANT) claims that things, objects and other non-human material entities also act, they have an agency and they
People-Driven •
suited for customers seeking complicated products and services
•
enhances customer comprehension of complex factual information
Technology-Driven •
accommodates rapidly changing information
•
requires significantly lower monetary investment
•
delivers consistent sales presentations
•
allows for highly effective twoway communication
•
precisely controls the customer experience
•
high cost
•
•
inconsistency
may not be comfortable to use for everyone
•
lack of control
•
lack of sensory communication Table 2.1: Pros and Cons of People-Driven Versus Technology-Driven Customer Experiences
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participate in creating actions. Retail environments could be labeled as action nets consisting of the customer, human- and non-human actants. ANT-optic creates an innovation space for retailers, where the who or what that creates a service, can be rethought (Sundbo, Darmer, 2008). The redesign comes with risks and may not be liked by everyone. Table 2.1 helps to identify the pros and cons of people-driven versus technology-driven customer experiences.
Figure 2.12: Interactive Mirror in Rebecca Minkoff Store. Source: Rebecca Minkoff
Numerous brands that have invested in improving their overall in-store customer experience have come to the conclusion that when their customers’ senses are engaged by the interactive environment the retailers have created for them, their customers will spend more time on the premises. This gives the people more time spend money and to buy more items per visit. One great example is Rebecca Minkoff’s investment in the brands’ flagship store in New York City’s Soho neighbourhood (Figure 2.12). “On the floor, shoppers can tap the screens — which look like mirrors when not activated — to flip through look books curated by Rebecca Minkoff, or order a free coffee or glass of champagne. To place a drink order, shoppers must enter a phone number, which will then be used during their trip as a way for the store associates to communicate with them about drink orders and fitting room status, as well as let shoppers save a list of items they tried on for later. (Digiday UK, 2015)“
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This investment has resulted in a serious sales boost. Although Rebecca Minkoff is mostly known for its handbags, they have made triple the amount of clothing sales than they originally thought. Whenever a customer is trying on an item in the fitting booth, they can see product suggestions on the screen in the fitting room and end up buying something they didn’t originally think of. People of all ages will start spending more of their lives in augmented (AR), virtual (VR), or mixed reality. These technologies have the potential to deliver sports fans thrilling new experiences in viewing, gaming, training and shopping. TaylorMade recently distributed 1,500 Google Cardboard VR viewers to golf shops like Dick’s Sporting Goods and The TaylorMade Golf Experience in Las Vegas to bring golfers closer to the game and tour professionals (Fortune, 2015). They could feel themselves on a virtual pitch with PGA Tour professionals Justin Rose and Sergio Garcia (Figure 2.13). There are possibilities for AR and VR technologies for everything from enhancing athletes’ performance to interactive marketing and outstanding shopping experiences. We are not only shifting to the experience economy, but the experiences will increasingly embrace digital technology, creating a seamless fusion of real and virtual. In the luxury retail sector, e-commerce is the only retail channel currently growing double digits and is expected to grow from 7 to 20 percent of global luxury consumption by 2025 (Bain & Company, 2015). We are no longer dependant on stores as distribution points. Digital media has become remarkably effective
Figure 2.13: Golf Through VR Glasses. Source: taylormadegolf.co.uk
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at fulfilling our basic shopping needs. Just about anything we buy can be at our doorstep in a matter of days, if not hours through vast online shopping options. In the early days of the dot-com boom, many experts thought that with the rise of e-commerce, the brick and mortar would be completely eliminated. While it may be true for some industries, apparel is unlikely to be one of these. Customers will want to try on, feel and interact with the products the are purchasing. Retail stores will likely go through an extensive transformation in the next decade though.
2.6 Multi- Versus Single-Brand Innovation Emerging from the research into community marketing and digital functions in retail, one could see that most of the innovations are happening on a singlebrand level. This way it is easier for the brand to fully control the experience provided for their customers. But it also means that the customers are confined to the options offered by one brand only. Many of them prefer to have more options and to pick from a variety choices. They give more credibility and trust to multi-brand stores as these are perceived as more unbiased. Instead of an exclusive brand story, multi-brand retailers create seasonal brand category stories to captivate the consumers. The highly brand loyal customers may still prefer a particular brand store but multi-brand stores have higher sales and are more comfortable for people who shop together – for example families that have members of various ages and interests (Table 2.2).
Multi-Brand Store
Single-Brand Store
•
more options for the customer
•
higher brand loyalty
•
more credibility and trust
•
showcases brand in its full glory
•
something for everyone – better to shop together with friends and family
•
broad category story
•
higher sales Table 2.2: Strong-Points for Multi- vs. Single-Brand Stores
To present some examples of how multi-brand sports retailers are leveraging technology to innovate and build communities, Sport Zone has developed a virtual addition to their retail stores called Every Zone (everyzone.sportzone.pt, n.a). Every Zone allows users to see trails, events and competitions happening nearby. Every time users work out, attend events, complete challenges, share their accomplishments and drag their friends along, Every Zone converts those
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actions into points that can later be redeemed for prizes (Figure 2.14). The users can browse for prizes from the online catalog. For example, for 6000 points they can redeem a 50% discount voucher for running shoes; for 500 points it is possible to get a 30% discount for all fitness accessories. Just like Sport Zone, Decathlon has created its own platform Decathlon Coach that consists of a website and an application (www.decathloncoach.com, n.a). The system aims to help its’ customers monitor their activity and guide them through their fitness journey (Figure 2.15).
Figure 2.14: Sport Zone Every Zone. Source: Sport Zone
Figure 2.15: Decathlon Coach. Source: Decathlon
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The solutions developed by multi-brand retailers have not been adopted as well though. The issue might be that multi-brands are trying to swim on the same wave as single-brands. By doing that, they are automatically competing with each other As the brand loyalty is often much higher towards single-brands, they are not winning the race. For multi-brand retailers to truly differentiate and be successful, they should leverage their strong suits – the multitude of options, credibility and trust they could provide for their customers.
2.7 Breaking Down Sales Channels For many customers, omni-channel is already the norm. They do not perceive barriers between different retail channels. The connectedness of the consumer will inevitably increase in the next five years due to technological influences like the IoT and social commerce. For retailers, it means they will have to try to capture the consumers’ nonlinear journeys across these channels – be it brickand-mortar, desktop, mobile, Instagram or marketing emails (Abnett, 2016).
Figure 2.16: 2015 Retailer Type Omni Channel Score. Source: Consultancy UK
In the “Omni Channel Fashion Survey 2015”, Kurt Salmon investigated how far fashion retailers in the three largest EU countries – UK, France and Germany – are omni-channel mature (Kurt Salmon European Omnichannel Fashion Survey 2015). The research looked at over 100 retailers and weighed four different subdimensions: Online Excellence, Mobile Excellence, Social Media Excellence and Cross-Channel Excellence (Figure 2.16). The research concluded that the most omni-channel mature country is UK, with the highest maturity score of 70%, followed by France at 53% and Germany at 52%. The researchers classified the UK fashion retailers in five different types – verticals, global brands, multi-brand retailers, grocery and pure play eCom. Verticals distribute 100% via owned or franchised stores, or through fully controlled store-in-store models. Global brands distribute partially or fully through third party stores. Multi-brand retailers sell
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products of many different brands (example T-shirts from brands such as Nike, Reebok, Allen Solley, Van Huesen, Peter England, etc.). Grocery stores selling fashion brands were also included in the study, as well as pure play e-commerce retailers. The data may be misleading though. When retail executives were surveyed at April’s World Retail Congress 2016 by McKinsey/Periscope researchers, only 6% of them described their omni-channel readiness ad “Excellent – fully implemented” (Retail Drive, 2016). Ken Sickles, vice president of product strategy at product data management company 1WorldSync, stated:
“Everyone is experimenting. The pure-plays are doing it better than anyone else, and everyone is playing catch-up with Amazon. But no one is doing it that well […] Any omni-channel effort has to be designed around the user. It means the user has got to be able to move easily from one channel to the next, because as consumers, we don’t think of them as different channels. The very name ‘omni-channel’ almost implies that a lot of retailers don’t quite understand it.” 2.8 Insights on Transforming the Retail Experience Experience offerings are gaining momentum in the economy. The future goal for the retailers should be the composition of carefully orchestrated experiences that are managed end-to-end. Experiences are unique and individual for everyone, which means the trend is also moving towards personalisation and customisation. The customers will look for authentic offerings that will help them in their desires of self-actualisation and goals of transformation. These holistic offerings are especially relevant for athletes and sports fans. The next generation of customers are not afraid of technology but realise the element of magic that it can bring into their everyday lives, if well-implemented. IoT functions have immense operational benefits for the retailers, like inventory and storage optimisation, improvement of staff allocation, energy management and maintenance. One of the biggest gains would be from automating the checkout process, which would also improve the in-store shopping experience for the customer. Marketing has already taken a new face as retailers have figured out that customers have a growing distrust towards branded ads, and that the
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most effective form of advertising is word-of-mouth. Customers’ consumption habits are changing and they are starting to look for more than just another mass-produced product. They will be attracted to something more personal, tailored to their needs and values – a connection, an ideology. Hereby one of the most important things for retailers to remember is not to use technology just for the sake of using technology, but to find what is truly meaningful for people. Successful retailers are skillfully leveraging technology to build memorable customer experiences. It seems that at the moment many are experimenting, but the true magnitude of what is possible is yet to be revealed.
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3 | U S E R R ES EA R CH
Figure 3.1: People Walking in a Shopping Street. . Source: pexels.com
This chapter describes the course of the user research done during the discovery phase. A questionnaire, observations and interviews are conducted to gain insights into people’s mindsets – what role sport plays in their lives, how often they buy sports products and what are their expectations regarding the shopping process. The interviews are used to construct user journey maps, where the customers’ thoughts and emotions, along with their perceptions of the retailers are captured. Sports product buyers are identified and categorised into consumer types. A stakeholder map is drawn, incorporating the interests and motivations of each stakeholder. The chapter is concluded with insights gained from the user research.
