Jenn Kretchmar, chief digital officer of Build-A-Bear Workshop Inc.
Build-A-Bear is pursuing a broad-based digital transformation plan that includes revamps to its e-commerce, loyalty and marketing offerings.
Chain Store Age recently spoke with Jenn Kretchmar, chief digital officer of Build-A-Bear Workshop Inc., about the experiential retailer’s digital transformation efforts.
How and why did Build-A-Bear decide to launch a digital transformation strategy? In 2017, we were seeing a lot of changes in how our customers were experiencing our brand. This included seeing people come to our website to start to preshop a little bit to learn more about the brand. So, we made a decision then that we wanted to invest in a digital transformation to meet our customers where they are interested in shopping, and we know people are shopping online.
At the end of 2017, Build-A-Bear went live with a new site in an effort to expand our addressable market. We understood that our customers wanted to have an opportunity to go online, select a bear, select the clothing, select the sounds or the scents, and then either ship it to themselves for their own personal collection or ship it as a gift to a loved one.
In developing the new site, we built the online bear builder and created our iconic “heart ceremony.” As soon as you finish building your bear online, you see that big red satin heart and you can click a button make a wish, and there's a really fun digital experience that goes along with it.
How did customers respond to the new e-commerce site? Up until around the time we launched the new site, we had about 4% e-commerce sales penetration. At the end of 2022, Build-A-Bear recorded almost 20% penetration of retail sales online. We really have seen an enormous response. Customers love being able to shop online in addition to our stores, and it has really been additive to our business.
What are some other transformation projects that you're especially proud of? During the store shutdown period of the COVID-19 pandemic, all of Build-A-Bear’s brainpower was focused on digital, and we had a very fast acceleration of technological capabilities.
For example, Build-A-Bear turned on our omnichannel capabilities. Up until the pandemic, all of our e-commerce orders were fulfilled out of our central warehouse and distribution centers. Following the shutdown, we were in a position to fulfill from stores as well.
We started using about 300 stores as micro distribution centers. Orders were able to flow out to our stores, where associates took online orders, building them, and shipped them out from the store.
In addition, we have been leaning heavy into personalization and our ability to engage our guests digitally. Leveraging Salesforce Marketing Cloud, we create specific email marketing journeys and journeys that are beyond email, to talk to our customers about the types of experiences that they're interested in, such as birthday parties or collectibles.
We bring in both online data and offline data from our stores so that we can understand how our campaigns are performing across the different channels that we're in. These could be social, paid search, display ads, or video channels like YouTube or TikTok. Build A Bear collects that data and look at it and then address our messages accordingly to make sure that we're serving up the right content to the right customer growth for our brand.
Do you know what type of reduction in fulfillment time you achieve when you fulfill from a store instead of warehouse? What's great about fulfillment from the store is the way that the system sends out orders to stores is based on geography. With the vast majority of customers selecting economy shipping, we can set a shipping point closest to where that package is determined. Associates pull the online orders that have routed out to their stores and can assemble it for shipping or in-store pickup that same day. Through our third-party delivery partner, customers can get their order that day.
Build-A-Bear recently launched a metaverse experience. What made you decide to enter the metaverse? Build-A-Bear has participated in gaming for many years before Roblox existed. We had a Nintendo game and an online multi-player game where you had avatars, so this was a natural evolution for us and felt very familiar to us. We wanted to create a place where our customers could go to Roblox and have a building experience.
The idea is you can build out your workshop and then you can build out your town, build furry friends and name them, and then add on clothing and accessories onto them. No brand is better suited for an online building experience — personalization is literally in our DNA.
What kind of technology transformation projects does Build A Bear have in the pipeline? Digital transformation continues to be one of our top priorities. In 2023, we expect to continue with amplification of more personalization. We also went live this year with the Salesforce loyalty platform. The Build A Bear Bonus Club loyalty program is an important part of our relationship with our customers and we expect to continue to leverage that tool to add more benefits, more perks and more engagement this year.