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Amazon Consumer ESG Podcast Retail leadership Returns

In Conversation with Amazon UK Boss John Boumphrey

Recording live from the retailer’s new Second Chance store in London, Amazon UK Country Manager John Boumphrey joins Natalie on the podcast to discuss:

  • How is Amazon extending the life of returned goods through its Second Chance programme?
  • How can the wider industry overcome the returns challenge?
  • Futureproofing – with more disruption on the horizon, how does Amazon ensure it stays relevant to customers?
  • Consumer outlook – does JB expect consumers to remain relatively resilient as we move into 2024?
  • From drones to generative AI: what technologies and innovations should we be watching?

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Consumer Fashion Podcast

‘Positively Dissatisfied’ M&S, Trailblazer Next, Black Friday Predictions

Retail expert Maureen Hinton joins Natalie to discuss retailer resilience. Which fashion retailers are defying the economic climate and what is the secret to their success? Maureen also shares her views on the state of the consumer and whether the Black Friday deals will sizzle or fizzle.

Connect with Maureen on Twitter/X and LinkedIn

Learn more about our work at the KPMG/Retail Next Retail Think Tank

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Consumer High Streets Podcast Store closures

Wilko’s Revival, Asos’ Identity Crisis, Bellwether Next Getting It Right

It’s a bumper episode of #RetailDisrupted this week with retail consultant and high street champion Graham Soult. We discuss:

🔹 5m: Business rates
🔹 10m: Store closures – is there more rightsizing to do or has the industry now recalibrated?
🔹 14m: Wilko’s demise and rebirth: what went wrong and how will the new stores be different?
🔹 21m: Back from the brink: how to revive defunct brands
🔹 28m: Mixed fashion fortunes: Is Asos still relevant and what’s the secret to Next’s resilience?
🔹 37m: New Channel 5 Lidl documentary
🔹 40m: Future of the high street

 

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Consumer Fashion Marketing Podcast

Victoria’s Secret Is Bringing Sexy Back

In retail today, you need to have a laser-clear understanding of your brand and what it stands for.

But what if what you stand for is no longer culturally relevant? Can you shed your skin and completely reinvent yourself? Can you buy your way out of cultural insignificance?

The lingerie brand Victoria’s Secret tried to do exactly that and it hasn’t worked out so well. They’re now ready to ditch their feminist makeover and re-embrace “sex appeal”. On today’s podcast, we’re going to be exploring what went wrong at Victoria’s Secret, how they tried to fix it, and whether they can go back to their roots in a post-#MeToo world.

TLDL: Victoria Secret’s newfound conscience and subsequent brand overhaul whiffed of inauthenticity. Too much, too soon… alienating both those in favour (who perhaps questioned the integrity of such a radical makeover) and those not.

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Consumer Economy ESG

Protecting Pockets Before Planet

Paid partnership with Manhattan Associates


The latest whitepaper from Manhattan Associates, Redefining Retail: What’s Next for Shoppers and Retailers?, has just launched and here’s one of the things that stood out for me – consumers’ deprioritisation of sustainable purchases.

Don’t get me wrong, there still very much appears to be a desire to shop in an environmentally conscious way – but consumers are currently less willing (or able) to pay for it. Of the 6,000 global consumers surveyed by Manhattan Associates, 45% said they still consider sustainability a top or important consideration when choosing where to shop, but this is down slightly on the 50% who agreed with that statement last year.

Persistent economic concerns have curbed consumers’ appetite for sustainable shopping. In the current climate, frugality trumps sustainability. The perception, and at times reality, that green products come at a price premium has led shoppers to abandon their eco credentials to switch to low-cost alternatives.

The Manhattan survey presented consumers with pairs of priorities (ie. “cheaper” vs “environmental friendliness” in terms of brand, product and delivery) and asked them to select which they are currently choosing. Unsurprisingly, “cheaper” prevailed the majority of the time.

But challenging financial times do not impact all consumers equally. More mature demographics are likely to be most insulated, with 1 in 5 (20%) consumers aged 65 years and over reporting that there is that the cost-of-living crisis has had no impact at all on their shopping habits. Yet this is the group least likely to take sustainability into consideration when choosing where to shop: over 20% of older shoppers said that sustainability is not important or not at all a consideration for them when selecting a retailer. This contrasts sharply with the 55% of 18-24-year-olds who consider sustainability an essential or important consideration.

So what does this tell retailers? It’s never been more important to know your customer! One size most certainly does not fit all. At a strategic level, retailers need to roll out the red carpet for their most loyal customers and ensure they are living up to their brand values. At an operational level, hyper-localised product assortments and more targeted, real-time promotions will help them to cater to varying customer demands.