3.1 Questionnaire, Observations and Interviews In human-centred design getting to know the people you are designing for and hearing about their lives in their own words plays a crucial role in the discovery phase. Human-centred design is premised on empathy, believing that the customers are the roadmap to innovative solutions and only by emphasising with them, can one truly grasp the context and complexity of their lives (IDEO, 2015). The research phase consists of various qualitative and quantitative research methods such as desk and literature research, questionnaire, observations and interviews. The interviews and observations will help identify consumer types and create journey maps. Observations were done in a Sport Zone store in Lisbon, Portugal. The questionnaire did not limit the target group by any geographical location or age group. The youngest responders were in the age group ’18 and younger’ and oldest ’45 to 54 years old’. Responses came from Estonia, Portugal, Germany, Spain, Sweden, Finland and Georgia. The aim of the questionnaire was to gain insights into people’s sports shopping behaviours; the importance of exercise in their lives; if and how they set goals for themselves; and what role technology plays in their shopping and training habits. Examples of the questions would be: •
How important is exercise to you?
•
In a typical week, how many days do you exercise?
•
What motivates you to work out the most?
•
Do you usually set yourself measurable fitness goals?
•
About how often do you shop for sports clothes/gear?
•
Is it difficult for you to choose which products to buy when shopping for sports clothes/ gear?
•
Do you usually shop for sports clothes/gear online or from a brick-and-mortar store?
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There were three key findings that emerged from the questionnaire. Firstly, many people (55%) find it ‘difficult’ or ‘sometimes difficult’ to choose which products to buy when shopping for sports products (Figure 3.2, Chart 1). Secondly, although online shopping trend is increasing, customers still usually shop either in brick-and-mortar stores or across platforms (Figure 3.2, Chart 2). Only 19% of the responders said they usually shop online. 31% of the responders check out products online first but go to interact with the products and buy them in a store. 10% of the responders check out what they need in a store but buy online. Thirdly, most people (63%) usually shop in multi-brand sports stores (Figure 3.2, Chart 3). Some are brand loyal and prefer to shop in a single-brand store (most popular being Nike and Adidas). 7% of the responders did not specify the choice, stating that they buy wherever it is the cheapest or most comfortable for them.
34% sometimes difficult
21% brick-and-mortar
19% online
10% check out in store, buy online
Chart 1
difficult
40%
3% do not buy sports products
Chart 2
31%
42% not difficult
63%
check out online, buy in store
multi-brand store
Chart 3
7% non-clear: “Internet”, “wherever it’s the cheapest”
30% single-brand store
Figure 3.2: Questionnaire Results
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Interviewing the people about their consumption habits regarding sports products brought up some common issues: •
“A lot of things that I want and need are not sold in my country. Ordering gym clothes and shoes online is uncomfortable for me. So I only do it if I really need to.”
•
“I don’t know the market situation, what is good and what is not.”
•
“Overwhelming product range. No performance measuring scale to choose.”
•
“There are too many options that seem identical”
3.2 User Journey Mapping User journey mapping is a tool used to provide a vivid and structured visualisation of a service user perspective. Touchpoints, where the customer interacts with the service are identified in order to construct a ‘journey’ – an engaging story based upon their experience (Stickdorn, Schneider, 2011). The journey map divides the process of using the service into subcategories. The users were interviewed regarding their thoughts and feelings. The overall emotional experience was mapped, as well as their perception of the retailer throughout the service. Each map is accompanied by a short description of the interviewee – their age, level of activity and their favourite sports activities and brands. The light blue wave maps their emotion throughout the journey and the dark blue wave marks their attitude/emotion towards the retailer at a specific moment. The journeys are divided into four distinct parts – discovering need, research and consideration, purchase and post purchase. The consumer’s thoughts are marked with a icon and feelings with a icon (Appendix 1–4). Rafael’s journey map, illustrated in Appendix 1 is a good example of how peers often affect customers’ shopping decisions. At the research phase he encountered a vast variety of options online and, like many consumers, felt overwhelmed. He knew that the athlete he met at the calisthenics park had gotten his products from Sports Store and decided to do his shopping there. Ave’s journey map (Appendix 2) helped to determine that in a world of globalised retail, internationality and effortless travelling, it is crucial for retailers to keep up and develop systems to facilitate this change. A unified experience across channels and continents is necessary to ensure a high-quality, seamless experience for consumers. The retailers need to adapt to customers, not the other way around. Joaquim’s experience as displayed in Appendix 3, proved that omni-channel still has not been fully mastered by the retail industry. Online and physical stores are separated, whereas the consumer perceives it as one experience. This is an extreme example to show that it is crucial for retailers to invest in skilled people and have well-designed systems for staff training, as well as a well-thought-
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through motivation package. While the previous customers were interacting with the sports retailer to purchase gear or footwear, Claire’s case was purchasing leggings (Appendix 4). As she rarely would buy clothes without trying them on first, she needed to use the fitting booth in the store, which was the first weak point in the journey. The second one was the payment process – although the line was not long, she did not appreciate having to wait, like many other customers.
3.3 Persona
THE PRO ATHLETE
THE DISCIPLINED ATHLETE
THE SOCIAL ATHLETE
THE YO-YO ACTIVIST
THE OCCASIONAL ACTIVIST
THE DEVOTED FAN
THE ATHLEISURE FAN
After the literature and ethnographic research, various types of sports consumers arose (Figure 3.3). They are hereby distributed into seven categories, taken into account their role in sports (spectator, participant), their frequency of training and their reasons and motivations. The Athleisure Fan is not a new type of sports
Figure 3.3: Types of Sports Consumers
consumer but the term ‘athleisure’ is, as the emerging trend of wearing sports clothes for nearly every activity (going for a coffee with friends, grocery shopping, picking up kids from the kindergarten, etc.) has become the fashion trend of the decade. Athleisure Fans may or may not actively participate in sports but they are sports consumers as they purchase stylish leggings, cool sneakers, caps and anything else that is comfortable to wear and aesthetically appealing. The Devoted Fan is another type of sports consumer who may or may not actively
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participate in sports activities. They enjoy the entertainment for many reasons. It connects them to the people around them, gives a frequent conversation topic and allows to celebrate something with complete strangers. For Devoted Fans, sports provides an escape from everyday life, they feel they are a part of their favourite team’s glory. There is also a high level of drama involved for the Devoted Fans as the lives of famous athletes offer ground for hot gossip. The Occasional Activist and The Yo-Yo Activist do not exercise on a regular basis but when they do, their reasons for doing it are profoundly different. The Occasional Activist enjoys soft sporty activities every once in a while. They may go for a leisure bike ride or hiking with family and friends a few times a month, participate in fun charity events happening nearby or enjoy swimming in the summertime. The reason is enjoyment – the good feeling of breathing in fresh air and spending time with close ones. The Yo-Yo Activists are not well educated regarding health and fall victims to malicious diets and advertisements claiming to help them lose ten kilos in two weeks. Due to the misinformation on nutrition and healthy lifestyle, they struggle to reach their goals. They do not fully enjoy the activity of exercising and instead put too much emphasis on their often superficial goals. The Social Athletes are very active. They enjoy a wide variety of activities ranging from team sports to aerobics and yoga classes. They always have training buddies with them – when no one is available to join, they feel unmotivated to train. They use different training apps and share their activities and progress on social media.
Figure 3.4: Paddling Between Cultural Spaces
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They often look for training events to take part in. The Disciplined Athletes, although also extremely active, have different motivations. They are self-reliant and prefer to train on their own. They often have specific measurable goals that they are pushing towards. It may be because of a wish to take part in amateur competitions or just for themselves – to feel a sense of accomplishment and mental strength. They push their minds and bodies hard to be the best versions of themselves and try not to compare themselves too much to other people. The Pro Athletes are on a next level, where sports is the core part of their lives, their bread and butter. They are sports consumers but often have more privileged possibilities to get custom-made pieces. They know what they want from the products they are using, but also want to be surprised or wowed by the creators. Although there are many different types of athletes, each one having their own favourite sports and reasonings, there is one commonality to be spotted – the athletes, no matter their sport, are paddling between two different cultural spaces – one they have during daytime and another when they enter their zone of sport (Figure 3.4, page 47). They share a language with their co-athletes. They have their own dress code, code of conduct and rituals. They experience the same issues and injuries, and help each other recover. They get the same tan lines in summer time. Certain smells and textures resonate with them as part of their sport, their culture – the smell of freshly cut grass on the golf course, the
Issues, injuries Textures, smells
Heroes
Rituals
Sports culture Code Language white horse peloton big slick icing bicycle kick
Figure 3.5: Sports Culture Mindmap
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Tan Lines
taste of salty water in a swimmer’s mouth, the smooth feeling of magnesium on one’s sweaty hands (Figure 3.5). These cultures are not bound by geographical locations. A CrossFitter living in L.A. may have more in common with a CrossFitter living in Macedonia than the person next door. What the athletes are wearing plays an active role in the valorisation of their self-concept and can provide a framework which gives a sense to consumers’ existence in achieving personal, social, cultural and environmental goals. Their values are mainly formed by the culture outside of sports and that plays a major role in what motivates and inspires them. Based on interviews and journey map analysis, a persona has been combined to aid with further concept development (Figure 3.6). Persona creation helps to reflect back in any stage of development and ask whether the proposed solution creates real value for her or if it would improve her retail journey (Appendix 4). This way designers can empathise with customers and understand their motivations, goals and feelings.
