Retail Transformation Briefing: 31st July 2024
Oliver Banks
I help retailers drive operating model transformation and change // Consultant & Advisor // Author: Driving Retail Transformation // Podcast: The Retail Transformation Show // Keynote Speaker
The Olympics are well underway now and plenty of brands are jumping on the hype and marketing train. From luxury retailers to cosmetics companies, from food brands through to underwear, and of course supermarkets and the inevitable sports brands are also focused on the trading opportunities.
While the athletes are striving for their gold medals, this moment represents the pinnacle of years of training and preparation. In retail, the annual peak season represents our pinnacle. For many retailers, this comes in the build-up and delivery of Black Friday and Christmas - but of course, that's not necessarily the case for all. However, what are the reps that you're doing right now to get ready for your company's next opportunity to shine?
I'm sure you have your regular preparation plans in mind. But if your company were an Olympic athlete, what would it do to get into the best physical shape for the big event? Consider all of the prep that these high-performance individuals and teams go through - what would be your equivalent approach?
Retail transformation news headlines
?? Boots UK will use their loyalty scheme's Advantage Card data to help predict and develop new disease treatments. The data would look to identify customers who could take part in clinical trials. For example, heartburn is a potential symptom of oesophageal cancer - so if a customer has been regularly buying particular products to combat this, this could present an opportunity to opt in for trials or further diagnosis. This follows a similar experiment last year and is a great example of the power of retail's big data and how it could have a meaningful impact on the world. However, it's also clear to see the privacy concerns that customers could have.
?? In the US, Schnucks Markets is integrating a feature on their electronic shelf label solution to allow Instacart pickers to activate a pick-by-light solution to increase productivity. Schnucks, which operates 115 stores, is also trialling smart shopping trolleys from Caper Carts (which is owned by Instacart) and will also be integrating them, allowing customers to search for an item and be alerted to the location by a light on the shelf edge label.
?? Sam's Club brings retail media to scan and go functionality for highly contextual ads. Product ads are displayed to customers based on recent scans. The lead example shared is displaying salad dressing ads after scanning a bag of spinach. This is about as close as you can get to the ecommerce concept of "customers also bought", however, done in a way to drive retail media sales rather than total sales. Whilst the example feels highly relevant to the customer, it will be interesting to see if this is the case, or if brands are willing to promote their unrelated products to customers that may be from similar demographics.
?? 耐克 have hired a new CIO who will be focused on simplifying, standardising and modernising Nike's platform, suggesting a period of consolidation rather than innovation. Nike have been one of the pioneers exploring the new digital commerce landscape. However, this new focus suggests that they're looking to regroup and focus on efficiencies, robustness and profitability. It can be a sensible approach to recognise that you don't always need to follow the same approach, and you may need to adapt through different phases over time. However, if you give up an innovative streak, it can alter the culture and then it can be immensely hard to recreate or reinvigorate that.
??♂? The John Lewis Partnership has been given planning permission to transform one of its Waitrose & Partners supermarkets into 353 homes and a refurbished store. The homes will be rented out and managed by John Lewis as it look to expand into house building and residential management. This is a long-term transformation by the company and it's great to see progress happening as they look to diversify where future profits are generated.
?? John Lewis & Partners launched a range of pre-loved designer bags. For years now, John Lewis has featured second-hand jewellery, so it's great to see this expanding into other categories. They are working with Sign of the Times and will feature a shop-in-shop in one of their London stores. This physical retail presence offers customers the chance to take their designer handbags to be assessed, authenticated, and resold. This follows the recent news that they're expanding into repairs, again powered through partnerships.
?? eBay and Love Island decided to take their relationship to the next level, with a livestream hosted by TikTok influencer and former contestant and footballer. The event had a particular focus on pre-loved items which were featured in the TV show wardrobe. All funds were donated to Doctors Without Borders. However, the limited edition items were sold to customers with the fastest fingers for a set discount price. So with over 10k people tuning into the livestream and just 28 items on sale, it was disappointing that they've missed the classic eBay auction opportunity and with reduced prices, they only seem to have raised ￡605 for charity.
?? Another company that focused on livestreaming this week is 沃尔玛 , which collaborated with 宝洁 to put on an Olympic special live shopping event. Featuring past gold medal-winning gymnast Laurie Hernandez, this event was very much focused on a content-led approach, discussing aspects like morning routines, everyday victories and managing stress. This livestream pulled in 29k viewers and I'm not aware of the sales figures.
? The Perfume Shop have partnered with Deliveroo to offer 25-minute delivery of branded perfumes. Feels like an obscure use of quick commerce - how quickly is fragrance really needed by customers? But it's also about offering choice. If the effort required to patch into another platform isn't huge, then why not? But if it adds a layer of complexity, stock segregation or processes, all of which for a low utilisation rate then it will likely be a new drag on the organisation.
? In Australia, ALDI Stores Australia has pulled out of its trials to offer online shopping to customers. It has struggled with keeping costs low and recognises the balance of profitability. Buying MD Jordan Lack said, "The greater concern is the impact on cost structure as fundamentally keeping our costs low has a direct impact on the prices we can offer our customers."
?? Coach is moving into the metaverse and aiming to appeal to Gen Z consumers. Digital clothing from their new collection will feature on Roblox and Zepeto. The venture is based around a common theme of "Find Your Courage" and encourages the player through different levels, taking part in games, picking up freebies and buying digital products. It's a metaverse pop-up as a limited-time opportunity, however, this seems to be a digital only solution. We're already starting to see companies going to the next stage where customers can buy real products in the digital world.
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Keep transforming better,
-- Oliver
?? I help retailers build effective operating models and drive transformation - with hands-on consulting services or advisory support.
?? I speak about the evolving retail industry and delivering transformation and also host two retail podcasts.
?? My book, Driving Retail Transformation: How to Navigate Disruption and Change, is out now.