Former Women’s Wear Daily Editor Robin Lewis is co-author of the 2010 book “The New Rules of Retail.” He has also held executive positions at DuPont, VF Corporation, Goldman Sachs and is CEO and Editor of The Robin Report, a newsletter on retail trends.
Last week I had the opportunity to hear Robin speak during a CEO luncheon held by the New York chapter of The Luxury Marketing Council. I’ve heard Robin briefly as a panelist and contributor at other conferences, and as one who attends lots of conferences and panels, his ‘where the rubber hits the road’ delivery I find insightful in an era where style over substance and high tech graphics often overshadow content.
A Robinism, if I can use the term, would be, “The Harvard Business School may have a different answer, but here’s my definition of a Disrupter: The guy who comes into your market and screws up your business by doing something different.”
With that in mind, let me share some highlights from Robin’s information packed talk held at The Parlor Steak House on the Upper East Side:
– Internet Technology and Globalization = The All Powerful Consumer
– The words retail and wholesale will cease to exist.
– Everything will be accessible to everybody 24/7.
– Boomers are downsizing and dying. Their career as luxury goods consumers is over. They are putting discretionary money into health and wellness.
– To reach Millennials luxury providers need to embed technology throughout the supply chain.
– There is retail saturation in America. In the United States there is 20 square feet for every person versus three square feet in the UK, two in France and Brazil and one in Germany.
– There are over 500 million websites. Consumers are overstuffed. The mass affluent consumer wallet is shrinking mean there are share wars, with increased price promotion and discounting, a troublesome trend for luxury.
– The Smartphone is the Igniter-in-Chief. Today consumers have everything in their pocket.
– There are over two million apps for consumers who do not need anything
– It’s a consumer centric world. The store must go to the consumer
– The point of sale today is the consumer
– Consumers have everything in their pocket
– We are in the third phase of the Internet – the Jobsian/Bezosian era
– Get to know eWallets, bar code video, Smartphone coupons, connected awareness, presence awareness and consumer awareness via personalized data
– The tsunami of new technology is overwhelming
– One major department store CEO told Lewis, “Nobody knows the future. It’s a Vegas crapshoot.”
– Another CEO commented, “We hire legions of tech savvy people, but they don’t have the retail experience to bridge to the consumer.”
– Always go back to the basics: What’s the consumer benefit?
– Luxury consumption has moved from Need Stuff to Demand Experience. It used to be a yoga rack, now it’s the yoga lifestyle with community, classes, trips.
– The Burberry flagship store in London has 500 speakers 1,000 synchronized video screens. Everything is integrated.
– Apple simplified a complex product and made it fun. Apple sells $5,800 per square foot versus and average of $108. Tiffany does $2,900.
– Salespeople become more important.
– In 1980 there were six major blue jean brands. In 2010 there were over 800.
– Consumers have too much stuff. The Mass Affluent consumers want exclusive products at affordable prices.
– We’ve gone from two day shipping to one day shipping to same day delivery.
– Technology used to be for work. Now we use technology for life. We work on the weekends and play at work.
– Traditional planned media strategies don’t work.
– Pre-emptive disruption means if there are 100 equally compelling products the key is to get to the consumer FIRST. Hockey great Wayne Gretkzy when asked what made him the best player in history said, “I don’t go where the puck is. I go to where the puck will be.” Retailers need to get to the customer first.
– The New New means kiosks, pop-up stores, mobile vans and strategic cataloguing. The goal is getting to consumers faster than the other guys. Instead of waiting for consumers to pick up food on the way home at a store, a food wall in the central station in Seoul enables consumers to take a picture of what they want for dinner, delivered by the time they get home.
– There is a neurological connection on how the human mind reacts to the external environment. Elevated experiences connect to the mind releasing Dopamine, giving feelings of euphoria and self-confidence. The result is more buying. The release happens at three points: anticipation of the experience, during the experience and during consumption. Hence, the Burberry and Apple have driven sales by creating a dynamic retail environment. I would add private jets probably release quite a bit of Dopamine.