Thomas Pink Deploys Real-Time Solutions
While most retailers continue to dip their toes in the Internet of Things waters, Thomas Pink has jumped in with both feet — and is seeing results.
The luxury menswear brand is involved in an IoT proof-of-concept test at its store on Wall Street in downtown Manhattan. Using a cloud-based IoT platform from Acuitas Digital, the retailer has the backbone it needs to seamlessly integrate networking, hardware, software and analytics solutions — all necessary pieces to digitize the physical store.
For retailers still wrapping their arms around the concept, IoT connects smart devices via web-based networks, allowing them to share data. Breaking down the many silos that still exist between business processes, IoT drives communications internally within lines of business, as well as externally with shoppers — a move that brings retailers one step closer to a truly seamless shopping experience.
While there are many IoT solutions to deploy, Thomas Pink’s smart solution of choice is RFID. A technology that made its bones in the supply chain, RFID has evolved into a solution that integrates data across point solutions, delivering near-real-time information to associates when they need it most — while they are engaging shoppers.
Thomas Pink “is taking advantage of this IoT solution to learn and evaluate its impact on the overall business,” Nick Catero, sales and business development manager of vertical propositions for BT Global Services, said during an exclusive store tour. “By focusing on using the technology across multiple-use cases versus adopting individual point solutions, Thomas Pink will drive higher business value.”
Specifically, the retailer is tracking movement of merchandise and people around the store, predicting shopper behavior and delivering real-time interactive in-store experiences. These details will help managers personalize customer service, optimize store layout, improve employee workflows, reduce cost and grow sales, according to the retailer. Here’s how IoT is benefitting Thomas Pink:
Improving inventory accuracy
By applying RFID tags to the hang tags of approximately 2,000 items, and adding the Intel Sensor Platform and dedicated sensors within display shelves, the stockroom and near point-of-sale, the retailer gathers actionable, near-real-time intelligence on inventory levels and merchandise movement across the store.
Specifically, the tags monitor merchandise included in Thomas Pink’s “Business Bundle 4 4 $400,” a promotion highlighting the retailer’s most popular shirts, which range between $130 and $185. By integrating a mobile dashboard from SATO, associates use iPads to monitor inventory levels storewide, as well as where merchandise resides.
Since adding the solutions, the store has reported increased efficiency and achieved near 100% stock accuracy.
“Besides improving inventory management, the mobile dashboard improves customer service,” Catero said. “Associates know where merchandise is across all store zones, which helps them assist shoppers in finding the ideal size, style and color shirt more efficiently.”
Speeding up replenishment
Locating merchandise is only one piece of the customer engagement puzzle. The retailer also needs to keep shelves stocked to meet customer demand. As RFID-labeled product moves through the POS, associates have insights into which styles and sizes need to be replaced, how many items are still available in the stockroom and what needs to be re-ordered.
This replaces previous limitations caused by legacy handheld RFID systems that required weekly or daily manual store scans, according to Alex Field, marketing director for Thomas Pink.
Leveraging more robust analytics
Through a partnership with in-store analytics provider RetailNext, Thomas Pink is on its way to better understanding customer demand patterns. By analyzing customer-specific big data flowing through IoT devices, retailers can more deeply determine how customers are interacting with the brand.
“Eye in the sky”-style domes installed in the store’s ceiling monitor shoppers as they move throughout the sales floor. They detect dwell time across specific store zones and fixtures, conversion rates and foot traffic.
By merging big data from RFID tags, including merchandise located in specific store zones, as well as items that were sold or abandoned in other store departments, Thomas Pink “can see trends across all of these data points and understand how these activities fit together,” Catero said. “It gives a complete view of the shopping trip, and the information needed to make better merchandising or marketing decisions.”
Overall, big data analytics will help the store “improve store efficiency and performance to help our people spend more time with customers rather than getting tied up in administrative tasks,” Field said.
“It will bring our digital store strategy to life, and will show how it can become a real driver of growth,” he added.
While some retailers are still exploring the value of the Internet of Things, Thomas Pink embarked on an IoT program as a way to track the movement of merchandise and people around the store, predict shopper behavior and deliver real-time interactive in-store experiences.
Reimagining Cumberland Farms
Cumberland Farms, a convenience store fixture in New England and central Florida for half a century, once fielded more than 1,000 stores. But, it has slimmed down to 600 locations as it transforms itself from a strip-center and gas station dairy store to a chain of freestanding, modern C-stores providing an array of food service options and gasoline.
Fran Sheflin, Cumberland Farms’ director of planning and construction, recounted the family-owned chain’s decade-long journey of rebranding, reimaging and remodeling during the SPECS session, “Cumberland Farms: Rebrand, Reimage, Remodel.”
The company’s revamp process started in 2007 with an appeal from Cumberland Farms CEO Ari Haseotes to The Moseley Group, a Franklin, Mass.-based retail, food and beverage consultant. The company has helped recast the public faces of brands the likes of Circle K, Au Bon Pain and Carl’s Junior.
In 1957, Haseotes’ parents opened the first Cumberland Farms location, in Bellingham, Mass., as a way to directly market products from their dairy farm in nearby Cumberland, R.I. Storefronts evolved to gas station formats, and the business escalated with the company’s 1986 purchase of Gulf Oil. As time went on, the Haseotes family recognized new trends, including a customer-service-orientation, in the C-store industry. It wanted to take part, so it reached out to Moseley.
