Episode #3

Reorienting Around the Omnichannel Customer

Contributors: Bart Waldeck, Mara Devitt

Bart Waldeck speaks with Mara Devitt, Senior Partner at McMillan Doolittle about the impact the pandemic has had on retailers, shifts in consumer behaviors, what is happening with consumer trust and how to reorient around the new consumer buyer’s journey.
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Reorienting Around the Omnichannel Customer
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In this Episode

In this episode of Location is Everything, Tango’s CMO Bart Waldeck speaks with Mara Devitt, Senior Partner at McMillan Doolittle about the impact the pandemic has had on retailers, shifts in consumer behaviors, what is happening with consumer trust and how to reorient around the new consumer buyer’s journey.

  • Transcript

Episode Transcript

Bart Waldeck:

Hi everyone. And welcome to Location is Everything Tango’s podcast about store life cycle management. I’m Bart Waldeck, your host. For those of you who have joined us before, you know that we focus on the brick and mortar side of retail. And in particular, lately we’re focused on the path forward for retailers as they adapt to a new consumer, a new customer and how they’re behaving and how that ultimately impacts the entire brick and mortar side of the business. So in a previous episode, I think it’s important to cover some things we talked about before that will set up our guest today that we can talk about. We want to talk about the three Rs of retail resilience. So that’s reorient, recalibrate and reposition. Really briefly, we’re going to focus on reorient today and our guest is going to help us unpack some of the changing consumer behaviors that are out there.

But reorient is really about having a cross channel view of customers. Typically, within a retail organization, often you’ll have marketing, merchandising, real estate store ops all with their own view of a customer. And the reality is because of the pandemic, and this was a trend that was going on well before the pandemic, but it was accelerated, customers are operating more in an omni-channel world. They’re shopping digitally, they’re stopping in the store, they’re doing delivery pickup, in-store purchasing and they need a buyer journey that is across all those elements. And you need a single view of that customer. So reorient is about getting everybody together, getting a consensus of that customer so you can better serve them. So we’re going to talk about that a lot in today’s episode with our guest.

The other stage is recalibrate. So, because consumers have changed their buying behaviors, the typical models used for sales forecasting, market optimization, all that stuff that goes into location strategy kind of can be thrown out the window, not literally, but a lot of the data is driven from historical data and information. Because, that has changed so fundamentally the past is not necessarily a good predictor of the future. So to improve accuracy of sales forecasting market optimization models, retailers need to look at new techniques, whether that’s AI and machine learning, they need to look at new data sets such as mobile data and things like that to recalibrate their models in the location strategy, to not just optimize in store in the trade area that draws customers to purchase in store, but also delivery and pickup in this kind of omni-channel world. So, that’s recalibrate.

The last R is reposition. So this is two elements, the first element being the location strategy and executing on that, as I mentioned. So in order to optimize dine in, delivery, pickup or shop in if you’re a traditional retailer again, where the pieces on the chess board maybe need to change from when they are. And the second part of that is the box itself. The four walls of the store or of the restaurant. The new consumer behaviors are dictating a different shopping experience, a different type of format. If you’re a QSR, for example, maybe you’re going from two drive through lanes to four. If you’re a traditional retailer like apparel maybe you’re decreasing square footage in areas like your dressing room and you are allocating more square footage to inventory and pickup or distribution or micro distribution from stores to customers. So all that is changing so store formats need to change.

So those are the three R’s of resiliency and recovery for retailers. And like I said, with our guest today we’ve got a great opportunity to dig into reorient and I’m really excited to welcome Mara Devitt, senior partner at McMillan Doolittle. Mara let her do her whole background, I don’t want to take all the thunder, but she’s everything retail. She spent the last three plus decades working with retailers of all sizes helping everything from strategic planning to digital transformation, concept development, you name it. A lot of work as it relates to the consumer themselves and shopping behaviors and experiences, what we will go in today. On a personal note Mara had a big impact on my professional career. She hired me many, many years ago out of business school into Accenture, which was then Andersen Consulting. So I’m dating myself and Mara probably too.

