Photo Laurel Marcus
Bright and early yesterday morning Robin Lewis, CEO of The Robin Report and speaker and consultant to the retail and consumer products industries, gave an introduction for Fashion Group International's annual retail report entitled "Tick Tock Retailers: It's Wake Up Time." The event was a breakfast at the New York Hilton sponsored by Hearst Magazines. Lewis presented his "Back to the Future moment" which went something like this: way back in 1908 all 1,140 pages (8 pounds!) of the Sears Roebuck catalog would be delivered to your door. "In this catalog you could find everything from the cradle you were born in, to the coffin you'd be buried in," he said.
|Matt Wood, Nadia Shouraboura, Robert Harrison|
Photo: Laurel Marcus
Inventions such as the automobile gave people increased mobility; by the 1960's the "big box" chain stores such as Walmart and Target were born and consumers began going to the stores. Flash forward to the '90s when Jeff Bezos founded Amazon which "sparked the explosion of e-commerce back into the living rooms of consumers." In 2000, Steve Jobs' iPhone "truly did change the world" and "flipped traditional retailing on its head with retailers going to the consumer once again." Lewis forecasts that the next big thing is "personalization" and "predictive analytics." To illustrate this he told a story of a guy coming home to an Amazon package on his doorstep which contained a light bulb. He is confused because he did not order the bulb -- later that night, one of his existing bulbs burns out. Creepy, isn't it?
|Left to right -- Robert B. Harrison, Dr. Nadia Shouraboura, Robin Lewis, Nancy Cardone of Marie Claire who gave the welcome, Dr. Matt Wood, & Paul R. Charron|
Photo: Bruce Borner
Paul R. Charron, chairman of American Apparel served as moderator for the panel of three including Dr. Matt Wood, GM, Product Strategist at Amazon, Dr. Nadia Shouraboura, CEO of Hointer, a new type of in-store automated retail experience which sells jeans in Seattle, and Robert B. Harrison, Chief Omnichannel Officer of Macy's Inc. Charron recounts how, in his past life in the late '90s when he was CEO at Liz Claiborne, "everything was product, product, product" as opposed to now when things like logistics and supply chain are taking center stage. "We thought we controlled our own destiny and if we just made a better product everything else would fall in line," he said. By 2010, the buzzword was "technology" and making it "faster, smarter, better. Take the complex and make it relatively simple" and of course, direct to the consumer, he said.
The first topic that the panel discussed -- organizational capabilities. Harrison remarked on how the retail "environment is changing dramatically. We have to demonstrate a much greater agility" in order to keep up. "If you cannot provide something that isn't available somewhere else, you will not be relevant," he added while stressing the importance of a format that blends and merges retail stores and devices.
Dr. Wood spoke of his "data fly wheel" which would create a better experience for customers. "The faster you can spin it, the better for customers." He spoke of mobile devices that scan things in the kitchen that need to be repurchased and even a washing machine that somehow becomes sentient (like the light bulb story) and knows when to order more fabric softener.
Dr. Shouraboura, the comedienne of the panel, told a hysterical story about overhearing her husband conversing with a "woman" which she thought was possible, "I travel a lot," she explained. It turns out that he was cooking with Alexa, from what I gather she's the Siri of the kitchen. She also spoke of a $7 device which converts your mobile phone into a magic wand so that you can "feel like a princess." She predicts a future full of even more "different devices that will take our husbands away and make us feel like princesses."
In answer to the question of what managerial capabilities or skills will become important with technology, Harrison mentioned the ability to "thrive in an environment of change" and to work in teams. Once again Shouraboura launched into a story about the day that a well-known European designer walked into her Seattle store ("He was very well dressed and in Seattle you know that means something is up"). After he tried on about 50 pair of jeans he remarked that he didn't feel anything and had no emotional connection to the experience. Shouraboura joked that as a scientist she didn't get the idea of emotion tied to shopping. Thinking of something that she felt passionate about she got the idea to substitute the word "sex" for "shopping" which worked well (example: "you don't want the customer in and out in a flash").
More talk ensued about conversion rates of the online experience versus a physical store (some things do better online and others such as clothing are better in a physical store), cosmetics (some customers may want help IRL with makeup not just watching an online video), as well as the fact that there's still a community of consumers who go to a store for entertainment, connection, theatre, experience, comradery and a human touch. (That last one's starting to sound a lot like Dr. Shouraboura...)
Data sharing was another hot topic; some people feel comfortable doing so online while others do not. Of course, the more information that a store can get from the customer the more they can curate the images they show you, so that one is not faced with having to scroll through thousands of things to find what they want. Ways to streamline fulfillment, such as a machine which scans the inside of a package to confirm its contents, saves on having to actually open, "count widgets" and seal up a box.
Other changes in today's retail climate: new products must resonate quickly and anything that erodes the customer's trust is taken very seriously. Dr. Wood mentions Amazon's ability to, with the press of one button, quickly take down any item that is perhaps defective or getting bad reviews. Building the customer's trust and creating good will (Macy's does so with its Thanksgiving Day parade) is also tantamount.
Lastly, in response to the question regarding whether Millennials are really game changers to retailers, all panel members agreed that rather than use the term as an artificial grouping, they are really just a bunch of individuals; a segmented part of the broad ecosystem, like anyone else of any other age category. Apparently there are Millennials who shop like 70-year-olds as well as 70-year-olds who shop like Millennials, which hopefully debunks this overblown retailing myth.
- Laurel Marcus