Claire
THE SOCIAL ATHLETE
Her body changing and endurance approving; Others’ abilities
•
Motivated by inclusion and encouragement
•
Training frequency 3 times a week
•
Technology Polar Loop 2, NTC+
I feel welcomed in this community; I want to get where she is; This coach is much more fun
Thinks & Feels
Sees
Goals Be consistent with training; Encourage other athletes; Stay healthy, get in shape
Hears
Fears
You can do it!; It’s super fun, join us!; I’m proud of you!
Falling out of training routine; Injuries
“I like to communicate with other people and enjoy life! I want to move and keep my mind straight.”
Figure 3.6: Persona – Claire
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3.4 Stakeholder Map A stakeholder map has been compiled to visualise the various groups involved with the sports retail industry (Appendix 5). The intent is to chart and analyse the interplay between these groups in a comprehensive but accessible way. The information is gathered through desk research, interviews and personal experience in the apparel industry. The map incorporates the interests and motivations of every stakeholder, each having the potential to benefit hugely from IoT. In the core of the stakeholder map are customers, multi- and single-brand retailers and the sales assistants and merchandisers working with them. Customers are looking for engaging experiences, quality products and ease of information. Retailers need customer loyalty, well-trained staff and reduction of loss. Sales clerks and merchandisers want to be valued representatives of retailers, be empowered and well-trained, have a creative liberty. Merchandisers need to know and be able to predict trends – what is needed, when and how. In the next tier of direct stakeholders, there are shareholders, competitors, social media channels, professional athletes and clubs, but also garment manufacturers, trim and fabric suppliers, assembly factories, warehouses and transportation service providers. Nowadays, technology companies have also become direct stakeholders as modern technology in incorporated into every business field. Shareholders need continuous growth from the retailers while competitors try to stay ahead. Social media enables modern advertisement and a voice for people to share their experiences. Athletes are often involved with retailers through endorsements and sponsorships. Logistics need to be optimised to save costs. The indirect stakeholders are environmental protection agencies, as any field of activity is regulated by strict green policies; government for their taxes and regulations; pressure groups with their specific interests and motivations. Communities begin to value more local activities and actions and prefer products and services that refle
3.5 Insights from User Research There were several insights gained from the user research. Firstly, emerging from the questionnaire, most people usually buy their sports products from multibrand stores like Rademar, Sportland, Sport Zone and Decathlon. Although the online shopping trend is increasing, customers still generally purchase from either brick-and-mortar stores or across platforms. This was evident in the user journey maps as well – the people who were interviewed had navigated across channels, checked the stores’ locations online, read other peoples’ reviews. Many customers find it difficult to choose which products to buy when shopping for sports products. Although reviews are helpful, they still trust the people
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around them the most. Another big insight from the user research discovered that although there are very many different types of athletes, each one having their own favourite sports and ideals, most of them are paddling between two different cultural spaces – one they have during daytime and another when they enter their zone of sport.
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4 | BR IE F
Figure 4.1: Two Buildings. Source: pexels.com
Through the insights collected from the user and secondary research in the Discover and Define phase, a focus can now be set for the Develop phase. Customers are increasingly looking to be drawn into experiences that would imprint in their memories, or help them in their goals of self-actualisation and transformation. Brick-and-mortar stores can become stages for orchestrating these experiences. Physical stores are far away from disappearing, but their role is changing and needs to be redefined. The desk research identified that there is most room for innovation in multi-brand sports retail environments. Some of the most relevant insights gathered from user research were: •
Many people find it difficult to choose which brands and products to buy when shopping for sports clothes or gear;
•
Although online shopping tendency is increasing, customers still usually buy from either brick-and-mortar stores or across platforms;
•
Although most of the innovation in retail is happening in single-brand environments, customers prefer to shop in multi-brand sports stores.
This means the new concept should reflect a new brick-and-mortar multi-brand retail experience of the future that would leverage the strong points multi-brands have over single-brands – credibility and trust, wide category stories, more options for different types of consumers – as it is defined in Chapter 2.6. The customer journey mapping helped to determine that the fitting booth and the checkout process are one of the most critical points in the journey at the moment. The seamlessness of checkout will be one of the main requirements for the new concept. The fitting area will have a central focus, aiming to pull customers out of their everyday culture and enter their culture of sports. A skilful use of technology does not mean merely adding more screens to the equation, neither is the fitting room an independent business unit. The new concept will facilitate a holistic offering, designing the system as a whole and using technology in a human-centred manner.
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5 | CON CE PT DEVE LO P MENT
Figure 5.1: Man Writing on Whiteboard. Source: pexels.com
This chapter describes the design process of developing a new multi-brand brick-and-mortar sports retail experience. Through an iterative process of developing and testing, the service concept is refined until the final design outcome is reached. Using creative techniques, individual service components are developed in detail and as a whole to ensure that these link together to form a holistic offering. The final system will incorporate all the feedback gained in the development phase.
5.1 Redesigning Brick-and-Mortar Back in the goods-dominated economy, retail stores looked different than today. It was not like Nordstrom, Target or Sport Zone, but rather like a street market where traders had their goods stored behind and around their counters. People could not go into a store to buy a shirt or pants. If they wanted something, they had to place an order, wait until it was made and then pick it up. Although the availability of commodities started to increase rapidly, the retail model remained the same for a long time. Gradually, stores started to conform to the service economy. Most of the products were showcased throughout the store. The customers could walk around, take a look, touch and explore the items displayed. Sales assistants were there to help customers when necessary, and finalise the transaction, usually behind a sales counter. Now, stepping into the experiencedominated economy, store layouts are once again called into question and although many are experimenting, it is not clear yet, what ‘the new big thing’ will be. The Swedish design researcher Åsa Öberg has emphasised that traditionally most innovation processes have been focusing on creatively solving problems with the help of new technology or business models while the products themselves have been described in terms of function and visual appearance (Öberg, 2015). This has left out a less visible dimension – the product meaning. This dimension, however, can be used as an alternative path to innovating products and services. When Öberts talk about the “innovation of meaning”, she refers to “a user, the product and the surrounding context to interpret a product or service proposal in the way that the purpose changes.” The “product meaning” is the purpose of a product or a service as perceived by the user (Christensen, Junginger, 2014). The meaning of brick-and-mortar is shifting. It is no longer a necessary point of interaction where customers can exchange values with the sellers. This function can be obtained from anywhere at any time via desktop and mobile. Brickand-mortar is acquiring a new meaning and this will also impact the physical appearance and layout of brick-and-mortar stores. Figures 5.2 and 5.3 on pages 56-57 illustrate how this metamorphosis could look like. Having to wait in queues is one of the main reasons customers choose to shop
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Figure 5.2: Store Layout - Before
Trying on clothes has been made very uncomfortable due to lack of space in stores.
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There is rarely any room in the store for reflection or relaxed interaction with coshoppers.
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Having to wait in queues is one of the main reasons customers are moving to online shopping.
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Keeping track of stock is difďŹ cult. Mostly, retailers know how many items are in store but have no overview on how many are on display at time.
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There will be more room for extra offerings that create a more holistic experience for the customer and differentiate the retailer.
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When keeping the size of the back room the same, by inventory optimisation it would largely increase product availability.
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Figure 5.3: Store Layout - After
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online. Many retailers are already moving towards self-checkout solutions by handing the task over to the customer. Unfortunately this is only a limited improvement over the traditional cash register system. The checkout process can be fully automated through IoT applications, as will soon be demonstrated by Amazon Go (Amazon, n.a). Network of sensors placed strategically around the store will enable customers to be recognised through their smartphones and other mobile devices. Sensors will also be embedded in the items sold in the store. The retailer’s mobile application will have the customer’s preferred payment information saved and therefore the customer can just walk out of the store and be billed automatically. This also means an end to the possibility of shoplifting. This will drastically change the role of the sales assistant, as further explained in the next subchapter.
The fitting area needs to be reimagined completely in order to create a unique customer experience that would differentiate the retailer. Fitting is also one of the biggest weak spots in stores. Often times, customers are intrigued by the products they find on display but when trying them on, they are left with disappointment. This could be turned around completely. Fitting rooms have the potential to become the spaces that make the customer imagine what more could be and to get them inspired. That would result in further purchases. 72% percent of customers prefer to try clothes on at home because the fitting rooms are too uncomfortable and the whole experience is stressful (Indyme, 2015). Another finding was that there is a lack of help inside the fitting area. This is an issue for the retailer as online purchases have a much higher return rate as those done in store. The fitting area needs to be reimagined completely in order to create a unique customer experience that would differentiate the retailer. Getting inventory right is one of the biggest challenges and key determinants of profitability for retailers. When there is too much inventory in hand, stores have high carrying costs and might end up being stuck with unsold items; too small inventory may result in stockouts that is not beneficial in the eyes of the customer. Automated shelf-replenishments and real-time inventory monitoring can help retailers calibrate inventory, as smart sensors can track the weight and height of the items on shelves and set off automatic reordering without any intervention from the employees. Shrinkage is the difference between what a retailer pays for inventor and what is available for sale. This could be caused by shoplifting, employee theft, paperwork errors or supply fraud. The average shrinkage percentage in retail is around 2%, which cost retailers more than $44 billion in losses in 2014 (The Balance, 2016). Technologies like real-time video analytics on data fed from IP CCTV (Internet protocol closed-circuit television) cameras can hugely improve surveillance, together with sensors embedded in the products themselves, which enable
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tracing individual items across the supply chain. This adds an additional layer of visibility to the process, which will mean an expected 99% accuracy of inventory and 70% reduction in shrinkage (Forbes, 2015). Retailers prefer to have as many items as possible displayed at the same time. Although this reduces the need for sales assistants to constantly refurbish, it also results in untidy, overwhelming retail environments that do not appeal to customers. Location and In-Store analytics are advancing fast. Google’s project Tango is on its way to bringing the store to life in 3D (Tango Developer Overview, n.a). Other customer-oriented enterprises like Facebook, Apple, Twitter and Baidu are developing systems to learn from images and videos. Soon, the exact location and journey of the shoppers in the store and even outside of it can be analysed and used to optimise layouts. McKinsey Global Institute has estimated that by 2025 this would lift productivity by 5%, based on the assumption of widespread adaption. This could result in an economic impact of $6 trillion in operating costs (McKinsey&Company, 2015). If early adopters lead the way and prove that this creates high competitive advantage, other stores would have to match the expectations.
