After three years of research and testing 80 omnichannel services, fashion retailer Bonprix has opened a world-class omnichannel best practice store in Hamburg.
There can no longer be any doubt: the future in retail is neither pure online, nor strictly brick & mortar, but omnichannel retail tapping into the best of both worlds. But the challenge remains to find the best ways to balance the two. And Hamburg is likely a witness to what can currently be considered global omnichannel best practice.
Many retailers are testing digital technologies – from tablets or magic mirrors to concepts like Nordstroms no-inventory stores or Amazon Go – to answer a key question: how to bridge online and brick & mortar retail worlds in an era where digital natives make for an ever-increasing proportion of consumers? All while remaining economically viable?
Research Driven Omnichannel Best Practice
Bonprix, a mid-market German womenswear brand that forms part of Otto Group, took a deep dive approach to precisely this problem and has since implemented omnichannel best practices with more sophistication than many competitors. Their new Hamburg store relies on the most customer friendly components of both, online and physical retail. Digital tools familiar to the online shopper can reduce the pain points of brick & mortar retail without ceding space to distracting digital gimmickry – that’s the idea behind the 600sqm store. By combining a virtual shopping basket with physical merchandise to take home right away, or with PayPal payments as an alternative to the checkout queue, for example.
“If we love retail and love our city centres, we have to rethink much more radically. There can no longer be so much boredom,” says Rien Jansen, Managing Director for Purchasing, Marketing and Retail at parent company Bonprix. With pride he looks around the new Bonprix Fashion Connect store and adds, “I’m certain that no one else is doing this combination of physical and digital to this extent.”
And indeed, the company has created a flagship store in Hamburg’s Mönckebergstraße, a popular shopping area, that many competitors will want to see. The store sits alongside Esprit, Mango, & Other Stories, C&A and department store Karstadt – in prime footfall location. Up to 160,000 consumers pass by on an average Saturday, many of whom have not bought from Bonprix before. This makes for an attractive potential when each new customer acquisition via Google costs an estimated 40-50 Euro.
A desire for competitive differentiation, alongside Jansen’s concern about a lacklustre store landscape are likely additional reasons for private-label retailer Bonprix, of all contenders, whose average price tag is around 20 Euro and who makes only a fraction of their turnover in brick & mortar, to create such a statement store. “I didn’t want this just anywhere, but right at the centre of our city Hamburg,” states Jansen and adds, “of course that means we’re taking a risk. But it’s also very exciting.”
The team spent nearly three years planning, creating, testing and iterating. Reality-checks were an integral part of the process, with employees as well as women passing by on the street invited to spontaneously test. They were asked what they liked and disliked about the current state of the project, what they felt was missing, or what they thought not a soul would care about. True customer focus, that is.
Out of 80 new shopping scenarios that were tested, only seven omnichannel best practices have made it to the floor so far. Payment by invoice or the magic mirror, last trialled at Massimo Dutti or Karstadt, all received the boot – overly complicated, unnecessary, or mere gimmickry that doesn’t contribute to simplifying the shopping experience.
And the research phase continues now that the store is operational. The store doubles as a lab to test new features. An interdisciplinary and highly agile team of UX specialists, product managers and technologists constantly evaluates which innovations work and what else customers might desire. “It would be nice”, says Jansen, “if our work encourages other retailers to try something new too.” Whether the new store concept will be scaled remains an open question while experience with the pilot is still garnered and processed.
The Customer Journey at Bonprix Fashion Connect
The customer enters the omnichannel shopping paradise at the check-in stele near the entrance; the new Bonprix app is required. The store is bright and neat, with part of the lighting hidden by black umbrellas. The walls carry large screens, while smaller screens are placed on columns to the front. “It was important to us that the store doesn’t feel cold,” says Daniel Füchtenschnieder, Managing Director at Bonprix Retail Ltd. And indeed, it doesn’t feel like a showroom or a tech store at all. “Technology is not meant to be the focal point, but serves as a means to an end,” explains Füchtenschnieder.
