Each month we share our thoughts about an issue to do with retail, an insight, an opportunity. This month we thought we would reveal a bit more about who we are and what RetailX does.
If you’ve met Juanita, you know she is unique. She has an endless enthusiasm for retail, can talk incredibly fast (especially when she is excited about retail), uses the odd swear word but travels the world and works alongside CEO’s and their businesses to reinvent their business. Tell us a bit about RetailX? RetailX are a team of retail specialists that combine their deep sector knowledge and commercial experience with an astute understanding of the shopper. Individually our founding team have over 25+ years’ experience as retailers so we understand what is necessary to convert a shopper into a buyer getting them to visit for longer, more often and spend more money. We work with retailers from diverse categories of different products and services to reshape, reinvent and grow their sales and customer base. Why? We love retail – it truly is our passion. We love how it changes every day and how customers can be so damn unpredictable. We also believe that we need a vibrant retail sector of all shapes and sizes to support our economy, create interesting and flexible jobs and ultimately to solve customer problems. We bring together the art and science of retail. From what makes customers tick, trends and opportunities in the sector here and abroad, sticky ideas to capture a customer’s attention and brand concepts that resonate. There is a science as to how retail can work as well. Many concepts are brilliant, but they won’t make you any money. But shit, they will be cool.
Retail is a fine craft of connection and commerce.
For a long time, strategists talked about being “the only” but the reality in retail is much of what you do can be copied and in fact you aren’t “the only”. But in the words of the great Howard Saunders, you want to be “the one.” More than ever before we seek out things that give us reassurance; products with meaning or stories to tell. We look for retail spaces that enhance our sense of community, of belonging, and we’re turning away from stores that only want to sell us more stuff. The one is that retailer that connects above all others as it is genuine, authentic and relevant. How have retailers changed marketing strategies over the years? In many respects retailers have and have not changed their marketing strategies over the years. There have been some turbulent times for retailers which have made them nibble, confused and creative. Through the GFC and post-GFC retailers had to do whatever in their power to stimulate sales. We saw prices plummet and more promotional activity (deep price cuts) become common place. I think they have discovered that slippery slope to the bottom. But it’s hard to turn off the heroin and it’s even harder to have the fortitude to try different things to win some and lose some. Retailers have also discovered that authentic storytelling and having a direct relationship with the customer can be powerful. But you must be genuine, compelling and relevant. The rise of digital capabilities and measurable one-to-one data has enhanced this. We know more, can refine our message more accurately and serve it in a way that speaks to individuals. There is thought that digital media channels are disrupting long-termism for brand equity build, what balance do you recommend when creating short-term campaigning and long-term brand positioning? I think yes and no – it depends on how you do it. Retailers need to be agile which means you must have a clear direction for the business and brand but how you get there can be adapted for the moment. Of course, there is a place for call to action campaigns, likewise there is a role for transactional storytelling and brand storytelling. But there are many touchpoints on the path to purchase that influences what a customer thinks about your brand. If you have clear brand pillars it becomes easy to build an approach using many different channels – including your physical store. My advice is to clearly know your brand pillars and make sure all activity maps to them. It doesn’t need to be every pillar, every time, but at least one pillar in every communication. Otherwise, why are you telling that message? How is it enhancing your directing and building on the brand promise? Finally, don’t weaponise your data. The last thing the world needs is another pointless email that is simply deleted or an intrusive piece of communications at the wrong point in time. Data is gold, use it wisely and respectfully. You can still be exciting and compelling, but a customer will take it away as quickly as you gave it to you by voting with the feet. Do retailers in NZ really understand their customers to connect with them appropriately and modify their activities based on results? Marketing, like every piece of the retail ecosystem needs to produce a result that can be measured. It is a mix of art and science but in order to have relevance at the Board table, and more importantly with customers, you need to understand what impact it has. Customer understanding in the majority of retail businesses in Australasia is incredibly weak. There are buckets of understanding, but these are often generalised. Often the reason this doesn’t change is the inability for marketing to influence. Results, data and insights are powerful influencing tools in any business. Especially retail.
If you can’t measure it, how do you manage its role in your business? Sometimes a media channel has different roles in your mix; to get customers to lean in, to sit up and to lean back. Likewise, some purchase decisions are infrequent, frequent, emotive or rational. Customers are irrational and multi-faceted so the more you learn about behaviours and the attitudes that connect to them, the more accurately you can craft your connection. Don’t get me wrong there are some companies that have a stunning understanding, but many of the incredibly large retailers simply have no idea. But often this is because they simply don’t know how to understand. How to take all the customer information and develop personas. How to analyse the customer information into meaningful insights. It is hard. You need to have an environment where information, systems and your people can interpret customer understanding and do something with it. Often insights are only derived to help support an idea, rather than uncovering a piece of gold you didn’t know. I think many retailers are scared of finding gold as it meant they didn’t have the answer. Retailers in our market have to appear like they are 150% on track to the solution – anything less and their board will oust them. But the true leaders are those that utilise their clever people to unpack the insights to pan the gold. Unleashing the unknown. About 14 years ago when I was at Progressive Enterprises (now Woolworths NZ) creating Onecard, the idea was it was the one card that would ultimately do everything. We had some idea what “everything” would be for the next 3-5 years but not really beyond that. We knew the data would unleash possibilities to deliver to customers unmet needs, make their shopping easier and more importantly ensure we could provide the right product for the customer in a way that was profitable. We thought you could pay with it, get your fuel and energy with it, we wanted you to be able to do whatever was necessary to connect your everyday household needs. We had a vision, a goal but not necessarily the roadmap – as we knew the changing shape of our customers and ecosystem would unwrap those opportunities. We knew we had to engage customers (rewards), provide instant gratification (onecard savings), pops-of magic (special offers based on their shopping) and prove value to the business (spending rewards in a way that drove benefits, negotiations and delivery of our proposition at store level). What we knew was while there were customer benefits there needs to be internal customer benefits, so it had to deliver to many areas of the business and it did. For example, operations (data about the catchment, peaks driven by rewards, ways to bring customers back), merchandising (deep dive basket behaviour), finance (managing rewards liability) and the list goes on. So retailers need to understand better the influence strategy to get the business aligned. The connection with one part of the business is going to be different to how you unpack the gold with the other. It’s about adapting the situation to meet your internal customer needs, wants and desires. What future trends do you predict for retail marketing?
