Retail

How B8ta Gives Consumers A Technology Test-Drive

“Retail isn’t dead; it needs a revival.”

With a list of bankruptcies growing ever longer, suburbs hosting the carcasses of scores of dead and dying shopping malls and foot traffic on an ever-falling curve, it’s not hard to draw the conclusion that retail — or, at least, the brick-and-mortar version of it — is dead.

But b8ta doesn’t buy it, hence the motto quoted above. Physical retail does have its issues; it needs to find a way to set itself apart and deliver for consumers an option that is as good, if not better, than the convenience of not having to leave one’s home to shop.

Since opening their first store in Palo Alto, California, in 2015, b8ta has aimed to offer just such an experience: the ability to snap up tech products that might otherwise be hard to find  — and buy anyplace but online.

B8ta’s goal is to give technology makers with big innovations (and small ones, of course) access to a physical channel when they are too still small for the biggest stores. Because consumer tech — think smart locks, high-tech skateboards and connected stove monitors — often requires a test drive before anyone but the most adamant early adopter is willing to actually buy it.

“In December 2015, we opened our first b8ta store in Palo Alto to prove that retail wasn’t dying because consumers had lost interest in shopping, but because the makers behind the best products had lost interest in working with retailers,” Vibhu Norby, CEO and co-founder of b8ta, said in a statement. “After opening our first five stores, filling them with hundreds of unique products and engaging 25,000 customers a month, we’ve proven our thesis.”

B8ta’s path to profit is a bit different from everyone else in retail, however. It looks quite a bit more like the path a software developer might take. B8ta doesn’t make its money selling products — instead, it rents out space in its stores to brands in something that very much resembles a monthly subscription plan. The manufacturer gets floor space from b8ta, as well as marketing, messaging and even price points for each product, right through the b8ta dashboard.

B8ta thinks consumers want to be excited about shopping, and high-tech products and gadgets are particularly engaging to customers in the digital age. What is not so exciting is paying upfront for something untested and hoping that it works.

“It’s a really bad experience as a consumer to put down money first,” Norby said, since the consumer now has to take on all kinds of risk. Perhaps the product is better in concept than execution — or perhaps the product never actually makes it to a customer’s hands at all.

“Sometimes the product takes 18 months to get to market, or never ships.”

Customers want to see the product and know it exists, but the reality of brick-and-mortar retail is that shelf space isn’t inexpensive to the merchant. For a new product, it’s a big gamble, particularly if customers don’t like it. And sometimes they really get the chance to determine if they like it or not, because it is sitting on a shelf next to a well-known consumer brand that does something similar, so customers never notice the innovated version.

So, b8ta offers — in the 11 cities were it operates — a chance for brands to do something different and a chance for consumers to be early adopters with retail technology that is legitimately ready for the market. The store lets any company apply and rent space in their retail locations, but they must be ready to ship with functioning consumer electronics — not just prototypes.

Within the stores, displays are programmable, meaning the firms that rent space from b8ta have control of both the content on display and the pricing. And whatever retail technology they sell in terms of profit, they keep. B8ta is only interested in charging rent; they do not take any part of a firm’s sales revenue.

As of today, b8ta sees over a million hands on consumer electronic demos in its locations per month; their broad goal is to change how the market views the relationship between brands and stores.

“I really think everyone in this industry on the manufacturing side agrees that the way that we sell and merchandise consumer electronics isn’t ideal, and the process for getting into retail is completely broken,” Norby said in an interview with Dealerscope last year. “As a customer of retail shops, and particularly electronics shops, we started noticing that the product selection was starting to feel old and stale, versus what we were seeing online. So, we started talking about, what if you created retail stores that were driven by the manufacturers and were powered by software? What would that look like?”

What it would look like is a store that is currently doubling its footprint — and hoping to operate coast to coast.

We’ll keep you posted on their progress.

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