6 Retail Experts Plan Retail Strategies for 2016

Update: Check out our 2017 update to this article.

 

With Q4 upon us and the holiday shopping season nearly in full swing, retailers will begin to face the ultimate test — from inventory management, employee productivity, omnichannel integration and millennial targeting.

We’ve gathered several retail experts to provide their expert observations and advice to help retailers focus on their retail strategies for 2016. These experts, combined, have over 100 years

collage of retail experience, and have helped drive strategy with top tier companies – including WalMart, Macy’s, JCPenney, Williams-Sonoma, Sears, ASDA, George., Rocket Dog Brands, New Balance, J. Jill, Barnes&Noble.com and Office Depot.

This article is tailored to retailers & brands who are looking to drive their strategy for the upcoming year — specifically looking into retail challenges, growth opportunities and competitive expectations for 2016.

 

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Meet the Retail Experts

Or Jump To The Key Takeways



Clay Parnell, President & Managing Partner: Parker Avery Group

WiClay P Headshot (2)th over 25 years experience in the retail industry, both as a consultant and retailer, Clay has led major transformations, developing strategy The Parker Avery Groupand processes, selecting and deploying systems, as well as managing organizational change. He specializes in merchandising, including item / foundation data, buying, planning, allocation, replenishment and inventory management.

 

Chris Hammond, Management Consultant: Parker Avery Group

Chris H Headshot 2015a (1)Chris has 10 years of combined industry and consulting experience throughout the retail, restaurant and consumer goods industries. He has worked with a broad array of clients across the retail landscape and focuses on delivering strategy, process and technology solutions. Chris has authored, edited and contributed to industry white papers, studies aThe Parker Avery Groupnd blogs – including omnichannel, the future of brick-and-mortar stores, employee incentives, millennials and retail pricing.

 

Paul Thomas, Senior Consultant: Retail Remedy

Paul Thomas

Paul is a successful Retail Sales Director who cut his teeth at Harrods of Knightsbridge and Sainsbury’s – where he covered Luxury and General Retail. He’s an expert at leading and developing teams in the areas of Sales Growth, Customer Experience and OperationaRetail Remedyl Standards, and always meets profit targets.

 

Ani Collum, Partner: Retail Concepts

Unnamed image (15)Ani is a retail industry expert with over 15 years of experience working with start-ups to large retail players across all aspects of the business, including new concept incubation, branding, marketing, financial analysis, inventory management, merchandising and operations. She has a background in lifestyle, luxury, department store and off-price segments with companies such as TJX, Tommy Hilfiger, Macy’s and J.Jill, and is an industry speaker and frequent press contributor for retail related trends and stories.

 

Ricardo Rubi, Partner: Simon-Kucher & Partners

Unnamed image (14)Since joining Simon-Kucher & Partners in 2003, Ricardo has specialized in sales, marketing, and pricing topics. Ricardo specializes in deriving pricing and promotion strategies that are aligned with corporate goals and tap into consumer psychology. He has developed multi-channel strategies and helped clients revamp sub-optimal pricing processes.

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Devin Fitzpatrick, Founder & CEO: CDF Consulting

Unnamed image (20)

Devin is an ecommerce industry leader, with a Columbia University and FIT education and an entrepreneurial spirit. Throughout her career Devin has defined and implemented the digital strategy of some of the top global luxury brands in the world. Having worked in house at brands such as CHANEL, Shiseido, Donna Morgan and J.McLaughlin, Devin launched CDF Consulting when she recognized the need that many smaller fashion and luxury brands had for top tier digital strategy assistance.Unnamed image (21)

 



 

5 Challenges for Retail Strategies

1). Omnichannel Integration

Clay Parnell, President & Managing Partner (Parker Avery Group):

OmClay P Headshot (2)nichannel has been a buzzword for several years now, but many companies are still struggling to integrate legacy systems and offer true “omni” capabilities. Integration challenges are particularly complex related  to inventory and demand. Additionally, the process design work required to address omnichannel requirements, update policies and procedures, as well as align training programs should not be underestimated — it’s a necessity.

Ricardo Rubi, Partner (Simon-Kucher & Partners):

OmUnnamed image (14)nichannel strategies are not easy to execute, but they do work.  Several companies have figured this out — Bloomingdale’s ties their in-store experience seamlessly to their online store giving a sense of continuity  — I shop at the store, but buy online.  Other pure e-commerce stores have developed brick and mortar storefronts to give the experience while still maintaining a pure online platform that also engages consumers.

