Retail Transformation Briefing: 7th February 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
?? Welcome to the Retail Transformation Briefing.
This LinkedIn newsletter shares the key changes and news stories from the evolving world of retail. My goal is to inform and inspire you to successfully improve your business.
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There is SO much going on. What are you choosing to do?
This week's Retail Transformation Briefing features a bumper crop of stories which clearly demonstrate the breadth and scale of transformations and trends in the market.
It can be incredibly difficult to know where to focus. Customer experience? Cost efficiencies? Sustainability? Channel development? AI? Automation? Retail media networks? Replatforming? International expansion? B2C? Etc etc. The list is vast and broad. All seem to promise great benefits and there are examples of retailers successfully deploying all of these ideas and more.
But we know that we can't realistically do everything. Even if each item seems like a good idea with a clear justification and demand. However, the reality is that we probably do less than we expect or hope for. So prioritisation is a crucial capability as we've discussed in past Briefings.
But, in the real world, we're also in a place were it's probably not feasible to just pick one item and leave the rest. So the prioritisation challenge becomes especially important as you look to balance multiple initiatives.
So let me ask you this - What can you stop doing or deprioritise? And conversely, what activities and initiatives must you put at the 'top of the pile'? What additional support or expertise can you use to help ensure success for these top initiatives?
And finally, I'm sure you're already feeling like you're spinning all the plates as best you can, but what could you do today to simplify the plate spinning? If you'd like to talk it through - reach out to me on LinkedIn and let's find a better way.
Retail transformation news headlines
?? Sainsbury's unveiled their new 'Next Level' strategy as they look to develop past their previous food-focused strategy. The new approach will look to 4 main goals: (1) gaining market share in the grocery sector through basket size and repeat custom, (2) building the Nectar loyalty platform through personalisation and meaningful rewards, (3) driving the Argos business through convenience and value whilst driving efficiencies and finally, (4) in investing in technology and infrastructure, including a ￡1b cost reduction. These are good to see and aligned to the broader trends and I'm pleased to see the Argos focus as it will help to drive a real differentiator in the competitive grocery market.
??? Morrisons are inviting customers to attend their management meetings and will host customer roundtables. Recognising poor performance over the past few years, new CEO Rami Baitiéh is looking to truly put customers at the heart and hearing perspectives and opinions directly from customers will help this. Getting customer insight on pricing, product and service will of course help but it's also important to be able to collate overall perspective rather than be directed by a few particularly vociferous customers.
?? 亚马逊 announced a new gen AI shopping tool called Rufus, which allows customers to ask specific questions as they shop. Customers can ask open questions like "What to consider when buying running shoes?" or more specific questions like "What are the differences between trail and road running shoes?" or even based on detailed product questions. The tool seems to consume data from the broader Amazon range, customer reviews, Q&A sections and other content from the wider internet. The tool is currently in a small beta test and will expand to more US customers in "weeks". I'm very interested in seeing this development as AI shopping assistants have remained a little clunky to date and not taken off in a major way yet. Amazon's customer focus and their continued use of AI in the shopping journey is valid experience to transform this opportunity.
?? Additionally, 亚马逊 are now looking to improve how they receive products at their warehouses. For years, Amazon have been using the latest technology and automation to accelerate the pick, pack and dispatch process to accelerate timescales. Now they're looking to drive efficiencies and speed into receiving and replenishing products. This also aligns with their new Supply Chain services announced last year.
?? Stationary retailer Ryman are looking to disrupt the greeting cards market by offering a blend of personalisation and convenience. Customers can choose from over 2,000 card designs and add personalisation elements using their website or app. These can then be picked up in stores across the country just 60 minutes after ordering. This is a great example of using the power of channels to serve customers in unique ways and online-only greeting card companies and traditional card shops will need to figure out how to compete in return. Additionally, Ryman will also be acutely aware of the opportunities to then convert those customers to make additional purchases in-store.
?? In Canada, the cashier-free grocery retailer, Aisle 24 Market , continues to expand to underserved communities and experiment with larger stores. The chain is looking to expand their 24/7 stores to more remote communities, especially targeting less competitive areas where there have been recent closures. Additionally, they're looking to grow the technology to cope with larger stores and bigger ranges, moving from a 2,300 sqft store up to a 12,000 sqft store. While many technology-enabled stores focus on central locations with high footfall and fierce competition, it's interesting to see this company take the opposite approach, where they can take a sizeable market share from a smaller audience. Feels like a 'big fish, small pond' approach!
?? Iconic luxury UK department store Liberty. have upgraded their POS system to enhance their customer experience. The new tool, powered by Aptos Retail , allows colleagues to access the CRM from the POS to support customer conversations and enhance omnichannel offerings. There is also the opportunity for real-time personalisation based on complex customer segmentation and shopping behaviours.
?? Meanwhile also in London, Harrods and Burberry have partnered with a large scale brand takeover. The partnership is a great example of omnichannel activation and consistency as it runs across the whole of February. Check out my recent post for more details and pictures.
