Neiman Marcus is not wasting any time as it marches into the new frontier, or the “wild west,” as many are calling it. And it’s headed right towards the intersection where technology and the Millennials connect. Neiman’s is recognizing the tsunami of new technologies being introduced on almost a daily basis, as well as the fact that Millennials will soon replace Boomers as the largest consumer segment. This next-gen cohort has not only embedded technology into every moment and movement in their lives, they also bring huge shifts to the marketplace in how they want to engage or be engaged by retailers.

First and foremost, understood by all retailers (except for the few with their heads still in the sand), they must promise a compelling experience to attract consumers to the store. This is especially true for the Millennials, who are more interested in pursuing style of life over the stuff of life. They desire many types of experiences over shopping and hanging out in malls. And since technology is their life, the Neiman’s that attracted their grandmothers will die with their grandmothers, if they don’t integrate technology into every aspect of their business, including an engaging experience in the store.

Burberry’s, having seen and understood this intersection, was a first and fast mover in fundamentally re-positioning their brand and creating a high-tech and even higher touch experience in their stores. They are arguably the poster child for the future among the traditional retail models. However, I would be remiss if I didn’t mention the fact that Nordstrom, Macy’s and Bloomingdale’s are leading the pack as well.

For Neiman’s to better understand all of the new technologies bombarding the industry and how their applications can better connect with, and elevate the shopping experience, they launched their iLab (innovation lab) just over two years ago — in a conference room. Today it operates in a 450-square-foot space, and still growing. As reported in WWD, the lab’s mission is to evaluate, design and test new technologies and applications; the winners will then be deployed into pilot projects in the stores.

The Technology Tsunami

Having just attended the NRF Big Show with its miles of exhibit halls, my head is still spinning with confusion and feelings of anxiety from trying to sort through the thousands of technology applications and solutions on display. In fact, to thoughtfully wade through and understand all of the new models, it would require weeks, not days. In a case of shooting from the hip, many of the tech start-ups do not have people knowledgeable enough in retailing to be able to clearly communicate what benefits their new technologies will provide to both the retailer and consumer.

So Neiman’s like all other retailers, faces three enormous challenges:

1. They must identify and understand as many of the consumer-engaging technologies as possible and be able to assess the relative benefits for the consumer;
2. They must make the risky ROI decision of selecting the best applications/solutions, and estimating their investment return, knowing that tomorrow another newer, better, cheaper technology will no doubt be launched;
3. They must figure out how to implement the applications.

Thus, the Neiman’s iLab is a sensible way to incubate all of these opportunities; to evaluate, design and test before making major financial and human resource investments.

The iLab has a range of initiatives in various stages. The hot system du jour is the use of beacon technology. Though the GPS-based beacon application, customers will be alerted of special events, cross-selling, sales, etc. Neiman’s is also testing wearable technology, digital signage, and “memory” mirrors. These magical mirrors on the wall in dressing rooms will help make fashion choices easier, and through Internet-based interfaces, will record and send photos or videos to Facebook friends and family. More iLab projects: Interactive touchscreen tables that provide associates and customers a large, digitally enhanced “look book.” It is also testing the “Snap. Find. Shop.” application that allows customers to photograph shoes and handbags wherever in the world they may be, even if being worn by another person, which Neiman’s will then search for and send similar or the same products of its own to the consumer’s phone. Finally, as reported, they are doing a complete “Wi-Fi refresh, major wide area network upgrades and a deployment of more than 8,000 Apple iOS devices – 5,000 iPhones and 3,000 iPads for Neiman’s sales associates.”

What’s so terrific about this venture is that the iLab is dedicated to an ongoing daily pursuit of new ways to personalize and elevate the shopping experience.

So, while we all love our grandmothers, it’s time for retailers to preserve their fond memories or bring them up to date (upscale Boomers are pretty good candidates for adopting to the digital age) as they create a new connected “third place” (home, work and the experiential store) for all of our generations to explore and enjoy.