5.2 Redefining the Role of the Sales Assistant The future of sports retail will also require redefining the role of the sales assistant. Intelligent automation can remove a lot of economically inefficient activities away from the hands of the sales staff. Automated checkout process is one of them, as it does not create any intelligible value for the customer when done by the sales assistants. Rather it will demote their authority and expertise, which will be the greatest asset for multi-brand sports retail stores. Deploying tablets to the sales assistants may seem like just adding another widget to the equation but when done right, it will completely change the game. Sales assistants could become product experts with unsurpassable insights and expertise. It would enable instant communication between staff members, retail offices and customers. By standardising and distributing customer information to the product experts’ tablets, it would allow them to provide personalised shopping experiences and product recommendations based on the customer’s previous views and purchases. The retailer can use the technology-connected devices to have a comprehensive overview of consumer behaviour to determine traffic and to deploy the staff most efficiently. IoT could improve process flows and determine the effectiveness of maintenance, repair and security workers in retail environments. At the moment, the everyday work of sales assistants requires walking long distances and spending hours updating price tags. They need to stroll through the store to find misplaced items, to return fitted items to their place and to replenish the display. There is an estimated overview of how many products are in the store but not their exact location; not even whether the items are in the stockroom or on display. Inventories are time-consuming as barcodes need to be scanned
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One of the biggest inefficiencies are the long distances sales assistants have to walk in the store
When customer asks the sales assistant something he doesn’t know the answer to, he asks his colleagues first, then Googles it in the work laptop
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fitting room
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Figure 5.4: Staff Work Process – Before Bigger brands train the personnel in seminars which usually last arond 5 hours, smaller trainings in-store
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Computers show inventory but not how much is in stock room vs what is on display. Shrinkage is a big issue.
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Visual merchandisers need to start their days very early in order to rearrange the displays
Whenever prices change, the sales assistant needs to find the products from the display room and manually update everything
Products arrive a few times a week. They need to be unpacked and stocked or displayed.
Inventory is done very rarely as it is a time-consuming process when having to manually scan every bar code. Keeping track of stock is difficult.
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Figure 5.5: Staff Work Process – After
To offer a better experience, the expert can see the client’s interests and purchase history
Product experts can see simple visuals on which products are raising the most interest and which are selling the best
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Figure 5.6: Storyboard – Joaquim Purchasing a Windbreaker
1. Joaquim enters the store and checks in with his mobile device in order to get a full benefit of the in store customer e perience. . he product e pert has a live view of the customers who are in the store through advanced people tracking technology. . he product e pert gets a consultation request from oaquim and lets him know he s available and will be there brie y. He can see oaquim s e act location from the application. . pon approaching oaquim, the product e pert can get e tra information about his sports preferences, visits and purchase history. . oaquim lets him know he needs a new windbreaker. hey walk through the store together and discuss the products available. he product e pert gets e tra product information fed to his device. . ogether they find a product to best suit oaquim s needs but it is not available in his si e at that store. he product e pert makes an order to get it delivered to Joaquim’s home.
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individually, therefore they are not conducted often. The excess workload of counting inventory, updating prices and finding misplaced items could be lost completely so that the sales assistants can focus on the work that creates the most value for all the stakeholders. Through an interview with a sports retail sales assistant, I could map out the communication between staff members and customers (Figure 5.4, page 60). The most frequent questions that sales assistants receive are about the availability of different sizes in-store. The thumb rule in this particular retail store was that there needs to be one item in each size displayed in the store. When products are misplaced or the sales assistants have not replenished the display fast enough, extra time will be lost for both parties. Other frequent questions include facts and opinions on materials, product qualities and price comparisons. Every once in a while customers may ask questions that the sales assistants cannot answer at the moment. In these cases, they first turn to their colleagues. If no one has the answer, they can use a work laptop to look information up online. When each product expert has a tablet in their use, they can easily chat with their colleagues or ask them to join in on a discussion with the customer (Figure 5.5, page 61). They can have all the necessary information about a product available in their hands, as well as user and expert reviews (Figure 5.6). When usually sales assistants get trained by bigger brands in lengthy seminars lasting around five hours and have smaller trainings in-store, then this could also be handled through technology. Webinars, videos, test tours – these mediums would be interesting and engaging for the product expert. In order for these changes to bypass, it will probably require different types of people to be employed than before but as proven before, in order for the retailer to keep up, change is inevitable.
5.3 Recognising the Visitor One of the biggest improvements will be in the fitting process. The customers come to the physical store to interact with the products and try them on. They will want to do in an environment that is comfortable for them and gets them excited over the items that could soon be theirs. My proposed solution would include interactive product testing booths that would recognise the customer as well as the product they are fitting on (Figure 5.7, page 64). Based on the customer’s profile, the interactive mirror can give them product suggestions. The booth should be able to create an atmosphere of the environment where the customer will start to use the product in the future. For example, if a man who often likes to hike in the mountains enters the booth to try a padded jacket, the screens could display an image of snowy mountains, while the lighting and sound systems would try to carry on the scenery as best as possible.
98% of retailers believe that customer profitability requires communications personalisation
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Figure 5.7: Storyboard – Clara Trying on Products
. lara came to the store to buy some new clothes to wear in the gym. ne of ike s tops catches her eye and the tag sends her phone a notification with the product info. . he decides to try the top on so she chooses her si e and favourite color and adds it to the fitting room items. .
hen she enters the testing area, the room reads the top s tag and automatically creates the atmosphere in the fitting room sound, light, background image this can be changed by lara later . he tries on the top and likes it a lot. n the interactive mirror, she sees product recommendations and a nice sports bra catches her eye. 5. Claire requests the item to be brought to the testing room. he can also ask for a consultation with the product e pert regarding her options. . he is e tremely happy about her new outfit and takes a photo to share it with her friends on nstagram.
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(InternetRetailing and Ometria, 2016) With the retail industry shifting into hyper-personalisation, ethics and security will become the cornerstone of building customer relationships, in order for the IoT-enabled future not to become an “Orwellian nightmare” (Sullivan, 2013). IoT applications expose both, the users and the retailer to security threats. Nearly half of all of the most invasive security breaches in recent years have been in the retail industry. The number of channels and complexity of data travelling will further increase the risk. Advanced security solutions need to be deployed but the biggest question will be how to win over the trust of the consumer. Firstly, boundaries need to be set inside the company to determine how the data will or will not be used. Transparency is the key. Customers should be able to have control over the data and should be able to edit their preferences. Lastly, it is recommended to take baby steps in delivering the personalised experiences, so that the customers can digest and get used to the changes (Accenture Technology, 2016).
5.4 Reaching Beyond Products Sport retail isn’t merely about selling products anymore. To increase customer loyalty, the retailer should put emphasis on giving the consumer more holistic benefits – helping them improve their form, technique and nutrition to achieve maximum benefits. A part of my proposition would be a nutrition area incorporated into the store (Figure 5.8, page 66-67). This would function as a meeting point for customers to interact with each other, as well as have a space for consultations with the product experts in a relaxed atmosphere. It should enable customers to independently learn about proper nutrition. Interactive tables could help achieve this. For example, when a customer orders a smoothie, he can see nutritional information about the smoothie projected onto the table. Companies like Nespresso have already been experimenting with these nolonger-futuristic solutions (www.youtube.com, 2009). As some part of the sports fans who visit the stores are tracking their nutrition, it would be possible for them to scan a code on the table to add it to their MyFitnessPal or other applications. The nutrition bar could hand out informational cards to the customers, created by known nutrition experts (explained in more detail in the next subchapter).
5.5 Remaining in Customers’ Minds One great strategy for a retailer to stay in the forefront of their customers’ minds the next time they need to purchase something is to leave them with engaging evidence from their previous pleasant shopping experience. My proposal, called Collectibles is a simple tool to increase customer loyalty and engagement. The Collectibles would be created as a collaboration between the retailer and professional athletes of various fields. The athletes would give small tips and techniques that anyone could try to implement in order to improve
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their performance. These tips would be created in the form of cards and organised according to their respective sports category – running, bouldering, skiing, calisthenics, etc (Figure 5.10, page 68). The customers would receive the cards one at a time and try to implement the professional’s tip into their next workout (Figure 5.9). The tips should never advertise a certain brand or a product, nor require the customer to purchase any new products he does not own yet. The Collectibles could be stored by categories in the customer’s account that he can access on the brand’s mobile/smartwatch application or website. The customers could receive a collectible (Figure 5.11, page 68) with every purchase they make. They could share them with friends and receive them from friends. When the customer has managed to fully implement the technique in his/her trainings, he could mark it as mastered. Thereby he could always see his progress and create a healthy addiction through a game. The aim is to help the customers improve their technique and form through a playful medium in order to deepen the bond between the customer and the retailer. If the customer has a physical evidence from his visit to the store or purchase, he is much more likely to remember this retailer the next time he needs to buy something.
