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Community and causes: Highlights from the Fast Company Innovation Festival

Chip Bergh, CEO of Levi Strauss & Co.
Chip Bergh, CEO of Levi Strauss & Co.

Experiences that attract young customers, engaging with the community and taking a stance on social issues were the major topics of conversation at this year’s Fast Company Innovation Festival.

Speaking at the conference, brand experts highlighted the growing importance of listening to their consumers, and reflecting their lifestyles and values.

Shopping as an experience

“Experience today is a younger generation’s currency,” said Daniella Vitale, CEO of Barneys New York. “They’re less motivated by money and more motivated by an authentic experience.” At a panel about the company’s strategy for reaching young customers, Vitale mentioned the success of “The Drop”, an elaborate, experiential program that involved a retail model inspired by streetwear, as well as parties and workshops. “We were willing to forfeit profitability and sales for an incredible experience.”

Vitale stressed, however, that the program ended up generating a huge return on their investment by converting visitors to repeat customers while retaining the ones they already had. ”The Drop is way beyond merchandising. It’s about working with large-scale brands on creating exclusive projects.”

Companies as communities

Tina Sharkey, CEO of FMCG startup company Brandless, says the company thinks of itself less as a company and more like a community, which includes constant communication with its customer base.

Social networks are its go-to channel for those conversations. “We are constantly asking what do they think, what we can do better, what they are looking for?” Sharkey said. “People want to answer these questions because people want to be seen. It amazes me that direct-to-consumer companies think of [social media] as a channel as opposed to a direct relationship.”

For Sharkey, the brand becomes a platform for customers to be heard and for products to tell their own stories. For instance, Brandless does weekly Facebook Live events with its buyers so that customers can ask questions in real time. “Companies shouldn’t be creating false narratives around the products. The products need to be able to speak for themselves. Therefore the quality of the product is foundational.”

Brands weighing in on activism

For Chip Bergh, CEO of Levi Strauss & Co, countries are so politically divided at the moment that CEOs have a great obligation to weigh in on causes. Recently, the company pledged $1M to gun control organizations, as well as signed a letter asking Congress to pass the bipartisan Dream Act. It has also also teamed up with over 200 brands, including Patagonia, in the “Time to Vote” campaign, which grants employees time off to vote.

Levi’s isn’t afraid of losing customers, Bergh said. “When we took action on gun control, I got lots of emails of people saying they would stop buying Levi’s, but I also got thousands of other ones from people saying they would buy even more from us.” The risk seems to be paying off, however. “We’ve had four quarters of double-digit roll growth. That’s on top of last year’s 8% growth. So our business results are actually accelerating.”

Bergh also said that becoming political was never an issue for the talent the company works with. “Having the courage to stand up and take a stand has always been a part of our lifeblood, and it’s who we are. And our employees expect it.”

Are you thinking innovatively enough in your brand messaging? We’re all about finding you the perfect partners to do so. TheCurrent is a consultancy transforming how fashion, beauty and consumer retail brands intersect with technology. We deliver innovative integrations and experiences, powered by a network of top technologies and startups. Get in touch to learn more.

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business digital snippets e-commerce product Retail social media sustainability technology

ICYMI: Macy’s buys Story, Gucci’s new flagship, AI and the future of fashion

Futuristic fashion by Tim Walker
Futuristic fashion by Tim Walker

A round-up of everything you might have missed in relevant fashion, retail and tech industry news over the past week.

