Like every business, we are not immune to the decision-making around cutting our cloth. This year we chose not to venture to ShopTalk USA to save some dollars as we see how the start of the new financial year pans out (not to say we may not sneak off to ShopTalk Europe mid-year but we do need to save our pennies for NRF in Jan 24. However, through our extensive networks, we have been able to connect and glean the key insights and discussion points to dig deeper into.
What is ShopTalk for the uninitiated
In my opinion, ShopTalk is one of the best retail conferences in the world, It is where the world’s most influential and rising retailers unite to connect, discuss business-critical issues and have meaningful conversations on insights, experiences and together openly talk about re-imagining the future. It’s the cooler version of NRF, where NFR is the forum where everyone is putting forward “their best selves” and preen their feathers.
The focus is on connections and discussions and have events and activities to meet with the people, solutions and discussions which matter to them most.
ShopTalk 2023 offered insights spanning shopper engagement, emerging channels, store experience, technology and organisational change. Like any conference, it’s like drinking from a fire hydrant and there are times you can’t get to everything you want to cover.
Here are the 5 key takeaways distilled so you are up with the latest insights without even leaving your office.
1. Omnichannel experiences are shifting to unified commerce (Hallelujah!!)
The concept of omnichannel is nothing new (and most people know I hate the term omnichannel) however it’s exciting to see the expansion of the definition to unified commerce. Today’s market requires retailers to think flexibly to reach customers across touchpoints and channels wherever they are – mobile, in-person or within the physical store. This interplay has stretched even further into other selling and engagement channels. These include marketplaces, social media, and live shopping. Shopify is emerging as a top partner across all emerging platforms with capability that enables shoppers to make purchases any place, any time, even when they are not actively “shopping.” Key highlights
A unified commerce experience is more than just creating a seamless experience across touchpoints. It’s understanding the customers and creating experiences that align with their needs.
This also means making a considered effort to provide assistance through AI chatbots and video on your brand’s websites and mobile.
Customers are increasingly expecting to be helped throughout the buying experience – whenever and wherever.
In a more traditional omnichannel sense, unified commerce is enabling social selling and curated content for customers through an appropriate platform.
2. Unlocking the store experience is paramount
Drawing customers into stores to engage with products, learn more about the brand, have fun and, ultimately, make a purchase is the key to physical retail. Various retailers at Shoptalk 2023 discussed how they are experimenting with new store formats and concepts to do this more effectively and to deliver an experience which is different to the digital experience – and better and more different to their competitors. The standout areas to delivering this ranges for unleashing the power of the store teams, delivering new concepts and creating WOW.
Mary Dillon (ex-CEO Ulta), now President and CEO at Foot Locker, discussed how the company hopes that reimagining the store network and formats will better connect the brand with consumers and remain culturally relevant. “Currently, 8% of Foot Locker stores are community stores, meaning they hire locally, put on “activation events” for families and feature local art.” Foot Locker plans to increase its portfolio of these community stores and introduce more off-mall and larger-format locations to enhance the shopping experience for its customers.
Customer centricity continues to be the north star keeping customers at the centre of design. Tolga Oncu, Retail Operations Manager (COO) at Ingka Group (IKEA Retail), discussed how IKEA has started introducing smaller-format stores to complement its 370 global flagship stores. The new format directly responds to consumers’ desire for closer IKEA stores. IKEA found that consumers who enter these closer, smaller stores often have not shopped at IKEA in 12–24 months, but, after exploring these stores, will visit the company’s website or make a trip to their nearest flagship store.
3. Unleashing the superpowers of the store teams
I have deliberately avoided putting technology or AI as a headline team, as these solutions and capabilities are enablers. However, at the event many retailers emphasised exactly how they are leveraging technology to increase productivity to unleash the team members capability to be better educators, brand ambassadors and salespeople. This specifically links back to our theme of our X-files this month on effectiveness and efficiency.
Digitising store task – retailers should be looking for solutions to operate efficiently on fewer employees. Digitising operations and tasks also enables instant visibility into performance. This in turn allows for quick reactions as retailers can’t wait days or weeks to find out whether or not stores are up to par and have implemented all the initiatives that will enhance sales and the customer experience.
This is where digitisation rocks. If store tasks and processes are digitised, data can be collected, and reports and alerts can surface and identify the things stores need to improve on and how support office can support the network better – a win-win scenario.
Workflow upskilling - Retail employees need the right training tools to perform at their best and to drive conversions or increase sales. We all intuitively know that employee knowledge drives conversions. Retailers need those in-store conversions now more than ever. Increasingly “traditional” training (in-person, take-home materials or conventional e-learning courses) doesn’t keep up with store team needs because it’s infrequent and not at their fingertips.
