Retail Transformation Briefing: 8th March 2024

Firstly, I'm sorry that this week's Briefing is coming to you on a slightly delayed timescale.... it's been a little busy for me because:

Driving Retail Transformation is officially out in the world

My book has launched and it's been an incredible week.

I've loved seeing photos shared on social media or that people have been sending to me privately. Selfies with the book or me (or both). Freshly opened parcels with the book. Photos of quotes or references to sections that have really resonated. The fact that the ideas and concepts are already being applied. Reading the initial reviews as they come in. This is a wonderful vote of confidence. Please do keep all of these coming!

The book has exceeded expectations in the book charts too - at one point, holding both the #1 and #2 positions simultaneously for "Retail" books on Amazon, with both the physical and digital versions selling well!

It would be an understatement to say that I'm delighted with the reception for this book. So I'd like to say thanks for your support.

But the real proof is, as always, in the delivery. My goal in writing this is to create an accessible and genuinely useful book to help with the "how" of transformation. For any category in retail... For any type of transformation... For any stage of the journey... I'd like to support you in improving how you're transforming.

So, as you open the pages of the book, I'm encouraging you to get in the driver's seat and let's create a meaningful forward movement, together. ??

Retail transformation news headlines

?? 特易购公司 , Asda , Co-op , Currys plc and John Lewis Partnership are among companies making major investments into frontline pay. Tesco are boosting the hourly rates and investing ￡300m. Asda are investing ￡150m, John Lewis's increases cost ￡116m, and Currys are allowing ￡13m for their salary increases, whilst the Co-op is looking to increase pay by 10.1%. These investments and increases help keep frontline salaries ahead of or in line with the new Real Living Wage. These increases make these retailers more attractive as an employer, although they must be budgeted for to avoid squeezing current margins and profits.

?? Matalan claims to be the first UK retailer to be using gen AI to create product descriptions. They are using product metadata and imagery to create written content whilst the copywriting team provides a human touch by reviewing the AI output. This initiative delivers operational efficiency and dramatically increases the capacity of writing new product descriptions. This initiative is also important to their broader business transformation so we could expect a range expansion with this new capability. Matalan have also announced a series of new senior hires and this will signal more changes upcoming. Back to the original storey here, I'd be genuinely surprised if no other UK retailer is already doing this, although this does point towards one of the 2024 trends highlighted at the start of the year, where Gen AI will become more of a competitive advantage and a secret weapon which isn't declared to the whole world.

?? Superdrug is partnering with Gophr to allow rapid delivery of pharmacy supplies and prescriptions to customers' homes. Legal requirements for collecting prescriptions are tight, so Gophr deliveries will be subject to several aspects of security to ensure that the right people receive the right delivery, with clear documentation and compliance checks throughout. This is a great customer proposition which helps those who may be less able to get out to a pharmacy for essential medication.

?? EE started deploying a new store IT system, which allows colleagues to use a single device for all store tasks. The system covers all aspects of the store operating model and enables colleagues to use a single device for sales transactions, service interactions and all operational processes. The new system was tested for 6 weeks before deciding to scale up to deployment. The solution should be available in all stores by September.

?? In the UK, Boots UK is demanding a full return to the office, starting in September. Colleagues are expected to be working from the office for 5 days a week to encourage collaboration and more natural communication across the company. MD Seb James wrote about their current 3 day a week model: "the office is a much more fun and inspiring place on those days". It will be interesting if more companies follow this move and whether as a collective, it encourages movement of staff between companies to find places of work with shorter commutes - especially those that have joined since 2020 and may not have considered the full travel time and impact to lifestyle.

?? ASOS.com are looking to expand into India through collaboration with Reliance Retail . This could see Asos products sold through Centro department stores and online via Ajio. It's also possible that an Asos website or even store network could be included in the partnership. One to watch to explore how they'll expand.

?? Sainsbury's and Nectar360 have released their latest retail media network proposition allowing brands to create mini-stores on the main Sainsbury's website. "Branded Shops" allows brands to design their own customised pages and select products to feature. The service can be deployed quickly, as fast as 10 days, and also allows the brand team to directly access edit and reporting elements.

?? In Melbourne, Australia, retailers are being encouraged to embrace "Twilight Trading". New data shows there is a major opportunity to trade in specific evening hours, especially between 5-9pm, varying by day. The suggestion is also to delay opening hours to 10pm. This is a good recommendation and consideration, especially around office hours.

? 塔吉特百货 are launching a paid loyalty programme, similar to Amazon Prime and Walmart+. Customers who sign up for "Target Circle 360" will be able to access free same-day delivery when spending over $35. This feels like a major challenge although a number of Target acquisitions, including Shipt, are focused on this rapid delivery element. Turning this into a profitable venture for under $100 per year relies on encouraging the most loyal customers to switch even more of their spend to the retailer.

?? Frasers Group have acquired cycle retailer, Wiggle , and put recent purchase, MATCHES , into administration. Wiggle were acquired for ï¿¡10m and fit into the brand ecosystem nicely alongside Evans Cycles and other sports brands. Matches, however, is interesting as the premium fashion retailer was acquired in December for ï¿¡52m. However, sadly, it's been announced that there is no viable path to profitability. It's not yet clear whether Frasers will look to buy back aspects of the company or perhaps only the intellectual property of the brand name to feed into its other premium offering, including Flannels.

?? And finally, in Japan, Uber eats are deploying autonomous delivery robots in response to driver shortages. The company has been testing the use of robots in the US and is now expanding this initiative internationally. Tokyo, Japan was identified as a suitable location based on the challenges around employing drivers as well as the quality of pavements and roads. I recently co-wrote a report on retail robotics that was published by RETHINK Retail . Read the report here.

New podcast episodes: From episode #280

To celebrate this week's launch of "Driving Retail Tranformation: How to Navigate Disruption and Change", I've been issuing new episodes of the podcast every day.

I've introduced you to the Retail Transformation Steering Wheel and why this is such a crucial tool. Then, we've been looking at the four quadrants of the tool and why these are so important to successfully navigate through the risky, challenging, but rewarding journey of transformation.

So, find the podcast in your usual podcast app and tune into episode 280 onwards to explore more about what's waiting for you in the book.

Also, check out these recent episodes:

#279: Being confident despite uncertainty

#278: What my book is not

#277: Explore the hyper-connected store

Have a great weekend, and 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 to 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 now.