Will AI mobile apps replace associates on Macy’s sales floor?

Discussion
Photo: Macy's
Jul 22, 2016
George Anderson

Earlier this week, Macy’s announced a pilot program to test “Macy’s On Call,” a mobile tool that will enable consumers to get answers to questions from an artificial intelligence platform, developed by IBM’s Watson via Satisfi.

The AI option (available at macys.com/storehelp) is being tested in 10 Macy’s across the country. Shoppers input their questions in English or Spanish and receive answers that are unique to that location’s inventory. The department store’s management believes there is demand for this type of tool and makes note that it will “evolve“ as the system learns about the needs of a particular store’s customers.

“We remain focused on identifying, testing and supporting new ideas and approaches that will help elevate service to our customers through technology. With an eye towards innovation, we are moving fast to test and scale up pilot programs that help enhance their experience with us,” said Peter Sachse, Macy’s chief growth officer, in a statement. “This program, in partnership with Satisfi and leveraging the power of IBM Watson, will help us explore new ways to engage one-on-one with customers in-store, providing them another level of service right at their fingertips.”

“Bringing Watson into a retail store setting presents an opportunity to engage with the consumer on a variety of levels,” said David Kenny, general manager of IBM Watson.”This particular use case takes Watson beyond helping consumers evaluate purchasing decisions, and influences another, equally important aspect of the in-store experience — ease of use in locating products, facilities and services.”

Stores involved in the test are:

  • Macy’s Santa Anita, Arcadia, CA
  • Macy’s Miami International, Miami, FL
  • Macy’s Aventura, North Miami, FL
  • Macy’s Mall of Georgia, Buford, GA
  • Macy’s Lenox Square, Atlanta, GA
  • Macy’s Montgomery, Bethesda, MD
  • Macy’s Short Hills, Short Hills, NJ
  • Macy’s Woodbridge Center, Woodbridge, NJ
  • Macy’s Roosevelt Field, Garden City, NY
  • Macy’s Clackamas Town Center, Portland, OR

 

DISCUSSION QUESTIONS: What role will artificial intelligence tech play on the sales floor at Macy’s and other retail stores? How will it affect the human element?

Braintrust
"AI such as this is the future and for savvy retailers the future isn't far off."
"The amount of back end integration for apps like this one to support more than a few limited use cases is typically enormous."
"I just don’t like this idea, personally. Maybe customer service is so minimal and the shopper experience so empty that an AI tool will be an asset."

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21 Comments on "Will AI mobile apps replace associates on Macy’s sales floor?"

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Ken Lonyai
BrainTrust

AI such as this is the future and for savvy retailers the future isn’t far off. Sure, today the technology is nascent and retail implementations are basic, but it is a huge growth area that will be coming to e-tail and brick-and-mortar retail, as well as other areas of business.

That said, it’s an opportunity for retailers to move associates into roles that are more human-centered.

Sterling Hawkins
BrainTrust

Agreed! This is definitely a sign of what is to come. We’re seeing more and more AI in stores both through apps as well as a number of retailers experimenting with robots that have an AI/customer service component. There is opportunity for more AI tools to help live store associates “know” the customer better and improve the experience rather than separate the digital vs. human interaction. Just another step in bringing together the online and offline worlds.

Frank Riso
BrainTrust

This is a very positive step for Macy’s. When all sales staff are busy or not available the shopper can now get the information they need about items in a different color or size so that when they do contact a sales person, they know exactly what to ask for. It also keeps the staff honest about what is in inventory. The sales staff will appreciate it more and more as more customers buy more because they can find exactly what they want to buy.

That being said, it remains to be seen what Macy’s does with the app, if they keep the information current and how much soft selling they do on the app. Left alone it will be a great tool for shoppers, or it could be another pain if too many messages and promos meet the shopper instead of the help the customers want.

Bob Amster
BrainTrust

I see technology as an enabler to simplifying complex tasks, and as a useful tool to eliminate mundane tasks (like grocery shopping or taking money out of an ATM, who needs money?). The application of technology to replace interpersonal tasks smacks of some futuristic book or movie in which people behave more like automatons than people and emotions play an unimportant part. Beware, that future is upon us. Some of us will say, yay! And some of us will lament that what once was is no more. I vote for the last sentence in Ken Lonyai’s comments.