The whitepaper also addresses the elephant in the room – the environmental impact of e-commerce deliveries. When consumers were asked about their most important delivery consideration, only 8% cited the impact on the environment. Cost and convenience are naturally going to be top considerations, but I think the lack of transparency and awareness around the carbon impact is also a factor here. The uncomfortable truth is that retailers have spent the past decade training shoppers to expect fast and free delivery, regardless of the financial or environmental cost.

The tide, however, is beginning to turn. Some retailers have quietly started charging for delivery and returns, while others have implemented more sustainable delivery options in a bid to decarbonise the last mile. Reduced packaging for home deliveries and ‘packageless’ collections and returns are starting to gain momentum. And, with many retailers now able to provide near real-time inventory visibility, consumers can make smarter decisions about which stores to visit or which delivery options to choose, which can significantly minimise miles travelled and open up a variety of greener last-mile delivery options.

Retailers are still in the nascent stages of giving customers greater control post-purchase, but this will evolve in the future as retailers recognise the triple benefits – profits, pockets and planet. So what exactly can be done? Offering no-rush/green delivery, letting shoppers select the day of their delivery, encouraging shoppers to consolidate orders and even letting them make basket edits after the transaction. That’s right, in the future, more retailers will allow shoppers to alter online orders right up to the point a shipment leaves the warehouse, store or microfulfilment centre. With these longer ‘order modification’ grace windows, retailers can not only enhance the customer experience but also reduce split-shipments and, in theory, unnecessary returns.

Ultimately, the onus is on the retailer to initiate change. When retailers were asked to select their top 3 business priorities for 12 months, only around 1 in 5 retailers called out creating a more sustainable and environmentally aware supply chain (21%) and doing more to minimise the environmental impact of their organisation (22%).

I believe, broadly speaking, that consumers want to make better choices but the lack of awareness, lack of alternatives and perhaps a view that the onus should be on the retailer – not the consumer – to fund this shift is hindering progress. Consumers may think of themselves as altruistic – but at the sake of convenience? I don’t think so. Retailers need to become more transparent and ultimately provide consumers with compelling incentives to alter their shopping habits.

Perhaps we will only see meaningful change with regulation, but as a starting point retailers should be prioritising operational efficiencies that allow them to simultaneously progress the sustainability agenda. After all, financial and environmental sustainability often go hand in hand.

Download the full whitepaper.

Listen to Natalie Berg and Ben Sillitoe, Editor of Green Retail World, discuss the findings on the Retail Disrupted podcast.

 

Categories
Consumer Retail trends

Natalie Berg Joins KPMG/RetailNext Retail Think Tank

RetailNext, the leading analytics solution for bricks-and-mortar retailers, today announced that it will partner with the Retail Think Tank to produce its quarterly Retail Health Index, alongside existing co-chair and global consultant, KPMG.

First established in 2006 by KPMG and market research leader, Ipsos, the Retail Health Index is the industry’s only comprehensive, sector-level benchmark of retail performance. With almost three decades of data, encompassing pivotal moments that defined and redefined retail – from the 2008 Financial Crash and ensuing ‘Credit Crunch’ to Brexit, Covid-19, the post-pandemic recovery and, most recently, the cost-of-living crisis – the Retail Health Index assesses the sector’s key performance indicators, including demand, margin and cost.

Each quarter, it is independently scored by Retail Think Tank members – an elite advisory board comprising industry experts, thought leaders and analysts, including Nick Bubb, former GlobalData Director Maureen Hinton, and NielsenIQ’s Mike Watkins – to benchmark retail health for the past three months, and predict how performance will evolve in the next quarter. This year author and Retail Technology Magazine publisher, Miya Knights, and retail consultant and author, Natalie Berg, will join the panel as new members, bringing fresh insight and perspective to the wealth of expertise and industry know-how of the Retail Think Tank advisory board.

Following RetailNext’s acquisition of Ipsos’ people-counting and footfall solution, Retail Performance, in November 2022, which had formerly co-produced the Retail Health Index, RetailNext will now produce the quarterly index in collaboration with co-chair, KPMG.

Paul Martin, UK Head of Retail at KPMG, commented: “From its very inception back in 2006, the Retail Health Index has been a formative resource for retail businesses and leaders, aiming to quantify the knowledge of the Retail Think Tank members in a systematic way, whilst also providing an assessment of the overall retail health, for which there was traditionally no ‘official’ data.”