2). Employee Productivity

Chris Hammond, Management Consultant (Parker Avery Group):

EmploChris H Headshot 2015a (1)yee productivity has been a challenge since the dawn of retail, and it is becoming increasingly challenging as employees expand into broader roles and are expected to deliver across more capabilities than ever before. The stocker is no longer just a stocker — he/she may also pull internet orders, scan inventory into backroom and / or sales floor locations, reorder out of stocks, update product counts and perform several other critical tasks.

Paul Thomas, Senior Consultant (Retail Remedy):

CPaul Thomasompanies today must be able to develop and engage with their employees, in order to keep their employees for the long run. If companies are not doing this, employees may feel less engaged, and less likely to go the extra mile for their company and customers.

 

3). Inventory Management

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)So many of the challenges and capabilities being focused on by retailers today hinge on the expectation that they have the inventory exactly where they think it is and that more will arrive exactly when it should.  As more and more consumer interactions begin to take place with inventory separate from the purchase location, the importance of inventory accuracy also increases.

Ani Collum, Partner (Retail Concepts):

Unnamed image (15)This is a challenge for many ecommerce companies, especially those who also launch into brick and mortar where the dynamics of carrying inventory can be vastly different depending on the type of business.

 

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)Increasingly, companies are finding their inventory accuracy is not where it needs to be, resulting in disappointed shoppers and lost sales.  With new complexities associated by using 3rd party shipping, inventory accuracy issues can place even the best omnichannel strategies quickly out of reach.

4). Price Transparency

Ani Collum, Partner (Retail Concepts):

Unnamed image (15)Given that customers are now accessing brands through multi-channel formats, it is more important than ever that retailers are totally transparent in the area of pricing and make sure there is consistency across all of their channels. This can require some infrastructure shifts for certain retailers, particularly for those who operate their businesses in different silos, but from the customers standpoint, there is no logical reason that prices may be different in different channels.

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)Retailers must make investments in price optimization solutions that support their brand positioning, align these with well-planned consumer policies and empowered associates ready to protect the brand.

 

5). The Chase for Millennials

Ricardo Rubi, Partner (Simon-Kucher & Partners):

Unnamed image (14)Perhaps, one of the biggest buzzwords in the industry has been “Millennials”.  This demographic embraces technology like no other generation has before.  They also tend to have a life philosophy like no other generation had before.  I see two important challenges that come with the Millennial’s phenomenon:

1. Millennial’s experience-based philosophy of life

Millennials have been shown to prefer to invest in experiences rather than physical objects.  This, of course presents a problem to retailers of physical goods.  It is important that, if you are targeting millennials, you communicate how purchasing your products online, they can have a footprint in the bigger meaning of humanity.

2. Retailers losing their brand focus

We have seen some other retailers that, on their hunt for millennials, forget about their core consumer segment.  If your company focuses on baby-boomers, it makes more sense to have simpler online platforms that help you retain your core customer segments, but have a brand message that also appeals to Millennials to provide them a path to you.

5 Retail Strategies That Will Fuel Growth

1). Mobile

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)You cannot talk about online growth without including mobile.  This area exploded onto the scene and has provided double digit and consistent increases year over year.  Although the overall penetration was initially small, it is growing – with mobile projected to make up 25% of all eCommerce sales by 2016.

Paul Thomas, Senior Consultant (Retail Remedy):

Paul ThomasRetailers have a great opportunity to expand their mobile presence, always making sure their website is mobile compatible. Retailers must be able to attract the younger customers via mobile, and the younger customers expect to be able to purchase easily on their mobile device.

Ricardo Rubi, Partner (Simon-Kucher & Partners):

Unnamed image (14)Mobile is a powerful tool that can be used across all of retail.  It enhances the convenience of the e-commerce channel.  However, always have in mind that mobile is part of the experience that the consumer goes through when shopping.  The mobile experience has to be a good one in order to retain a client.

Devin Fitzpatrick, Founder & CEO (CDF Consulting):

Unnamed image (20)Brands are seeing anywhere from a 30-50% increase of mobile traffic, and the conversions are there too. It used to be traffic, but now consumers are shopping from their phones all the time. Optimize your mobile site immediately – it will drive an increased conversion and revenue rate.

 

2). Omnichannel

Ani Collum, Partner (Retail Concepts):

Unnamed image (15)If you are shopping with a multichannel retailer, you should be able to talk about the product you are looking to buy online with an employee in a brick and mortar store. Every touch point needs to be connected–that’s the expectation.

