8 New Product & Services From Popular Retailers You Should Checkout in 2019

Boxes

By Tricia McKinnon, Ben Rudolph and Emily McCullough

Did you know that Nike has a subscription service for kids?  Nike Adventure Club is a subscription service for kids’ shoes that was launched in August of this year and it had a waiting list within hours of launch. This is just one of many new products and services that retailers have been launching in an attempt to stay ahead of key trends and lure customers in.  From convenience, to the sharing economy to a desire for more curated merchandise retailers are trying to cash in.

For example, last May Walmart launched a personal shopping service called Jetblack where customers can make shopping requests via text message that are fulfilled within one day.  The simplicity of the service speaks to time strapped consumers that that are looking for retailers to provide them with more convenient shopping solutions.  From Walmart, to Nike to West Elm see what new products and services you should be paying attention to.

1. In May of 2018 Walmart launched its Jetblack service in New York City. Jetblack is a personal shopping service that customers access via text message.  The service’s tagline is: “Need It. Text It. Get It. Jetblack is the easiest way for busy parents to shop”. Jetblack is a standalone company within Walmart’s Store No. 8 tech incubator which is focused on helping Walmart stay ahead of retail trends. 

The service costs $50 per month and all a customer needs to do is send a text with a shopping request.  The service can fulfill almost any shopping request as long as it doesn’t involve food, alcohol or prescription drugs.  Jetblack’s CEO Jenny Fleiss says that there are typically three use cases for the service. One is to reorder frequently purchased items such as toilet paper, another is to get a recommendation for something such as  a birthday gift for a friend and the third involves sending a text message with a picture of a specific product (i.e. a screen shot of something a customer has seen online) but the customer does not want the hassle of finding the product online or they do not feel like taking the time to enter their payment information. 

According to a Wall Street Journal report, a Walmart executive said: “it's the first thing the company's tried that can separate the customer from Prime.” "The early indication is that [Jetblack] has legs."

2.  Still aiming to dominate the apparel sector in July of this year Amazon launched Personal Shopper by Prime Wardrobe. The service allows shoppers to receive a curated box of clothing and shoes based on their style and personal preferences.  To get started with the service customers have to complete an online quiz that covers a range of topics including the customer’s budget, style, body type and measurements.  Then based on that data Amazon’s stylists select up to 8 items of clothing and shoes for the customer.  Amazon says that it uses: “a combination of technology innovation and a personalized human touch” to select a curated set of items for customers using the service. 

Before the items are shipped the customer can review what its stylist has selected, likely in an effort on Amazon’s part to reduce the volume of returns. Once the customer receives their box of clothing they can keep and then pay for as many items as they like. Customers have seven days to try on merchandise and decide if they want to keep it.  

To be eligible for the service customers must be Amazon prime members and it costs $4.99 per month.

3. Last December lululemon started testing a paid loyalty program.  For $128 per year members receive a variety of benefits including a pair of yoga pants or shorts, free expedited shipping for online orders, and admission to yoga classes and events.  This type of program is likely to work well for a lifestyle brand like lululemon.  People want to have a sense of community. It is not just about getting something. It is about being a part of something.  A program like this can provide a sense of belonging and increase word of mouth associated with the brand.  Speaking about the CEO Calvin McDonald said the program has seen "wonderful take up" so far.

 4. Within the home décor sector West Elm is partnering with Rent the Runway to offer home décor merchandise for rent.  As part of the Rent the Runway subscription service which launched this July for $159 per month customers can choose from 26 different exclusive home décor bundles. These bundles include decorative pillows, throws, shams, quilts, and coverlets for the bedroom and living room. This will be the first time Rent the Runway is moving outside of clothing and accessories rentals.  Speaking about the partnership Rent the Runway Co-Founder and CEO Jennifer Hyman said: "just as our closet has become an area that we now share online, it's the same thing happening in our home." "They've moved from personal to public spaces because of social media." 

 5. American Eagle is also getting in on the sharing economy trend. It launched “Style Drop,” in January of 2019, a subscription service where customers can rent clothing in four easy steps – Browse, Rent, Return, Repeat for a monthly fee of $49.95. For that fee customers get three items per month, unlimited exchanges, free shipping, and free dry cleaning. If the customer decides to keep an item, they can purchase the item at a discount of 25% or more. 

 6. Nike represents the latest brand to join the subscription model trend. Whether it be streaming, software, health apps, clothing, or even groceries, recurring revenue subscriptions are an increasingly popular business model due to their ability to generate predictable revenue streams as they lock in consumers. Called “Nike Adventure Club”, Nike’s subscription model will allow parents to order shoes for their children aged 2-10 on a monthly, bimonthly, or quarterly basis. These subscriptions cost $50/month, $30/month, or $20/month, respectively. Each of those subscriptions gives subscribers a new pair of Nike sneakers that cost approximately $50 or more once a month, once every two months or once every three months.  

Nike also pitches its focus on sustainability with this initiativew, encouraging shoes to be sent back once they are worn out or outgrown. The company plans on either donating the shoes to a non-profit cause, or recycling the materials into other products.

Speaking about the Nike Adventure Club, Dominique Shortell, Director of Product Experience and Retention said: “in providing footwear, we’re always trying to answer: ‘What do kids want?’” “But an equally important question is, ‘what kind of experience are we providing for their parents?' We want to make shopping for footwear as convenient as possible for them."

7.  In an effort to offer a better customer and seller experience - and better compete with Amazon - eBay will be rolling out “Managed Delivery”Unlike Amazon, eBay will not build its own series of warehouses and transportation networks. Rather, it will use a series of third-party contractors for warehousing, packing, and shipping. eBay plans to roll out Managed Delivery in 2020 across its various geographic areas of service. It has said that it plans on trialing the new service throughout 2019 in select cities in the US, Germany, and the UK. eBay has stated that between 40% to 50% of its marketplace products will qualify for Managed Delivery.

Similar to Fulfillment by Amazon (FBA), sellers who opt into Managed Delivery will be charged a fee for warehousing and for shipment of products once the item is sold. Many sellers are excited about the possibility of expanding their SKUs without having to store them in their own space. eBay CEO, Devin Wenigsays that Managed Delivery aims to offer two-day shipping under the program but that eBay does not plan to enter a “fast shipping war”. Rather, he reiterates why shoppers and sellers chose eBay, saying they “shop on eBay because of the value and uniqueness of our inventory. We’re not the one-hour delivery guys. We’re never going to be that, but consumer expectations are changing.”

8. Not to be left out, eCommerce platform Shopify recently launched its “shopper fulfillment network” offering access to fulfillment centres and faster delivery times for its merchants’ customers. Speaking about the launch Shopify’s Chief Product Officer Craig Miller said: “we plan on spending over $1 billion to build and operate the Shopify Fulfillment Network over the next few years. Shopify is planning to offer two-day shipping or less to 99% of the United States within by the end of this year.  Additionally, the initiative will provide merchants with custom branding (i.e. packages will not show up in a Shopify box unlike Amazon) and Shopify will also manage returns and exchanges.


Sources

https://business.financialpost.com/news/retail-marketing/shopify-launches-network-of-warehouses-and-shipping-in-u-s-to-handle-orders-for-independent-merchants

https://www.usatoday.com/story/money/2019/08/12/nike-adventure-club-nike-has-new-kids-subscription-service/1988537001/

 

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