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Retail insights from retail experts

Retail insights from retail experts

With retail facing a marked industry shift, innovation and digital disruption was the theme of the annual Australia-Israeli Chamber of Commerce retail luncheon.

Here are some insights from the panel discussion that I moderated between Michael Ford, CEO of The Good Guys, Frances Martin, VP of Optus Retail Sales, and Richard Umbers, Managing Director of Myer, at the retail luncheon last month.

The discipline of innovation

Technology is unleashing hundreds of ideas. The challenge is picking the next realistic thing you can do that customers will value. The way that ideas are operationalised has to be much faster. That means running lots of pilots and moving on when things don’t work.

Whether you internalise it, buy it or develop it with a partner, each innovation requires ownership. It needs a champion who steps forward because they believe in it and who puts in Agile processes to move it forward. This is very powerful because it results in rapid adoption.

None of this is possible without a culture that is comfortable with ambiguity and uncertainty. Other requirements are strong communication, good collaboration – internally and externally, a structure that gives people access to the resources they need and good governance for the organisation’s pioneers.

Technology has lifted the bar in customer service

Good retailing is having what people want to buy and selling it in an engaging way. Data enables retailers to do that better because it provides greater understanding of the customer and helps to anticipate their needs.

Likewise, technology can enhance the customer experience. Giving sales staff iPads* or CommBank’s cutting-edge EFPTOS tablet Albert, for example, empowers them to play to their strength of customer service. It isn’t technology for technology’s sake but improving on the previous offering.  In fact, the best technology is invisible – when customers don’t realise they are engaging in a digital solution.

So it isn’t choosing between bricks and mortar and online but doing both in a complementary way that makes the sum greater than the parts. ‘Click and collect’ and ‘collect and try it on’ are examples of using technology to make the physical assets more valuable. Perhaps that’s why bricks and mortar retailers that are embracing online are enjoying the best growth – they can leverage their brand and supply chain.

e-commerce is in its infancy

Worldwide only around 8% of retail sales are online (1) yet today’s retailers must not only consider customer and product but also where customers collect the product. With so many possible permutations, scalable and secure platforms and accurate, perpetual inventory are big issues. Without them, e-commerce will splutter.

Big data and how that is overlaid on CRM to make it more effective could be the next focus. Looking further ahead, in a decade’s time, virtual reality will play a reasonably active role in the retail industry.

There is an absolute blur between where retail ends and technology starts, but people are still important. Technology and human interaction must be integrated and the unique needs of all customers – not just millennials – and how to meaningfully engage with them must be considered. So attitude and understanding what the organisation is trying to achieve are more important when recruiting staff than age or credentials in technology.

For further insights, review our credentials or email changethegame@cba.com.au

Bruce Begbie
Bruce Begbie

Executive Director, TMET and Retail

Bruce Begbie is an Executive Director for Client Coverage in the Institutional Bank & Markets with the Commonwealth Bank of Australia. His sector focus is on the Telecommunications, Media, Entertainment, Technology and Retail industries. An important aspect of his role is to ensure our customers have access to the latest insights and advice drawn from across the Bank.

* Apple, the Apple logo and iPad are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc. [1] http://www.strategyand.pwc.com/perspectives/2015-retail-trends