Out of the 22,000 available products, 350 are on display in the store, one piece each. Touching is allowed, taking it of the rack isn’t – that’s what keeps the store appearance neat and never messy. The large screens show inspirational videos featuring the pieces available in store. Any given thematic selection is on display for eight weeks at most, with some replaced each week to make sure customers have something new to discover at all times. The vast remainder of Bonprix’ assortment, however, cannot be found here. Neither is it an option to have a purchase delivered home – that’s what the online store is for.
Nine staff members are present on the shop floor, up to seven more work in the store room. But a customer so inclined can shop without human interaction whatsoever: scan an item’s tag with a smartphone, select the right size and add it to the virtual shopping basket, just like they’re used to from otto.de, Zalando or Amazon. Next, the customer clicks on ‘buy now’ or ‘try on’. After selecting ‘buy now’, the app notifies the customer as soon as their selection is ready for them in one of the designated lockers downstairs. Click & Collect works much in the same way as this in-store ‘buy now’ option; the customer picks up their online order from the designated locker, the app provides the door code.
The more thrilling option is ‘try on’. After three to four minutes at most, the contents of the virtual shopping basket are ready in a fitting room. In the meantime, two bars offer free drinks, phone charging, a chat with staff or some on-screen infotainment on fitness, beauty or travel.
Finally, the app will let the customer know, ‘fitting room 7 is ready for you’. The fitting room features four lighting modes: beach, indoor, focus, or ambient. All services available via the smartphone app are now also featured on the wall display. Perhaps most importantly, ‘try on a different size’.
Quietly, a small sliding door opens, and a rack delivers the chosen item in size 40, after the originally requested 38 turned out to be a little small. No need to leave the fitting room, and while waiting for the new size the customer can try on the remaining pieces. “This tends to offer the greatest wow effect for our customers. After this, they love our store,“ delights Füchtenschnieder.
Once the customer has decided on their purchase, she clicks on ‘done trying on’ and places her items in the paper bag available in the fitting room. RFID technology registers what’s in the bag, deactivates any anti-theft features and issues an invoice. The smartest way to complete the purchase is simply using PayPal to pay on the way out of the store – even if that may feel a little like shoplifting the first time around. The other option is paying by debit or credit card at the checkout counter. Cash is accepted too, but there are no traditional registers in sight, and even the receipt printer is hidden away in a drawer. Apple Pay, Google Pay and Alipay may become options in the future.
Do Customers Think in Silos like Brick & Mortar or Digital?
After our tour, Rien Jansen takes the time to explain why Bonprix now invested so heavily in a brick & mortar store – after reducing the number of store locations from 130 to eight (now nine including the new pilot) and focusing primarily on online, that is.
“We asked ourselves the fundamental question: do we still believe in brick & mortar?”, recounts Jansen. And they do. “Even if brick & mortar soon declines from 80% to 60% of turnover in the retail industry, which wouldn’t surprise me, that’s still a huge proportion. People want to meet other people and experience something.“ Not least while shopping, but considering the increasing uniformity, that can be a challenge.
That’s why Jansen appeals to the collective conscience of the industry: „As retailers, we have a responsibility for our city centres and their identities. We need to do our part to make sure that Hamburg doesn’t end up looking exactly the same as Munich.”
Jansen sees opportunities for brick & mortar because many consumers continue to seek viable alternatives to pure online shopping. But to seize these opportunities, drastic change is necessary, as simply adding a few tablets to the shop floor won’t do at all. He says, “we have to rethink every step from a consumer perspective and not only talk about what the customer does and doesn’t need. Do customers think in silos like brick & mortar or digital? No, they don’t. The Fashion Connect Store is our way of providing answers.”
About the Author
A longer German version of this article was originally published in TextilWirtschaft, the leading German trade publication for the fashion industry. We thank Hagen Seidel, author of this article and chief correspondent at TextilWirtschaft, for permitting us to publish an English version of his report for an international audience. In addition to his work at TextilWirtschaft, Hagen Seidel is the author of excellent business books, including one about the founding years of Zalando.