In a first for the high-minded management consultancy, McKinsey is opening a retail store and flogging underwear, make-up and jewellery to customers in a Midwest shopping mall.
Due to open on Friday in Mall of America, the largest US shopping centre, the outlet is designed to test the effectiveness of new technology that retailers and their advisers could deploy to keep stores relevant in the age of Amazon.
Visitors to the mall in suburban Minneapolis will be able to try out gadgets including smart mirrors and software that aims to help them pick the right bra size.
Cryptocurrency will be among the payment options. In the background, McKinsey will be crunching data on shopper behaviour.
Praveen Adhi, a McKinsey partner, said retail executives were “constantly inundated with pitches, and can struggle to figure out how to get value from all the different technologies out there”.
He added: “There is no real way, given the speed at which the technology and analytics is changing, to keep ahead of the trends without getting your hands dirty.”
A rotating roster of retailers will share space in the store, a near 5,000 sq ft site formerly occupied by Abercrombie & Fitch.
Microsoft is among several technology companies involved. Four fashion and beauty brands will take part initially.
The line-up comprises jeweller Kendra Scott; type:A Deodorant; Elevé Cosmetics; and ThirdLove, a “body-positive” clicks-to-bricks lingerie company that has been taking market share from Victoria’s Secret.
“We thought it would be a great way to learn,” said Heidi Zak, ThirdLove’s co-founder. “It’s an interesting example of a consulting firm that’s trying to add value.”
Mall of America is not charging McKinsey rent for the space. Revenues generated from the store will go directly to the retailers, which will pay a fee to offset some of McKinsey’s costs.
McKinsey does not expect to make money from the venture, which has been branded Modern Retail Collective. Instead, it hopes data gleaned from the project will help improve its understanding of what works in retail and what does not, and so improve the quality of recommendations to clients.
“This is a large investment for us,” Mr Adhi said. “The economics of the store itself don’t come close to breaking even. That’s not why we’re doing this.”
ThirdLove hopes to learn about the optimal level of interaction between shoppers and staff to maximise sales and profits.
Both the McKinsey store and its own outlet that opened in Manhattan in the summer allow women to use an app to find their optimal bra size, but there will be fewer employees available to help in the McKinsey outlet. ThirdLove plans to compare the results.
It is the latest retail experiment at Mall of America, which also features a theme park, toddler groups and live music concerts.
“There’s a lot of change in the retail industry,” said Jill Renslow, senior vice-president of business development at Mall of America. “The key is trying new things, taking risk, and learning from it.”