And I had the pleasure of working for her at the firm’s retail Think Tank. So suffice it to say I owe her one and I had to pull a couple strings to get someone of her caliber to join us here today. So I know Mara you’re in the trenches every day with McMillan Doolittle doing a ton of things that relate to what I’ve been talking about. Thanks for joining today, I really appreciate it. Clearly your greatest professional accomplishment was having the wise mind to hire me.

Okay. So just to set the stage for everyone you should just give us a little bit of background and McMillan Doolittle your role there at the firm and what you guys are focused on.

 

Mara Devitt:

Wonderful. And you did give some great background there, Bart. So I’m a senior partner at McMillan Doolittle, and our firm is a boutique consulting firm that specializes in retail, but we define retail quite broadly and serve any client that sells goods and services to the end consumer. We also serve solution providers to the space as well as investors in retail. So most simply our mission is to help our clients grow. Our scope of services, includes strategic planning, new concept development, customer experience, design, and performance improvement programs.

We also have a very well-developed consumer and market insights practice, and my role there it’s I’m managing partner and I actually run the day-to-day operations of our business. I started my career, as Bart said at Andersen Consulting now known as Accenture and spent quite a bit of time there and worked with some great people like Bart, of course and spent a great few years running the innovation center there for retail. And then joined McMillan Doolittle back in ’03, so I’m really dating myself. So that’s a little bit about me and I’m really happy to be here today.

 

Bart:

Yeah, no, it’s great to reconnect. I don’t know if it’s the same experience for you, but for me, I’ve never remembered a time that felt more turmoil in the world, let alone in retail and what we’re going on the pandemic has really thrown a wrench into an already challenging environment, retail apocalypse, whatever you want to say over the last five, 10 years, and now the pandemic rolls around. I think what we’ve been seeing is it’s a big acceleration, a lot of trends that have been going on before. What are you seeing in walking the halls and talking to retailers, what’s happening to them, what’s happening to their customers? What type of impact does the pandemic add?

 

Mara:

Significant, I think we’ve all felt it right? And I would like to start with customers first, which was where we always tell our retailers to start. And we’ve seen really three main behavioral shifts in how consumers are shopping, what they’re buying and where they’re spending. So first how customers shop, you mentioned it the data shows that customers have shifted so much of their purchasing behavior to online shopping and contact-less methods of pickup and payment. So I’m sure you’ve seen those charts that many people have been sharing that show that acceleration in e-commerce growth five years in five weeks, I’ve heard four years in three weeks. They’re all different, but regardless of the data set that you’re looking at it’s clear that we’ve seen a significant acceleration moved online. Most of that, driven to how we acquire groceries and consumables.

So as a result, our consumer to have reduced the trips to store, reduced the time they’ve spent in stores. And in more recently in open areas of the country, we are seeing a return happily to some of the pre pandemic behaviors where customers are returning to stores a bit more, they are spending more time in stores. So I think this is really a positive sign for retailers.

 

Bart:

I agree with you a 100%. Everything you’ve been saying is kind of what we’ve been seeing as well. Obviously not all segments are fairing the same, like say grocery versus apparel or large department stores you’re in completely different worlds, right?

 

Mara:

Exactly. And the second thing is what customers are spending on. So we’ve really seen a shift in spending from the social experiences to solitary experiences. So really any category that is associated with feathering the nest or improving the home has grown as well as any category involved in health and self-care so fitness, skincare. So the results are really uneven in terms of where consumers are spending. Some categories have never had it better and others are really challenged. And then finally, where they’re spending. So consumers have really consolidated trips. So they’re spending more with the retailers that they know and trust. And we’ll hopefully talk a little bit more about that. But they’re also exploring new brands and retailers. So, social media, digital marketing, getting your name out that way has never been more important. And that’s really been another trend that we’ve seen.

So that’s kind of it on the consumer side, on the retail side, the impact has been again, very uneven, as you mentioned, depending on local regulations and if the business is deemed essential. Some of our clients saw business and trips, skyrocket, and others have been literally shut down. So retailers have also had the added challenge, regardless of which bucket they fall into having to take care of customers, having to really worry about the community and most importantly take care of their employees. So it’s literally been exhausting for so many companies. And it’s really amazing I’d say the endurance that everyone from our retail leaders to frontline workers have shown as the pandemic, unfortunately persists. So I’d say it’s been a marathon for a lot of our clients.