Figure 5.8: Storyboard – Rafa
5.6 Conclusions From Concept Development The changing meaning of brick-andmortar stores affects the physical layout of them. The new improved store will have no space needed for checkout desks and queues. There will be significantly more room for interacting with the products,
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Figure 5.9: Storyboard – Rafael Re
ael Purchasing Shoes
eceiving a Collectible
. afael has gone to the nutrition bar before heading to e plore products. He orders an orange uice and sees the nutritional information displayed on the interactive table. . He scans the barcode on the table with his My itness al application to add it to his daily intake. . He wants to buy new shoes but is not quite sure which ones he should buy so he invites a product e pert to oin him. . ogether, they pick out some favourites and then head to the testing area to try on the products. . he e pert has the tools to give afael quick feedback thanks to sensors attached to his equipment. . He can now ust take his shoes and leave the store. he payment will be done automatically as he leaves the store. He will now receive a collectible.
. afael needs new training pants and decides to order them online . He pays for the order and gets it delivered to his ofďŹ ce . He conďŹ rms his delivery and chooses whether to give feedback regarding the items or service . he retailer has information that afael likes calisthenics and he receives a tip from an e pert afael follows on nstagram. t is stacked in his application. . ater that day afael goes to train and remembers he had gotten a tip from a professional. He re checks it on his smart watch and tries applying it in his workout.
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Figure 5.10: Collectibles System Map
Figure 5.11: Collectibles Visualisation
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trying them on in more engaging ways. The new experience will include extra value-adding offerings inside the store like nutrition bars. While the storage area will be kept the same, the product availability will increase tremendously thanks to storage and layout optimisation with IoT functions. The role of sales assistants will shift from supervisors/sales assistants to product experts with unsurpassable insights and expertise. By standardising and distributing customer information to product experts’ tablets, it will allow them to provide personalised shopping experiences and product recommendations based on customers’ previous views and purchases. It will enable instant communication between other experts, retail offices and customers. The core of the final concept will be reimagining the fitting process, while designing the store and needed systems around it. The new fitting experience will be customised for each customer, pulling them into their own culture of sports and getting them inspired about different ways to combine products. The action of choosing with items to try on or purchase will be made effortless and assistance and expertise will be available for anyone with a single action. The new retail concept will be centered around customers, moving the products and experts around them, not the other way. The in-store experience will be finalised with a Collectible as a memory of the visit and a tools for customers to reach their goals of self-actualisation and transformation. Little by little, the Collectibles will help customers improve in the field they love and relate their success with the retailer. The design outcome needs to show the experience as a whole and combine the details designed in the concept development phase.
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6 | DE S I G N OU TCO M E
Figure 6.1: Finish Line. Source: pexels.com
The final concept combines the learnings from the Develop phase. The new and improved multi-brand brick-and-mortar sports store experience is visualised in two forms. Firstly as a system through a store layout plan, which shows the technology implementation and the benefits for customers and retailers. Secondly as a customer journey, visualising the new enhanced experience, including customer’s thoughts and emotions.
6.1 Final Concept The new brick-and-mortar is equipped with sophisticated camera technology, smart shelves, source-tagged SKUs and sensors. Beacons enable information such as purchase histories and personal preferences to travel between the retailer and the customer, allowing a more customised, high-end service to be delivered. Advanced in-store customer tracking enables the retailer to map customer journeys and analyse product placement. Sensors can detect, which products raise interest in customers and send additional information to their smartphones. The retailer will have an in-store mobile application that allows customers to add products to their testing or purchase list and check availability on any items. Contactless checkout automatically scans the products when customers exit and charge them on a respective amount to an account on their smartphone. Upon leaving, customers are rewarded with technique cards from professional athletes to build customer loyalty and drive repeated sales. Customers can ask for help from product experts at any point of their journey via mobile. The experts can see the location of customers in store from their tablets and let them know instantly when they will be available. Extra value-adding services like sessions with experts on yoga mats or treadmills keeps customers engaged and helps them make feel more confident about their purchases. The experts can feed relevant information or visuals from their tablets to the screens placed in testing areas. The equipment can be regularly replaced to offer new experiences and tips from other sports fields. To enable more social interaction and a holistic approach to a healthy lifestyle, the larger stores will have a nutrition bar where customers will be able to order snacks, juices and shakes in-store. The bar accommodates an interactive counter that gives customers nutritional information and helps them arrange consultations with experts. Customers will be able to add items to their fitting list as they move through the store and get them delivered to the fitting rooms. Smart fitting rooms can adjust the wallpaper, lighting and sound according to algorithms that consider the products that are being tried on, as well as the customers’ interests and backgrounds. Interactive mirrors will give customers product suggestions and enable social people to take photos and share them online. Experts can help
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Sensors can detect, which products raise interest in customers and send additional information to their smartphones
Customers can ask for he from product experts at a point of their journey via In-store mobile application allows customers to add products to their testing list and check availablity on any items
Extra valu on yoga m engaged about the
Customers are rewarded with technique cards from professionals to build customer loyalty and drive repeated sales
Beacons enable information such as purchase histories and personal preferences to travel between the retailer and the customer, allowing a more customised, high-end service to be delivered
Contactless checkout automatically scans the products when customer exits
Advanced in-store customer tracking enables the retailer to map customer journeys and analyse product placement
Interactive nutritional customers with produ
Figure 6.2: Final Con
customers along the fitting journey as they will have a constant overview of stock and further product information available on their tablets. Customers will have the possibility to get their purchases delivered at home. RFID technology helps the retailer track inventory at any point in the supply chain. Smart
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Smart energy management systems are not only necessary for the health of our planet but have a major economic benefit for the retailer
elp any mobile
Possibility to get the purchase delivered at home
ue-adding services like sessions with experts mats or treadmills keeps customers d and helps them make feel more confident eir purchases
Smart shelves together with source-tagged SKU’s and sophisticated camera technology will help reduce shrinkage
RFID technology tracks the inventory at any point in the supply chain Smart shelves that detect when inventory is low
Customers will be able to order snacks, juices and shakes in-store
e counter gives information and helps s arrange consultations uct experts
Equipping product experts with tablets enables them to have a constant overview of stock, helps them interact with customers and gives them quick information to help customers Smart fitting rooms can adjust the wallpaper, lighting and sound according to the products that are being tried on
Interactive mirrors will enable social customers to take photos and share them on social networks Smart mirrors will give customers product suggestions
Benefit for customer Benefit for retailer
ncept – Store Layout
shelves detect when inventory is low and enable automatic stock replenishment. This, together with source-tagged stock keeping units and sophisticated camera technology will nearly eliminate shrinkage. Smart energy management systems will have a major economic benefit for the retailer (Figure 6.2).
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7.2 Customer Journey The real scope of the metamorphosis of the store is hard to communicate through two-dimensional figures. The true change will manifest in the way the store comes to life and implants the dynamic soul of sports. Therefore, a better way to describe it is to show a journey through the eyes of a customer named Claire.
Figure 6.3: Customer Journey – Claire Noticing the Sports Store
Figure 6.4: Customer Journey – Claire Entering the Store
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Claire is in her twenties. She works out three times a week and it is usually something aerobic. Her favourites are DanceFit and BodyJam but she also enjoys yoga and pilates for a less intensive workout. It is weekend and she has decided to go to the shopping mall. She had browsed for some new leggings in the retailer’s website a week ago. She is passing by the store when she sees a dance scene displayed on one of the store’s window screens. That raises her attention and she remembers about the leggings. She is curious and decides to go inside (Figure 6.3). She steps in the store and looks around. Claire is a bit confused for a moment as there is a lot going on – in one corner, there are a few people stretching, there
Figure 6.5: Collectibles Visualisation
is a man walking on a treadmill, there are many interesting clothes displayed, and even a bar where people are drinking juices. She is quite surprised by it all (Figure 6.4). The momentary confusion is broken by a notification she receives on her phone. It is asking Claire if she would like to be guided through the store to find leggings suitable for her (Figure 6.5). Claire feels welcomed and accepts the guidance. She walks through the store with the help of AI, sees items she likes and adds them to her fitting list. She then proceeds to the fitting area where she meets a product expert named Laura. Laura has the four pairs of leggings ready for Claire to try on in the requested size and colour.
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Figure 6.6: Customer Journey – Claire Entering the Fitting Room
Figure 6.7: Customer Journey – Claire Interacting With the Mirror
Figure 6.8: Customer Journey – Laura Helping Claire
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Claire steps into the fitting room and is baffled as the walls turn into a studio much like her own. The speakers start playing a cheerful dance music and it lifts up her spirit (Figure 6.6). She tries on one of the leggings and gets product recommendations displayed on the interactive mirror that is covering one of the walls (Figure 6.7). She sees a top and a bra that she really likes and adds them to her fitting list. Laura lets her know that the products will be brought to her briefly. Laura gets there with the products and asks Claire if she can help her with anything else. Clair had trouble choosing between two pairs of leggings so Laura helps her with more detailed information to compare the products. She can see detailed information in her tablet and project it to the mirror so that Claire could see it as well (Figure 6.8). She can also see information about Claire’s favourite sports and can give her recommendations according to that. As Claire enjoys to move a lot, Laura recommends her the Stella leggings, as the material on those is more durable in the long-term. Claire feels informed and assured. She makes her choice and adds the items to her shopping cart. She is planning to shop more in the mall so she chooses to get the items delivered to her home. She simply walks out and thanks Laura for her help (Figure 6.9).
Figure 6.9: Customer Journey – Claire Leaving the Store
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Figure 6.10: Customer Journey – Claire Receiving a Collectible
After she has left the store, she receives a tip from an aerobics coach through a Collectible, recommending her to try stretching with bands to increase mobility and help her muscles recover after a workout (Figure 6.10). She is eager to implement this tip into her routine. The physical cards are sent to her afterwards with the purchase delivery.
