Transcript
Reva Bhatia: You're listening to next in retail from Publicis Sapient, the podcast that shares insights on unlocking what's next in digital transformation. Since COVID-19 was declared a global pandemic in March of 2020, we have seen industries evolve rapidly. Underscoring all of these changes is a simple thread—in an increasingly contactless world, we are more reliant than ever on digital technologies. This is particularly true for the retail industry. This era has brought forth an extreme bifurcation in the businesses that are deemed as essential, like grocers, versus those that are non-essential, like apparel retailers. And the digital tools and operational changes that retailers have had to adopt have varied on the spectrum. In this episode, we're going to explore how retailers have adapted during this crisis and review what we think is here to stay and what might fade away as we revert to a new life. Joining me are Hilding Anderson, retail strategy lead in the Americas and Andy Halliwell, retail strategy lead for EMEA and APAC. I'm your host for the session Reva Bhatia. Thanks for joining me, now let's get started. So to kick things off, I would love each of you to weigh in on some of the more compelling changes you've seen in retail amidst the crisis that were perhaps a bit unprecedented. I'm going to start with you, Andy.
Andy Halliwell: Cool. So, I mean, it's been a period of huge change and turmoil, and there's been some really interesting ways in which organizations have responded. So, I've been impressed at the speed and the agility of some smaller organizations here in Europe to really pivot on a dime and change what their service and product offering is for their consumers. So, smaller companies like the bakeries that we've seen, Crosstown donuts, Lola's cupcakes, they've managed to pivot from, you know, creating these sweet goods that only really go to these stores. Also, these shops around London to creating a shipping grocery boxes of produce using the supply chain that they already have in place and taking fruit and vegetables, putting it into a box and then packaging it up and sending it to consumers. And they've stood up, you know, these East store fronts and the ability to actually deliver within, you know, a few days or a few weeks of the crisis setting.
Andy Halliwell: There's been some obviously shocking issues around, you know, panic buying and stockpiling of some really bizarre products, frankly, eggs and flour and milk, which I struggled to understand because they're all perishable. So, okay that seems a bit weird. And so that's been a, that's been kind of difficult to comprehend and I guess the final thing is, there’s been some, there's been some interesting rationalization for why certain stores have tried to remain open during the crisis. The one that sticks in my mind is both Sports Direct and Decathlon claiming that they were essential services because otherwise how were people going to exercise if they did not have access to sports goods? But I do want to, I don't want to call out specifically, you know, some of the larger grocery companies like Sainsbury's, Marks and Spencers, Carrefour in Europe and how they have responded to supporting vulnerable people and just making sure that they were able to get food and they were able to get produce. Sainsbury's is one of the first companies here in, in the UK to work with the government and the NHS to identify people who were either self isolating or were at risk because of immune system issues. And so they, they kind of reached out proactively to people like that to make sure that they actually had access to delivery slots and to goods online.
Reva Bhatia: Awesome. Thanks Andy. I'm going to kick it over to you, Hilding. What have you seen that's been perplexing or incredible?
Hilding F. Anderson: Yeah, I mean, over on the other side of the pond here, just been obviously really amazing and challenging for a lot of our retailers. And I think you have to look at it a little bit sector by sector. So, I think we'll talk a little bit later about grocery in detail, but obviously, you know, essential businesses, huge surge in traffic, especially online traffic, really seeing a lot of adoption online from a consumer perspective and a lot of investment from groceries as they try to scale up with the hiring of, you know, a hundred thousand plus workers at both Walmart and Target, both of whom have a very significant grocery component. And then the digital kind of, I guess the more traditional grocery, has really have also expanded greatly into that digital space.
Hilding F. Anderson: And we actually have seen more digital activity and kind of click and collect activity here in the last three months than, you know, than we've seen in the last three years and the kind of broader trajectory has been accelerated by, you know, three to five years. You know, everything we thought was going to happen in 2024, 2025 is now here today. And, and that's just grocery, right. You know, in the apparel and department store space, you know, a bunch of bankruptcies, JCPenney, Neiman, both filed for bankruptcy. Nordstrom just reported some of their outcomes and down 40% worse than analysts expected. And in some ways it's, I mean, it's all, it's all been unknown for the industry. I mean, we've never had to have a kind of mass closures like this, so it was absolutely a black swan type of event, and everyone's been adapting.
