Retail Reinvention Day 1 Recap: Consumer

Experience Takes Centre Stage

Opinion | 10 Aug 2015

From August 4th-5th, the Retail Reinvention conference took place at McCormick Place
in downtown Chicago. The show was hosted by PYMNTS.com and ACI Universal
Payments and Euromonitor was pleased to attend both days. Talks revolved around the
relationship between the retail environment and consumer payments, with an underlying
theme of what it means to reinvent and why retailers need to consider doing so. The host,
Karen Webster, CEO of PYMTS.com, outlined in her welcoming remarks that reinvention
is important because you need to see the hidden trends to stay ahead of the curve. Just
because things are going well does not mean that it is not time to change.

Marcus Lemonis impresses as keynote

Authenticity and relevance were on display in the first hours of the conference thanks to
the talented speaker and retail mogul, Marcus Lemonis, the host of CNBC's The Profit.
He warned retailers to be wary of thinking they know the customer better than they
actually do, underlining the importance of catering to the customer's needs and desires.
People largely know how they like to shop. When retailers look to reinvention, they need
to accurately assess what they are doing right and wrong in order to solve real problems.
Does society really need a new way to buy milk? Catering to customers was the only
winning strategy in his book because according to his philosophy, it is people, not
products or spreadsheets, that really grow a business.

Online companies stress the need to be consumer obsessed

The following presentation by Amazon and a panel by a number of online companies

(Trunk Club, Dominos, Barkbox, Threadless, and Amazon) proved to be very interesting
as well from a retail perspective. Amazon noted that their business works backwards,
making the customer the centre of all decisions, despite how counterintuitive the
solutions may seem. Hosting a marketplace platform for smaller retailers, essentially
allowing competitors onto Amazon's own website, might not have been an obvious
solution back in the year 2000, but it served shoppers by increasing selection and has
done so ever since. According to Amazon's own study, 64% of online consumers now

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use marketplaces as a primary avenue for online shopping, compared to a 40%
utilization rate for search engines. Marketplaces are coming of age thanks to their ability
to meet consumer demand in a more egalitarian way. Even the CEO of Threadless took
the time to point out that they were about to roll out a marketplace for artists, an
interesting development considering that marketplaces have not yet become tailored to
more specific markets.

Being customer obsessed prompted a different counterintutive move for Trunk Club.
Trunk Club's VP of marketing explained that the company's model, while based online,
relies on 1-to-1 interaction between stylists and customers to personalize the relationship
and build brand trust in a more human way. To strengthen the relationship, Trunk Club
moved from an online only presence to opening its own stores. The physical presence
allows customers to meet their stylists in person and share a drink with them while trying
on clothes, making the experience all the more engaging. Omnichannel to them was
about creating one seamless experience across the digital and physical realms that
served the customer in whatever way possible.

Technology driven changes must not overwhelm

It is the technological developments of the past few decades that have brought forth the
emergence of omnichannel retail and will continue to drive retail reinvention. Talk for the
rest of the day shifted to a more technical perspective. Making good use of data to
inform rewards programs, being vigilant in the fight against fraud, and looking at
opportunities for cross-border commerce were all topics that were discussed in depth.
The most interesting highlights were the consensus that the most undervalued
engagement strategy is still basic human connection (but one that is more informed by
technology), the exploration of the potential of purchase data from fraud teams to inform
marketing campaigns, and the fact that marketplaces are taking off even faster in places
like Asia because they promote easier cross border trade.

Payments and technology were the underlying threads here, but many discussed the
need for technology to blend into the background. Once new technology begins to feel
invasive or overwhelming, shoppers will revert to a smoother or more trusted
experience.

Read about day 2 here

For further insight or comment, please contact Tim Barrett, Retailing Analyst, at
tim.barrett@euromonitor.com.

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© Euromonitor International 2019

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