TOP STORIES
  • Macy’s buys Story concept [RetailDive]
  • Gucci plants its flag in Soho [BoF]
  • How artificial intelligence will impact the future of fashion [Vogue]
TECHNOLOGY
  • Can AI and AR turn your prospects into customers? [Inc]
  • How beauty brands like Coty and Shiseido are using voice assistants [Glossy]
  • Ticketmaster to trial facial recognition technology at live venues [Venture]
  • Verisart brings blockchain certification to the global art auction market [TechCrunch]
SUSTAINABILITY
  • Fast fashion goes green with mushrooms, lumber scraps, and algae [Bloomberg]
  • Applied DNA Sciences confirms traceability of leather [WWD]
RETAIL & E-COMMERCE
  • Walmart.com redesigns as the anti-Amazon [Co.Design]
  • Farfetch partners with Stadium Goods on sneaker hub [WWD]
  • Brandless’ pop-up is focused on community engagement rather than selling products [AdWeek]
  • China’s live-streaming fashion boom changing the way Gen Z shops [SCMP]
MARKETING & SOCIAL MEDIA
  • Inside the bitter war to bring Tupac and Michael Jackson back to life [Wired]
  • Diet Prada unmasked [BoF]
  • Instagram quietly launches payments for commerce [TechCrunch]
PRODUCT
  • Amsterdam is solving its gum litter problem by making shoes out of recycled gum [AdWeek]
  • ElektroCouture: Inside the fashion house behind Swarovski’s $60,000 light-up dress [Forbes]
BUSINESS
  • Over 400 startups are trying to become the next Warby Parker. Inside the wild race to overthrow every consumer category [Inc]
  • Prada: Making the most of its moment [BoF]
  • Alibaba’s anti-counterfeit group now has 105 brand members, including L’Oréal and Bose [TheDrum]
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Campaigns data digital snippets Retail social media sustainability technology

ICYMI: Plastic waste becomes Adidas tees, how Bitcoin went luxury, data to reduce returns

Adidas for Earth Day
Adidas for Earth Day

A round-up of everything you might have missed in relevant fashion, retail and tech industry news over the past fortnight.

TOP STORIES
  • Adidas created Earth Day soccer jerseys made from ‘upcycled’ plastic ocean waste [AdWeek]
  • How Bitcoin went luxury [Vogue]
  • How retailers are crunching data to cut losses from returns [Glossy]
  • The fashion world after Anna Wintour [NY Times]
TECHNOLOGY
  • Alibaba is becoming a major investor in facial-recognition technology [Quartz]
  • Retail’s adapt-or-die moment: how artificial intelligence is reshaping commerce [CB Insights]
  • Leap Motion’s “virtual wearables” may be the future of computing [Co.Design]
  • Why beauty giants are snapping up technology startups [BoF]
  • Farfetch launches startup accelerator [BoF]
  • LVMH’s Ian Rogers on Station F [WWD]
SUSTAINABILITY
  • The beginner’s guide to how blockchain could change the ethical fashion game [Fashionista]
  • Why brands are under increasing pressure to be transparent about what they believe in [AdWeek]
  • Stella McCartney: ‘Only 1% of clothing is recycled. What are we doing?’ [TheGuardian]
RETAIL & E-COMMERCE
  • Brandless, the ‘Procter & Gamble for millennials’ startup that sells everything for $3, is launching a pop-up, but you can’t buy anything [Business Insider]
  • Glossier opening permanent retail space in LA [WWD]
MARKETING & SOCIAL MEDIA
  • Two computer-generated influencers are at war right now, and nothing is real anymore [W Magazine]
  • With privacy updates, Instagram upsets influencer economy [BoF]
  • How Vans is shaking up its experiential marketing to get more personal [BrandChannel]
  • Snapchat has launched in-app AR shopping, with Adidas and Coty among the first sellers [TheDrum]
BUSINESS
  • Adidas partners with Lean In to promote equal pay for women [WWD]
  • Gap CEO Art Peck: Big data gives us major advantages over competitors [CNBC]
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5 bold predictions for e-commerce tech in 2018

Mike Mallazzo of Dynamic Yield, shares his views on the year ahead in e-commerce tech, from the need for vast amounts of data to gain ground in the machine learning era, to the idea of Patagonia as a target for Amazon.

Bold predictions for e-commerce tech in 2018
Bold predictions for e-commerce tech in 2018

Fifteen years ago, the existential threat to many major retailers was a small online bookshop. Ten years ago, the medium that drives 60% of online retail traffic didn’t exist. Five years ago, personalisation was a nascent technology experiment being conducted by a few enterprise retailers. One year ago, the term “retail apocalypse” didn’t even exist.

With the pace of innovation in e-commerce technology, predicting how retail tech will shake out in 2018 is the ultimate fool’s errand.