 

Bart:

It sure has. And you hit on a couple of things that personally must be in that swath of people that you’ve been serving, but example, I had a flood in May, my all basement was flooded, kids decided to have a pillow fort the night before. So the couch, everything was gone. So I had to buy a bunch of new furniture and stuff like that. And stores were open but only certain hours I started looking at different retailers that I normally wouldn’t look at. So it fundamentally changed. My wife and I are trying to work out at home, I got a Peloton next to me right here. So I kind of fit that mold dead on.

And I think we’ve seen the same thing with our retail customers just trying to adapt a lot of it’s been mega shift. So certain cleaning protocols, stickers on the floor. I think it was in Home Depot this weekend and they still have just a strip of tape, an arrow telling me on an aisle, which I’m all the way down the aisle when I see it the first time. So clearly I was going the wrong way. But what have you seen in this ad hoc environment that retailers have tried to adapt and do you think any will stick, any that will be long-term obviously a lot of the safety protocols I think will, but there’s other things as well.

 

Mara:

All right. So there I can give you some kind of good and bad, bad stories and tactics that I’ve seen. As I mentioned, I’ve been very impressed with the agility that our retailers have shown at this time. So the old saying necessity is the mother of invention really brings true here. So we’ve seen so many companies like you saw that just have been really willing to test and try new operational tactics and empower their store teams to come up with their own solutions and quickly share back successes and failures. So in some of those have literally stuck the tape on the floor that you were just describing, it worked, it was great. For now, it’s fine. Why do we need to have a fancy decal and spend money on that when it’s doing the job?

The other thing that we saw retailers doing that worked really well during this period was simply organizing structures for communications. So things they always probably wanted to do, but didn’t do they just mobilized ways to get themselves communicating across store teams and with their workers which were remote to really share ideas as quickly. So those were some of the things that that I thought were some really good initial tactics that people took. But the retailers that have been able to survive and in some cases we’ve seen thrive during this time are those that really quickly reoriented. Several were really important during this time, like supply chain, new technology and digital marketing, I think I mentioned already, and I’ll probably mention it again several other times, but those companies that made investments there, those investments really paid off.

And it wasn’t just large companies, there were smaller brands and even startups that were able to leverage technology to really build awareness with customers during this time, we had several clients that literally last March had no e-commerce capability at all. I mean, to speak of just very, very simple, and they really had no omni-channel. So they were really late to the game in terms of buy online pickup in store, in store returns things like that. And they implemented tools really quickly, like Shopify, as an example, I think you saw that if you watch Shopify their revenues just skyrocket because so many companies kind of ramped them.

 

Bart:

They became Zoom of e-commerce.

 

Mara:

Right, exactly. And others that had never thought of or had capabilities around social selling just quickly implemented that to expand their reach to new customers, as well as current customers. On the negative end, and I don’t know if you remember, but we had some reopening before we shut down again, a lot of parts of the country. So some retailers I think were too quick to take away some of the capabilities they’d enabled and the services they’d added during the pandemic, they were like, “oh, now we’re reopen we’re just going to go back to square one.” department store who I will not name names, but they were guilty of this. And they just didn’t understand that their customers weren’t ready, that customers weren’t feeling safe enough to actually go back into the store.

So, as an example, they still wanted curbside pickup and it was taken away. They wanted local returns and it was taken away. And so that company quickly realized their mistake and implemented that. But I think it’s a real lesson to retailers that we really need to listen to our customers and make sure we’re not out in front of them in trying to rush change, and really make sure that we’re on target with our experience to what they’re looking for.

 

Bart:

Yeah. That makes sense. It’s interesting because outside of being in the right categories, but a lot of those that kind of excelled during the pandemic were those that were positioned well going in, right?

So Target, a major investment over the last four to five years in pickup delivery, shipped and all that other type of capability, you got Chipotle Mexican Grill, we got Panera Bread, those that had invested so heavily in digital and a cross channel thing. They just hit their stride right when they needed to. And it accelerated the demise of some other concepts that we’ve seen in bankruptcies and other things that it just moved the ball a little faster for what they were inevitably probably going to go through.

