advertisement
advertisement

Gap’s Piperlime Problem: Online To Stores Isn’t So Easy

Written by Frank Hayes
May 23rd, 2012

Moving a brick-and-mortar retail chain online is a pretty well understood process at this point. Gap is now facing the opposite problem: how to turn its online-only Piperlime store into a brick-and-mortar business. The verdict so far: This isn’t as easy as it was supposed to be.

The irony is that opening new store brands online is easy, once a chain has its E-Commerce presence up and running. Infrastructure can be shared, and the challenge is mainly making the new brand distinctive. But if anything, going the other way is actually harder than opening a completely new physical-store brand from scratch.

The problem for Gap is its Piperlime brand, which the $11.8 billion chain launched in 2006 as an online footwear retailer. Gap is now working to open at least one brick-and-mortar Piperlime store, the way it has with its Athleta athletic-clothing site-turned-into-chain. But when talking to analysts on May 17, Gap CEO Glenn K. Murphy said the process with Piperlime hasn’t been straightforward.

“We’re taking a little bit of the blueprint from Athleta. Now they’re different businesses for sure,” Murphy said. “Well, we’ve taken that blueprint for Piperlime and so it’s tough. If we were standing right now in September in SoHo, I could articulate to you how that 4,500-square foot store is going to come across.”

That may sound like merely a store-design problem. But in a merged-channel world, it’s more than that. Going from bricks to online means a chain has to translate not just the overall design of a store to the site, but also the little personality details that aren’t just a logo or color scheme. Customers expect Walmart’s site to feel like Walmart and for Nordstrom.com to match what they expect of the Nordstrom experience. If it doesn’t, the store and the site will feel like they don’t belong together.

That’s a challenge, even after more than a decade of retail translation to online. Much easier is launching a sub-brand that leverages the E-Commerce infrastructure to go after a slightly different customer. Almost anything is possible, because there’s only one channel and no translation of an existing experience required.

But going from pure-play E-tail to physical stores is hardest of all. All the questions that never had to be answered online now must be addressed: What’s the floor plan? How do the associates look and behave? How much merchandise? What type of POS arrangement? What about lighting? Loss-prevention arrangements? In-store technology? How much of the square footage is stockroom? How fast are shelves replenished? Are you offering customers Wi-Fi? Will their mobile phones work in the store?

A chain that started with stores can steal some of the answers from existing stores, but that’s not a perfect answer.


advertisement

Comments are closed.

Newsletters

StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!
advertisement

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

StorefrontBacktalk
Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.