?? In China, luxury travel retailer, DFS Group, and video platform, Douyin Life Service, have collaborated over a series of livestreams. Whilst the event unveiled new beauty products, the initiative also allowed customers to purchase coupons which can be used in DFS stores. Owned by 字节跳动 , Douyin is the Chinese counterpart to TikTok and it will be interesting to see how TikTok could start to develop to allow closer integration in app purchases for in store redeption.
?? Jewellery brand Pandora have committed to only using recycled gold and silver and expect to complete the transition this year. The initiative is a major sustainability play and they predict this will lead to a net saving of 58,000 tonnes of carbon per year. There are numerous ethical and environmental challenges in the jewellery category and Pandora are leading the way for larger brands, having already started using lab-grown diamonds.
?? H&M have opened a new store in New York featuring a resale shop-in-shop area. The store also uses mobile POS to allow customers to checkout anywhere in store, RFID to track inventory (although not fully integrated for instant scanning at checkout), smart mirrors and collection lockers.
?? 宜家 's new AI assistant is on OpenAI 's GPT store, allowing customers to ask for advice in planning their decor and home. The tool will use aspects like room dimensions and purpose along with personal preferences on factors like styling, sustainability and budget. Ikea's range will also form recommendations and the tool can even check current availability of products in stores or for delivery. The tool is only available in the US now and for ChatGPT Plus users, although Ikea plan to expand to a bigger audience this year.
领英推荐
?? Whilst 苹果 try to convince the consumer market that the time of VR is now, J.Crew and E.L.F. BEAUTY are among the first to get on board. J.Crew have launched a Virtual Closet app on the new Apple Vision Pro headset. Users can see and interact with high definition 3D virtual products and can also sync to a video call with a J.Crew stylist or friends to get opinions. Meanwhile, e.l.f are releasing opportunities to explore products in 3D as well as more engaging options such as guided meditatons, stetching exercises and painting games. These two examples demonstrate the variance and the importance of using technology to genuinely serve customers and integrating with the wider channel ecosystem.
New podcast episode: The small steps to continuous improvement - #276
Delve into the art of continuous improvement which has reshaped industries and personal habits alike. Originating from Japanese car manufacturer Toyota and popularized through Lean Six Sigma, Kaizen is more than a methodology; it’s a mindset of perpetual betterment. Join me and unpack the essence of making each day more efficient and effective than the last, applying Kaizen not only to business operations but also to personal growth and productivity. With practical tools and insightful discussions, we pave the way for incremental yet powerful transformations in your retail environment and beyond.
Take a listen to episode 276 of the Retail Transformation Show podcast:
Also, check out these recent episodes:
Driving Retail Transformation: Book spotlight
"Like the analogies of ‘boiling the ocean’ or ‘stopping world hunger’ suggest, doing everything isn’t feasible. So, the answer is prioritization. And often, after much debate (you can probably guess what’s coming next) everything gets prioritized as important. Back to square one again.
Prioritisation is a crucial skill for driving transformation and deciding what to do. Whilst it's a challenge, it's not a surprise.
However, we all know the impact of being unable to prioritize. Overpromising and under-delivering, leading to overwhelm, anxiety, confusion and many other negative emotions. And perhaps the biggest risk is that nothing gets delivered, nothing changes and the status quo lives on."
These couple of extracts from my book lead into approaches and considerations to help you prioritise. But the real key is understanding the challenges that the business is facing right now. It's easy to get entranced by 'sexy' projects or ideas, but are these really what the company should focus on?
Prioritisation was certainly a challenge for me in writing the book... There were so many topics I'd love to have included but it came down to hard decisions about what to include and what not to include. In fact, there were entire swathes of content that didn't make the cut!
Driving Retail Transformation: How to navigate disruption and change is out on 5th March and available for pre-order now in all good bookstores.
...Oh, and stay tuned for exciting news about the book launch coming up very soon!
There is LOADS going on right now. So I'd love to hear from you - which were your favourite stories or which resonated most from today's Briefing? Do please share your thoughts.
And until next time - keep transforming better,
-- Oliver
?? I help retailers build effective operating models and drive transformation and change - with hands-on services or through advisory support. Book a meeting to see if I can help you define or deliver your change or strategy.
?? I speak about the evolving retail industry and delivering transformation and also host the podcast, the Retail Transformation Show.
?? My book, Driving Retail Transformation: How to navigate disruption and change, is out in March.
?? "The secret of change is to focus all of your energy not on fighting the old, but on building the new." - Socrates. Great roundup in this week's Retail Transformation Briefing! ??? Embracing these market transformations is key to staying ahead. #Innovation #Growth ??
Chief Commercial Officer | Chief Marketing Officer
1 年Great update Oliver - there’s so much good stuff going on in retail right now. Transformation is the name of the game now and going forwards.