Micro-audiences and persona marketing Yes, some businesses do segment emails and others know their audience personas. But only the “best in class” are using these strategies effectively with the retail marketing. We can see how powerfully international retailers like Nike can speak to incredibly small audiences and receive their reward in creating powerful customer groups. They are delivering uber-localisation and curated offers based on their intimate understanding. Likewise, the growth of the Daigou category has seen how micro-influences can create powerful returns. This is micro-audience marketing. Coal-face engagement One of the most powerful influences in a retail business are its people. Yep sure I love hearing what the designer loves about what they created, or the buyer telling me about where the product was sourced, but a WOW is when the person on the shop floor (or digitally) can solve my problem one to one. Empowering our teams to do more, find information at their fingertips (yes, their own mobile phone) and having the permission to use all of those elements will be a game-changer. But it relies on incredible content repositories and a truckload of trust (and training). If you don’t believe me check out usehero.com which is a platform that enables stores and their teams to proactively assist online shoppers creating a formidable advantage. Visual shopping Driven by AI-power, visual search allows shoppers to find and buy products simply by snapping a photo. Pinterest Lens is one of the capabilities that will lead us through the innovation cycle. I think this will be the winner, not voice search. Our love with our phone and the vibrancy of images is simply more powerful. And the obvious ones:
Ethical and values-based retail and marketing
The rise of the store as the largest physical manifestation of the brand
Who is doing a good job in retail in NZ? I always hate this question as I worry that I have overlooked someone unfairly. But reality is this is just a moment in time as it changes so often.
Loaded NZ The High Street outpost of this retailer is absolutely world-class from the selection of product, customer service, product knowledge and visual merchandising. It’s an incredible mix of local, international and down and out cool. I love Boutique Undergrnd especially in High Street and whenever I visit, I learn something inspiring and new.
Countdown They are really punching it at the moment from their actions in the sustainability space including BYO container, to their click and collect and online shopping, their utilisation of onecard for personalisation, their work with The Salvation Army on the Good Van ethical shopping trucks. They have improved their produce in many stores and their pricing is consistently competitive.
BP They have continued to lead the way with their BPme app which lets me pay in car and drive away, Wild Bean Café and more recently their foray into partnerships with the likes of Krispy Kreme. I must say last year I was all about Z but I think BP certainly got the jump on them. It’ll be interesting to watch this space with the new Z app and Get Pumped rewards programme.
The Market NZ It is brand spanking new but this aggregation marketplace has a big thumbs up from me. It’s rich with content (long may that continue) which enables you to slide down the rabbit hole of inspiration. I also love that it has created a platform where all brands can compete equally, where some retailers we haven’t seen before.
Barkers This menswear fashion leader is always forging ahead with incredible stores. Their content is always on point and we especially love their digital concept store in Ponsonby (although No 1 High Street is my favourite).
Chemist Warehouse They might be Aussie, loud and big but I never fail to leave one of the Chemist Warehouse stores without spending about $100. They have made health and wellness affordable enhanced by an incredible selection in the categories they stock. From entry level to premium there is something for everyone. And they are growing fast. The downside is they are always so busy that I hate having to wait to see the pharmacist – but hey the buzz in the store is amazing. I even had a security guard (in the Glen Innes store at 8.50pm on a Friday night) show me where the product I was looking for was (and trust me it wasn’t main stream). One of our team. Awesome. Ballantynes I always enjoy this iconic department store. It helps (unfortunately given the circumstances) that they could reimagine their space and they have delivered a world-class operation supported by exceptional team members. I am also impressed that they have been able to deliver West Elm and Pottery Barn to New Zealand.
What are your top tips for anyone reading this? Stop thinking in channels. It drives me nuts. A customer isn’t sitting there going “hmm I might do some online shopping now.” They simply just go shopping and expect to interact with your business whenever, wherever and however they want.
Get out of the office. What is happening in the world? What’s happening in the market? What’s happening in the store? Build networks of people who can tell you real stuff. See it with your own eyes and experience it. At least one day per month (if not per week) you need to be out where people shop.
Storytelling is powerful. Own your narrative. Why do I want to pick-up this product and take it home over all others? Why do I want to cross your lease line and engage with your brand? Why should I tell others about who and what you are?
When you tell an authentic, genuine and relevant narrative then great things happen.
Retailers need to connect with shoppers functionally, rationally and emotionally. Don’t keep your story of greatness a secret. How you make the product, select ingredients. Shoppers are people with attitudes, behaviours and beliefs.