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Retail briefing: Retailers are turning employees into influencers

Influencer fraud

Call it the SoulCycle effect. Everyone’s an influencer now, including front-line store staffers.

At the Vitamin Shoppe, where stores have undergone a major rebrand to borrow a little inspiration from Apple, employees are “health enthusiasts,” said head of content marketing Lisa Chudnofsky. Employees that apply to work inside Vitamin Shoppe stores are interested in wellness — they take training sessions and tests before they start work to study up on all of the products stores sell and are also taught to advise customers how they fit into their health goals. Now, there is a new facet to the training: social media. Employees now get their own Instagram or Twitter handles, and each store also has its own.

It’s a trend. The 2018 Sprout Social Index, released in June, found that more companies are focusing on employee advocacy as the “new” influencer marketing. Marketers, the report found, see value in it because it’s scalable. About 71 percent of marketers are now using employees as influencers.

Macy’s this summer also extended “Style Crew,” a program open to Macy’s store employees who can apply to be Macy’s influencers, sharing videos to their own social media, and also get money if they get conversions.

Soulcycle has for years worked to turn its trainers into influencers, a strategy that turns them into mini-celebrities, followed on social media by fans who see them as instructors but also as life coaches. It’s a trend that has taken on more meaning just in the last couple of months, where SoulCycle and Equinox and their retail operations are now launching a management agency with advisory from WME that will represent their instructors to lock in sponsorship deals.

Overheard
“I think with us, we were very candid and said that we didn’t think that our product innovation and some of our new launches were quite frankly compelling enough for the consumer so that it created desirability. I think we feel much better about where we are on that. I wouldn’t sit here and tell you that we can reach the levels of the two or three or four competitors in the luxury space who are running high-double-digit-comp store growth. We just don’t think that’s a level that we’ll be able to achieve,”–  John Idol, CEO, Michael Kors, on why the company will never be a Gucci or LVMH.

What we covered
Party City is selling products on Amazon in an effort to maximize reach. The company announced a pilot program that will place products on Amazon around Halloween, opening up a new distribution channel. While some argue Amazon is simply a “virtual shelf,” and brand-agnostic, others worry that selling on Amazon means giving Amazon more customer data that the e-commerce giant could use to compete more effectively against its own brands.

Snapchat is letting creators use AR lenses with Shop buttons so they can sell products on the platform, its latest move to win over creators. This follows a July move where the company let creators make their own sticker packs, even as rival Instagram added more commerce features.

Wendy’s is making a play for e-commerce by growing its mobile ordering capabilities, placing digital ordering kiosks in its stores and re-organizing internally to bring digital transformation under a new unit called the “digital experience organization.” The idea is to appeal to customers who are used to buying more consumer goods online. The company now has 40 percent of its locations in North America on a digital delivery platform, up from 25 percent in the first quarter.

By the numbers
It’s a big week for retail earnings. Here’s what you need to know:

  • Tapestry, the new owner of Kate Spade, saw a 31 percent jump to $312 million in fourth-quarter sales both online and in-store, largely attributed to the death of the eponymous designer, who committed suicide in June.
  • Home Depot had comparable sales growing 8 percent over a year ago after delivering soft results in May for the first quarter. Much of the growth is because it’s been restrained in opening new stores and has made serious investments in e-commerce while also driving people shopping online back to stores through an “omnichannel” strategy.
  • JP Morgan analyst Matt Boss said that as he watches for Macy’s and Walmart earnings coming up, he’s seeing a picture of a stronger customer mindset that will mean good things for all retailers, especially with stronger e-commerce investments that should start paying off.
  • Boss also said that concerns about Amazon may have largely been overblown, and retailers are coming back because they’re fighting back by extending services like same-day delivery and improving the online shopping experience.
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