Peter Charness
BrainTrust

Replace? Supplement the few that are there, maybe. Department stores aren’t exactly full-service experiences as-is.

Camille P. Schuster, PhD.
BrainTrust

Experimenting with AI is great. With many fewer associates available now, replacing many more with AI is premature. Replacement of personnel depends upon two things: whether AI can have responses to all consumer questions programmed and whether consumers want to either type in their complete questions or will be understood if using voice recognition. We are probably at a point in time when AI can supplement current staff but not replace them.

Carol Spieckerman
BrainTrust

These types of digital in-store engagement innovations are in the early, early stages and Macy’s is to be lauded for getting started. These days, launching experiments (many of them), tracking results and managing strategic rollouts places a heavy burden on retailers, the danger being excessive dabbling without traction. How is Macy’s massive beacon beta going? Does anyone know?

Bob Phibbs
BrainTrust

Mark my words. The more you get consumers to look down, the more irrelevant you’ll make your brick-and-mortar experience.

The idea that employees can be replaced by an app makes your store nothing more than a warehouse with very expensive stuff. It is hardly a growth strategy.

Lee Kent
BrainTrust

AI is a step in the right direction in helping consumers find what they are looking for, not so much for replacing the sales associate. Consumers in fashion will always want an honest person to tell them if the item fits right or that perhaps they need another size, then go get it for them.

Yes there is automation being used that can get items back and forth to the dressing room but until that is in place, consumers want help while in the changing room. Or, like a recent survey (timeytrade, The State of Retail 2016) I read said, 85 percent will leave without buying anything if there is no one there to help.

Not sure how good Watson can be at styling either. But that’s just my 2 cents.

Charles Whiteman
BrainTrust

If these applications can connect customers with the products they’re looking for by overcoming staffing, stocking and store signage problems — they certainly should justify themselves by avoiding lost sales.

On the staffing front, I think the technology can be especially valuable in markets with a diverse customer base by overcoming language challenges. A multi-lingual app will be far more cost-effective than staffing stores with bilingual associates.

Mark Price
BrainTrust

There is a significant consumer segment that prefers to deal with technology on their own time and at their own pace, rather than have to wait for customer service or support. The ability to access real-time inventory at a location level, as well as rapid answers to standardized questions, will improve perceptions of customer service as well as free up time for store associates to reduce out-of-stocks and improve the check-out experience as well. A strong move forward — for the right segment, of course.

Other segments will continue to want in-person service and will be unwilling to migrate to technology solutions — so the answer must be multi-faceted to succeed.

Shep Hyken
BrainTrust

This will be an interesting test. Macy’s is a full-service experience. The balance between personal service and AI must be carefully made to ensure Macy’s doesn’t lose their on-site shoppers to online, which is more competitive and throws many retailers into a commodity trap.

Michael Day
BrainTrust

Especially in the Department Store space: The day the human customer service element totally goes away, is the day the format goes away.

That said, Macy’s can deploy AI (leverage the data and manage the technology) to augment and make better their in-store customer service and customer experience.

Martin Mehalchin
BrainTrust

While I applaud Macy’s for their willingness to test and experiment here, the amount of back end integration for apps like this one to support more than a few limited use cases is typically enormous. So they are a long way away from replacing store associates.

In a large format setting, a better play would be for AI to help lead the consumer to the right store associate and then help enhance that interaction.

Patricia Vekich Waldron
Guest
Patricia Vekich Waldron
1 year 2 months ago

It’s great to see retailers — especially mature companies like Macy’s — embrace new technologies to improve the shopping experience, deliver new service options and differentiate their brands. Smart retailers are already experimenting with cognitive computing, like Watson, augmented reality and virtual reality.

