What does the Future of Retail look like?Thursday, 31st January 2019
On Friday 25th January, we brought together over 100 professionals to hear our expert panels of retailers and advisors share their views on the changes ahead for the sector.
Sian English, co-chair of pro-manchester’s Retail & Ecommerce committee and Head of Multichannel at seventy7, opened the event and thanked B Works for hosting. She welcomed the first panel to the stage: Joy Parkinson – CEO, Faith in Nature; Tayyab Akhlaq – Director, Public Desire; and James Gill – National Sales Manager, Sorted.
What impact are global consumer trends having?
Tayyab launched Public Desire on 2014 on Instagram and built it up on a social only model. The aim was to get to 10,000 followers by the end 2014 – it actually reached 100,000 by September. The brand has followers in over 150 countries and they ship to over 100. Whilst we used to think in terms of national stereotypes, people are actually living very similar lives – and posting very similar selfies! – all over the world. For fashion, travel and restaurants, Millennials and Gen Z are asking if it instagrammable.
Joy notes that in all markets consumers are becoming more informed on “nasties”. 15 years ago, the company mainly exported to Scandinavia but it now has 40 different international markets and is speaking to another 50. Social media and websites have easier to network internationally, and despite Brexit, Joy believes it has never been easier to trade internationally.
For James, some of the challenges have created opportunities for his company. The power shift to consumers has allowed them to demand what they want. In the delivery space this has become more about convenience – choosing when and where – than immediacy.
Connecting offline and online
Joy has seen a complete switch from a reliance on paper campaigns to social media. As well as a sales channel, they use social media to recruit panels to test products and run polls to choose new launches. Tayyab agrees and reiterates the importance of connecting with the audience and using the right language. For example, he noticed employees using the phrase “drip drip” to describe something very cool. Using that language on social improves brand awareness and loyalty.
Influencers are no longer just getting paid but being taken on expensive holidays. Tayyab is moving towards using university ambassadors and letting fashion students compete to create a new product line. Joy notes that Faith in Nature is getting better at driving revenue and sales through social media. This includes actively engaging with key retailers, such as Boots and Holland & Barrett, as they are closer to point of purchase.
Innovations and new technology
Faith in Nature are in the process of developing a new shampoo bar that offers equivalent delivery to liquid shampoo. This is due to be launched in May. All products are currently in fully recycled and recyclable and they are working with a Finnish business to move to a plastic replacement made from paper.
James is more focused on the delivery stage of the process and the importance of maintaining the brand experience through the online and offline journey. Some retailers, such as H&M, are moving towards AI stores with the option to order in the store and have the product delivered at home.
Keeping up with new social trends is essential for Public Desire. Tayyab notes that some brands are now recruiting for TikTok Specialists (creating 6 second videos) to communicate with their future customers.
Sian closed by asking each panellist for their top tips for the year ahead:
- James – Don’t sit on you hands when it comes to tech and innovation; do it as soon as possible.
- Joy – Be honest and transparent. Customers don’t mind if you are not 100% natural or still use plastic, so long as you are honest about your position and the journey being taken.
- Tayyab – Regardless of industry, make sure you know who your customer is. Challenge the customer profile as it will change very regularly.
Sian then welcomed the second panel of the day to the stage: Oliver Rosevear – Head of Environment, Costa Coffee; Rachel Beattie – Co-Founder, Careaux; and Naveen Gupta – Real Estate Partner, DWF.
Impacting the future of retail
Oliver’s role when he started 9 years ago was all about operational efficiency and reducing energy costs. The shift has come from the changing consumer demands. Costa now roast all beans in the UK’s most sustainable roastery, use coffee grounds for fuel, powered 1800 buses on coffee oil and developed recyclable cups. Costa also appreciates the new for retailers to collaborate on the big challenges and works with Greggs, McDonalds and Caffe Nero to make recycling cups easier.
It is undoubtedly a difficult time for retailers with well know brands in trouble. Naveen asserts that all companies must think differently about the space they operate. B Works is the perfect example: it is a bank but also an experience and a showcase for an online retailer. He also notes that the places getting it right, like the Trafford Centre, are flourishing and funding extensive redevelopments. Whereas others, such as Fife, are being auctioned with an opening bid of just £1. To succeed, retailers must offer the full experience or, as Naveen puts it, go “phygital”. This blend of physical and technical innovation can be seen in Adidas Westfield’s stadium concept or Burberry’s flagship store.
Costa’s strategy adapts depending on store location. A city centre store may rely on click & collect, connected cups and a range of payment options. A market town store may focus on providing a comfortable leisure space. People talk about the death of the High Street but the best performing Costa stores are behaving like traditional local shopkeepers and creating a community hub.
Barriers to progress
As a new, small player, Racael has particular challenges sourcing ethical and sustainable fabric. Unable to meet the minimum quantity reduces pool of supplier and makes harder to challenge on ethics and sustainability. She encourages all manufacturers to question suppliers and demand transparency. All the voices together will make a difference.
Reinvigorating the High Street is challenging, but Naveen is seeing more flexibility in leases and rates to allow retailers to thrive. The recent campaign to save Kendals/House of Fraser shows the community spirit and helped a deal to be done. Local authorities can support through free parking and discounted travel but the revenue needs to be created elsewhere, potentially through digital taxation.
Sian again closed by asking for the top tips for 2019:
- Oliver – Collaborate, especially on climate change. Mass movement is needed to create significant impact.
- Naveen – Bricks and mortar isn’t dead, you just need to do it differently.
- Rachel – Stick to your values. Just because it makes money doesn’t mean it’s right for you.
pro-manchester runs a varied programme of activity through the Retail & Ecommerce sector committee. To get involved please contact me at email@example.com. Our next event will be our popular annual Retail & Ecommerce Lunch on 23rd May: https://www.pro-manchester.co.uk/event/retail-ecommerce-lunch/.