Panel: Lessons Learned From 2014 Holiday Shopping
Moderated by Jordy Leiser of StellaService, Inc, the panel discussed data from this past holiday season, along with omnichannel fulfillment strategies.
Some interesting retailer survey data presented by Jordy Leiser:
The panel discussion covered a range of topics, from technology to fulfillment. Some highlights:
Panel: Monetizing Consumer Demand with Predictive Analytics and Real-Time Inventory Visibility
Bob Carpenter of GS1 moderated a discussion about how retailers can not only get information about consumer trends, but also make better business and supply chain decisions. Panelists included Peter Longo of Macy’s, Eileen Dileo of Hudson’s Bay Company, and Ken Duane of PVH Corp. The discussion centered around 3 key points–the elements of omnichannel success, the role of technology in solving inventory problems, and the need for businesses to collaborate.
Omnichannel Success
Peter Longo: A few years ago omnichannel wasn’t a word. Multichannel was an idea, but unformed. Omnichannel as a concept is evolving. If you put the customer first, a lot of existing business processes do not satisfy the growing customer demand. Macy’s has spent the last few years trying to put together a single view of inventory. Three fundamental ways to achieve success are to have great product, common and similar pricing, and great marketing.
Eileen Dileo: Everyone is time-starved, everyone wants their inventory immediately. We need to be able to deliver that.
Ken Duane: 50% of PVH business is overseas. We split the world into 3 pieces – Asia, Europe, the Americas. We have supply chain hubs all over the world, and we plug into those places. We try to pay attention to the differences in those regions in their supply chain, and work with partners to meet goals.
The takeaway: The business who does fulfillment the fastest, smartest, and with the most accuracy will win.
Technology & Inventory
Peter Longo spoke about inventory accuracy. Inventory degradation occurs at about 2-3% a month. “You don’t want to make decisions based on bad data.” Macy’s used to focus on replenishment-based recycling of inventory. Moved focus to delivering, for customers, robust options to buy online and pick up in stores. By moving the inventory management around this idea, Macy’s has reduced $1B of inventory from stores. RFID technology is enabling a revolution in inventory. “We’ll never run out of ideas on how to use RFID,” said Longo. He introduced the concept of “pick to the last unit,” meaning that the last unit of a product in every store is easily locatable and sellable.
Ken Duane spoke about how there’s always a cost to technology, but sometimes you have to go all in. Such was the case with RFID for PVH. “You need to take costs from beginning to end, because there’s a huge margin improvement.” He also highlighted how even small suppliers are beginning to see RFID as a standard operating procedure. He noted that “you need to know where your inventory is at any time, in any part of your supply chain, all the time.”
Eileen Dileo, meanwhile, described a successful implementation of RFID for shoes in her stores, and extended the concept further up the supply chain: “I think the single view of inventory is one of the most important things that have worked for us. The world reacts differently in different parts. You can maximize inventory. But if you’re shut down because of a snow storm in Alberta, and you can use inventory from one store to fulfill another’s, [everyone wins.]”
The Need to Collaborate
Moderator Bob Carpenter made a strong statement: “There is a network effect for the industry to move forward. There is a need to collaborate.”
Ken Duane described the importance of partnerships: “The future will encourage us to work more closely together. We have to narrow down the noise out there.” He later added, “We’re partners. We work for win-wins. Or we look for common solutions. You have to talk about your issues. How can I be a better partner? If you don’t collaborate you have no shot.”
Peter Longo: “The age of I win, you lose [is over], as opposed to we both find ways to win.” “You are collaborating around an organizing agent that allows trade and commerce to go smoother.”
But perhaps the strongest call for collaboration and the need to operate as part of an ecosystem was made by Eileen Dileo at the end of the discussion, when she turned to face the audience directly. “To our suppliers and retail partners sitting out there–we need you. We cannot do this alone. We cannot do it in a silo.”
Key Perspectives on International Merchandizing
Some highlights from the session featuring Pierre-Antoine Perrot, COO of Petit Bateau, Anastasia Charbin, fashion marketing director at Lectra, and Alan Wragg, category technical director at Tesco.
Final thoughts from Pierre-Antoine Perrot:
Internationalization is a great challenge to be in the right countries. Localization, with SKUs, seasons, etc. creates a great challenge. Process is key. In order to succeed in our international expansion we launched a transformation plan for the following stages:
BIG !deas Session: “Rethinking” the Omnichannel Fulfillment Strategy
This morning Bruce Hicks, President and CEO of RTC Quarterion, Darryl Jenkins of TSC Stores Canada, and Joe Skorupa of RIS News led a discussion on a topic very near and dear to us at GT Nexus–how supply chain challenges are holding back retailers from delivering true omnichannel fulfillment.
The discussion started with the question, “How do you get very precise knowledge of your inventory?” Both Jenkins and Hicks highlighted the importance of assessing your current situation–figuring out what items go out of stock, what their margin impacts are, and what channels they’re needed in–before designing a solution. Big ticket items are usually high volume, low margins, and are frequently the most out of stock. High margin items, on the other hand, can generally absorb more shipping cost. Optimizing fulfillment means having visibility into your entire supply chain across the omnichannel.