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)The real area of growth to look forward to within the omnichannel umbrella is sales – as integration improves, more product becomes visible to more consumers when they want it, at the price they expect, and within a time-frame they are willing to accept.  

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)The key here will be seamless integration – if your in-store experience saves the sale by supporting shoppers going online, and your online environment supports in-store experiences through add-on value and pick up locations in key areas of the store, the benefits will speak for themselves.  The retailer can capture a larger share of consumers’ wallets as well as cement themselves as the retailer of choice and convenience.

3). Millennial Generation

Paul Thomas, Senior Consultant (Retail Remedy):

Paul ThomasThe millennial generation is an interesting one because they expect instant satisfaction when purchasing a product/service. They expect the buying process to be easy, and for their order to be fulfilled as promised.

 

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)With over 75 million individuals in 2015, Millennials will officially become the most populous generation.  With an average age of 26, the Millennial generation is still branching out in their spending and decision-making.

As they become increasingly affluent, Millennials will play a central role in retail’s profitability moving forward.  As the economy improves and more Millennials leave the nest and find careers, retailers can expect spending to increase in the medium to long term across all categories.

4). Capitalize On E-commerce Value Proposition

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)Ecommerce seems like yesterday’s buzzword, but it is still growing at a significant clip – with no better highlight than Amazon.com’s emergence as one of the world’s largest clothing retailers. “Pure play” competition will stay strong but will be mitigated by retailers’ own web presences becoming increasingly sophisticated and offering many of the same benefits either through price matching or by leveraging brick-and-mortar locations as distribution centers.

Ricardo Rubi, Partner (Simon-Kucher & Partners):

Unnamed image (14)To think about what e-commerce can do for you, you have to think about what e-commerce does for your consumers.  E-commerce provides a channel that people can access from the comfort of their own home, 24 hours a day 7 days a week, it takes as long as the consumer wants to spend shopping, hassle free, and merchandise arrives at the consumer’s doorstep.

5). Customer Buying Journey

Paul Thomas, Senior Consultant (Retail Remedy):

Paul ThomasIt’s really all about the customer experience and the customer journey. If the customer is buying online, mobile or in store, the customer should expect the same branding, the same type of answers to their questions, same response time, and same price. It creates a mistrust if not all channels are connected.

Ricardo Rubi, Partner (Simon-Kucher & Partners):

Unnamed image (14)Understand that one of the most powerful tools in e-commerce is the power of up-selling and cross-selling. Consumers tend to be drawn by certain items, they tend to use the high transparency of the internet to compare prices across retailers in some products.  It has been vital to retailers’ growth to identify those items that drive traffic to their site and help retain consumers shopping in it. These items need to have something that will entice or hook consumers that are not as brand loyal as one would wish.

5 Expectations for Competitive Retail Strategies

1). Inventory Management

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)In-stock accuracy is more than just having the product at the right location, it’s also making sure that the product makes it to the sales floor (in the right location) and is ready for purchase.  A vast majority of shoppers will not take the time to find an associate and wait while a product is checked – they will instead perceive the product to not be carried or not be available, and not make the purchase – or worse, purchase elsewhere.

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)Despite advancements in retail inventory management solutions, many have not effectively “closed the loop” in making sure the product is received, goes out to the sales floor, then ends up on the shelf. 

For physical stores, the primary reason for sales spikes closely following floor resets – not only attributable to freshness and cleanliness – but largely the simple fact that the product is visible to shoppers and available for purchase.  Systems can only go so far on the retail floor – much of this is basic retail execution.

2). Social Media Integration

Ani Collum, Partner (Retail Concepts):

Unnamed image (15)This kind of goes back to the point about really being multi-channel. Every brand touchpoint needs to connect and social media an important communication vehicle that needs to be totally integrated with the rest of the brand. It is not the place for random posts that clog up customers feed. Everything done here needs to be strategic and on-brand so that it becomes a meaningful outlet.

Devin Fitzpatrick, Founder & CEO (CDF Consulting):

Unnamed image (20)Brands need to focus on Pinterest, Facebook and Instagram. Some of these are pay to play, but you can never acquire a customer who is more intensely targeted and perfect for your brand than from Facebook ads. Time and time again it drives the highest conversion and outperforms our KPIs.

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)To further engage the consumer beyond delivering on their value proposition either in-store or online, retailers need to carefully craft their social strategies with personalized messages, offers and appropriate “touches.”   The social shopping space must be tread with extreme care to keep consumers engaged and loyal, but avoid being social channel “noise.”

