STORE SPACES

TJX to open 260 stores this year

BY Ernie Herrman

Off-price powerhouse TJX Companies still seems plenty of room for store expansion — particularly in the home good sector.

The retailer, which reported strong second quarter results on Tuesday, has more than 3,800 stores worldwide and will open 260 new locations this year. Long term, it sees the opportunity for 5,600 stores with it current banners, or about 1,700 more locations than it currently operates.

"We see enormous global store growth potential for TJX," CEO Ernie Herrman said on the company's quarterly call with investors and analysts. "We have plenty of white space or markets to fill in throughout our current countries. We continue to see store openings as an attractive investment and a very good use of capital internationally."

TJX's remains committed to its brick-and-mortar strategy. More importantly, so do its customers.

"The customer is clearly telling us that brick-and-mortar retail continues to be an essential part of the shopping experience and certainly when it is executed right with the right values," Herrman said. "All of this gives us confidence in our long-term global store growth potential. Our key pillars for growth remain driving comp sales and customer traffic and our global store expansion."

On the call, Hermann also discussed TJX's new U.S. home concept, HomeSense, which debuts Aug. 17 in Framingham, Mass. He emphasized that HomeSense will look and feel very different from the company's HomeGoods chain.

"HomeSense is rooted in inspiration and discovery and will complement HomeGoods by offering expanding categories such as large scale furniture lighting and art," Herrman said.

The new format will also include such new departments as a general store, which will offer organization and hardware items, with an element of fashion. Certain departments, including kids and pets, will be featured only at HomeGoods.

“We believe an enormous opportunity remains for us to gain additional share in the U.S. home market,” Herrman said. “We are confident that shoppers are going to love our new HomeSense stores.”

While HomeGoods is typically a standalone format, TJX is experimenting. It has "successfully" opened more than 20 HomeGoods stores co-joined with an existing larger Marshalls or T.J. Maxx store. Pleased with the above-plan sales of this group of stores, the retailer plans to convert an additional 10 Marmaxx (Marshalls or T.J. Maxx) locations to this format this year.

“This initiative will bring even more HomeGoods stores to new markets more quickly and efficiently and increase our overall HomeGoods openings to almost 100 this year,” Hermann said. “Again, we are seeing great opportunity for the future of our company within the U.S. home sector.”

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Saks Fifth Avenue to roll out new salon concept — with augmented reality

BY Marianne Wilson

Saks Fifth Avenue is debuting a new salon concept with a futuristic edge.

The luxury department store retailer is partnering with Joel Warren, co-founder of the Warren-Tricomi hair salon chain, on the Salon Project, which will offer hair care, skin care and beauty services along with a medical spa and retail. The concept will launch this fall at Saks' store in Huntington, New York, with additional locations at Saks' stores in Houston and Boca Raton, Fla., opening by 2018. The concept will open in Saks' New York City flagship in fall 2019. In all, the concept will be rolled out in in 10 U.S. Saks stores during the next two years.

Designed by New York City-based design and build firm RPG, the salons will range in size between 3,000 sq. ft. to 5,000 sq. ft., with an environment described as "20th-century retro meets modern classical glamour." The space, which includes many contemporary twists, will not have the typical salon front desk to check in clients. Instead, customers will check in with concierges equipped with iPads which will direct them to their designated station.

The stations are designed with sink, services and retail together so that the customer can remain there for the duration of their services. At their seats, clients can use augmented reality technology to try on products available in the salon's inventory and test lipsticks from a try-on bar cart, all while receiving recommendations from their hairdresser who can complete product purchase transactions from an iPad.

"This is the salon of the future by combining stores like Apple, Sephora and a high-end salon and spa," said Warren. "As soon as guests walk in, they will literally enter a virtual reality. Screens will be set up right at the entrance, which will allow clients the ability to virtually try on lipsticks and other cosmetics, then purchase products or add on services on the spot."

Warren, who left Warren-Tricomi in 2016, is creating his own makeup line and hopes the salon will be a “brand incubator” and showcase for curated, independent retail lines, reported the New York Post.

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Getting Shoppers to Notice and Touch Products is Key to Purchase

BY Kirk Hendrickson

Understanding in-store shopper behavior is key to designing environments that promote product purchase. But retailers must overcome numerous hurdles to get shoppers to notice a product, let alone buy it.

Toward that goal, we recently conducted research in six stores nationwide to identify shopper behavior patterns and generate insights into the retail experience. Mobile eye tracking headsets were employed to observe actual shopper behavior and to measure key levels of engagement at three stages:

1. Shopping Path/Track

2. Aisle/Category/Shelf

3. Display Engagement

Shoppers were intercepted at the store entrance and asked to perform their intended shopping trip while wearing mobile eye tracking system. Before shopping, participants were surveyed about their intended trip and after shopping, they were surveyed about items purchased.