But it surely is interesting and it’s changing. Just to circle back to where you said, everything needs to start with the customer because we’re reacting to that and it’s changing a lot. I know you’ve mentioned some of these statistics, you guys do a lot of customer insight study for what a decade or something that now that you guys have been developing proprietary research. And I think you’ve had a couple installations of it during COVID one, maybe in the early summer, late spring. And then I think you did it again right before the holiday was about to kick off around election time. Is that right?

Why don’t you give us a little bit of background on that research and what you saw come out of that?

 

Mara:

Yeah, so really interesting, as you said, we did two surveys one at the end of May and then the other right in the middle of November, literally right before the election. So I think this was early November. And both were national panels with representation and all age groups, economic cohorts, ethnicities, political affiliations, as well as a mix of urban and suburban and rural consumers. So it was a really great snapshot and really interesting what came out of it. So there were a few key themes I just like to share. And the first that I’d say not surprising was that over 80% said that the global pandemic certainly influenced their shopping attitudes and their outlook for the future.

But it translated into, we found four very distinct segments which was quite interesting. And the largest segment of customers reported that the pandemic completely changed their shopping routine, adhered to social distancing, but they were very, I’d say cautiously optimistic about overcoming this challenge. It was like they just needed to kind of batten down the hatches for awhile. And then they thought, everything is going to be fine at the end. And we called this segment Hopeful at Home. And that was about a third of our shoppers. So these were the ones that really shifted to doing most of their shopping from home. They tended to be, which was really interesting Democrats, younger middle and upper class I’d say upper income actually with higher levels of education. And they were also urban and suburban residents.

So the second segment, which was just about under a third, they took fewer shopping trips, were really worried about… So these were the folks that were very concerned about the longterm effects of the crisis. These were our real stackup shoppers and we call them Concerned Stockpilers. So this group over indexed, as older than 65 empty nesters, and you can see their concerns because that group from everything that’s been reported are thought to be higher risk for virus related complications. These folks so tended to be in smaller towns or rural areas in the Midwest and tended to be at middle income or lower economic levels.

The third was this 20% that we call the business as usual group. So they reported really no significant changes to their behaviors. They really were anxious for things to get back to normal. This group about 20% tended to be male Republican living in smaller towns and rural communities. And it also over-index for higher levels of income. And the smallest segment, which was under 20%, we called them Tough Times Ahead. So they were working spending. They were more likely to be millennials with kids. They were certainly less optimistic about the future and about what was going to happen after the pandemic. So those were the four segments that we came out with and really the four big themes.

 

Bart:

It’s interesting that some of the older demographic being forced into a largely digital experience. I know dealing with my parents was not a smooth transition, but they’re getting there, but it’s interesting. I think that has a lot to do with this advancement, a lot of people like myself and probably yourself, we’re already doing a fair amount of digital commerce. It’s just this large swath of people that were forced into it who maybe were resistant in the past.

 

Mara:

Yes. It’s really interesting. And I think if you hear at our recent National Retail Federation they had an individual presenting from Walmart really interesting about their big upswing in buy online pickup and how many of those were older consumers. Which again, isn’t surprising because they didn’t feel comfortable going in the store, but that they adapted that technology was interesting. I also saw some data coming out of the UK yesterday about the high percentage of contact-less payments now happening over there. And the biggest growth was with the older consumer. So really interesting too, who before had not been using those methods.

 

Bart:

Right. Anything else jump out at you, surprise you from the research?

 

Mara:

Well the most surprising overall was the consistency over the six month period. We thought we would see a change. And really there were four segments before, four segments after very little change. And what I thought was very surprising was that business as usual segment that 20% persisted as well, that across the country, even though we had significant shifts over the six months, where the pandemic hotspots were happening, we had that persistent 20% that were just completely unaffected in their mind.

 

Bart:

Oblivious to what was going on. God, I wish I could be in that bucket.

 

Mara:

I do too. But really what didn’t surprise us was that customers, and it was another thing that came through consistently, was that they were really depending on their trusted retail relationships as where they were shopping.

