New York – According to Matthew Shay, CEO of the National Retail Federation, more than 35,000 attendees from 80 countries are attending this year’s Retail Big Show. If the first two days of presentations and breakout sessions are any indication, many of them are focused on one thing – how to become more customer-centric. More importantly, how can they bridge the gap between what customers expect and what retailers are equipped to deliver?
One retailer recognized for doing it “right” is JC Penney, whose executive chairman Myron ‘Mike” Ullman was the recipient of the NRF Gold Medal Award. Having made a triumphant return to JCP in 2013 to rescue the company from oblivion, he refocused the company back on its core audience of mid-market shoppers. The result? Same store sales grown in seven of the last eight quarters.
“Knowing the customer is absolutely job number one,” Ullman says. For JCP, that means a return to the regular promotions they had come to expect, a focus on private label brands its shoppers can only get through JCP, and a maniacal focus on consistency across online and offline channels.
Before his return, Ullman says the company lost a significant amount of business by not having merchandise advertised online in its physical stores. “That’s a non-omnichannel strategy,” he says.
(An aside, the Razorfish session ‘Omnichannel Evolves’ was standing room only, with attendees spilling into the hallway and craning necks through the glass walls to take pictures of the presentation.)
House of Fraser, a UK-based retailer, says it took 18 months to break down internal barriers between digital and store channels with the ultimate goal being that customer insights inform all of its business decisions.
The company, which describes itself as multichannel rather than omnichannel, now focuses on revenue per customer rather than revenue per channel, which forces a more personalized approach to marketing and promotion. As it grows its online business – now 19% of sales and growing – the company is cognizant of the need to address organizational requirements to support a multichannel strategy.
Andy Harding, HoF Chief Customer Officer asks rhetorically, “Are we ready for massive multichannel growth? What will the business look like when 50% of sales come from digital? How should we be structured to make the most of that?”
“It easy to say ‘we put customers first.’ Who wouldn’t say that? But it is far less easy to do,” Harding said, underscoring the importance and rigorous work required to establish the optimum organization.
Finally, Marks and Spencer. In an effort to create deep engagement with its customers, the UK retailer created the Sparks loyalty program, which really functions more like a club-based member organization.
“We are taking a radical look at the customer engagement journey,” said Patrick Bousquet-Chavanne, executive director, marketing and international at M&S. “As a Sparks member, we ought to know you much better than a standard customer.”
Sparks works on a point basis. The more customers collect, the more benefits are unlocked. Shoppers receive personalized offers, access to exclusive events and experiences and priority access to seasonal previews. The highest level gives shoppers experiences like all-expense paid trips to M&S wine vineyards and meet-and-greets with top M&S models.
In just a few months, about 3.5 million people have joined the Sparks club.
”We have a degree of knowledge and engagement we didn’t have before,” said Bousquet-Chavanne. “It’s about the quality of the data and customer insight we’re getting from Sparks.”