Shopping paths are largely driven by their primary destination category, which tends to create concentrated pathways through the store. As a result, most shoppers see only a small portion of in-store displays, and for just a brief time. The typical shopper notices some 30 displays, which represents approximately 12% of all the displays in a store; most notices are brief, at <1 second. Moreover, noticing a product does not guarantee that a shopper will buy it.

The research demonstrated that getting a customer to pick-up a product has the highest correlation with purchasing (30% of products held were purchased; purchasing increased to 60+% when more than one item was held). For most product categories, the longer a customer spends in a category space, the more likely they are to make a purchase. So the challenge for retailers is two-fold: how to get people to spend more time in the destination category, and how to encourage them to pick up, to touch a product.

How Shoppers Shop Shelves

Display viewing frequency is largely a matter of the path shoppers take through the store: If it is not on their path, they won’t see it. If it is on their path, they will notice it based on the time spent in that area, not on the density of the displays. In high traffic areas viewing will tend to be high, while viewing is low in low traffic areas. Since shoppers tend to focus on products displayed slightly below eye level, a retailer can alter this pattern by either mixing categories in bays or by incorporating value-sized packages in the same bay.

Highly noticed displays are not necessarily the best performing displays. Highly viewed displays toward the front of the store on the racetrack are noticed by 40% of shoppers passing. However, these displays have a product interaction rate of 0.4%, 1/10th the rate of lesser-viewed displays in the center of the store. Engagement is highest when the display is integrated with the adjacent aisle and products and is placed in the center of the store along the shopper ‘racetrack.’

Not Seen, Not Purchased

What researchers call fixating is the first step to purchase (obviously what is not seen is not bought). The good news is that more half (56%) of shoppers that hold a product will purchase a product in that category. Still, high-fixation, or notice rates, does not necessarily translate into high rates of purchase for many categories. We found that fixating leads to the purchase of: packaged cheese, carbonated soft drink, and packaged bread, but does not promote the purchase of: prepackaged fruit snacks, candy, household cleaners, or pasta.

As with categories, engagement with displays, rather than merely viewing, is essential for purchase. Highly noticed displays are not necessarily the best performing displays. Highly viewed displays toward front of store on racetrack are noticed by nearly one-half (40%) of shoppers who pass by, however, these displays have a product interaction rate of 0.4%, 1/10th the rate of lesser-viewed displays in the center of the store

Implications for Retailers

As the shoppers near checkout, unplanned purchasing drops off dramatically with shoppers still seeing displays but failing to act. Rather than trying to capture the last few unplanned purchases at checkout, it would be wise to research how improving the shopping conclusion experience can increase return trips, which will more favorably impact store sales.

Various tactics can be employed to enable retailers to provide a positive shopping experience at the last moment. For retailers lacking a destination category, creating a destination category could lead to increased shopper visit frequency. For retailers with a destination category, the destination category should require shoppers to traverse a large portion of the store.

In addition, the path to the destination category should pass by impulse purchase or high value categories, such as pharmacy and health and beauty. Where possible, a category should be oriented horizontally, with as limited vertical spread as possible. For larger categories, place value packages lower so shoppers looking for the value items will search lower shelves, and other shoppers will focus on higher price per unit products placed in the center shelves.

Engage Shoppers to Hold Products

Rather than make the primary objective driving attention to the category, the primary objective should be to engage customers that do pay attention as engagement will increase time in category and increase the number of products held. Engagement can be promoted by the use of interactive displays (mechanical & electronic), on-pack promotions, integrated displays and store staff suggesting products, which wind up in shoppers’ hands.

High value displays should be placed in high traffic areas, whereas in low traffic areas, take a low effort approach and do not change displays as frequently. Use display space for way finding, to provide information, or assistance to shoppers. In a low traffic area, where the shopper is likely looking for something specific that is not obviously in other locations, help them find it.

Given the limited number of displays that an individual shopper sees, and the limited time allocated by shoppers to noticing displays, the goal of the display should be engagement over noticing. Engagement needs to be encouraged rapidly and communicated clearly to the shopper. One way to achieve engagement is through the use of custom displays placed along the racetrack in the center of the store, as they are most likely to generate incremental sales.

Retailers of all stripes face tough challenges today from online to specialty to pop-up competitors. If a retailer hopes to maximize his environment, he must first thoroughly understand how people shop and then reconfigure the retail space to accommodate shoppers’ habits and preferences. The good news is that new research tools are now available to provide the necessary insights to create successful retail experiences.


Kirk Hendrickson is CEO of Eye Faster, a provider of shopper research. He developed his expertise in eye tracking and shopper research while leading worldwide field operations for EmSense Corporation and product management for MarketTools.

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