Apparel caught up with Uri Minkoff to get the scoop on the new self-checkout deployment in Rebecca Minkoff's SoHo flagship and why it makes sense for this luxury brand to offer a "low-touch" customer experience. The conversation has been lightly edited for clarity and length.
Q. What prompted Rebecca Minkoff to deploy self-checkout technology? Uri Minkoff: When we launched our Store of the Future concept in November 2014, self-checkout was actually on the roadmap as a goal. Part of the shopping journey that we wanted to solve for was the customer who wanted the VIP celebrity experience versus the customer who wanted a private or anonymous experience. If we create this truly authentic experience that if you wanted a private shopping journey, how would you actually complete it? The idea that I may be a self-service customer, I know what I want, I don't want to talk to people in the store. That's one extreme end. The other extreme: You're coming in at 2 p.m. and there's a fitting room waiting with champagne for you and items you want are ready. With that first extreme, the customer really loves shopping on ecommerce but it would be great if she could go to the store and have an experience similar to ecommerce in that she didn't have to talk to anyone in store and could navigate through the transaction seamlessly.
Q. What in particular made QueueHop stand out? UM: We evaluated a number of solutions from big companies, startups and mid-size firms. Queuehop was the best, based on its technical merit. It easily integrates with POS — that was important — and is very efficient and simple to work with.
All product tags in our store have passive RFID tags, which is not a very secure system in that the tags can be easily removed unless they're somehow hidden within the lining of a garment or handbag. And that would mean you'd have to affect production. Even if the tag is hidden, because of the frequency of the passive RFID wave, the wave can be shielded by the body and not picked up by the security device.
That's one thing that we went over with Queuehop. We looked at solutions that leveraged passive RFID and they helped up understand from a technical and a wave level that it wasn't foolproof and wouldn't stand up.
One of the issues with self-checkout is the user experience. Most shoppers are honest: you keep swiping the product but it doesn't read and you don't know if it charged you twice. It's that anxiety connected with that. With Queuehop, you put your product on a table, it reads it automatically, you see that the transaction is done. It's very lightweight on the customer, the user interface has very simple navigation and it's foolproof technically. Queuehop is very innovative and entrepreneurial, that's why we chose them.
Q: How does the technology work? UM: Queuhop technology pairs a product's RFID tag with a QR code that's on the Queuehop security device. You're basically inputting the RFID data onto that device. This isn't something we have now, but that will enable us to leverage media properties based on that QR code which is now flexible and mobile.
Let's say you bought Handbag A. That QR code now has Handbag A's properties on it. Handbag A is bought, that security device is now dead and is now reimported with new properties for, say, Handbag B. It has new life. As we start playing with other things that QR codes can enable, there are some great possibilities that come from having that there and being able to suck in our ecommerce assets and our other media properties. Not only is there within the security device the magnetic security interface but it also has an RFID chip in it. So we're able to transfer the RFID properties from the tag onto it, which then hooks it into our digital asset systems.
That's why honestly it took us almost two years because we really evaluated on a wave level, magnetic level: what's the right tech, and where can we go with this tech? What are the different features? If we start thinking two or three years from now — what are the capabilities as we have this technology that's flexible in terms of the media it has on it and will allow us to take future store innovations to tie in with the system?
Q. Who worked on this project? UM: It was definitely my baby. We have a digital and innovation team and about two or three from that group worked on it. Some looked at tech integration, some looked at the user interface of coordinating with the POS and the development team.
Q: What are the implications for loss prevention? UM: This solution makes everyone completely comfortable because the technology is so good that we don't have to beef up store staff to watch for theft. The alarm is either going to go off or not go off.
Q: How many checkout areas does the store feature now? UM: Queuehop is in one location in the store. We don't have other checkout locations because one of the human experiences that I thought was uncomfortable was the idea that you're in your fitting room, you're comfortable there, now in a normal checkout scenario you're made to be like cattle, go stand in line, and now second and third thoughts kick in, and that's where judgment kicks in, that's when other people in line are looking at your clothing sizes, questioning what you do for a living. That's where internal dialogue and judgment start to happen. The experience here is either you checkout on Queuehop by yourself or with the sales associate on an iPad in the comfort of your fitting room.
Whatever you bought is between yourself and the credit card company because the associate has boxed everything up for you and given you your private bag and no one else is none the wiser.
Q: How can self-checkout lead to a better in-store experience? UM: We're trying to solve a human subjective thing. Each of the initiatives we've done in the store so far is driven by this idea: is there an uncomfortable human moment a person had experientially that has caused them not to continue the transaction?
I'm calling it the "Pretty Woman" moment, when Julia Roberts goes into the stores in Beverly Hills and there's that moment of judgment, and the intimidation factor and there's that hostile relationship.
What if your technology is so good that it took away the tension between the sales associate and the customer and there's complete trust there? What if we could take away judgement or prejudice based on skin color or sex or appearance? The person either stole or they didn't. What if we could create a warmer, more comfortable store, a better environment because the worry over theft is gone. We could take away our biases. That's what I wanted to solve.
I want to kick off a conversation amongst retailers. Part of the retail experience is that people are intimidated or uncomfortable going into your stores. What if you took part of that away, would more people come into your stores?
Q: Is the concept of luxury evolving? UM: I think luxury in the past has been around that notion of "only for the few" or speaking to just a select group. I'm not certain that in today's age driven by the Internet and social media, where the consumer has power, that those things are relevant. We're trying to say, let's try to be more respectful to each, let's treat each other like humans — it's 2017 basically, let's have a different dialogue and be more cultured and civilized.
The ultimate luxury is time. Is the ultimate luxury also experience? I think we're going to see luxury take on different forms and approaches. To us, does luxury mean stuffiness and snobbery or does it mean I want to go in and touch product and not be bothered by anyone and get in and get out and have people be nice to me? That in and of itself is a luxury of time and experience.
It's interesting that Amazon Go launched on the same day that we did. They probably spent a lot more money than we did but the whole concept is the ultimate luxury is time. We hit the same overarching theme and intent on the same day as one of the most innovative tech companies in the world. I think the idea of luxury is changing and our goal is to be at the forefront of that conversation and helping to drive it.
Q: Are Millennials on the forefront of changing that conversation? UM: Yes. Millennials and Gen Z have different expectations. They were raised in a different environment, they're digital natives. There's a power they have that other generations didn't. It's the power of social, the power that there are more people like them, they can garner a mass-like support system. There are behaviors within fashion and retail companies that people have gotten away with for years and the Millennials are sitting there saying, that's not acceptable. It could be transparency of supply chain, could be customer experience. There are a number of newer companies are coming out saying, "let's be inclusive of sizing, let's be transparent, let's show a makeup-free look, let's change this conversation." Those brands are winning with Millennials because of their authenticity and this is something we thought was important in our journey.