Figure 6.11: Customer Journey – Claire Implementing the Technique
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Claire starts practicing with bands every once in a while and notices some improvements in her flexibility (Figure 6.11). She feels like this has helped her get a little better and she is glad she received the tip. Comparing Claire’s journey with her previous experience (Appendix 4), the main improvement is in the personalisation of the provided service. The experience is customised to Claire from the moment she sees the store. The personalisation is subtle and non-intrusive. The implemented technology does not require any additional actions from her. She trusted the AI and saved time from walking through the entire store to look for the leggings she had seen online. She did not have to browse through racks full of clothes to find a suitable size. She could feel cosy and inspired in the fitting room and didn’t have to leave in order to bring in additional items. The fitting room allowed her to start imagining what she would look like in a fitness studio, bringing her into the culture of sports. Decision-making had also been made easier for her. Laura, the expert, could show her relevant information on the large interactive screen and give advice to help with the decision-making. The hustle of checkout was eliminated, there was no need to wait in a queue. In addition, Clara didn’t have to walk in the mall and back home with shopping bags. The evidence left behind – the collectible – helped in her endeavor of self-improvement and she will relate this success to the retailer. Besides, she is eager to get more collectibles and therefore is highly likely to return to the retailer the next time she needs something.
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7 | CO N CLU S I O N
Figure 7.1: Man Stretching. Source: pexels.com
The thesis aimed to explore what the future of sports retail could look like by analysing the latest technological advancements, especially IoT functions, along with economical and cultural influencers. The process was divided into four phases according to Design Council UK’s double diamond model – Discover, Define, Develop and Deliver. The expected outcome was a conceptual system presenting a new and enhanced customer experience. Qualitative and quantitative research methods were applied, including a questionnaire, observations, interviews, desk research and literature research. The secondary research found that spendings in experiences are gaining momentum in the economy. Holistic offerings are increasingly superseding products, as consumers are looking for help with their goals of self-actualisation and transformation, connection to peers and more personalised solutions. Although the mobile phone has become more popular as a purchasing tool, most people still prefer to shop either in brick-and-mortar stores or acrossplatforms. The current market situation and user research revealed that the biggest opportunity to innovate was in multi-brand offerings, which was also the preferred store type for customers. So far multi-brand retailers had tried to walk the same path as single-brands when it came to implementing technological innovations into their strategies. Their non-success suggested that a different approach should be taken, playing into their strong points of credibility, trust and more options for different types of consumers. The user research revealed that consumers find it difficult to choose which items to purchase, as the product range is overwhelming and there is no clear performance measuring scale. The central focus of the new concept unveiled while looking into specific customer journeys, showing that the areas which needed the most improvements were the fitting process, checkout and seamless navigation across platforms. The financial value of IoT functions for retailers was dissected, finding the biggest economical value from inventory and storage optimisation and the automation of the checkout process. Based on the findings from the Discover and Define phase, a new multi-brand brick-and-mortar sports retail experience was developed. Through an iterative process of designing and testing, the service concept was refined until the final design outcome was reached. Using design and creative techniques, individual service components were developed in detail and as a whole, making sure that these linked together to form a holistic offering. The layout changes of brick-andmortar stores in the age of IoT were presented. These changes resulted in the need to redefine the role of sales assistants and their in-store work process.
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The new and enhanced experience was visualised firstly as a system through a store layout plan, which showed the technology implementation and benefits for customers and retailers. Secondly, through the eyes of a consumer named Claire, showing her thoughts and feelings throughout the new conceptual journey. The main improvement was in the personalisation of the provided service. The fitting experience was augmented immensely and the decision-making process had been made easier. The hustle of checkout was eliminated, there was no need to wait in queues or walk home with shopping bags. In addition, the improved service left behind evidence, which helped Clara in her endeavor of selfimprovement. The thesis delivered well to its’ initial goal. Although the proposed concept incorporates a sample store layout and a customer journey in that specific store, the core value of the work is not the proposed new layout itself, nor claimed to be. The aim was to create a comprehensive overview of the future possibilities in sports retail, guide retailers through relevant trends and opportunities, explore the possibilities and limitations of technology and to help them understand the desires and behaviours of consumers. IoT applications will, without doubt have extensive implications for retailers, forcing them to rethink how their companies operate, and revise business models. Elseways, they risk becoming history.
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Fortune, http://fortune.com/2015/10/13/taylormade-using-vr-to-sell-golfclubs/, accessed 24th October, 2016 Gear Junkie, https://gearjunkie.com/oakley-radar-pace-sunglasses-review, accessed December 1st, 2016 IDEO, ideo.org, “The Field Guide to Human-Centered Design”, 1st Edition (2015) Canada Inditex News, “Inditex Deploys RFID Technology in Its Stores” https://www. inditex.com/media/news_article?articleId=150174, accessed November 2nd, 2016 Intel Labs and The Store WPP, “The Second Era of Digital Retail – A vision for the future of shopping and the smart shelf”, http://www.intel.com/content/www/ us/en/retail/digital-retail-futurecasting-report.html, accessed December 20th, 2016 Interaction Design Foundation, https://www.interaction-design.org/literature/ article/the-principles-of-service-design-thinking-building-better-services, accessed October 10th, 2016 InternetRetailing in association with Ometria, “Personalisation 101: a C-level Playbook: A behind-the-buzzword commercial view on personalisation’s place in multichannel retail”, (2016) J. Margus Klaar, “How To Have Your Cake And Eat It Too – An Introduction To Service Design”, (2014) BIS Publishers Jon Sunbo, Per Darmer, “Creating Experiences in the Experience Economy” (2008) MPG Books Ltd, Great Britain Jonathan Chapman, Nick Gant, “Designers, Visionaries and Other Stories. A Collection of Sustainable Design Essays” (2007) Earthscan, UK and USA Karen Price, Pittsburgh Tribune Review, “No Sign of CrossFit Boom Slowing Down”, http://www.iclubs.com/more-news/no-sign-of-crossfit-boom-abating. html, accesssed December 1st, 2016 Kurt Salmon European Omnichannel Fashion Survey 2015, “What Makes Some European Retailers Best-in-Class and Others Lag Behind?” (2015) Lynn Matson, “See It, Hear It, Experience It, Buy It! Increase Sales With Digital Signage, Ambiance Marketing, and Electronic Merchandising” (2009) Innovation Press, San Fransisco, USA
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Marc Stickdorn, Jakob Schneider, “This Is Service Design thinking : Basics Tools - Cases” (2011) Amsterdam : BIS Publishers Marion Maneker for Quartz Media, “CrossFit’s Extremely Lucrative Business Plan is Also Deceptively Simple”, accessed October 28th, 2016 McKinsey&Company, “The Internet of Things: Mapping the Value Beyond the Hype” (2015) Merriam-Webster Dictionary, https://www.merriam-webster.com/dictionary/ experience, accessed October 10th, 2016 Neil Saunders to Business Insider, http://www.businessinsider.com/zara-hasthe-best-business-model-2015-12, accessed October 27th, 2016 Nike homepage, www.nike.com, http://www.nike.com/us/en_us/c/nike-plus/ nike-app, accessed December 19th, 2016 Ometria, “Ecommerce Marketing Trends 2017” (2016) Patrick Bouchet, Dieter Hillairet, Guillaume Bodet, “Sport Brands” (2013) Routledge Sports Marketing Series, MPG Printgroup, Great Britain Poul Rind Christensen, Sabine Junginger, “The Highways and Byways to Radical Innovation – Design Perspectives” (2014) Design School Kolding & University of Southern Denmark PSFK Future of Retail 2016 Report, http://www.psfk.com/report/future-ofretail-2016, accessed October 16th, 2016 PSFK, http://www.psfk.com/2016/10/hyper-personalized-training-egymworkout-routines.html, accessed October 19th, 2016 PwC, “They Say They Want Revolution - Total Retail 2016”, http://www.pwc.com/ gx/en/industries/retail-consumer/global-total-retail/global-key-findings.html QVIT home page, http://www.qvit.com/pages/the-problem, accessed October 24th, 2016 Retail Dive, http://www.retaildive.com/news/retailers-omnichannelstruggles/422963/, accessed October 31st, 2016 Siiri Same, Jorma Antero, “Marketing Theory: Experience Marketing and Experiential Marketing” (2012), The 7th International Scientific Conference
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Business and Management 2012: Selected Papers: May 10–11, 2012, Vilnius, Lithuania Tango Developer Overview, https://developers.google.com/tango/developeroverview, accessed December 9th, 2016 STYR Labs homepage, https://www.styr.com/, accessed October 19th, 2016 The Balance, https://www.thebalance.com/top-sources-of-retailshrinkage-2890265, accessed December 10th, 2016 The Business of Fashion (BoF), Kate Abnett, “Will Mass Customisation Work for Fashion?”, https://www.businessoffashion.com/articles/intelligence/masscustomisation-fashion-nike-converse-burberry, accessed October 18th, 2016 The Business of Fashion (BoF), Kate Abnett, “The Store of the Future”, https:// www.businessoffashion.com/community/voices/discussions/what-will-the-storeof-the-future-look-like/the-store-of-the-future, accessed October 31st, 2016 YouTube: Atrac Multitouch table tells you about Nespresso, https://www. youtube.com/watch?v=P6-0IGZPUKc, accessed December 9th, 2016
