September 15, 2016
Alex Senn, Co-Founder at Distribution Hub
Nike does omnichannel right
You wouldn’t think the shopping experience at a fortune 500 company would make the day, but my recent encounter with Nike did just that! Recently, a buddy came down to visit. While here, we visited the Nike store on Newbury street in Boston. This was not a super special shopping trip, but he thought maybe he would grab some shoes and a pair or two of shorts. Nothing huge, but upon entry to the Nike store, I noticed the experience they were providing was really something different, and masterful in their approach to omnichannel retail. From the vibrant, bright entrance to the well-placed mannequins and great displays, the store was already setting customers up to feel happy enough to buy. But it did not stop there. This post will explore the omnichannel retail implementation at Nike from the perspective of a consumer, with my comments as a retail technologist so you too can apply these concepts/technologies, and strategies into your own omnichannel retail presence.
Design for omnichannel retail
In this Nike store, as I mentioned they truly are making the actual store design accessible and easy to navigate. They make great use of colors/textures/design to truly enhance the actual mood of the customer. If you look at Google for a second, who has come to be the epitome of fun/vibrant workplace design to get more out of their people, the same applies to retail stores. Filling their stores with colors, placing their most vibrant designs on mannequins and using natural textures delivers a powerful buying environment. The Nike store is a marvel of omnichannel retail design. It helps make the connection for consumers that this is not simply a retail store, but they are a brand with the right technology in their products to deliver great activewear, which is reflected in the quality of the store design itself. Since a picture is worth a thousand word, check out the designs below. This is obviously a large space, and does have a lot of room for design aesthetics, but the point is they make you feel good about the brand before you’ve even decided to buy something, making it easy to consider an actual purchase. In addition to the store, if you look at the Nike website, the very first thing is a whole page of all different color jerseys. This is to A) appeal to wider range of people B) to excite the consumer to purchase. You can actually accomplish this easier than you might think, by using modern, chic looks which can come from Pinterest, using household materials and wood structures.
The Nike website, filled with color.
Let channels help each other
One thing I noticed while I was shopping around the store that truly represents the strength of Nike’s omnichannel strategy is how often they reference their online site within their products and displays. It’s actually quite amazing how few retailers are willing to fully integrate their stores with their online presence. If the website is showing customers where the stores are, then the stores should be showing customers. This is how you get customers to feel comfortable with you as a brand provider, through all channels. It’s a way to cross-sell your channels as well. One great way Nike has done this is with their NikeID program. In this sense, they are showing shows in store, but they can only be bought online (similar in a way to Bonobos). This is great because it’s something unique to Nike, powered online, and introduces people to a new way to shop their stores if they have only been an offline customer. In this sense, Nike is actually encouraging showrooming, but has a powerful mechanism to convert those customers online. A great example of this which any retailer could do is to set up a subscription box. Provide an example in store, with a very easy place on the web to signup for it.
Getting product from everywhere
When you shop at Nike, or at Nike.com, you’ll notice (maybe you wouldn’t which is kind of the point) that you can shop anywhere and have the product show up anywhere you’d like. I’m referring to buying online, picking up in store or buying in store and receiving the product at home, or simply having it ordered and ready at another store. Whatever the case may be, the omnichannel retail system being utilized is ready to provide any product Nike carries, anywhere the consumer could possibly want it to be. This really is what consumers expect now. If you think about what this is from a technical perspective, it is simply one common database, with parameters to edit which locations the product is on hand, and which locations to ship the product too. It is not overly complicated, and yet many retailers are STILL missing this point. While Nike may have put a few million dollars into the entire customized system, you can have the same ability to operate across channels with Epic Commerce. This is not hard to implement, or have someone implement for you, and will give you the same functionality across any channel you prefer to operate through while letting you manage it all from the comfort of any device.
The staff operates as omnichannel closers
When in this store, you realize the people of Nike have really educated and made aware their employees of all options a consumer has while shopping. Nike staff members are sensible about when a customer should be approached, without being overly aggressive, but very attentive to the needs of customers when a customer requests help. This is very important as customers in this sort of buying environment are susceptible to multiple purchases (also must consider location as an advantage here). However, many people making purchases here are international, so buying in store and shipping to their home is a preferred option. Additionally, Nike get’s a lot of customers purchasing online to pick up at this store. Each staff member is aware of this, and thus likely to suggest the other options. One specific example is their use of NikeID. Because Nike has embraced a wide color pallet for the production of their shoes, they can allow customers individuality. Staff members make this known to many people who are not online shoppers of Nike.com or are unaware of the website functionality. For Nike, this is a great way to introduce people personally their omnichannel retail systems. They can sell them in store to make lifetime customers online.
