Global retail expert Joe Jackman calls this the time of the Great Reset for the retail industry as it grapples with the crisis brought on by the COVID-19 (coronavirus) pandemic and the uncertainties it has created for the future.
Jackman, founder and CEO of Jackman Reinvents, a very well-known consultancy that has worked with many major brands, said now is the time for many retailers and brands to reinvent to overcome the challenges presented by the current health emergency.
“For the first time ever in my career I’m seeing stats that indicate this is more than a momentary crisis that will eventually go away and people will go back to normal. I think it’s widely accepted that there will be some kind of new normal,” said Jackman.
“I’ve been fascinated with that as of course everyone in retail and beyond has as well.”
Jackman said that led to him and his team to do some research. Powerful evidence is suggesting that the changes that are impacting us all are going to have lasting consequences.
“Only four percent of 4,000 consumers that we surveyed said that they aren’t impacted in any meaningful way. I’ve never seen a number like that where 96 percent of a population is saying the same thing. This is profound. Maybe not surprising, but it’s pretty stunning,” explained Jackman.
“Almost 50 percent are saying that the changes are causing them to revisit not only their consumer behaviour, purchasing decisions, and such, and how they buy and who they buy from, but their very beliefs and values.
“What’s emerging is a picture of an entire human race revisiting what’s important. That will have consequences of how we buy and who we buy from.”
In March, about 48 percent of North American adults said they expected to retain the new behaviours because of these shifts and re-examination that’s going on. Three weeks later that number jumped up to about 66 percent, said Jackman.
“That has a very, very significant implication for what the new normal will be. That’s why I say it’s the Great Reset,” he said.
Jackman said retailers have to first accept that there will be a shift, a significant shift, and therefore now is the time to re-examine their place in the world, their strategies, which customers are they focused on and why, what do those customers really care about.
“A deep understanding in the process of resetting your strategy,” he said. “A deep understanding of customers and what they’re experiencing now is really, really fundamental. I think that’s different from what many retail leadership teams are doing which is hunkering down in a crisis, trying to make the best possible decisions, trying to keep their businesses alive, serve their customers sometimes in really scrappy new ways because they’re forced to, and not really thinking so much about the future.
“I totally get the instinct to focus on survival but what’s going to happen very soon is that the world will start to put itself back together again and buying will begin again anew particularly in categories of retail that have been restricted and the customer is going to take this shifted set of values and they’re going to start to behave in different ways and every retailer needs to take this moment and re-examine their most fundamental strategy.”
Jackman said retailers should not delay. They need to take the time and make the time to start asking and answering those really fundamental questions because by doing that they’re going to set themselves up for success and strength coming out of this crisis. If they leave it and try to return to business as usual, the risk is they will be offside with how the world has changed.
One of the key shifts will be the continued trend toward more online shopping. If retailers haven’t already done so, now is the time to double down on digital and direct shopping.
“We’ve now crossed some sort of bridge where the march towards ecommmerce penetration which has been building and building, and mobile platforms helped that climb, I think now we’re coming through a time where all of those people were fence sitters. We’ve just been through the largest single exercise and trial that we could have ever imagined,” said Jackman.
“I was talking to a CEO of a big retailer and he said it’s interesting what percentage of their online traffic is net new to the business – these are people who have never before either bought with them and analysis revealing they had never bought online. So all that trial, the longer it goes particularly, the more comfort, the more confidence and the fact of digital direct delivery, it is easier once you get the hang of it. It’s a lot more efficient and it’s safer. The penetration of ecommerce will continue to climb now and at a higher rate.”
If a retailer is lagging in that, they will have to play some really fast catch up and be as scrappy as possible. If a retailer was on the curve and continuing to invest in the online, now is the time to double and triple down “because we’re not going backwards from this point,” he said.
It’s not just the transactional shift to online and delivery. It’s the importance of engagement and creating an experience beyond just the transactional. To be successful online with direct delivery it’s got to be simple and efficient.
Retention is now the key. Retailers have to not only serve customers but also figure out how to engage and retain them before they go back to their other options.
“The way I think about reinvention is simply not starting from scratch but taking what’s true and special about any particular business and continually adapting it to what’s going on around it and in that continually return to relevance. When a crisis like this comes along, you don’t very often get everybody on the same reboot. Every company now has to fundamentally re-examine the strategic questions – which customers, who are using them, how do you show up, how do you deliver your proposition, what is that proposition, and what experience you’re going to create around that,” said Jackman.
“So I say to companies on a regular basis, if you’ve been successful for a long time without making any changes, the likelihood that you’re going to need to consider reinvention is probably pretty good. It’s pretty high. Never in my career have I said to the entire community of retailers, everyone now is the time to reinvent. Simply because the context at which you go to market has changed so profoundly that you can’t do anything but go back and ask how do we evolve?”