Moseley polled consumers and found that Cumberland Farms had lost its original connection with customers as a local, family-owned farm store. Customers also wanted to see more choice and innovation in the stores’ food service offerings, and more fresh prepared foods.
In response, a new mission statement was crafted and new leadership was put in place, with new store designs and products to follow. The company engaged the services of architectural and design firm HFA — by chance located in the same Franklin office park as Moseley — and the store transformation was underway.
A new concept store was created, one that celebrated the company’s farm heritage with an updated identity and decor package, and new made-to-order food offerings. Other features included a more stylish and modern design, with wider aisles and digital signage.
Larger, more open space was devoted to food service inside the store, which was crafted in two varieties — sleek boxes for urban areas and colonial-style buildings for suburban locations.
HFA architect James Owens said that Haseotes insisted on using the colonial-themed stores in Florida as well as up north to give the chain a point of difference in the Sunshine state.
“He said he wanted the stores to look like they dropped in out of the sky from New England,” Owens explained.
A white, green and blue palette was chosen for Cumberland Farm’s new branding, with brand imagery created for everything from drink cups to gas pumps. The Haseotes accepted all the changes. But they insisted that the company’s blue and white logo — with its iconic tree symbol — had to remain intact.
Not only had it become instantly synonymous with the brand through the decades, but it also held a lot of meaning for the Greek immigrant family who founded the chain. The tree that sprouts from the logo was the Greek “tree of life,” with a shade of blue that came directly from the Greek flag.
But the logo also brought to mind the image of the old Cumberland Farms. The family was finally won over to a newer version that featured a more organic representation of the tree. The iconic tree symbol is now green, and calls to mind a sprout with leaves encircled by a ring of dots. The Greek blue still shows up, in the word “Cumberland,” while the word “Farms” is green.
Between 2009 and 2013, Cumberland Farms opened 28 new stores and remodeled 141 locations in the new style. Since then, the company has completed 34 remodels and 105 new builds.
Retail Operators on the Ropes
As Congress reconvened after Easter, retail operators had a tremendous amount at stake. The industry is in an unprecedented state of strife with major legacy brands announcing large-scale closures.
If that’s not enough, here is another one to consider: Roughly 80,000 retail workers lost their jobs in the past year, a total that is greater than the number of workers in the entire coal industry. Clearly the disruptive impact of the online economy is quickly and permanently taking its toll on traditional retail operators.
If Amazon and Alibaba do not put traditional operators out of work, it could be Congress that ends up doing the job for them. Lawmakers appear to be piling on instead of understanding the threat to Main Street businesses that exists. Congress is failing to do everything it can to relieve pressure on retail businesses and restaurant operators and the critical, entry-level jobs they create and foster into careers.
The retail industry continues to find itself in a precarious political position. For example, businesses need real relief from many of the demands of the Affordable Care Act. Yet the first attempt at that was nothing short of a political debacle. The same type of scenario could easily play out if and when Congress turns serious attention to corporate tax relief.
As we all know, one of the big “pay-fors” in the Trump/Ryan tax plan is the “border adjustment tax,” which includes a potential 20% tax that would be assessed on a wide variety of imported goods. If Congress really wanted to crush the retail industry, I cannot quite think of a more effective weapon than the border adjustment tax.
We have another big battle on our hands that specifically targets retailers as well — interchange fees. Many in Congress, along with their allies in the banking and financial sectors, would like to repeal Dodd-Frank, which includes a cap on fees that credit card processors can charge retailers.
In a low-margin industry with low profit per employee, an industry that is already undergoing fundamental change, a critical few percentage points can dictate whether a business survives or fails. Remove those caps and you get the picture.
The retail industry’s political position is not at all secure. By and large, we have overwhelmingly supported Republicans, and with good reason. For longer than I care to remember, the vast majority of Democrats have demonstrated little regard for our business model, the value of the jobs we create and the role we play in the overall economy.
Politically, they are so connected with the labor community that they cannot even reach out and try to learn the truth. These days, however, our problem lies with our “friends” in the GOP. Our so-called friends are now using our industry as a poster child for more vigorous immigration enforcement, as a revenue source and trade battle pawn with the border adjustment tax, as a roadside casualty as they potentially repeal Dodd-Frank.
We are caught in the middle of an ongoing struggle with the establishment, traditional business stakeholders, the Chamber of Commerce wing of the party on one side, and the insurgent, tea party, anti-establishment, and social conservatives on the other. The suits versus the boots. And the suits are losing badly.
Retailers and restaurant operators need to fight back like their lives depend on it. The survival of their business does depend on it. They have to force both themselves and their industry representatives to take a stand and stop supporting candidates who are clearly punishing our business just because they have an “R” on their chest. Otherwise, half of the Republicans, along with Democrats, fighting the collective weight of Amazon and Alibaba will ultimately turn the bricks-and-mortar retailer into rubble.
Joe Kefauveris managing partner of Align Public Strategies, a full-service public affairs and creative firm that helps corporate brands, governments and nonprofits navigate the outside world and inform their internal decision-making.