High Performance Retail: How The Winners Are Winning

The recent World Retail Congress in Paris brought together C-suite retailers and retail suppliers from all over the globe. This year, leaders huddled around a theme that I loved – “High Performance Retail.” Given the Paris location, it was also a nod to the Olympics just three months away. The speakers and content were a mix of sobering, optimistic, realistic, and inspiring, and across that range all were insightful. Attendees were there to explore and answer: What are the levels of “perseverance, passion and commitment required to be a winner?” More specifically, they debated the traits, skills, and decisions needed to be “truly world-class in today’s retail landscape?”

As a speaker on the keynote panel on the first day, I gave my answer in just two words: Consumer led.

As I wrote in a Forbes article in January, the consumer is the product – today everything must revolve around them. That means new levels of customization and personalization – from the product range to the retail environment. Perhaps nothing new in that rally cry, but it was clear that the current challenges facing the sector has forced many a strong retailer to turn inwardly, perhaps losing touch with their continuously changing consumer and one that will often say on one hand, brand purpose and sustainability matter most, and yet do something entirely different when it comes to their purchase behavior.

Salesforce Research tells us that 73% of customers expect a more highly tailored experience as technology advances, and Artificial Intelligence will help deliver what I call “PersonalAIzation.” And while most consumers are mobile-first or shop with a second screen, physical retail still plays an important role in shopping and buying.

In a high-performance retail world, custom messaging and solutions will be necessary but not sufficient. The other key component of consumer focus is how retailers – and brands for that matter – make people feel. VML’s Future 100 study, a review of the 100 trends that our agency predicts will change the world, coined the term “Emotioneering” – the need to engineer emotion into what we do; in other words “crafting experiences with emotional payback.” Eighty three percent of consumers actively seek out experiences that bring joy and happiness.

The World Retail Congress showcased some inspiring examples of retailers obsessively focused on their consumers, and providing personalized, emotionally engaging retail experiences that resulted in outstanding performance.

Guillaume Motte, global president and chief executive of Sephora, shared how the retail brand has grown “twice to six times faster than the prestige beauty market in most geographies.” Besides having a strong point of view on beauty, which extends to nurturing and launching many new brands, Sephora combines technology and humanity to make consumers feel special. In-store, team members use high-tech diagnostic tools to conduct 200,000 skin analyses a week. Sephora’s loyalty database is 160 million customers strong, and of those, Motte says, 60 million are highly engaged, closely monitored and appropriately “pampered.” They are also addressing what it means to be a responsible retailer, even when that means turning away a younger tween from buying expensive wrinkle cream to a less expensive but more age-appropriate choice.

Janet Hayes, CEO of US furniture and homewares retailer, Crate & Barrel, addressed the Congress on how consumer focus for them is not just about the product, it’s about the service. Crate & Barrel’s DesignDesk gives consumers their own designer to work with, with a personal consultation that ends by previewing a room or project with photorealistic 3D renderings. Since launching three years ago, DesignDesk now drives 40% of the retailer’s overall revenue. They have further made strategic store design decisions to place the DesignDesk in the front of the store visible through sidewalk facing windows for people passing by to see.

There was plenty of chatter at the World Retail Congress about the challenges that retailers face – for example, the ongoing squeeze on consumers of stubbornly high interest rates, geopolitical turmoil, and a major election year in many key markets. But high-performance retailers are just like elite athletes; they block out the noise and distractions and maintain their eyes on the prize. They are marrying creativity with technology to better forecast and deliver to consumer needs and wants. They put the consumer on the podium, and that’s one way to surely win.