Retail apocalypse or retail rebirth?

Yesterday Rachel Burdett Partner Cor Cordis, Jenny Nettleton Executive Director at Korda Mentha, Paul Zahra. (CEO of the Australian Retailers Association) & myself were panelists at the Australian Restructuring Insolvency & Turnaround Association Online Conference (10-12 November 2020) the topic being "Retail apocalypse or retail rebirth?

With 4 panelists and 45 minutes, I didn't get time to share all my points so I have detailed below the topics we covered and my answers.

Rachel framed the topic around 3 questions that we answered:

Question 1: Rachel "Firstly, let's talk about this Retail Apocalypse – is there one? What has been the impact of Covid on the industry over the last 10 months – what have we seen and experienced across the industry?"

My answer:

"The Retail Apocalypse has been brought about by the digitizing of the industry all COVID-19 has done is to accelerate the process to eCommerce and a seamless customer experience across all channels.

Bricks and Mortar is not going away however what has changed is the structure and people required to be successful and many traditional retailers are having difficulty in transitioning their business.

The future is bleak for inflexible traditional full-price retailers and the sky is the limit for their agile existing competitors who can pivot and for new start-ups not weighed down by old ideas.

E-commerce sales as a percentage of total sales in Australia lag the US materially, the good news is there is substantial growth potential for Australian retailers willing to invest. Below are three examples of the wide disparity between US Retailers and Australian Retailers.

Question 2: Rachel "Let's break down the impact of Covid and take a deep dive into 10 key areas"

My answers:

Question 3: Rachel "What does the next period look like for Retail and what are your key thoughts for our attendees today?"

The key success factors for retailers moving forward are innovation, consumer insights, and customer experience across all channels driven by research, data, and analytics.

When customers search for products over 85% of customers start with google, amazon and social media, and 15% of the retailer website (and that is in decline). If you are a bricks and mortar retailer then you need to excel at marketing and selling into these social media channels to drive traffic into the store.

Ecommerce is not an add-on channel in the future it is the key to running a profitable retail business. This is the digital way – so in retail, the model has changed, the CMO is the driver of the business and the defacto CEO through the strategy, customer insights, marketing, and new product development.