 

Bart:

Well, that’s a perfect segue way and you’d mentioned a comment earlier about consumer trust and I think that’s been a thread through a lot of your research over the years as it relates to retail. I saw a recent survey from McKinsey, they had a COVID-19 consumer poll survey that they conducted, I think in the June timeframe and 75% of the consumers there were trying new shopping behaviors as a result of the pandemic. One of those new behaviors was switching brands trying something new which that’s one of the central themes I know, as I mentioned of your research is kind of this brand loyalty and trust. Do you see that erosion out there in brand loyalty and if so, what do retailers need to do to try to lock that back in or increase it?

 

Mara:

Yeah, well really interesting because what we found is that high consumer trust equates to shopping and preference. So it doesn’t mean that you’re not going to try something new occasionally, but where you spend the bulk of your energy and dollars are with those top choice retailers where you really trust that they’re going to fulfill their promise. So as a part of our research this year, we asked consumers just a very simple question about the retailers where they shop. And we asked them to rate on a scale of one to 10, I feel that I can trust this retail brand completely. And what was interesting is we could compare the results from that to the results of the survey that we did 10 years ago to really get… And we also asked a lot of follow-up questions around the implicit areas of trust to really get to the drivers of trust.

And it enabled us to assign, we call it our retail brand index to a set of retailers. And what was most interesting over this time was that for every retailer we surveyed that we had surveyed in both 10 years ago and now, trust declined over the 10 year period. And we attribute this to two things, one the pandemic and maybe everyone is just a little more sensitive than they were 10 years ago. But more likely, and we’re going to follow up to really understand this more, we believe it’s just now we communicate negative stories so much more fluidly through social media and the internet. And so it’s harder to not get the negative news spreading around employee issues or consumer service issues can be communicated much more broadly.

But there were some bright spots. So what are the most interesting was ALDI. So ALDI actually scored really well in both the years and really maintained their trust, which was interesting. They certainly expanded over that 10-year period here in the U.S. but they were probably the brightest spot out of our research.

 

Bart:

Yeah. Any thought as to what they were doing that they’re fulfilling their promise or what kind of- (Mara’s smart watch tried to join the discussion) No problem. What I was saying with ALDI is there anything you could think of as to why they were scoring so well?

 

Mara:

Yeah, well, I think they’ve done what I think most retailers have tried to do. And I won’t say… We had several retailers their grocery competitors like H-E-B and Costco that also scored really well. And I think what they all have in common is they exhibit integrity around their positioning. So they literally do what they say they’re going to do consistently and staying true to their positioning and values. So it’s treating employees fairly, providing consistent customer service and engaging with the community as appropriate for their brand. In all these cases, which I think really stands out is we found there’s an executional component to trust as well. So in all these cases, if you’re known for low prices retailers still need to surprise and delight around kind of special things around sharp prices, which you find at ALDI right over time.

But similarly retailers that are known for innovation and amazing experiences like Nike, they also score high on trust for us. In our survey is they continously improve and surprise and delight their customers around that innovation and what they stand for. So we think also it’s important our research tells us for retailers to take a stand on issues impacting society more broadly but in a way that’s consistent with their brand. So again, in August back to, and I think it’s one of the clear messages you’ve been talking about in your podcasts is having a really clear positioning to know what you stand for and communicate it and then execute against it. Right?

 

Bart:

No, it hit home because I’m just thinking in the grocery area, I live in Chicago as you know, and we shop at three grocery stores. We go to Whole Foods, we go to Trader Joe’s and then a local chain. And it was interesting to see how each of them acted differently during the pandemic and how it influenced us wanting to a go in the store and B buy from them. So the local merchant it’s still a big organization, it’s a local brand part of a larger supermarket chain. It was packed. It didn’t feel safe. There were too many people.

At Whole Foods it felt a little bit better, at Whole Foods and then Trader Joe’s my wife and I were like, “oh, this feels right. This feels great.” And how they all delivered on their promise and kind of what was more important to them, the dollar or customer safety, employee safety and things like that. And that kind of sticks with you when you think about trusting a brand. So it kind of aligns with what you’re saying about having a position and operate within that box of that position, but then actually execute and fulfill on it.

