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TEST DRIVE

High-Tech Playground

AT&T ‘experience’ store at Westfarms touted as the emerging trend in retail

By Mary Johnson

Hartford Business Journal Staff Writer

05/05/08

AT&T used to do retail just like every other wireless provider. It operated slots in malls or shopping centers and banked a bunch of customers through online sales.

Contributed Photo

The new AT&T Experience Store at Westfarms Mall opened in April and is one of 16 new stores nationwide.

Then it started listening to its customers, who said they love the Internet for product research and comparison and for shopping when they know just what they want.

But if they wanted to try before buying, customers weren’t finding their fix online. Neither were AT&T’s existing retail outlets — with minimal staff and product testing capability — filling the void.

So AT&T revolutionized the way it does retail, creating an environment in which customers “test drive the products in the store in a way that hasn’t been done before,” said Steve Krom, vice president and general manager of AT&T’s wireless unit in New England.

The brainchild of that revolution is the AT&T Experience Store. The company opened 16 such stores nationwide last month, two of which are in Connecticut—one at 935 W. Main St. in Branford and the other in Westfarms Mall in West Hartford.

The AT&T Experience Store mimics the way indie computer darling Apple does retail. Apple stores offer wide open spaces and high-tech toys to play with, as well as bells and whistles like personal shopping appointments and one-hour workshops to help customers make the most of their Apple products.

Apple Was First

Apple’s retail success — its in-store traffic shot up 50 percent last year — has sparked a new trend in high-tech retail, said Daniel Butler, vice president of merchandising and retail operations at the National Retail Federation. Companies are seeing that success and customizing the concept to suit their particular needs.

“Retailers are constantly evolving their environments,” Butler said, “so they’re always looking at how they can improve.”

When it comes to electronics, he said, if companies can give consumers an environment that allows them to test the product, they can get attached to the product and everything it offers, Butler said.

The design of the stores, the products, the marketing and customer needs are all working together in one of these stores, said Butler. It’s all about looking at the bigger equation of what does the customer want and need and how can customer experience be enhanced to the point that a store makes them spend.

Verizon also launched an experience store near Dallas in 2006 to showcase products from Verizon Wireless and Verizon Communications. “The Verizon Experience store will demystify how technology improves productivity and makes buying decisions simpler than ever,” Bob Ingalls, executive vice president of Verizon Communications, said at the store’s opening.

But Verizon hasn’t expanded the concept everywhere, with only two such stores nationwide. A Verizon Wireless store at Westfarms is “a traditional cell phone store,” said Kevin Keenan, the mall’s general manager.

Keenan said he was skeptical when AT&T planned to open its Experience Store. “I kind of rolled my eyes at first, but I’m very impressed with what they’ve done,” he said.

Hands-On Interaction

To sculpt its new retail environment in Westfarms, AT&T created a high-tech playground, allowing customers hands-on interaction with gaming, music, browsing, video and e-mail. AT&T also uses the venue to show off its TV offerings, like U-verse and Homezone, on three, 52-inch, high-definition televisions. And there’s an entire station dedicated to the Apple iPhone.

“This has been an evolution,” Krom said, from the products in the stores, to the traffic flow to the staffing and the training. “We really revamped the way we do retail,” he added.

Each area of the store is manned by a different employee specifically trained on particular devices. The need for a highly educated staff to accommodate the purpose of the Experience Store has trickled down throughout the rest of AT&T’s retail outlets, Krom said, as have some of the design elements.

“We’ve actually changed our strategy because it’s been so successful just with these initial 16 stores,” Krom said. AT&T measures its success by the level of positive customer feedback.

Krom said the construction and opening of the new stores has been a significant capital investment, although he declined to give specific figures. The new retail strategy will not include massive new construction. Some new stores will be built, and the company is looking at sites in New London and southwestern Connecticut. But typically, existing AT&T stores will be remodeled to incorporate elements of the new retail methodology. And over the the next two or three years, AT&T is looking to refresh its whole portfolio, Krom said.

“In retail, newness drives sales,” said the NRF’s Daniel Butler.

AT&T’s new retail strategy will allow it to update and change the experience of the store with the new products constantly being added to its inventory.

“You can add additional newness,” Butler said, and that gives each trip to the store a novelty feel.

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