What Retail Bankers Can Learn from Warby Parker, Casper and Apple.

As a follow up to last week’s blog article entitled “The Branch is Dead, Long Live the Branch!” we thought we would flip the script here and look at three companies who started as an online only company, but subsequently took retail by storm and opened up not only successful brick and mortar locations, but played a large part in reinventing retail for the modern age.

These are great companies and their retail strategy has one thing in common – a great customer experience.

Founded in 2010, out of the Wharton School of the University of Pennsylvania, Warby Parker took the idea (and challenge) of selling fashionable eyewear at reasonable prices directly to consumers via a company-owned website.

The online model proved successful as they allowed customers to “try before you buy” – a classic brick and mortar strategy, by allowing customers to pick up to five styles, which are then shipped directly for trying on in the comfort of their own home.

Migration to Retail

Within three years, Warby Parker began opening up “showrooms” as a compliment to their online presence. Customers could now walk through their stores and browse through the displays, fashioned after library stacks, that carry multitudes of frames for men, women and children in both eyeglass and sunglass styles.

The Lesson For Retail Bankers

While born online, the company quickly realized that the retail worlds of online versus brick and mortar were not mutually exclusive, but rather complimentary. This is called omni-channel; where these two entities work together, seamlessly. In banking, Omni-Channel is a three-pronged entity, with Mobile Banking, Online Banking and Brick and Mortar Retail Banking ideally working in unison.

Additionally, the customer experience is paramount. Just as Warby Parker developed the “try before you buy” for online purchases; they continued this type of anchor strategy in the brick and mortar sites. The retail design, however, doesn’t feel sterile like a LensCrafters or traditional optical store. It is very much a retail-first design.

The staff are trendy. They wear the product and encourage browsing. You can spend all the time you want, and even take advantage of their photo booth, to not only take a photo of yourself with a frame of choice, but of course to take that photo and post it to social media (because of course).

Founded five years ago and likely the most well-known of the new breed of online mattress retailers, Casper sells foam mattresses and promises the best sleep of your life. The crux of their online selling process was a “100-day return policy” – basically a “try before you buy” variation of traditional retail. This no-risk strategy proved successful, especially for a product that traditionally sold through brick and mortar where prospective patrons jump from bed to bed and pretend to sleep in 30-second increments.

Migration to Retail

After a wild online ride, the company began experimenting with pop-up stores before rolling out permanent locations in major U.S. markets. The pop-up stores was a very interesting strategy, almost their own version of “try before you buy,” but in this case, they were “trying” out the market before “buying” in on an expansive and expensive retail rollout.

The Lesson for Retail Bankers

In retail, the traditional “try before you buy” has returned and is likely the experience anchor for those looking for a better night sleep. The company, however, didn’t just launch locations to operate like traditional mattress stores. Products are sold in low-pressure environments (the opposite of traditional mattress stores) and offer customers the opportunity to discover how these modern mattresses are made. This is not only enhancing the experiential side of the store, but it also goes a long way to for building the brand and solidifying the mystique of the product.

This little fruit company out of Silicon Valley, believe it or not, used to sell its products exclusively online. Back when the Apple Computer was more of a boutique product for the “artistic” crowd and Apple vs. Microsoft was the new Cold War, CEO Steve Jobs was looking for a way to expand its customer touch points and grow the brand – and sales along with it.

Migration to Retail

In 2001, the first Apple stores opened after experimenting for years with “shop in shop” concepts that ultimately did not prove fruitful. Most analysts believed the concept would fail, but they were immediately successful. Now, within the retail worlds, Apple Stores are the gold standard in not only sales per square foot, but in how to execute retail when online sales have dominated to the point where entire malls are closing.  

The Lesson for Retail Bankers

There are many reasons and tons of articles written as to why the Apple Stores do so well. When looking at this through a Banker’s lens, we’ll focus on three factors.

Discover Products – It’s hard to imagine, but back in 2001, there were no iPhones, iPads, or Apple Watches. The stores acted as showcase vehicles for the Macintosh and the software therein. The open space and clean product displays allowed no-pressure browsing with staff their to answer questions when needed.

Demystify Products – For those who did not grow up with the original Apple Computers and/or early Mac computers, they were intimidating. 2001 was a PC (Microsoft) dominated world where it was just difficult to convince people to make the switch. While ad campaigns spoke about how seamless and easy to use Apple products were, it still did not translate into sales.

Enter the Apple Store and let’s “try before you buy.” The stores gave wary customers the opportunity to see how easy it was to plug in a camera and unload pictures, how quickly printers were added (no searching for drivers), and ultimately, how intuitive the computer’s operating system truly was.

Genius Bar – The kicker for the Apple Store was the concept of the Genius Bar. These “Universal” employees are not only there to act as technical support, but first and foremost are there to help onboard you as a new Apple customer, or at least as a new product user. They do this by offering classes or individual guidance on how to best use the product and take advantage of the key features that you, as the customer, need to know.

As a Retail Banker, of course it’s important to pay attention to the industry in which we operate, but there are valuable lessons to be learned and case studies to study for retail in general.

If you’d like to learn more about industry trends and how critical retail strategies can be adopted into your Branch Transformation strategy, the experts at LEVEL5 are here to help.