And we saw that as well. And another Whole Foods story, a colleague of mine who I know you know, he’s ordered a couple times from Whole Foods where he ordered something really nice, like a steak or something like that and they screw it up and they send him the wrong one, but still a good one. And they’re like, “okay, we’ll take that off. And this and this.” So they just immediately give him 30 bucks off of his order and it’s happened twice. And I’m like, “you’re going to be flagged database somewhere that you’re ripping them off,” but they keep making the mistake. But to your point, they’re working on that execution and delighting the customer. And that goes a long way. It really does.

Absolutely. And that kind of helps shift us to this next conversation or topic around shopping attitudes. There’s been a lot of changes in attitudes because of COVID, the presidential election was going on. So anything else that we haven’t talked about around basically shopping habits, or maybe how those shopping habits rolled into the holiday season. I know the timing of your research was kind of right before, so you got some pre-holiday sense of what was going on. What was different about shopping patterns in the holiday that you saw kind of maybe in your survey and then what you’ve seen since.

 

Mara:

Yeah, really interesting. So when we did the survey, we found that the top purchase driver for holiday gift purchasing this year were promotions. So Prime Day, Black Friday, Cyber Monday, there were so many deal days this year. And more than a third of our respondents reported having purchased during Amazon Prime Day, do you remember this year was in October, right?

And that really this year kicked off the holiday season. So our holiday season really stretched out this year. So that reported this increased focus on deals for this year. And I think a lot of it was because we had more time, people had more time to shop this year because they weren’t commuting, they weren’t planning vacations. They were staying home. More than a third also plan to spend less and what was really interesting was that one in four of our respondents said they were worried about their ability to afford holiday gifts at all this year. And also it was clear across the board that there was going to be less spending on apparel. So really interesting because what came out I believe is that holiday, there was a lot of spending, but again probably that spending shift, we believe that would have been on travel and vacations went into again, feathering the nest and buying some luxury items and things like that.

 

Bart:

That happened for us, for sure here at our house. We started earlier was, it was more steady and it was straight Amazon and other retailers. You know I’ve got young children, so Christmas is still a really big thing. And we also felt a little bit of an obligation if we’re able to give them a little bit more, because they’ve been stuck inside and we’re working on buying games and stuff we do as a family. And I think spending overall was somewhere in the 6.5 to 7% increase range, which surprised me.

 

Mara:

Exactly. So overall for holiday, really a few things were really different, but these were trends that I believe will persist in the next year. So this trend of shopping earlier and elongating the shopping season we’ve seen that happening for many years and I think that’s certainly going to persist and will be more promotion driven even next year. The other thing that really happened this year showed up in our survey, was consumers very worried about shipping delays, packages getting lost in the mail and lo and behold, that certainly happened. So that again will probably cause folks to shop earlier so that they’re sure that the products get there on time. And although we expect the capabilities of our delivery to improve significantly over next year.

Another area that was really interesting in terms of holiday shopping was the concern about safety. So 70% of the folks in our survey were really concerned about shopping indoors. So they just would not do it even though in many parts of the country indoor malls were open, they just wouldn’t go. And they were also really concerned about cleanliness. So again, that drove a lot of behavior to online or ordering at least. The other thing that was interesting in our survey, respondents said in store pickup or curbside was really low in the number of respondents that said they were actually going to take part in that. But I think what we saw actually was that people did move to that because of concerns about shipping delays and getting their product, they were like, “yes, I’ll go at least go pick it up.”

 

Bart:

We got a Nintendo Switch. So we crossed the barrier on the video game with the kids and the minute I found one online. I think we did Target or something and I did a pickup just because I wanted to get my hands on it because I didn’t trust that it would come otherwise. But yeah, I could see that for sure.

 

Mara:

And you saw a lot of retailers actually incenting you to do that. So Nordstrom as an example, they were giving you a coupon to redeem later $15 if you would just come and pick it up.

 

Bart:

Yeah. That’s kind of the essence of what we’ve been talking about is all these behaviors are changing and how are retailers going to adapt? And I know you guys have done some work as it relates to store format and kind of experienced design with many retailers. And we talked about some of the ad hoc stuff that’s been going on, but there are legitimate changes happening that will have longer impact on store prototypes. How do you see formats changing, store formats? Have you been in discussions with retailers thinking about that exactly?

