In Conversation with Oliver Banks - The Future of U.K. Retail
This week Rotageek talks to Oliver Banks, a leading retail consultant who specialises in delivering effective transformation programmes for large retailers.
With the future of retail an uncertain sight, Banks shares how retailers can adapt to change, transform quickly and overcome the devastating effects of Covid-19.
How did you get where you are today in your career? Tell us your story.
I started my career in engineering, with a particular focus on system engineering which sparked my interest in overcoming challenging and complicated problems. Coupled with owning a mobile cocktail bar business and early ecommerce business, I then moved to retail, looking for a faster pace and more intimate focus on consumers. I joined Tesco’s supply chain team as a project manager and never looked back. Tesco offered me a wide experience and eventually found myself leading large and complex change programmes in their internal consulting function.
In 2015, it was time to move on and I founded OB&Co as an independent retail consultant. My mission since has been to help revolutionise retail operations and operating models through supporting people to transform their business as well as driving progress and action for hard, complex changes.
I also present a podcast, the Retail Transformation Show, and a run live virtual event, Retail Transformation Live.
And now, as I look back on my younger life, I see I've regularly flirted with the world of retail - from working dolls house fairs, to supplying pet shops and bartending - so it seems like a natural fit.
What do you see as the biggest challenge facing the retail industry right now?
Being able to change and transform in an effective way. For some time now, the retail market has been evolving in our digital age. We (as consumers) are changing how we live and are blending more digital elements into everyday living. We're looking for simplicity, speed and convenience. But at the same time, we're expecting high service, great value and high retail standards.
Covid-19 has accentuated and accelerated this. In turn, retailers must accept and respond to the changes. Burying your head in the sand or crossing your fingers and hoping things will be ok is not a good strategy.
The bar is getting continually higher and, unfortunately, it's forcing more retailers to make mistakes or to do nothing in fear of getting the balance wrong and risking destroying sales and profitability.
What role do you see technology playing in tackling this?
Technology is the root cause of this challenge… but also the solution!
Devices such as mobile phones are causing consumers to live differently, being more connected than ever before. The internet gives more visibility to all aspects of life and we’re increasingly impatient and lazy.
But technology also allows us to become more data driven and make more intelligent decisions. It can even help us become more intentional. With more transparency and speed, retailers can choose to be perfectly placed to respond to the changing world.
However, I also believe that technology is not a replacement for human elements in a retail brand. Instead, technology should be used to boost the human element of a retail brand.
For example, human care and service is boosted by data-driven insights about customers, potential upsells, pain points etc. Looking to positively adjust future experiences by taking preventative action to avoid frustrations and by proactively serving customers to present delighters. Data and insight without action to change the future is useless.
Technology should supplement the experiential impact that people have. And it may also alleviate or automate workload for retail businesses. But it's not a shortcut for avoiding hard work or smart work. That needs to be done for technology to be truly effective.
What makes for a successful technology transformation in enterprise retail?
Interesting question. I personally feel that a successful technology transformation isn’t to do with the technology. Technology may be part of the solution (and possibly a problem too!) But it’s also not the only part.
It’s why I don’t use the term digital transformation - it unhelpfully narrows the scope, potentially ignoring important “non-digital” elements of the business.
But I regularly see three elements to a successful transformation.
Firstly, there must be a strong will to change. This is a recognition and real understanding of the problem - both from a leadership perspective and a user perspective. It’s also important to recognise the real challenges here. Because, ultimately, without a strong will to change, you’ll experience resistance at every stage.
Secondly, you must identify an achievable approach. Effective programme and project management are key here, to manage priorities, timelines, risks, finances and more. Without this achievable approach, it’s easy to descend into ‘headless chicken’ mode where nothing really gets done.
And finally, there must be the right people to ‘do’ the transformation. And the right people means having several different elements - bringing together mindset, behaviours and technical skills. Being good at your day-job doesn’t mean that you’ll necessarily be a natural at delivering transformation. So without this element, mistakes and missed opportunities will be rife.
I call these three elements the Transformation Trifecta. And, when you bring these elements together, that’s when you’re best set up to deliver successful transformation.
What are the top-performing retailers doing to give them their edge?
Top performing retailers are continually changing their business. They’re trying new initiatives, they’re experimenting, they evolve with the market and most importantly, they’re taking action.
Take Amazon and Walmart for example. Amazon are transforming how grocery shopping works through their cashierless Amazon Go stores and they continually try new things. Whether it is their new DashCart, their Fresh stores or expanding their grocery home shopping initiatives through partnerships with companies like Morrisons.
Then look at Walmart where they’ve recently launched Walmart+ to rival Prime and have created new partnerships with companies like ThredUp and Shopify. Most recently in late December 2020, they also piloted a new shoppable livestream on TikTok.
