Retail In­dus­try’s Next Big Step Is Con­sumer-cen­tric, Com­pli­cated

WWD Digital Daily - - Wwd - BY WWD STAFF

Ex­ec­u­tives are tak­ing a hard look at the best way to move for­ward.

Retail is a com­pli­cated busi­ness. But in a land­scape that’s com­prised of picky con­sumers, swel­ter­ing com­pe­ti­tion and high-stakes strate­gies, find­ing one’s foot­ing is more than a sim­ple mat­ter of play­ing catch-up. In­stead, it re­quires c-level ex­ec­u­tives in many cases to ad­mit de­feat — or at least con­fu­sion — regarding dig­i­tal ad­vance­ments and in­still­ing pos­i­tive change man­age­ment in or­der for once siloed de­part­ments to work in the same sand­box, with­out is­sue.

Com­pli­cated, yes. Im­pos­si­ble, no. It’s these evo­lu­tions in the mar­ket that are in­spir­ing new so­lu­tions. This year, WWD’s Retail 20/20: The New Store Ex­pe­ri­ence event, be­ing held to­day in New York, fo­cuses on the fac­tors shak­ing up the retail mar­ket while show­cas­ing in­sights from thought lead­ers in­side the in­dus­try as well as how to nav­i­gate change.

From break­ing the old rules of retail to the retail re­nais­sance, speak­ers David Olsen, chief ex­ec­u­tive of­fi­cer of Cos Bar, and Rati Levesque, chief mer­chant of The Real Real will ex­am­ine how the land­scape has shifted.

“The big­gest change is that retail is now 100 per­cent driven by the cus­tomer and the ex­pe­ri­ence they need and want. They drive the con­ver­sa­tion on dig­i­tal and so­cial chan­nels, and it is im­por­tant as a re­tailer to be con­stantly lis­ten­ing and in­no­vat­ing to ex­ceed their needs. It’s what has made re­tail­ers suc­cess­ful in the past, but now laser fo­cus is re­quired,” Olsen ex­plained.

The fu­ture for retail is bright — if it per­mits it­self to shine. And while wip­ing the slate clean might not be easy, sur­vival and suc­cess go down eas­ier than bank­ruptcy. Karla Gal­lardo, chief ex­ec­u­tive of­fi­cer and co­founder of Cuyana plans to take a hard look at the fu­ture of retail dur­ing her pre­sen­ta­tion with this in mind.

Retail would be nigh with­out the heav­ily cov­eted — and courted — con­sumer. Keep­ing the shop­per ex­pe­ri­ence at the cen­ter of busi­ness oper­a­tions and plans is cru­cial for not only de­vis­ing brand loy­alty, but also gen­eral suc­cess. With an in­flux of data comes the ne­ces­sity to crunch in­creas­ingly large sets of it — quickly.

“[Retail lo­ca­tions need to] un­lock the power of an­a­lyt­ics and dig­i­tal plat­forms to de­liver an­tic­i­pa­tory and per­son­al­ized ex­pe­ri­ences. This is much eas­ier for ver­ti­cally in­te­grated re­tail­ers, but more chal­leng­ing for brands that are in­ter­me­di­ated,” said Elana Gor­batyuk, vice pres­i­dent and part­ner of Sid Lee, an in­ter­na­tional cre­ative agency that counts the North Face, Honda and Sam­sung Galaxy among its clients. “As an in­ter­me­di­ated brand, it’s im­por­tant to work on cre­at­ing ways to share data and code­velop pro­grams with a peo­ple-first ap­proach, not a sys­tems-first ap­proach.” Gor­batyuk will be dis­cussing how to break tra­di­tion to cu­rate pur­pose­ful retail ex­pe­ri­ences dur­ing the con­fer­ence.

It’s one thing to draw in a con­sumer; it’s en­tirely dif­fer­ent to keep them en­gaged. To do this, brands and re­tail­ers need to de­liver unique and in­spir­ing om­nichan­nel ex­pe­ri­ences aimed at bring­ing to life its gen­eral ethos, but also con­cen­trat­ing on the cus­tomer.

Sum­mit speaker Matt Corey, chief mar­ket­ing of­fi­cer of PGA Tour Superstore, said, “The cur­rent chal­lenge for re­tail­ers is whether or not they truly know their cus­tomers, and what their cus­tomers want from them — in a seam­less om­nichan­nel ex­pe­ri­ence, in a bricks-and-mor­tar en­vi­ron­ment that has ‘ex­pe­ri­ences’ they can­not get when shop­ping on­line[…] Re­tail­ers have to be tire­less about won­der­ing if they are de­liv­er­ing the best pos­si­ble over­all shop­ping ex­pe­ri­ence for their au­di­ences, pe­riod. They have to con­tinue to ask ques­tions and talk to their cus­tomers. And they have to think about ex­pe­ri­ences that their cus­tomers don’t even know they want yet.”