“Having been the voice reporting on retail health for almost three decades, we’re excited to welcome RetailNext as our co-chair for the Retail Health Index, and through the partnership we look forward to continuing to help retailers set a course for success as they navigate the multifaceted pressures, challenges and opportunities the market continues to present,” he added.

Gary Whittemore, Head of Sales, EMEA & APAC at RetailNext, commented: “With the fast-moving and multi-dimensional challenges facing retailers, impacting every area and function of their businesses, the Retail Health Index is not just a valuable indication of sector health. Crucially, it also dissects and contextualises the key factors impacting performance, drawing on the extensive knowledge and expertise of the Retail Think Tank membership. This results in a quarterly playbook for retailers, which outlines actionable insights and strategies to create competitive advantage in the context of the market, to drive retail businesses forward and readdress the balance of health back in the retailer’s favour.”

As well as being available online, a digest of the results of the Retail Health Index, including wide-ranging insight, contextual analysis and exclusive data-sets on key performance metrics, is available in a quarterly report, which is free for retailers to download.

Categories
Consumer E-commerce Retail trends Technology

2023 Predictions: A UK Retail Rollercoaster

‘Permacrisis’ was declared the word of 2022, so what might 2023 bring?

There are reasons for cautious optimism, but first retailers are going to have to buckle up and brace themselves for more turbulence.

Spending more to buy less

Let’s briefly recap on retail’s Golden Quarter. Christmas was not the wipe-out that many of us had expected. After a bumpy couple of years with Covid cancelling Christmas, consumers were determined not to let illness, inflationary pressures or industrial action hamper their celebrations.

There are some caveats here: soft comparatives (remember Omicron?); supermarket success came at the expense of the hospitality sector; and perhaps most importantly much of the growth we saw was fuelled by inflation – in December retail sales were up in value terms but volumes continued to fall. In other words, consumers are spending more to buy less.

Inflation might be starting to ease, but consumers are still a long way from feeling the benefit. This ongoing erosion of spending power makes for a pretty gloomy outlook: consumer confidence tanked again in January, returning to a near 50-year low. Looking ahead, the deterioration in consumer sentiment is likely to persist throughout the first half of the year, at least. A reminder to retailers that value will remain firmly top of mind, purchases will continue to be incredibly considered, and big-ticket discretionary buys will be delayed.

Trimming the fat

The spending hangover is here and while there’s never a good time for subdued consumer demand, it’s especially painful when retailers are simultaneously grappling with their own cost inflation. No one is immune: this dangerous combination of soft demand and rising costs is impacting even the most bulletproof retailers. Amazon, for example, is laying off 6% of its global workforce, closing warehouses and putting the brakes on bricks & mortar expansion. 2023 will be a year of operational efficiencies for retailers, in many ways mirroring their own customers’ behaviour by trying to do more with less.

The other immediate challenge for retailers will be shifting excess stock, the result of over-ordering during the supply chain crisis and exacerbated by the current consumer weakness. With a glut of inventory and sluggish demand, retailers are left with little choice but to slash prices. But wait, haven’t they been doing that for the past four months? Aside from the obvious margin implications here, there is also the risk that shoppers are becoming desensitised as promotion fatigue sets in – or even worse, that they forget what it’s like to buy at full price.   

2023 opportunities: bricks & mortar resurgence and immersive digital experiences

There’s no sugarcoating it: 2023 is going to be another year of instability and uncertainty. But the retail industry is nothing if not resilient and I believe there are reasons to be optimistic. Stores are back, they’re repurposed and better than ever. We’ve been thrust into the future thanks to the pandemic-induced digitization of bricks & mortar retail, levelling the playing field and shifting the industry’s perception. Stores were once considered liabilities in this digital era, but they’ve been reconfigured for 21st century shopping and are now essential assets.

When it comes to customer experience, I believe that ‘tech-enabled human touch’ will be the next battleground, as retailers recognise the many opportunities that come with equipping your staff with the right digital tools. Mediocre experiences have become a thing of the past. Meanwhile, automation will climb higher up the agenda as retailers look to achieve operational efficiencies, despite the initial outlay, while simultaneously addressing the current labour shortage. In 2023, we’ll see more trials of autonomous vehicles delivering our goods and robots working alongside humans in warehouses.

Shoppers will continue to abandon e-commerce in droves now that we have returned to some semblance of normality. Some categories like food, fashion and furniture will never transition online like the rest of retail has, but it’s clear that as an industry we have been propelled towards a more digital world. And over the next decade, new, immersive digital experiences will redefine our perception of e-commerce – this is going to be the next big thing in retail. I’m still a bit of a metaverse sceptic. I know barriers can be knocked down but right now how many of us really have a VR headset kicking around at home? However, it’s clear that e-commerce is ready to evolve. Sure, all of the friction has been sucked out and today the experience is wildly accessible, slick, effortless. But is it any fun? Not really. It’s still far too transactional, too one-dimensional. This will change.