Craig Sundstrom
Guest

I initially thought this was one of those “Rudy-the-Robot-Roaming-the-floor” stories, but upon reading it, I see it’s actually about a smartphone app. Is it better than nothing (which is what many people perceive to be the level of help offered at Macy’s now)? I would hope so. But I’m dubious it will be able to answer questions like “what would go well with this dress?” or “the map said toasters are here, but I don’t see them … where are they?” (I.e., the kind of involved questions that humans still have an edge with.) So I guess we’ll see.

Brian Kelly
Guest
1 year 2 months ago

The minimum wage is bound to go up. And that will put pressure on operating profit. Shopper expectations for a relevant experience is increasing. Therein lies the rub.

McDonald’s already has an automated check out in test. The balance of high tech and high touch within the in-store experience continues for retail in general as the cost of labor is not unique to department stores. Tests with person to person customer service need to be in-market along with technology. What is the best use of payroll dollars, especially in consultative sales categories? I think Home Depot learning during the housing bubble when out-of-work tradesmen were scarce is an example of alternatives to staffing and training.

Ah, another retail conundrum. As we like to say, “retail ain’t for sissies!”

Cristina HOLM
Guest
If this is designed to replace shop floor staff, it will fail. The tests will highlight that app adoption will be low and behaviour to ask an employee (if one is visible) will be a shopper’s first reaction. Why do I say this? It’s easier and faster to talk than reach for phone, open an app, type, read the response etc. It’s the staff that need a handheld oracle so that they can accurately and promptly answer these questions. Knowing about stock availability has nothing to do with AI. A good inventory system (RFID) that’s properly integrated does that. Sharing my bias (and full disclosure), I have a business in RetailTech, personalisation software that matches clothes to shoppers. Importantly, although it’s an application, it’s designed to work on a tablet device, IN THE HANDS OF THE SALES ASSISTANT. I’m certain the future will prove that those retailers who invest in their store teams — by giving them great tech to give fantastic service and efficiency — will be the winners. AI can certainly play a big role in this, though I see greater benefits in use throughout the supply chain. Sadly, this AI test on the shop floor suggests it’s… Read more »
Joan Treistman
BrainTrust

There’s nothing professional about my response. I just don’t like this idea, personally. Maybe customer service is so minimal and the shopper experience so empty that an AI tool will be an asset.

I prefer the in-person “Can I help you?” approach that incorporates some advice as well as a navigational tool. I want to say something like, “I’m looking for a dress for a wedding. I want it to be age appropriate, knee length and not over $200.” And the sales person says something like, “Let me show you what we have.” And you’re saying, “Dream on.”

If consumers simply need the answers to specific questions that relate to pricing, inventory and location, they will adapt to solely shopping online. No need to go into a store.

Christopher P. Ramey
BrainTrust

Any use of technology to enable clients is a positive move for consumers. In this case, it’s AI (artificial intelligence) rather than a salesperson with LI (limited intelligence). Invariably, customers will prefer the former.

The more fascinating point is the long game.

Hitting a button to buy online is easier than standing in line to make the purchase. This will greatly expand showrooming as no one need be embarrassed to be caught online looking for product.

The path to purchase will come down to “Do you want it shipped to you or do you prefer picking it up now?” In store sales will suffer while online grows. The impact on inventory and employee skill set will be dramatic.

Looking further, Macy’s will have more stores that are substantially smaller. Retailing will turn into facilitailing. You read it here first.

Dan Frechtling
BrainTrust

I agree with Cristina that technology in the hands of store associates creates a better experience than publishing it to apps. The poll by Consumerist affirms this, with nearly two-thirds of department store shoppers preferring answers from human employees. So far, the Macy’s app apparently only provides way finding–a limited use case — with the promise of more later.

Online use cases are different. One-third of Amazon sales, half of LinkedIn connections and three-quarters of Netflix views are driven by algorithmic recommendations. Personal AI has a brighter future in settings other than department stores, where it’s harder to get human assistance.

wpDiscuz
Braintrust
"AI such as this is the future and for savvy retailers the future isn't far off."
"The amount of back end integration for apps like this one to support more than a few limited use cases is typically enormous."
"I just don’t like this idea, personally. Maybe customer service is so minimal and the shopper experience so empty that an AI tool will be an asset."

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