1. The golden age of customer experience will shine brighter

Today’s e-commerce professionals aren’t just thinking about changing colours on banners and buttons. The conversation has shifted to thinking about the entire shopper journey and how to optimise every element of it.

As barriers to entry in e-commerce crumble, there are scores of e-commerce start-ups in every category competing for your affection. Concurrently, there are thousands of marketing technology vendors trying to sell these companies technologies to help them deliver superior digital experiences.

The competitive landscape is fierce, breeding incredible innovations in every corner of retail from supply chain and logistics to in-app augmented reality. With smart people competing across the internet to capture our attention, the end experience for the end user will continue to get better and better.

2. Artificial intelligence will finally make a real impact, but with little glitz and glamour

With honorable mentions to “growth hacking” and “storytelling”, no buzzword was more abused in 2017 than “artificial intelligence”, or AI. It’s replaced big data as the new teen sex with everyone talking about it and nobody doing it.

However, the problem with adoption of AI in e-commerce has not been limitations of the technology itself. It’s been in access to data to help the machines learn. In order to meaningfully impact the customer experience, machine learning algorithms need to ingest vast amounts of data; machine learners are ultimately only as good as the school supplies you arm them with. However, even for tech-forward retailers, this data often exists across a myriad of software programmes and dusty basements of servers making it impossible for them to create unified profiles of their customer.

Low hanging applications of AI in retail lie in solving unsexy problems, such as which recommendations strategy to serve new visitors to an e-commerce website. While AI won’t upend retail anytime soon, practical applications of machine learning to common e-commerce problems will proliferate in 2018, benefiting brands that adopt the technology.

3. Retail’s middle class will face its toughest year yet

Already eviscerated, retailers and department stores that sell to the middle class will encounter even tougher market conditions in 2018.

All of the feel good articles saying that a lemonade stand can compete with Amazon leave out an inconvenient truth – most of the brands successfully competing with Amazon sell really expensive goods. The median household income in America simply can’t buy Away luggage, a Rent the Runway subscription or $150 shoes from Rothy’s.

Quietly, the retail apocalypse has also been a boom time for hyper discount retailers such as Dollar Tree, who can still compete with Amazon on the basis of price. Incredibly, one company, LA-based Hollar, has successfully managed to take the dollar-store experience online, blending competitive pricing with sophisticated supply chain and digital technology.

Expect Hollar to become a true household name in 2018 and beyond and a company that delivers real value to the e-commerce ecosystem.

4. Amazon will meaningfully enter fashion by way of acquisition

Last time Jeff Bezos couldn’t crack a niche e-commerce market, he simply bought out his competitor, Vito Coreloning diapers startup Quidsi. Look for Amazon to bring back this playbook in 2018 to finally break into fashion.

Amazon whisperer and NYU professor Scott Galloway predicts that Nordstrom will join the Amazon empire next year to plug this gap. An even bolder prediction from Gene Munster has Amazon buying Target in 2018 for about $40 billion. While Amazon has shown a willingness to swing big with the Whole Foods acquisition, I’d look for slightly smaller stores with high margins, nouveau riche clienteles and chic brick and mortar presences to be prime targets. Amazon can buy a retailer with less than $1bn in revenue with pocket change while avoiding pesky antitrust concerns.

Bold prediction: Amazon unites the South American topographies by making a bid for Patagonia. Bezos picks up a socially active brand beloved by millennials while Patagonia does the deal to lower prices and to provide financial cover for even more political activity

5. Brands will have less value than ever

While Amazon’s shadow looms everywhere, retail’s old guard is also being hammered by the fact that more shoppers every month are simply ambivalent about the logo on their clothes.  For many millennials, the $12 black polo with no logo is just as good as the $70 Lacoste polo with a cute little crocodile.

Perhaps nothing is more telling than the fact that one of the VC darlings in e-commerce is literally called “Brandless”. In 2018, expect a lot more nice apparel from no-name brands to flood the market, increasing pressure on many iconic brands to win on the basis of customer experience rather than brand equity.

Mike Mallazzo is the head of content at Dynamic Yield, a personalisation technology start-up. His writing on the future of commerce, media and technology has appeared in Quartz, Entrepreneur, Forbes, The Next Web, MediaPost and the Chicago Tribune.