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March 10, 2021

Could droppTV's Shopatainment Platform have saved Barney's New York?

There was a time when Barneys was a peerless partner for new brands. They were radical, edgy, and aware of what consumers wanted. In fact, for a while Barneys could have been considered a disruptor among department stores. In the 1970’s they were the ones who brought Armani’s relaxed tailoring to the United States and threw men’s suiting into an uproar, and the same can be said for womenswear as they championed Rei Kawakubo of Comme des Garçons and Azzedine Alaïa, of the clinging bandage dress. Their Madison Avenue store broke all of the rules that typically governed the design of a department store, putting perfumes at the back of the first floor instead of the front where entry-level products are typically sold, opting instead to display Kazuko Oshima’s idiosyncratic jewelry constructions of crystals and semi-precious stones wrapped in wires front and center. Barneys knew how to deliver the message that they knew better than the consumer did what they needed.

Unfortunately, this attitude also proved to be their ultimate downfall. The elitism and exclusionary nature of their image that once translated as aspirational began to be seen as arrogance, and the swift rise of e-commerce eliminated the ability for the brand to set itself apart through brand selection and curation alone. In their prime, luxury department stores were the ideal place to find exclusive products that weren’t available elsewhere, but today the modern consumer can find just about anything with a quick Google (News - Alert) search. In order to adapt, they instead needed to recognize the growing consumer trend of experiential shopping, providing customers with a unique purpose or value prop that differentiated them from the competition. Barneys missed the boat on e-commerce and user experience, but other department stores can avoid a similar fate by remaining open-minded and adapting emerging retail trends such as droppTV’s Shopatainment platform.

Once you remove selection and value as differentiation, having a retail presence can quickly turn into a liability rather than an advantage. In today’s e-commerce world buying products from multiple brands online is already an effortless and seamless experience, and combining this with the fact that high-end, multi-brand destination stores lack the rich brand experience that consumers are looking for today means that the focus on traditional retail has become obsolete. Given the choice between a large department store and the boutique or showroom for the brand itself, consumers are seeking a more direct way to interact with the brands they support taking their foot traffic and sales with them. Although many brands that originated online have expanded to retail locations, they see them as opportunities to extend their brand experience to a physical space rather than their main source of revenue.

In the late 1980’s, Barneys pushed their Co-Op brand nationwide along with expansion of their outlets which soon saw the brand become a household name. However, by 1996 the company had filed for bankruptcy for the first time, and by the 2010s it had changed hands a number of times and was increasingly trying to keep up as Net-a Porter was coming in the United States and smaller curated stores like Shopbop and Internix began to pick up the Barneys customer. Rather than double-down on their “our-way-or-the-highway” attitude, the store instead tried to pivot to become more malleable to rapidly changing customer sentiments and better-focused on service. Rather than moving in the direction of Dover Street or Opening Ceremony who had found niches in the market by successfully curating new and emerging brands, it instead seemed to be simply chasing the business of other high-end department stores such as Saks Fifth Avenue. It was Barneys’ decision to become a generic form of high-end luxury rather than developing a strong brand presence that saw it go the way of Lord & Taylor and Henri Bendel who also fell prey to the growth of e-commerce, sky-rocketing rent, and shifting consumer habits.

There was a theory that high-end retailers like Barneys would continue to be a destination where people would come to experience the merchandise and would survive in populous affluent markets, rendering them immune to the trends of e-commerce. However, the key word in that theory is “experience,” and Barney’s lack of cohesive brand story saw them unable to create a valuable user experience. Had they continued to invest in emerging brands as well as their platform to build something innovative, they may have been able to weather the storm that is the fast-changing retail sector. Customer expectations are changing fast, and that’s been a massive driver of retail mergers and acquisitions. Large, “traditional” retailers must adapt to the times and learn that they must leverage e-commerce technology, embrace experiential marketing trends and bridge digital and in-store experiences.

To effectively appeal to shoppers today, big-box retailers need to act more like multi-brand boutiques, starting by adopting elements of the shopping experience that have turned the business of selling hoodies and tees into a multi-billion dollar industry and made elevated streetwear the overarching aesthetic of choice. Of the many trends that are constantly emerging and receding in the retail space, shopatainment – native shopping experience on a video streaming platform – is a solid one that appears to have staying power. Consumers today are looking to spend their money on brands that project both authenticity and relatability, and want to feel that their purchases have purpose. They are looking to feel an emotional connection to the brands and influencers they support, meaning that whether big or small companies need to focus on the experience of shopping just as much as the act of buying itself.

Shopatainment is one of the more recent digital trends, but it is also one that has the ability to efficiently merge many of the qualities consumers today desire most. The streaming age has given rise to an ever-increasing amount of video content, and it would seem to be a no-brainer for brands to attempt to make that valuable space shoppable. Already a booming industry in China, the concept is quickly gaining traction in the United States, with Gurps Rai and Christopher Kelly’s droppTV being one of the newest and brightest shopatainment players thanks to its proprietary seamless shopping experience. As the world’s first shoppable streaming platform, it uses artificial intelligence and smart video technology to allow viewers of its videos to purchase items within the filmic flow with a single click, without ever leaving the page. Although other companies have attempted to create shoppable streaming platforms in the past, it is founder and chief executive officer Gurps Rai’s attention to detail and emphasis on experiential shopping that has the company making waves. 

The first phase of droppTV’s consumer rollout has been dedicated to music videos, playing off of the buzz and hype that accompanies both music video releases and streetwear new arrivals. Rai recognized that millions of people within the United States were already creating video content around music but weren’t doing anything to monetize it, and this concept can easily be applied to the thousands of other forms of video content that exist today. What if during one of Vogue’s now famous “73 Questions” videos, you had the ability to tap what the interviewee was wearing and purchase it on the spot? Or the candle that was burning on their coffee table? Utilizing video for monetization gives you the ability to capitalize not only on the viewer themselves, but the relationships they may already have built with those within the video as well.

Another way in which shopatainment capitalizes on digital shopping trends is through the use of exclusivity and difficult to find items to create perceived value. Like the wildly successful Supreme ‘drop’ model of selling, limited editions and a constantly revolving product selection create demand, and traditional retailers could utilize droppTV’s shoppable streaming platform to feature exclusive brand collaborations that will generate further interest in their brand as a whole. Additionally, the coronavirus pandemic has completely shaken up consumer loyalties, with 36 percent of consumers trying a new product brand, and of those 73 percent indicated they intend to continue to incorporate the new brands into their routine. While this may sound like a recipe for disaster for department stores, big, trusted brands are actually benefiting from this shift, making now the perfect time to take that momentum and run with it toward digital shopping trends that will increase the growth further.

The downfall of Barneys is a cautionary tale to the other department stores, showing what can happen if you fail to keep up with the digital trends and create an innovative infrastructure. Their bankruptcy revealed that they no longer understood the needs of the consumer, or the evolving nature of the shopping experience itself. Rather than seeing the death of brick-and-mortar stores, instead we are witnessing their transformation to a supplementation of an online experience, aiding in bringing the brand alive rather than driving sales. For department stores, the goal should now be creating online and offline shopping experiences by leveraging trends such as shopatainment to build their brand presence, creating a strong story that will have the ability to withstand the consumer’s shifting desires.

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