Product displays summarize technology
This is critical to the success of each person buying. Again here it is all about technology but it is centered around product technology. Nike has some really innovative materials and fabrics which are used to showcase quality and durability for athletes. Consumers don’t recognize this unless they are shown clearly at purchase. Even online, where you can find all the details, it’s nothing compared to the in-person product review. Nike handles this very well with the displays to clearly map out what features the products have both in store and online (ie. Flywire, NikeID, Dri-Fit, Hyperfuse etc.). On top of this, the store staff help points this out in terms of how it will help you with whatever it is you will use the product for, or they will show you where it is located within the store.
Frictionless checkout
As my friend worked with one of the staff to find the pair of shoes he liked, helpful tips took him around the store to several styles similar in color/design that my friend wanted. This was smooth, and the salesperson was helpful in his approach. As soon as the “yeah these are good” came, the staff member was there on the spot to scan (with Nike’s app) the barcode, accept the credit card, and complete the purchase. He gave the option of an email receipt or physical receipt, and when asked for a physical receipt he simply sent it to a little printer machine (three of them throughout the store) to grab the receipt and bring back a bag. This both stunned and awed us at how seamless it was. In any Nike store, the staff is equipped with handheld point of sale (POS) systems to operate this from. From the same POS they can buy items and have them shipped home, or accept returns (though not all devices). This was a remarkable use of retail technology which went a long way to enhancing the retail experience in a large, heavily trafficked store. Going a step further, this frictionless checkout can become even more frictionless with Epic Commerce, using payments directly through a consumers app to scan, buy, pick up, and walk out without ever needing any assistance (still in beta, signup to receive updates).
What did Nike do wrong?
After the whole purchase, we walked outside, my friend even put on the shoes to walk around in, and he said: “you know if he hadn’t made me check out so quickly, and instead guided me around or offered to hold the shoes, I probably would have shopped more.” I got to thinking about it, and it did make sense. So valuable lesson here is to make sure the shopper is done shopping. This is a case where employees really need to be trained to suggest more products, as your commerce system should do for customers shopping online.
Increasing customer confidence
As we neared the end of our shopping experience, my friend mentioned how excited he was about the 30-day money back guarantee. This is, in fact, a great policy if you can pull it off. Many new brands utilize this method to sure up any customers on the purchase decision. In this case, Nike offered to let you wear the shoe for 30-days, and if you weren’t satisfied, you can return then and get Nike credit. While I’m guessing most will not do this, it automatically delivers a happy post-purchase experience for a customer and helps reassure during the purchase that you will be satisfied, even if it requires a new pair of shoes.
Nike’s omnichannel map
Omnichannel retail technology utilized
It really was a great display of technology to deliver a seamless shopping experience. Nike has most definitely customized and built-from-scratch a significant amount of their own technology. This is something they need to do, as they have a large distribution and complex supply chain. If we think about what they are actually using, it can be broken down into a few different pieces (aside from the stores, warehouses, and other physical items). When you look at it, the software behind everything is as such:
- central warehouse/vendor management system
- inventory system centrally connected with store and warehouse availability
- website to handle orders/distribute proper order details for warehouse/store orders
- personalized CRM for detecting past purchases
- in-store mobile-based POS
This pretty much sums it up. Really, the system just needs to route the proper order details across all channels while keeping accurate inventory updated. This is something Nike has done a nice job of. This system, however, is already available for small to medium sized retailers. You can have a full omnichannel retail presence and not have to pay the dollars Nike has in order to make it happen. The key is to get it started sooner rather than later.
With that, we will conclude the Nike shopping experience. As you can see, it is a promising time for retailers who can combine the right use of technology with proper in-store implementation. While not every part of retail is perfect, this was an experience many customers can jive with. It offers a great layout for what omnichannel retail should represent now, and hopefully, it will only continue to expand in the future.
Nike: A case study for what omnichannel retail should look like
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