Fred Ger­antabee, global vice pres­i­dent of dig­i­tal in­no­va­tion at Coty Inc., echoed Corey’s sen­ti­ments. “I be­lieve that the con­tin­ued rise of the ex­pe­ri­en­tial store and the rise of in­te­grated ser­vices be­tween retail and e-com­merce are where we’re see­ing the most growth. The de­sire to bring be­hav­ior over from e-com­merce (prod­uct se­lec­tion, rec­om­men­da­tions, cross-sell­ing, same-day de­liv­ery) is strong, as the line be­tween phys­i­cal and dig­i­tal shop­ping ex­pe­ri­ences has all but nearly dis­solved. Con­sumers over the last 15 years have be­come ac­cus­tomed to the on­line shop­ping ex­pe­ri­ence, and it can be a let­down if their vis­its to a brick and mor­tar store is any­thing less.” Ger­antabee will be fur­ther dis­cussing the merg­ing be­tween the phys­i­cal and on­line worlds for the sake of the shop­per ex­pe­ri­ence in his talk dur­ing the sum­mit.

Ex­pe­ri­en­tial retail is be­com­ing the new “om­nichan­nel” strate­gic mind-set. And for good rea­son. As Gen­er­a­tion Z ma­tures and gains more spend­ing power, their pen­chant for en­gag­ing in unique brand­ing op­por­tu­ni­ties will swell, too. For Jose Cas­tro, se­nior vice pres­i­dent of fash­ion and life­style li­cens­ing and global fash­ion col­lab­o­ra­tions at Nickelodeon, ex­pe­ri­en­tial retail serves as a “third screen,” the topic that he will ex­plore dur­ing his talk at Retail 20/20.

“We [Nickelodeon] con­sider retail our third screen mean­ing that retail is the plat­form we use to take our char­ac­ters and sto­ries and trans­form them into tac­tile, sen­sory ex­pe­ri­ences that ce­ment the au­di­ence’s bond to our brand,” Cas­tro ex­plained. “To help us get to scale very quickly, we part­nered with JoJo Siwa, a so­cial in­flu­encer, who had 90 mil­lion views when we met her and now she has over 1.2 bil­lion. JoJo is emerg­ing as a mul­ti­plat­form pow­er­house brand who spans on-air and in-per­son ap­pear­ances…. We have de­vel­oped prod­ucts in­spired by the things she likes to wear and make for her­self which fans can pick up at a va­ri­ety of dif­fer­ent re­tail­ers glob­ally.”

Keep­ing the con­sumer at the cen­ter of all busi­ness strate­gies — even those that seem un­re­lated on the sur­face — is im­per­a­tive, de­spite the chal­lenges in de­ploy­ing new soft­ware and pro­cesses that will en­force such a change.

A ba­sic fea­ture up­date like im­prov­ing search func­tion­al­ity will do won­ders, Gor­batyuk ex­plained, “Thought­ful nav­i­ga­tion that de­lights and adds emo­tional peaks or re­moves fric­tion points [are cru­cial]. Over-in­vest­ing in nav­i­ga­tion and way-find­ing in­creases mem­o­rable ex­pe­ri­ences in stores that trans­late to re­peat vis­its and in­creased pos­i­tive word-of-mouth and shar­ing. Ama­zon Go, Reci­pease in Lon­don, as well as The Line are good ex­am­ples.”

For Olsen, tap­ping a suite of tech­nolo­gies to en­hance con­sumer ex­pe­ri­ences has been key. “Cos Bar has im­ple­mented new tech­nolo­gies like Stella Con­nect and Re­tailNext that drive our abil­ity to bet­ter un­der­stand our cus­tomer and gives us the in­for­ma­tion we need to ac­knowl­edge and re­ward our staff for pro­vid­ing the best cus­tomer ex­pe­ri­ence,” he said. “The cus­tomer is al­ways right, you can’t be ev­ery­thing to ev­ery­one, and your peo­ple are ev­ery­thing. Know your cus­tomer and fo­cus on their needs, and make sure that you have the best staff in place to en­sure they de­liver on the prom­ise of pro­vid­ing the best luxury beauty shop­ping ex­pe­ri­ence.”

To fur­nish en­hanced con­sumers ex­pe­ri­ences, re­tail­ers and brands would be best to not ig­nore the com­pe­ti­tion, but in­stead, com­pare best prac­tices and where the oth­ers are win­ning. De­vel­op­ing a hy­per-aware­ness of strate­gies, method­olo­gies, and tech­no­log­i­cal ad­vance­ments, mer­chants will find them­selves less and less in the game of catch-up and in­stead in a proac­tive po­si­tion to flex cre­ative ap­proaches to prod­uct — and per­haps most im­por­tantly — brand ex­pe­ri­ences. ■

A Cos Bar store in Ok­la­homa City.

Cus­tomers in se­lect NYX stores will be able to view makeup tu­to­ri­als in a vir­tual re­al­ity ex­pe­ri­ence.

JoJo Siwa

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