Top of Mind Topics for Senior Leaders

Distinguished leaders who’ve worked for dozens of top retailers met online to discuss the top opportunities facing retail, and the road to resilience. Among the most common themes:

The Workforce

Will headquarters staff return to the office full-time? The consensus is that every company will handle this differently, with different rules for different kinds of employees. People have shown that they can successfully work remotely, but there are intangible benefits to being in an office that may call for leaders to be in the office periodically. Participants believe that, from now on, all meetings will be hybrid with some at home and others in the office. Some participants have hired people who aren’t in-state, or who are many time zones away.

We agreed that formal training for executives is desirable, as is soft-skills training for younger associates. Mentoring staff pays off.

Many leaders talked about quick all-hands meetings each morning. Companies are also holding skip-level meetings.

Participants want to make work fun. They’re hosting Star Wars Days, having virtual cocktail parties, doing yoga, etc.

 We talked about the need for transparency when communicating with associates. It’s important to keep the rumor mill to a minimum.

 Everyone reported that filling positions is difficult, in-store and at HQ.

 The Demand Chain

 The pandemic distorted both historic demand, and supply.

 Retailers found it difficult to ship product via rail, trucks, FedEx, and UPS, during a time when the USPS is historically slow. Amazon’s decision to create its own transportation network was a smart one. Some participants admitted that their approach to supply chain was pretty casual until the pandemic hit. One participant said that their company viewed the supply chain as an afterthought. Post-pandemic, winning companies will carefully plan supply chain strategies.

Because of shipping delays from the Far East, Interest in near shoring has never been higher. 

We touched on the difficulty in analyzing data that lives in siloes. Many companies don’t have the right talent to leverage corporate information, and many outsource the job.

 Retailers are doing more research into what customers potentially want, in order to align supply with demand.

Technology

Are retail companies technology companies? No; most struggle to catch up, largely because retail margins don’t provide enough cash to keep ahead of the behemoths. Most retailers still have servers on-premise, although participants noted that cloud is not necessarily cheaper than on-prem.

 We discussed multiple companies that have underinvested in technology and are now out of business.

What should keep retailers up at night? Complexity. Data leaks. Retailers must have layered defenses and be aware of potential chinks in the armor across the enterprise. Retailers need to call in third-party companies to assess their risks. To have the best chance of securing the enterprise, IT must know about all systems; this is one of the reasons why shadow IT can be so dangerous. You can’t protect what you can’t see. One of our participants’ biggest fears is ransomware, as digital systems become more critical than ever.  Retailers also need to check their disaster recovery / resilience plan.

The role of the enterprise data architect has never been so important.

 It’s important for every retail company to re-map the customer journey and then prioritize projects. Tech implementations are delayed because the organization can absorb only so many changes at a time. 

Hire young people. It’s more important than ever. And hire older people who have decades of experience. SIM, AARP and other organizations can assist.

Executive Considerations

 Participants agreed on the need for networking events and professional development to continue to grow. Some recommended www.FullyHumanatWork.com. They also recommended courses from Korn|Ferry, LinkedIn Learning, and alumni groups. People mentioned ageism in industry and urged colleagues to stay current on skills. Take advantage of events managed by vendors and industry figures. Build relationships on committees, in Clubhouse, and on LinkedIn. We also mentioned Laurie Santos and https://www.happinesslab.fm.

 We talked about the ongoing impact of the CCPA and the EU Privacy Directive. Companies are receiving few inquiries from customers.

Retailers continue to look at ways to correctly attribute omnichannel sales, providing credits for store labor. Increasingly, they attempt to come up with one income statement for the enterprise, instead of one for stores and another for ecommerce. The obvious problem is the need to attribute also for newspaper advertising, TikTok, and other channels. And no company yet has cracked the code on making commerce seamless for associates. They note that customers are omnichannel, but retail systems are not.

Retailers need to have a Customer Data Platform to track customer behavior accurately. Retailers more sophisticated now, using iPads for endless aisles, and attributing .com sales to stores.

Customer resolution happens as retailers rationalize Operational Data Stores to accurately reflect who customers are. Managing these records is very important. One participant recommended hiring data scientists from casinos, which are the best at knowing customers and predicting behavior. Stores would like to be able to send an email to a customer saying, “here are details on the products we talked about a few days ago.” Participants referenced lake house architecture.

 We talked about sending push notifications to customers who have a given retailer’s app and are in the neighborhood.

We talked about the need for retailers to make better use of that rich depository of data, to figure out the who, what, where, when and why of shopping.

 Disney has done an industry-leading job of mining data through wristbands that customers wear, for park access but also purchasing food and souvenirs. Disney even created their own analytics conference. [1]

 Returns have been a hot topic in retail, after the massive spike in ecommerce during the pandemic. Uncertain sizing, inadequate information on websites, variables in fabric performance and changes in customer preference help inform this trend. Better analysis of reasons for returns could help this situation; in some cases, the product packaging is the problem. 

Younger customers have new habits: they value sustainability, natural ingredients, and skincare over cosmetics. They favor social media influencers and product reviews. They want to purchase from Instagram, TikTok, Google, YouTube, but not television.  They also value Buy Now Pay Later because they don’t want to have credit card debt.

 Luxury customers prefer one-on-one time with salespeople. Selling by appointment is resulting in larger basket sizes. Call centers are now more important than ever and need to be high “touch.” Retailers who turned to virtual stylist appointments have reaped the benefits. Upscale retailers talked about serving Pellegrino or champagne in short in-person one-on-one meetings.

 What about malls? We agree that traditional closed boxes are problematic, but multifunction shopping areas that have experiences like restaurants and ski jumps can win. We also talked about travel retail, which is returning, and the importance of near field computing.

Partnerships are making news these days, with Sephora opening stores in JCPenney. Companies have made partnerships with Instacart and other delivery services;

Retailers who can leverage data have a “get out of jail free” card to innovate and try everything. With a lot of things in flux, this is the time to innovate.

We enjoyed sponsor presentations from:

Rob Garf, GP and GM, Retail, Salesforce. [email protected]

Ned McCauley, Director, Retail Strategic Accounts  Sensormatic. [email protected]

Sterling Raehtz, SME, Human Mobility Analytics, Sensormatic. [email protected]

Wendy Wise, VP Product Marketing, Logicbroker. [email protected]

Jaclyn Berger, VP of Operations and POS, Adyen. [email protected]

Quirjin Meulenberg, Product Manager, Shopper Insights, Adyen. [email protected]

 Don Couchie, VP Technical Operations, Optical Phusion. [email protected]

Steven Love, Senior Account Executive, Optical Phusion, [email protected]

We also enjoyed guest presentations from: 

Thornton A. May, futurist. [email protected]

Paula Rosenblum, managing partner, Retail Systems Research, talked about how agility matters. [email protected]

[1] https://disneydataconference.com