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LI ST O F FI G U R E S AND TAB L ES Figure 1.1: Man in Track and Field. Source: pexels.com Figure 1.2: Lines on Tennis Court. Source: pexels.com Figure 1.3: Research Areas Figure 1.4: Double Diamond Diagram. Source: British Design Council Figure 2.1: Woman Jumping. Source: pexels.com Figure 2.2: The Progression of Economic Value. Source: Pine, Gilmore, 1999 Figure 2.3: Nike+ Application. Source: Nike Figure 2.4: STYR Labs Products. Source: STYR Labs Figure 2.5: Ethnotek backpack with a Threadâ„¢ by a master weaver Vankar Shamji, of Bhujodi-Gujarat, India. Source: Nookmag Figure 2.6: Burberry Scarf With Initials. Source: Burberry
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Figure 2.7: Lululemon Yoga Class. Source: Lululemon Figure 2.8: CrossFit is About the Community. Source: CrossFit® Figure 2.9: Zara’s Sales Assistant Using an RFID Reader. Source: Inditex Figure 2.10: Real-Life vs. Virtual Fitting With QVIT. Source: QVIT Figure 2.11: Apple EasyPay. Source: Pocket-Lint Figure 2.12: Interactive Mirror in Rebecca Minkoff Store. Source: Rebecca Minkoff Figure 2.13: Golf Through VR Glasses. Source: taylormadegolf.co.uk Figure 2.14: Sport Zone Every Zone. Source: Sport Zone Figure 2.15: Decathlon Coach. Source: Decathlon Figure 2.16: 2015 Retailer Type Omni Channel Score. Source: Consultancy UK Figure 3.1: People Walking in a Shopping Street. . Source: pexels.com Figure 3.2: Questionnaire Results Figure 3.3: Types of Sports Consumers Figure 3.4: Paddling Between Cultural Spaces Figure 3.1: Code in Screen. Source: pexels.com Figure 3.2: Zara’s Sales Assistant Using an RFID Reader. Source: Inditex Figure 3.3: Figure 3.3: Real-Life vs. Virtual Fitting With QVIT. Source: QVIT Figure 3.4: Apple EasyPay. Source: Pocket-Lint Figure 3.5: Amazon Go. Source: Amazon Figure 3.6: Ethnotek backpack with a Thread™ by a master weaver Vankar Shamji, of Bhujodi-Gujarat, India. Source: Nookmag Figure 3.7: Burberry monogrammed scarf. Source: Burberry
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Figure 3.8: Lululemon Yoga Class. Source: Seeking Alpha Figure 3.9: Interactive Mirror in Rebecca Minkoff Store. Source: Rebecca Minkoff Figure 3.10: Decathlon Coach. Source: Decathlon Figure 3.11: Sport Zone Every Zone. Source: Sport Zone Figure 3.12: 2015 Retailer Type Omni Channel Score. Source: Kurt Salmon Omnichannel Fashion Survey 2015 Figure 4.1: Two Buildings. Source: pexels.com Figure 5.1: Man Writing on Whiteboard. Source: pexels.com Figure 5.2: Store Layout - Before Figure 5.3: Store Layout - After Figure 5.4: Staff Work Process – Before Figure 5.5: Staff Work Process – After Figure 5.6: Storyboard – Joaquim Purchasing a Windbreaker Figure 5.7: Storyboard – Clara Trying on Products Figure 5.8: Storyboard – Rafael Purchasing Shoes Figure 5.9: Storyboard – Rafael Receiving a Collectible Figure 5.10: Collectibles System Map Figure 5.11: Collectibles Visualisation Figure 6.1: Finish Line. Source: pexels.com Figure 6.2: Final Concept – Store Layout Figure 6.3: Customer Journey – Claire Noticing the Sports Store Figure 6.4: Customer Journey – Claire Entering the Store
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Figure 6.5: Collectibles Visualisation Figure 6.6: Customer Journey – Claire Entering the Fitting Room Figure 6.7: Customer Journey – Claire Interacting With the Mirror Figure 6.8: Customer Journey – Laura Helping Claire Figure 6.9: Customer Journey – Claire Leaving the Store Figure 6.10: Customer Journey – Claire Receiving a Collectible Figure 6.11: Customer Journey – Claire Implementing the Technique Figure 7.1: Man Stretching. Source: pexels.com Table 1.1: Discover Phase – Objectives, Tools and Methods Table 1.2: Define Phase – Objectives, Tools and Methods Table 1.3: Develop Phase – Objectives, Tools and Methods Table 1.4: Deliver Phase – Objectives, Tools and Methods Table 2.1: Pros and Cons of People-Driven Versus Technology-Driven Customer Experiences Table 2.2: Strong-Points for Multi- vs. Single-Brand Stores
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Ho wd on e’s o I k the now be st which f or me ?
’s t oo ma Ov ny erw op he tio lm ns ed
ere Th
Th is wh guy at s he eem ’s t s t alk ing o kno w ab Th ou eg t uy’ sa pro It’s s me o ni he ce o lp wit f him ho ut to of eve fe na r ski ng Ex cit ed an di nsp ire d
I sh
ou
ld
ge
t it
Appendix 1
gets put off by the website
This is Rafael, a 22-year-old student with a bug for sports. He does calisthenics five times a week. He doesn’t think it’s necessary to get a sports club membership as any space can be turned into a gym. Rafael rarely makes irrational purchase decisions. He doesn’t like to have too much stuff lying around so he prefers to buy a few quality products that would be have a diverse purpose and last for a long time.
does online research gets invited to join a group
gets a recommendation from a peer
decides to get the products
Emotion throughout journey Emotion towards the retailer
Discovering Need Description I often struggle with pull-ups as my hands sweaty, I lose my grip. They get worn and torn and cause me a lot of pain. One day I went to a new calisthenics park I had seen online and met a few guys there. They noticed I had this issue and recommended me bags of magnesium that they were using themselves. I had used magnesium before in the gym but these were compact small bags that you could easily carry with you anywhere, actually meant for climbers. They let me try it and I liked it. They showed me other equipment they were using, like resistance bands and told me where they got all the stuff (Sports Store). The guys told me they were working out there regularly and had their own workout group with whom they got together every week. They invited me to join.
92
Research & Consideration
Description The next day I started doing some online research, seeing which retailers offered these products, what w the price differences and product reviews. I also visite Sports Store’s webpage but the site was overwhelmin and quite hard to navigate. All in all, there were too many products out there. It was hard to make a decis I didn’t know which was the best option for me. I felt I needed to try the product out, touch it.
I let the idea sink in for a few days. I checked out Spo Store’s locations online and decided to go there as I wanted to feel the products myself, and besides – the peer had been very satisfied with Sports Store’s produ so it was the safest choice.
sion, like
orts
e ucts
ed Sa tisfi
Iw i ma ll com ny thi e bac ng s I k her mi gh e, I sa tn ee w d Th ese are gre at pro du cts
ine d Th ere ’ ha rd s too to fin man dw yt h ha Sh t I’ ings, e’s m loo it’s rea kin lly gf nic or e Iw ish to kn I cou ow ld wh try th ich Cu to e ba rio cho nds us ose ou t Th ere he re are o tha t t in her c o ter est ol th me ing s Jee z, t he line Bo is s red ol on g Fin ally Ih ave Ex the cit m! ed
ter m De
were ed ng
s Thought checks out the screen
ngs
and feeli
leaves the store
goes to the store waits in the line
talks to the clerk
tries another product
trains with the products
e
xperienc
al E Emotion
touches the various options makes a decision locates the products
Purchase Description The store was on my way to a park. I went in, there were too many things so I decided to ask from the clerk. She explained to me where to find them. There were three different options for the band, one was out of shelf. I touched the two to see if they were good quality, stretched them. I noticed there was a screen right next to the bands with the company’s e-store. I used it to see if the lighter bands were in stock. They weren’t but it said when they would be back in. I saw a foam roller nearby. One was unpackaged for testing so I tried it but decided not to buy as I hadn’t done enough research. I didn’t want to make an irresponsible purchase. I went to pay. The line was too long but staff was lovely. While I was waiting in the line I saw a water bottle and thought about buying it but again, felt like I needed to weigh my options more.
Post Purchase Description I went straight to the park to try the products out. They matched my expectations fully. I am very satisfied with them. I don’t usually post online reviews anywhere so I wouldn’t do it for these products neither but if I would see someone in person struggling with the same issues I would definitely approach the person and share my experience regarding the products.
93
Phase of
ey
the journ
Ik in wa d of nt k alr now ea dy wha tI Th is pri is th ce eb op tio est q n ua I co lity / u alw ld o ays rde r be tte it on r to Am see azo I’m it I n bu RL no t it t in ’s ah urr y Ex cit ed
My ha powe ve ser rliftin ved g me shoe we s ll It’s tim et og et ne wo Wh ne s yd po o es we no rlif o tin g s ne s e ho An es? ll no yed
Appendix 2
has had the old shoes for years
This is Ave. She is a 21-year-old powerlifter determined to break records (national and personal). For her, there can never be too many sports clothes in the wardrobe. High performance is the number one priority but she’s also wants cute and colourful looks in the gym. Her favourite brands are Nike and Adidas – brands that offer fashionable and high-tech sports gear at a good price point.
compares models and prices
can’ prod
decides to wait
decides to buy new shoes
looks for options where to buy
travels to Germany googles for store locations
Emotion throughout journey Emotion towards the retailer
Discovering Need Description I needed powerlifting shoes. I am very aware of which product I want and why. I had had my old adidas Powerlift 2.0 shoes for two years now and I wore them every day so I decided to get new ones. No retailer in Estonia sells powerlifting shoes for women so basically the only option is to order online but I knew that I would be travelling to Germany in a few months so I decided to postpone the purchase and get them while I was abroad. Otherwise I would have ordered from Amazon.
94
Research & Consideration
Description As I had had adidas powerlifting shoes before I truste the brand. I knew about their various products – Powerlift, Adipower, Power Perfect, etc.