 

Mara:

Yeah, absolutely. That’s why I really like your three R’s because this is really an opportunity for retailers to really study the consumer and adapt their storm formats because the role of the retail store is changing. So before the pandemic started our research showed us that retailers were really winning by competing on the extremes and I’ll just spend a minute or so going through what those extremes were. So you saw retailers competing and winning on what I call extreme convenience or removing friction from the shopping experience. So an example would be Amazon Go, which many of us are familiar with, which is just walk out convenience. And then others were winning and delivering extreme value or competing on price, usually in a treasure hunt type of experience. You saw how successful pre pandemic Ross, and T.J. Maxx and our Dollar stores and all of those were actually growing as other retail channels were contracting.

And then the third area was really delivering an extreme experience. And what we think of as adding friction to the shopping experience. So think about the Lululemon Flagship Stores, where you’re really engaging with the brand or the Starbucks Roastery. We had one here open in Michigan Avenue that’s just an amazing sort of the best place to experience the Starbucks and immerse yourself in Starbucks brand. And so as we prepare for a post pandemic world, we really believe that retailers are still going to win by applying these to their own positioning. So it’s really important again, we keep coming back and harping on, it is really thinking about who is your target that you’re going to be just right for? What is your positioning to win with them? Really thinking about that journey and extreme convenience. So where do we add friction to the experience to really engage them with our brand, where do we remove it and really go frictionless.

And if you think through, and we’ve got some large retailers that are doing a very good job of this right now is Target and Walmart, which we’ve already talked about, but some great companies to study. But those are the things that consumers are going to be looking for. And those are really key to building trust. So that’s on the consumer facing side, but there’s so many opportunities right now what I call the actual efficiency side now to really think about our store formats differently, as you were talking about earlier. How do we actually reinvent the inside of our store and the technology that supports employees and our product movement, et cetera, to really optimize the delivery of our brand. So thinking about that differently is another key area that we’re working on with our clients today.

 

Bart:

Yeah. It’s an exciting time. It’s scary but exciting. And I think it’s a good push for some retailers if they want to reinvent themselves and adapt to the environment we’re in but I’m excited to see what happens and what type of experiences, what type of cross channel work? I do think the omni-channel, we went from single channel to multiple channel where [inaudible 00:42:17] now to omni-channel. And how do you architect a buying journey that is dependent on so many circumstances and individual, like any given day, I may go to the grocery store another day I may order it, all that diversity and to try to kind of sew that together into something that can digitally align with what I’m doing physically and all kind of work together is a huge challenge.

There are some great examples of folks who have done it right. Many that we’ve mentioned today. And as you said, I think there’s some startups that are even trying to change the game more that you saw whether it was Walmart buying Jet or Target buying Shipt or other things. Those folks will get gobbled up and integrated into a larger company probably or a new way of doing things that we can all benefit from.

 

Mara:

Yeah, absolutely. And underpinning it all is capturing the data along the way. So we really know how to react and respond and really meet the domain and satisfy those customers. So there’s this data layer and analytics layer that’s going to be super important in all of this. So we call it integrated retailing and that’s key to making that happen so that we are giving it an integrated response to the customer across all touch points that allow them to shop however they really want to with us.

 

Bart:

Yeah, absolutely. Well, and I may in a future episode try to see if you can join us to talk more about that, because I think that is going to be one of the biggest challenges and how do you leverage that into operations, and the real estate, and the merchandising marketing and all that stuff. We’re doing some pretty neat stuff as it relates to mobile device and helping our customers push ads when they’re within a geographic range of locations, looking at where customers are coming from, looking at where competitors or customers are coming from. So there’s a ton of data that can be leveraged. And a lot of times it sits in these pockets and it isn’t being pulled together to really understand the full picture of what’s going on. So don’t be surprised if I ask you later to join us to talk to.

Well, I really appreciate. This has been absolutely fantastic. I think you’ve helped us and the listeners better understand the changing consumer and in subsequent episodes, we’re going to talk about how that translates into the brick and mortar side of the business. And once again, great to talk to you.

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