A recent report indicated: 37% of retail employees are trained only once per year or less. The inconvenient length of training programs, the locations and required back-cover all seem to be the most common excuses. Most retail store employees will tell you about a time they were directed straight to the sales floor with minimal training – with training put off until time allowed – if at all.
Solutions to this problem include using mobile to ensure training materials are available to all employees, keeping training materials short and easily digestible so that it fits into store employee’s flow of work, and making the content engaging and fun (and not 2020 fun).
Setting the stores up for success is the only way to achieve a significant increase in sales.
Simplifying processes: It’s obvious that the more time that is spent on tasks, and task management, the less time store employees have to focus on customers. With fewer employees working in stores today, it’s more important that the ones who are have sufficient time to enhance the customer experience. When store teams spend too much time on tasks, customer experience suffers.
Simplifying and digitising repetitive processes can alleviate some of the time restraints store employees are facing. This includes getting rid of paper-based processes, merge tools like email, phone, and intranet so employees only have one place to check for all communication and digitising complex processes –task handovers and waiting for approvals is where bottlenecks happen. These efficiencies can increase overall productivity.
Panera Bread, an American fast-casual restaurant chain, discussed how the company has introduced technologies include Amazon One palm-recognition technology, which links MyPanera loyalty memberships to customers’ Amazon One profiles and enables Panera team members to offer a more efficient and personalised experience.
Panera’s technologies can also minimize low-value interactions between store associates and customers, if the customer chooses—for instance, customers can opt for “contactless dining”—freeing up store associates for more meaningful work.
4. Shifting the focus from customer acquisition to customer experience and retention (aka Personalisation)
In the wake of Covid, for many brand loyalty was less of an issue. Simply finding the product I needed became the focus due to supply chain disruptions and shortages. Let’s face it, some of us got very excited from fluctuation demand (when positive) from a more fluid customer base.
Many retailers at ShopTalk mentioned they are revitalising their strategies to ensure they are a customer’s first point of purchase and have the activities and touchpoint activation in place to turn visitors into repeat customers.
Many brands and retailers also talked to deploying personalisation strategies and technology across the shopping journey to engage consumers’ fragmented attention, increase engagement and, ultimately, drive higher conversion and loyalty. Enhancements are coming through leveraging both AI and first-party data to better engage with their customers.
An example from ShopTalk:
Amanda Bopp, VP of North America Marketing at Kate Spade, an apparel and accessories company, explained why personalisation is so important: it shows that retailers understand that their shoppers are complex humans and will not simply reduce them to general categories, such as their preferred shopping channels. The session highlighted personalised language as one of the most critical elements of a retailer’s overall personalisation strategy, as it can significantly impact how a customer responds to specific offers.
5. Agile merchandising strategies are a must
The pandemic, economic uncertainty, cultural, social or environmental shifts and inflationary pressures has made it more critical for category/merchandise teams to have the ability to pivot to meet market changes. Effectively a mission critical skill that allows flexibility and agility to make changes and iterate at speed (like when the summer you were waiting for never came). Not to mention the emergence of second-hand or “repaired and renewed” products.
In addition, as ecommerce marketplace and social media selling channels become more diverse, it becomes even more critical that forecasting, inventory stock holdings, price and promotional strategies can keep up. The ability to scale, sell in more volumes, interpret performance and forecast.
It comes back to having a deep understanding of the customer through data and utilising platforms that unite information and enable merchandising teams to deploy strategies easily; effectively and efficiently.
Retailers that are embracing this new expanding unified network must have tight integration between marketing and the planning team so planners know which channels are going to be impacted by marketing budgets and when.
This allows them to prepare inventory to fulfil demand most effectively for that channel before they are hit with spikes in demand. Better forecasts based on consumer trends allow retailers to drive more repeat purchases and higher lifetime value.
In researching and having conversations with attendees I do have a serious bout of FOMO. However, with the unusual start to 2023 it was the right thing for us not to attend. But it is in our diary for next year as it is important to be a part and immersed in the conversations exploring the evolving retail landscape and paving the way for next-generation retail.
We believe that brands and retailers of all sizes should continuously look to innovate across their businesses and operations to adjust to the shifting retail landscape and provide their shoppers with the best retail experience possible. So feel free to reach out and come join us on our trip in 2024.
The new financial year has started for the majority of retailers. Do you feel like you need a fresh set of eyes on your business to assess where the key opportunities exist to grow your business. RX has a proven and successful Due Diligence Review process which identifies where the key priorities for your business lay and how you can achieve this. Engage with a partner that is pragmatic, innovative, experienced and works as a part of your team. Contact Juanita@rxgroup.co.nz or +64 274 768 073