Nike also has nice products but they cost twice as mu
When I was in Germany, I googled the location of the nearest adidas store. Their web page didn’t have information about whether those shoes were there or not but I decided to check it out.
uch.
e
r
! it t a sha o w me arr I ca an ty n’t t ake he All re go mi no od st r th il ing l, it’s jus ta Sa tisfi ed
gy m! he
erf ect
it t
It’s
re p
ey’
wa it t oh
Th
Ca n’t
ee I ca ns
I ca n’t
she
’s b
usy , it ’s o wa kay it t ot ry the Wo m on w rea , th es lly a nic l e a eswo nd ma he Th lpf n is e ul go stor e od vib is cle es an an dh as No hu stle ser vic e, jus th It’s ow ag I lik rea ei td t! ea l! Ex tre me ly h ap py
ta wa y dr igh wa nte d
lig
hte
dw ha tI
De
un I fo
smoothly pays goes to the store
leaves the store
waits for the clerk
tries on the shoes trains with the products
’t see whether the duct is in store
ed
gs
nd feelin
sa Thought
receives a signal from the clerk
decides to buy
perience
al Ex Emotion
finds a defect
asks for her size locates the product
Purchase Description When I entered the store I headed straight to the footwear wall and there they were – several rows of lifting shoes. There were many salespeople but they were all busy talking to clients. Still, they let me know with a look that they could see I wanted to ask something and they would be with me as soon as possible. I asked for my size and they brought it to me. Everything fit well. I bought the shoes with €99.95, which was a big surprise for me as the Amazon price would have been around €120. In general I was really happy with the shopping experience – there were pleasant, sporty vibes in the store; the salespeople were active and sparkly-eyed. There were no lines when paying. Everything was clean and I found what I wanted easily.
fixes herself
Post Purchase Description After the purchase, there was actually one little problem with the shoes – the metal piece that goes through the lace hole came loose. Because I had bought the shoes from Germany and had now returned to Estonia, I couldn’t give them to the store for fixing so I had to glue the piece back myself. The only thing I was kind of disappointed in is that there were only new models in the store, and they only had the Powerlift 2.0 product. I think that if other products would have been available, I wouldn’t have made this particular choice. But as I had never in my life seen so many lifting shoes nicely in the store, I was crazy happy and excited. And I’m still very happy for my choice.
95
Phase of
ey
the journ
Ia m ju on l ine st no sho t us e pp Iw ing d to il l a lwa ys pre fer sto res Ex cit ed
Cu ri
ou s
Th e ah se sh ea d o oes s e fm y c em w urr en ay to ne s
I lo ok for in
I tr
ust
t he
pe
op le
in
no vat ion In s ee d for t he my b e tra inin st sho g es
my clu b
Appendix 3
locates the pro the retailer’s w
Joaquim is 56 years old. He started his athlete career just a few years ago. Judge during the week and marathon runner during the weekend, he is disciplined and driven on and off work. He lives in a quiet area with beautiful landscape all around. Nature is his playground. He usually runs trail but also loves to cycle. His next goal is to run the Ultra Trail® K60 uphill on Serra da Estrela.
hears about the new product
does online research
discusses products with his team
decides to get the product
Emotion throughout journey Emotion towards the retailer
Discovering Need Description When I first started running the quality of the equipment was not that relevant. I mainly looked at the price and style of a product. As I kept getting better and attending competitions, every small detail mattered. Although the entire team wears a club outfit while competing, we choose and buy our own training equipment. We discuss a lot with each other which good products we’ve found from the market. Nowadays I really search for innovations and if I feel that there’s a better product in the market from what I have already, then I want to get it. Sometimes I also buy off emotion – I really enjoy shopping for sports equipment. I remember a particular case when I heard about new innovative running shoes in the market and decided to purchase them.
96
Research & Consideration
Description I rarely shop online, I like going to physical stores mor see the products, try them on and then decide. I sometimes do some online research to keep up to da with innovations. I read about the recommended product and checked where it’s sold. There was a reta that had the shoes in their e-store but I decided to go the store to buy them.
ate
ailer o to
f el ie isb In d
ct?
Ma y be be t he tte r ma na ge Id rk id n no ’t e to ws ha ve xpec t th ob s e tac Yo um les shop to like pi old ean, t hi ng gu you s ys Sh d ock like on’t ed sel me l th ? em I ca n’t let it b rin Iw gm il l n ed eve ow rv n isit t ha If t he ts y tor mo ea ne don’ y, t t ga in ha wan t’s tm fin It w y e as b ym so e ea sy in t Id he isc oth o fro er m urage sto bu re yin eve ryo gt he n e re
Ho wi do s esn it p o ’t k s no sib le wa t bo hat s ut h t he e Up pro set du
d
Iw i as ll buy t he i sto t from re is c t his r los e b etaile y r
goes to the store
oduct on website
re –
gs
nd feelin
sa Thought
“Nós temos o produto mas só o vendemos a atletas, não a velhos como o senhor.”
talks to the clerk
waits for the manager trains with the product
gets told off
perience
al Ex Emotion
leaves the store shares his experience buys the product from another retailer
Purchase Description When I got to the store I turned to the saleswoman to help me find the product. She didn’t seem to know the product I was talking about, neither could she locate it so she got his manager to help her out. I had to wait some time and when the manager came, he told me that they do have the product in the storage but they only sell it to professionals. I am not the kind of person to raise drama. I found their “logic” unacceptable, wished them good day and went to another store to buy the product. I made a decision never to visit that store again.
Post Purchase Description I was very happy with my product but told the incredible story of the retailer’s response to all of my friends and club members. I have stuck to my decision to not return to that store – if they don’t want my money, it’s fine by me. There are so many places to shop from these days.
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Phase of
ey
the journ
Claire is a 23-year-old journalism student. She works out around 2 times a week – sometimes less, sometimes more. She enjoys group trainings the most. Yoga and pilates are her big favourites, but also more aerobic trainings like BodyJam. Her sports wardrobe is fashionable and colourful. She likes to freshen it up once every two months or so.
e
no
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ld Iw ou
Ins
pir ed
r tr yt
hs Iw i mo ll loo k re site thro ug s
pir ed ins an d Ex cit ed
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om
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ese
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Appendix 4
goes through various retailer’s e-stores browses through products
sees something nice online
compares her old products
decide
decides to buy leggings
Emotion throughout journey Emotion towards the retailer
Discovering Need Description I didn’t really NEED anything. I just feel like I never have too many workout clothes in my closet. I like to go shopping over the weekends sometimes, and then I just see what is offered and what I might want. I also like to check things out online, sometimes I get ads on nice products on my Facebook feed and check them out, and without noticing I’m already browsing for new stuff. Well, and then I look back to my wardrobe and discover that there are some things that could get replaced. Maybe they’re too worn out or just not appealing to me any more.
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Research & Consideration
Description Well, I was looking for some new training leggings. I have a couple but one of these are really starting to w out. The quality wasn’t as good as I thought when I g them. I decided to look for new ones online. I went through many retailers’ online stores – Nike, adidas, There were many cool things but it’s quite hard to sa just by looking. I think with leggings, it’s really import how it fits you and I always want to try them on first before making a decision. I decided to postpone the purchase a bit and go to a shopping mall over the weekend. There are many different sports stores ther
etc. ay tant
e
re.
d Lif te
Iw i ma ll com ny thi e bac ng s I k her Th mi ese gh e, I sa tn are ee w gre d at p rod Sa tisfi uct ed s
Th a loo t is e x kin g f actly or! wh at Bu Iw t th as nic ese eo d n m on’ t lo e Dis ok ap ver po y int ed Iw ill h ave to fin ds Th om ese eth are ing nic els ea e sw Th ell ese loo kg rea Ih ate to nm wa e i t i ng Bo red in line s I re ally like my Ex ne cit wl ed eg gin gs
em Iw on i the ll go firs t we shop ek p ing en d ov er
finds a favourite product
goes to the store
feelings
nce
l Experie
a Emotion
looks for more options goes to other stores trains with the product
leaves the store
es to go to the mall
wear got
s and Thought
tries on products gets home
makes a choice tries on a product
gets a compliment
waits in the line
Purchase Description On the weekend, I went to this shopping mall I usually go to. I went to a store that has all sorts of brands and different things. First, I found a pair that I liked the most because of the pattern but then I tried it on and it was really low-waisted, so I searched for more. I took three more pairs to try on. I liked them all a lot but one pair was my favourite one because of how they made my figure look like.
Post Purchase Description I went to some more stores in the shopping mall and afterwards to the grocery shop. I used the new pants straight away on my next training because usually always when I get something new, I am so excited to wear it. I just got the pants like a week ago, so I can’t really tell much more, but so far I’m really satisfied with them and I’ve gotten some compliments from my girlfriends with whom I train together.
The store was nice and organised. It’s just that actually I find trying on clothes in stores always quite uncomfortable, especially if you have to go back to look for more products, and then come back again – dress and undress. When I wanted to pay for the product, then there were two people ahead of me and I had to wait a bit. I guess it was only like five minutes but I really hate waiting in queues.
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the Phase of
journey
Appendix 5
DIREC
CORE
Sports
Customers – engaging experience, quality product and ease of information Sales clerks – empowered, well-trained, creative Retailers – inventory optimisation, well-trained staff Brands – customer loyalty Customer centre – effective, real-time way to communicate information to the various functions responsible Merchandisers – know the trends and the customer, predict what is needed, when, how much
Shareho
Athlete
Social m
Garmen optimis
Fabric, optimis
Assemb informa
Wareho
Transpo
Compe ahead
SPORTS RETAIL STAKEHOLDERS OF…
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Technol coopera
CT Clubs – victories sell
olders – continuous growth
es – endorsements, sponsorships
media – share experiences
nt manufacturers – zero waste, sation
INDIRECT Environmental protection – green policies Government – taxes, regulations Pressure groups – specific interests Society – values, norms
trim suppliers – zero waste, sation
Local communities – keeping culture alive
bly factories – from workers to ation operators
Press, media – inspiring, interesting stories
ouses – inventory optimisation
Research labs – testing concepts, open innovation
ortation service – optimisation
etitors – gain information, stay
logy companies – needed ation as things get smart
product creation function direct customer contact
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