Also, brands going DTC (direct to consumer) companies are doing an excellent job. Apple, Samsung, Lego, Nike, Adidas and many more understand their purpose and place in the market. Their operation supports that purpose effectively and reliably. And they love their customers, in turn earning the right to be loved by customers.
What lessons should we learn from the retail industry in 2020 to take into the future?
We’ve seen some big changes happen quickly in 2020. Sometimes, these initiatives have even been years in the making but lacked the strong will to change up to now - and the result is that nothing moved very quickly. But, as an industry, we’ve now proved to ourselves that we can move with haste and that change is possible. We must take that as a lesson for the future.
Personally, the biggest lesson for me was from Dr Jackie Mulligan of ShopAppy.com, at the second Retail Transformation Live event. In her session, we discussed scenario planning and our natural tendency is to assume the future is aligned to what we hope will happen - and that we tend to ignore or pick apart the alternative futures that make us uncomfortable. As a result, we don’t plan and aren’t prepared for these versions of the future. So going forward, we must learn to take nothing for granted and be willing to accept an alternative or inconvenient truth and adjust the business accordingly.
What is the most interesting retail tech proposition you've seen recently?
Aside from Rotageek of course which really excites me, there are three innovations that come to mind.
Firstly, Quorso, for serving data in an insightful way and building in action taking and minute adjustments to continually move the business forward. As I mentioned earlier, insight without action is useless and Quorso wholeheartedly recognises this.
Uncrowd, for understanding consumer behaviour in a new way and helping to show people what is possible to better serve customers. This is a completely new way of looking at the customer journey and focusing on what really matters.
And lastly, the various warehouse automation options, especially those such as Geek+, which provide a simple retrofit solution. This offers companies the opportunity to revolutionise supply chains and fulfilment centres in relatively tiny amounts of time.
What do you see as the future of retail for the UK? Will high streets in cities, towns and villages develop differently now?
High streets will no doubt continue to play a part in the future of retail - but they will be different. There will be more focus on relationships and meeting points - seeing the high street as somewhere for people to come together. I think the future can be bright but we need to proactively initiate the changes required.
What do you think will change in our high streets over the next 18 months?
I worry that there will be many companies that face extreme financial difficulty over the course of 2021. This will wreak havoc and we’ll see more empty stores which present two key challenges.
Firstly, retailers must evolve their store operations to ensure that they are making the best use of the space to support discovery, fulfilment or service.
Secondly, high streets must come together to deliver an enjoyable shopping experience. I’m sure we can imagine shopping in a location with empty stores - it’s probably not the ideal setting for a wonderful day out. So, how places can come together - town centres, retailers and hospitality businesses - will be important.
I think over the next 18 months, we’ll need to ignore lots of doom and gloom headlines, but if we look closely, we’ll see that some high streets offer a brilliant shopping experience. Then the challenge is about learning as an industry and taking relevant action.
How will the role of physical retail stores change going forward?
Depending on category and target market, more physical stores will need to move to become places of discovery - rather than purely providing instant access to products. To fulfil this new outlook, there will be more showrooms and more high value touchpoints that enhance the customer experience.
And on the flip side, other categories will need to shift their stores to become places for micro fulfilment for ecommerce orders. Similar to how we have seen Co-op trialling local deliveries by robot.
Finally, with sustainability still firmly on the agenda, stores offer a great opportunity to house repair and post-sale service propositions. Examples of these include mobile phone repairs centres and even in store recycling.These are all elements that Amazon and other online players will struggle to create so they make physical stores more robust for the future.
How will these changes impact the retail workforce?
People will need to be more flexible and adaptable. Through the changes, people must be willing to learn new skills. These will include elements like live streaming and video consultations as well as being able to engage effectively on social media platforms.
Then, in the future, people will find their day becomes filled with different tasks and multi skilling will be important. Whether it’s balancing serving customers with replenishment or fulfilment or even flipping from the digital world to the physical world.
And to enable this, leadership will need to become more trusting of the wider retail workforce. Over the past few years, store colleagues haven’t always been trusted to engage on social media for fear of making a mistake. Although these same colleagues are interacting with the same people in real life on a daily basis - and they’re trusted to do that.
So perhaps, we all need to give people the right skills and tools for retailing in 2021 and then learn to just “get out of the way.”
Any final thoughts?
Retail has undoubtedly been tough over the past year and particularly in stores. But physical stores still offer huge opportunities and can specialise in elements that eCommerce can’t do.
And remember, we’re seeing physical stores still playing a huge strategic element for companies like Lego, Nike, Apple and Amazon. However, it’s essential that physical stores serve a purpose and are set up with the right operating model to conjure excitement whilst being suitably digitally enabled.
Taking this journey of transformation is hard - but essential - to stay relevant and encourage customers back into stores. But it is possible by intentionally taking on your transformation. The benefits and rewards for doing so are big. Plus you get to earn the right to be your customer’s favourite shop. And that’s exactly what we should aspire to become.
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