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Report On Business Shopping destination or mall dinosaur? Retailers scramble for millennials

Thyme Maternity’s flagship location at Yorkdale Mall in Toronto, Ontario on Saturday June 13/2015. The chain is incorporating high-tech features into its customer experience to compete with rising e-retailers.

Kevin Van Paassen/The Globe and Mail

Tucked at the back of the Thyme Maternity store is a 360-degree interactive mirror that can show all angles of a shopper as she tries on an outfit and moves about. It features iPads that are mounted on the walls and placed at a "Bump Bar" where consumers can settle onto a stool and peruse online content as well as purchase more Thyme goods. It has fitting rooms that are outfitted with mobile phone charging stations.

Welcome to the Thyme store of the future at Toronto's Yorkdale Shopping Centre, a digitally savvy outlet and the kind of store that retailers increasingly need to invest in to keep customers coming back in an era of burgeoning online business.

"This is how that millennial customer today will find the store experience interesting," Roxane Liboiron, vice-president of marketing and visual presentation at Thyme, said in an interview. "That makes the difference between brands that succeed and some that don't."

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With Amazon.ca and other online players rapidly adding more products to their selling sites, traditional merchants are racing to make their physical stores more appealing to ensure they remain shopping destinations rather than become mall dinosaurs.

Canadian Tire Corp. Ltd. is another retailer that is pouring money into digitally advanced flagship stores both at its namesake chain – with its latest "showcase" outlet in Edmonton launched this month – and its Sport Chek stores. The Canadian Tire in Edmonton features more than 100 digital screens, a car simulator that allows shoppers to test drive tires in different weather conditions and the "dream backyard and patio builder" app that creates 3-D images of outdoor spaces .

"The speed of change and innovation in our industry means that we need to be nimble and try new things," said Allan MacDonald, chief operating officer at Canadian Tire.

Change is coming quickly. Online retailing is expected to grow at a compound annual rate of 12.3 per cent over the next five years, reaching $39.9-billion by 2019, according to a report by Forrester Research Inc., which was published this month for the Retail Council of Canada.

Still catching up to their U.S. counterparts, Canadian e-players "see shoppers buying more items and higher-priced items," the report says.

Last week, Amazon.ca introduced dedicated clothing and shoe stores on its website – including maternity clothing – pushing its inventory past 100 million items.

Amazon.ca's new offerings added 1.5 million items to its site, resulting in the site's selection of goods nearly doubling in the past year. "We're always looking to expand our selection and you can expect to see more brands and items in our clothing store and across our entire site as we continue to grow our selection," Amazon.ca spokeswoman Katie McFadzean said in an e-mail.

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At the same time, conventional retailers ranging from photography specialist Blacks to electronics purveyors Future Shop and Sony are closing, feeling the digital squeeze.

Thyme's parent, Reitmans (Canada) Ltd., one of the country's largest specialty apparel retailers, has also felt the winds of change. Over the past two years, its profit has been sliced almost in half to $13.4 million in 2014 while its sales fell more than 6 per cent to $939.4-million in that period as it moved to close weak stores, including its Smart Set chain.

Among its closings last year were two of its 70 Thyme stores and all 169 of its Thyme boutiques in U.S. Babies "R" Us stores, although it still runs 21 of those "shop-in-shop" locations at Babies "R" Us in Canada, having shut two here.

Still, Reitmans is seeing some signs of improvements, helped by cost cuts. Its first-quarter same-store sales increased 3 per cent, including a 97.7 per cent surge in e-commerce sales, and its loss narrowed to $7.7 million from $13.4 million a year earlier.

Ms. Liboiron said the company has invested hundreds of thousands of dollars in remaking the Yorkdale flagship Thyme store, including the "catlook delay" mirror, which is equipped with a video camera that automatically replays what is in front of it within 10 seconds so the video can be shared on Facebook or in e-mails to friends. She said the mirror poses no privacy issue because it doesn't save any data.

The "Bump Bar" at the centre of the store mimics a kitchen island and serves as the cashier area and gathering place for mothers-to-be where they or their family members can use preloaded iPads or shop further online.

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On Tuesday, Thyme will also launch a "Bumpfie" app, providing a Bump Cam for pregnant women's selfies of their growing baby bump and weekly updates on their baby's growth.

The chain, which will add two more flagship prototypes this year – one in Ottawa and one in Lachenaie, Que., outside of Montreal – is also adding new offerings to respond to customer demands for trendy clothing, she said. They include up to $298 Citizens of Humanity jeans and, by November, baby clothing in 30 of its stores.

The chain will also offer this fall more nursing clothing, such as dresses with zippers at the front. Its research found that 87 per cent of new mothers breast fed (or tried to breast feed) in 2010 compared with 81 per cent in 2001.

And demand for maternity wear overall is "very stable," she said. Birth rates rose 0.7 per cent to 385,937 in 2014 from a year earlier, according to Statistics Canada.

Thyme executives are pleased with the revamped store's performance which has met expectations since opening two months ago, she said. "It's attracting a trendier customer." As for the shift to e-commerce, "bricks and mortar stores are still very important, especially for brand recognition," she said.

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