The next stage of e-commerce is all about immersion, discovery, curation, hyper-personalisation and escapism. And it’s already happening with augmented reality, virtual showrooms, live shopping, social commerce, 3D product views/virtual try-ons, video shopping consultations, among others. In the future, we won’t know where the physical world ends and the digital one begins.

Our hybrid way of living is here to stay and while businesses may still be acclimatising to the consequent shifts in demand patterns, longer term this will present new and exciting customer engagement opportunities. Despite tight budgets, investment in sustainability will remain high on the agenda in 2023, while opportunities to tackle the often-neglected post-purchase experience and explore new revenue streams such as retail media and third-party marketplaces will accelerate. In summary, short-term volatility will persist while consumers batten down the hatches, but as always the future of retail is bright for those who are willing to evolve.

Categories
Consumer E-commerce Fulfilment Retail trends Technology

Recalibrating for the Next Normal

Paid partnership with Manhattan Associates


Greetings from Germany! I’m here at the Manhattan Exchange in Berlin and am super excited to share with you a new report that I’ve authored for Manhattan Associates: Recalibrating for the Next Normal.

The pandemic may have accelerated digital transformation strategies, but what comes next? We spoke to 3,500 consumers and 700 leading retailers across the US and Europe to get a better sense of the consumer landscape and the capabilities required as retailers recalibrate for this next stage.

The findings of this international research study highlight the need for retailers to continue to keep up with the pace of evolving consumer expectations. It also revealed a retail landscape where the lines between physical and digital commerce are becoming increasingly opaque and complicated. 

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Download the full report.

Categories
Consumer Retail trends

Clicks and Cliques: Understanding Modern Shopper Tribes

Knowing your customer is essential in the best of times. In a post-pandemic world, it will be the difference between survival and failure.

I had the pleasure to work with Klarna on their latest report Clicks and Cliques: Understanding Modern Shoppers where we identified five distinct shopper tribes for the post-COVID world. Based on a survey of 4,000+ consumers across Europe, the UK, USA and Australia, the report examines how shopping behaviour has evolved and how retailers can stay relevant in a fast-moving world.

Good value for money is naturally a top priority for shoppers this year, with more than two-thirds (67%) suggesting it has become more important since the start of the pandemic. It’s followed by promotions and deals (60%), a good reputation and trustworthiness (60%) and having a wide range of products available (58%) — perhaps fuelled, in part, by shortages on the shelves earlier in the year.

Over half of respondents said that an easy returns process (55%) and next or same day delivery options (51%) have become more important this year — naturally coinciding with 49% doing more of their shopping online and 44% doing most or all their shopping online now.

The ability to pay flexibly has also grown in importance, according to 45% of respondents — and this can be a real dealbreaker. Four in ten (42%) prefer to shop from brands or retailers that offer flexible payment options, while three in ten (32%) won’t shop from those that don’t.

Commenting on the research, Luke Griffiths, CCO at Klarna, said: “This year’s events have transformed the way we browse and buy, reinventing our relationships with brands and retailers and accelerating change at an unprecedented rate. Merchants must keep a finger on the pulse of their customers wants and needs and adapt their products and service offers accordingly to build a connection with shoppers to drive loyalty and, ultimately, sales.” 

Natalie Berg, Retail Analyst and Founder of NBK Retail, added: “The retail industry is no stranger to disruption, yet nothing in our lifetime has jolted the industry like Covid. As retailers look to navigate the new normal, resilience and agility will be essential for survival. There will be no return to the status quo. The days of being everything to everyone are well and truly over: in order to find their tribe, retailers need to be bold about who they are and what they stand for. Opportunities have emerged, enabling retailers to reimagine both physical and digital commerce for the future.”

Download the full report here.

Categories
Consumer Retail trends

Peak Car And The Hyper-Local Retail Opportunity

In my latest long read for Forbes, I explore how London’s green recovery will create opportunities for local retail:

Across the UK, city streets are quietly undergoing radical transformation. Temporary cycle lanes have popped up, footways widened to enable social distancing and, perhaps most drastically, residential roads are being blocked to through traffic. Since May, over 200 of these “low-traffic neighborhood” (“LTN”) trials have launched as more than 50 councils take advantage of the £250 million of emergency “active travel” funding from central government. The vast majority of these LTN schemes are in London. Full disclaimer: I live in one.

Full article can be accessed here.