Skorupa asked the audience how many people feel their omnichannel fulfillment is where it needs to be, and only around 10 people in a room of 200 raised their hands. Jenkins responded to the idea of technology investment being high by mentioning how freeing up working capital is important. Paying vendors early with payment terms helps establish that. So does assortment tailoring.
Also discussed was back-end transparency, and the alerts and notifications that need to take place to achieve it. But technology doesn’t always get adopted. “There’s a lot of analysis paralaysis, across technology, operations, and management,” Hicks declared. “It’s an investment worth making. But I see so many retailers who are scared of being wrong, and do nothing. Analysis paralysis is not going to work. You need to take some chances.”
Best of NRF 2015: Top 10 Takeaways
1. Eye-Catching Booths
2. Retail Rollouts
3. New Tech Deployments
4. Retail Tech Companies Join Forces
5. Retail Tech Companies Join Forces
Many companies and brands today have the same overarching problem: how to connect with fans of the growing business and make that sustainable. The NRF Big Show 2015 kicked off on Sunday with “Game Changer: Loyalty and Performance Lessons from Passionate Sports Fandom”. The sports industry has built its empire around loyal, passionate fans, as well as created engaging experiences to drive fan interaction. Through the use of big data, the various franchises and companies are able to not only deliver personalized experiences, but also leverage these insights for drive better on-field performance. “A lot of focus is set on how to bring the new generation into the mindset,” commented Oliver Bierhoff of the German National Team. “It must begin with leadership and be guided through the process – whatever atmosphere and philosophy is created by the leadership must be reinforced by the company as well as the families.”
6. Time Magazine Person of the Year at RetailROI SuperSaturday
The sixth annual SuperSaturday event presented by RetailROI raised $400,000 in charitable contributions and had standing-room-only attendance to see Katie Meyler, founder of More Than Me and the recipient of a recent Time Magazine’s Person of the Year cover story. Meyler was one of the courageous heroes honored for her efforts to battle Ebola in Liberia. When every organization left Liberia, Meyler stayed to provide support in the worst hit section of the capital city. Her appearance at SuperSaturday was her first appearance in the U.S. since becoming a “person of the year” and the night before her session she was greeted at the airport by a camera crew from NBC/TV and featured on the national newscast. In addition to Meyler the strong agenda featured speakers from Chico’s, Nordstrom, Hudson’s Bay Company, Sur La Table, Google, Gartner, Forrester and PwC.
7. Retailers Rock
The sixth Annual RIS News Rock n’ Roll Retail event saw over 200 retailers flood into the Hard Rock Café in Times Square to see their peers take to the stage. Three bands consisting of vendors and retailers rocked the venue all night long with classics spanning the 60’s to today. The annual NRF tradition offered retailers and solution providers alike the opportunity to let their hair down after working the show floor all day long.
8. Kohl’s Pilots Beacon Technology
IBM hosted a roundtable discussion featuring Kohl’s EVP of digital innovation Ratnakar Lavu. Lavu discussed the digital initiatives his team is currently developing and deploying including the use of beacon technology. The retailer is currently testing location-awareness technology in 22 stores in both tech-savvy and non-tech-savvy markets. Unlike some retailers that are using beacons to simply push offers to shoppers’ smart devices, Kohl’s is more concerned about creating an experience for the customer with a high level of personalization that make their most valuable customers feel like they are being treated differently. “We haven’t cracked the nut on beacons just yet,” Lavu says. “But one thing is for sure for us it is not just about the offer, it is the offer and the experience.”
9. Belk Grows Bottom Line with Effective Scheduling
Reflexis hosted a closed door session for analysts and journalists featuring the largest family owned department store in the U.S., Belk. Eric Bass, SVP of staffing and productivity discussed how the chain has leveraged Reflexis Labor Scheduling, Advanced Reporting, and Time and Attendance solutions to fuel bottom line growth. Before implementing the solutions Belk allowed their associates to build their own schedules based around personal preferences. Now associates must schedule their work hours with an eye on the store’s busiest hours. At least 80% of an associate’s schedule needs to align with store traffic patterns. Despite the fact that associates now have less control over their schedules, workers are reporting increased workplace satisfaction. Associates at Belk are commission-based and increasing staffing during the chain’s busiest hours is a win/win situation for both the retailer and its associates.
10. Exploring the Disconnect between Business and Data
Mobile devices to social networks, new payments to personalization – retailers are battling to keep up with the evolution of technology both in the store and in the hands of customers. Greg Buzek of IHL Group, Joe Skorupa of RIS News, Alan Outlaw of Toshiba Global Commerce, and Grant Shih from Carter’s shared insights and opinions on the roadmap through 2015 and how it aligns with research from the 12th Annual RIS News/IHL Group Store Systems Study. “The thing about IT is that flexibility and security don’t usually go hand-in-hand,” noted Alan Outlaw, VP of commerce technologies for Toshiba Global Commerce Solutions.
Source: Retail Info Systems News
The BIG Show: NRF 2015 Blog, Day1 | Day 2 | Day 3
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