American Marketer


Technology is means, not end, of improving customer experience: Neiman Marcus

October 17, 2017

Neiman Marcus' Innovation Lab was created to determine how technology can aid customers. Image credit: Neiman Marcus


NEW YORK – Retailers and brands are hungry for new technology that can help engage customers on their terms, and Neiman Marcus’ Innovation Lab serves as an example of how to do so effectively.

At Luxury Interactive 2017, the head of Neiman Marcus’ Innovation Lab walked the audience through the origin of the group and some of the ways it has experimented with different aspects of the customer experience to positive results. A key theme of the talk was that technology can serve as the perfect bridge between the digital and the physical worlds.

"Retailers everywhere are hungry for inspiration and ideas," said Scott Emmons, head of the Innovation Lab at Neiman Marcus. "We are bricks-and-mortar focused, but ecommerce is very strong for us.

"It’s a billion-dollar business," he said. "More than 30 percent of our revenue comes from ecommerce."

Innovation Lab
Finding new ways to connect with customers through technology is one of the key strategies in the modern brand’s toolset.

Five years ago, Neiman Marcus was not performing strongly with technology. Mr. Emmons admits that the company’s presence online was weak and its business was suffering.

In response, Neiman Marcus created the Innovation Lab specifically to develop new ways of using technology to make the shopping experience smoother and easier.

But Mr. Emmons emphasizes that the goal is always to solve a specific problem and not just to use cutting-edge technology thoughtlessly.

“When I’m thinking about what kinds of projects we will tackle, I think about this: what can we do?" Mr. Emmons said. "I want to do projects that solve a problem for my customer.

"I need to understand them first," he said.

Not all of the Innovation Lab’s projects have worked out. While some have been successes, such as a mirror in the store that snaps a photo of an outfit the customer is trying on to save for later, others have had to be shelved, such as in-store 3D image scanning.

These are all part of the learning experience, Mr. Emmons says.

In the end, every effort is trying to bring the experience of shopping online to the in-store experience.

"Personalization is key," Mr. Emmons said. "We believe that personalization is an important part of the experience beyond segmentation.

"It’s about you and specifically you, not just a segment you belong to," he said.

"That’s been our bread and butter. How do we deliver that same thing we deliver in-person to an online experience?"

Chasing consistency
Neiman Marcus is confident that its approach to technology and innovation can help it drive up revenue in the coming years.

The retailer’s comparable revenues for the 2017 fiscal year were down 5.2 percent from the previous year.

Despite its yearly results, Neiman Marcus Group is optimistic about its efforts to drive growth, which include a new Digital First strategy. While Neiman Marcus Group is remaining cautious about the current challenges in retail, its fourth quarter comparable revenues were only 0.5 percent behind the figures for the same period in 2016, which it sees as a move in a positive direction (see story).

Outside of technology, the retailer has been partnering with other groups as well.

Neiman Marcus is helping its smallest shoppers dine healthily through a menu developed in collaboration with local Girl Scouts.

Working with the Girl Scouts of Northeast Texas and Dallas’ Medical City Children’s Hospital kids teaching kids program, Neiman Marcus created a new Kid’s Fit Menu that will be used in its 43 in-store restaurants. Part of the retailer’s the Heart of Neiman Marcus Foundation, the initiative enables the company to support children with arts education (see story).

Amid all these developments, Mr. Emmons stresses that technology is not the end goal in itself. Rather, it is only a tool for reaching the real goal: creating a retail experience that is engaging and enjoyable for consumers.

"It’s a mistake to follow the bright and shiny in technology," Mr. Emmons said. "It's fun and it gets attention but it will be gone fast if it’s not solving a problem for your customer."