3). Foster Loyalty & Trust

Devin Fitzpatrick, Founder & CEO (CDF Consulting):

Unnamed image (20)

Customers seek how to use your brand and your product in the real world; they want to feel a part of the brand. Invest in getting content out to the world and receiving content — Build trust & loyalty.

 

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)Loyalty programs have benefited from a wide variety of research regarding consumer purchase behavior and value systems.  It’s important for retailers to both differentiate themselves and stay top of mind for their shoppers – but more than that, a great loyalty program will inspire action on behalf of the consumer.

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)“Gameification” is an example of one such trend, the desire to reach “tiers of status” similar to airlines and hotels can be a great motivator to shoppers who want a more specialized and personal experience.  It’s the responsibility of the retailer to deliver on that expectation with a program that is also personalized, valuable, and easily navigated.

4). Online Consumer Experience

Ricardo Rubi, Partner (Simon-Kucher & Partners):

Unnamed image (14)One of the challenges with e-commerce is the inability to immerse someone into the brand experience.  What retailers are catching up on is that, online, they can customize the experience that consumers have when shopping.  There is the opportunity to even customize the entire store based on what a consumer has viewed in the past or shopped at a brick and mortar. The more customization of the experience, the more consumers will engage with the brand and find it more relevant to them.

Link this experience with loyalty programs and then you might have just struck gold: customized inventory, customized offers, customized retention strategies all optimized for each and every one consumer.  Start small and grow your customization and loyalty program over time.  Have in mind that consumers generally value experiences more than monetary offers.

Clay Parnell, President & Managing Partner (Parker Avery Group):

Clay P Headshot (2)Without a doubt, retailers need to focus on mobile channels.  This intensely growing space requires retailers to consider consumer accessibility to assortments, pricing, reviews, product information, substitutions and complementary products.  This also implies the need for reliable WiFi in stores and not only easy access to purchase history for shoppers’ own use, but to also support highly tailored product suggestions.

Paul Thomas, Senior Consultant (Retail Remedy):

Paul Thomas

Mobile has already been mentioned being as a source of growth, but to stay competitive, retailers will need to integrate their channels. Seamless Integration has been a phrase that has been bounded about  for some time now, but what does that actually mean, and how can you achieve it?

Putting yourself in the shoes of the customer, how can you ensure the experience online reflects that in store, and reflects that on mobile. Allowing customers to order a product from the back of a taxi on the way to a meeting and then collect from a store later in the day is just one example of where integration will be effective. 

5). Millennial Generation & “Feel Good” Experiences

Devin Fitzpatrick, Founder & CEO (CDF Consulting):

Unnamed image (20)They are the fastest growing generation and soon to have more purchasing power than any other generation. They have grown up on digital and brands need to learn how to speak to them, engage with them, and build a relationship with them for the brand’s long-term success.

Ani Collum, Partner (Retail Concepts):

Unnamed image (15)For brands that are focused on Millennials as their target market, transparency, authenticity and personality are particularly key. They have so many options and are very discerning about the brands they shop and don’t have the patience to deal with brands that carry a lot of “baggage”. NOTE—this is NOT suggesting that brands can stay competitive by targeting Millennials. The suggestion is that for brands that target Millennials, they need to consider the above.

Chris Hammond, Management Consultant (Parker Avery Group):

Chris H Headshot 2015a (1)A key competitive offering more recently making waves is the desire to differentiate based on the “goodness” or “wholesomeness” of the brand. Spurred by value-centric Millennials, brands that can also offer consumers the sensation that they are contributing to a cause, supporting local small businesses, farmers or craftsmen, helping others, or benefiting the environment can see a groundswell of support and provide shopping incentive separate from price and location.  

 

Additional Resources

2016 Search Predictions from Leading Industry Experts

2016 Amazon Predictions from Leading Industry Experts

How Retailers Can Grow Their Business in 2016 with Social Platforms

 

 

The Google Shopping Guide: 2017 Edition

Next-Level Implementations in 2017 for Advertisers on Google
 

About the AuthorNick recently relocated from Boston, MA to sunny San Diego, but not before he received his Marketing degree from Framingham State University. In Nick’s prior roles, he was responsible for client management, content creation and marketing ROI analysis. When Nick is not in the office, you can find him playing soccer, sailing, exploring the world, and tasting new craft beers! See all posts by this author here.