Last week we brought together more than 400 retailers and industry experts for this year’s Stockholm edition of our world-famous Retail Breakfast Club.
Two Retail Breakfast Club events took place earlier in the year in New York and Oslo, with the Stockholm event being the last one for 2019. These meet-ups are designed to bring together like-minded retailers and help them understand new ways they can meet and exceed ever-changing customer expectations.
Taking the stage in Stockholm were Jens Levin, Sitoo co-founder and CEO, Karin Lindahl, CEO of Indiska and Jim Lofgren, CEO of Nosto. Together, they painted a vivid picture of how retail is changing and what the best brands need to do in order to survive – and thrive – in this brave new world.
Here’s what we learnt from Stockholm’s Retail Breakfast Club:
1. The retail ‘apocalypse’ is fake news
Stores are in trouble, right? Big brands are folding, high street stores are closing across Europe and ‘retail death’ is being shouted from the rooftops. In fact, a UBS report projects retailers in the US must close 75,000 stores by 2026 due to ecommerce. The logic goes, if online sales go up, store sales go down and, as a result, stores must close.
Yet retail store numbers continue to grow. According to Census Bureau data, 2018 saw a net increase in retail stores in the United States. There were almost 3,100 more stores during the fourth quarter of 2018 than the same quarter a year earlier. What’s more, when a physical store closes, ecommerce sales in the immediate area fall by a huge 37%. And, according to a study by Forbes, 68% of consumers use ‘click and collect’ with 85% of them buying something else when they collect their goods.
Stores are far from dead. They are in a digital transformation. The challenge for retailers is to embrace this digitalization and meet our new ways of shopping. It’s the failure to do this which is costing retailers. Adyen’s Retailbarometer for 2019 shows retailers are missing out on more than SEK 8 billion because of long lines at the checkout, lack of payment options and because items aren’t in stock in a particular store. All of this can easily changed through digitalization.
2. Be brave. Have courage. Failure is not an option
When Karin Lindahl joined Indiska she was faced with an operating profit of minus SEK 41 million. She was tasked with transforming the fortunes of the brand and in less than two years the company’s revenue from ecommerce has doubled. Furthermore, Indiska has reduced costs and streamlined operations. The next step in its transformation is to create a seamless customer experience in-store and online.
So how did she keep the ship moving with storms all around and forecasts for worse to come? In short, by defining a global vision for the brand and creating a retail strategy with a mix of ecommerce, physical stores and marketplaces.
She told Retail Breakfast Club, leaders need to not be scared when things go wrong, and to instead, draw creativity and adrenaline from the situation they are in. They can do this by surrounding themselves with people they trust, having the endurance to go the distance, believing in what they are doing and not extrapolating negative trends too far into the future.
3. Make every moment matter
As consumers, we used to have one point of contact with brands; when we walked into their store. Now, these points of contact are everywhere and we’re more exposed to brands than ever before – yet we feel increasingly disconnected from them. In his talk, Jim Lofgren of Nosto told us how brand loyalty has fallen by 50%, and 65% of consumers say they don’t feel recognised by their favourite brands. In a world where the strength of the relationship between brands and consumers is everything, this has to change and it’s why brands are shifting the relationship from producer/consumer to a peer/peer relationship.
This is why every moment matters. It’s now more important than ever for brands not only to sell great products, but to engage consumers through channels they prefer across all stages of their journey, beyond the transaction.
There are many touchpoints in a customer’s journey – from researching a product online (most likely on a mobile device) to going into a store to try it on, to then seeing a social ad promoting the same product. Typically, these touchpoints are all managed by different people – like an ecommerce manager, a store manager and a marketing manager – who are often competing against each other to see who can drive the most revenue rather than working towards a common goal. The challenge lies in unifying these elements to make each touchpoint relevant to shoppers. The more moments there are, the higher the probability of broken journey there is even if the quality at each touchpoint goes up.
However, by unifying these processes and data, retailers can make every moment matter by delivering a personalised and relevant experience to consumers whether that’s online or in-store. What matters in physical retail is the service, and the service is dependent on what’s known about the consumer – the sum of all the data collected from all the other moments.
Last updated: December 19, 2024