Hilding F. Anderson: I think we're now in a phase where we're pivoting to this saying, okay, well, this is we're starting to reopen. Most of our clients are thinking about, okay, May, late May, early June, we start to see the new normal, let's see what that trajectory looks like as they start to make decisions about where and how to invest. And so I guess, as I think about who's doing it well and leading, I mean, I think we're seeing a lot of agility, like Best Buy is allowing making appointments as a way of kind of reducing total amount of traffic. There's been a lot of micro innovations in the grocery space around, you know, one-way aisles and upgrading their, their mobile platform and, and their digital platforms to make it easy for people to buy in the, you know, apparel sector. We're seeing this shift towards enabling fulfillment and really moving even a small percentage or even a quarter of, of the stores; I think Bed Bath and Beyond talked about moving some percentage of their stores to be dark stores so that they can support this massive growth in online. And I would say across the board, we're seeing growth of online of between 40 to 50%, I think is kind of where Nordstrom was to some of our clients are 800 plus percent of online traffic. And, and that puts enormous pressure on their technology stack and really is the ultimate measure of how well they've transformed themselves as an organization to be digitally first. And I think we're seeing organizations some be successful, some struggle, but I would say overall, I've been, I've been amazed at how, how well the digital infrastructure has held up given, you know, just think about how many people in North America are now, zooming, Skyping, doing things they, many of them have never done before at scale. So that's pretty amazing.
Reva Bhatia: Awesome. Thanks, Hilding. And you definitely touched briefly on grocery and what we've been seeing in grocery and how they've had to pivot into a more digital ecosystem in a really, really accelerated way. I'd love for you both to unpack a little bit more what trends you've seen specific to grocery and how you think these will evolve coming out of COVID-19. So we all know, you know, the proliferation of curbside pickup and the changes that we've seen with the in-store experience and self-driven checkouts and, you know, those becoming the norm amidst the pandemic. I'm keen to unpack a little bit more what you guys think will be here to stay as we look beyond our current crisis, I'm going to start with you Hilding.
Hilding F. Anderson: Yeah. I mean, I think there's a, you know, I'd love to engage with you on this. Cause I think there's a real debate right about is this sustained? Is this not sustained with the online traffic? I, in my point of view is I think that there is a meaningful shift here that is happening with the move, especially in the U.S. that has trailed, you know, Europe. Yeah. We just haven't, it hasn't been a meaningful aspect of many grocers’ business, and now it is, and it is for many for the first time and becomes even more critical given the focus on employee safety and some of the other elements. So, there's a lot of conjecture and speculation about, oh, you know, in another month we're all going to go back to how it is. Yes, people love going in and feeling and looking at the, at the bananas and picking out the right in Texas.
Hilding F. Anderson: I'm an, I'm an Austin, Texas, and picking out the right steak, make sure it's three feet long and two feet wide if you're going to smoke a brisket, but……
Reva Bhatia: Everything’s bigger in Texas.
Hilding F. Anderson: Everything's bigger in Texas and you want to make sure it's nice and not too deep, actually, that's what’s huge cause I smoke meat from time to time, and if it's too…anyway, I won't go there, but it does matter. And you're not going to get that online, at least in the current digital experience. But it, but there will be, I mean, there will be a percentage…my point of view is I think there will be a percentage of people that go back to their routine. But I think there'll be a larger percentage that recognize the convenience, at least for some portion of their shopping. And so I've got colleagues now that, you know, they'll do a core weekly order and get it gets delivered. And then if they need to go out on a Tuesday to pick up a big brisket, cause they're, they're smoking all day on Wednesday, they can do that. So Andy, I'm curious what you're seeing though.
Andy Halliwell: Yeah. I mean, up until recently, my personal opinion was, was aligned with that, but I guess I didn't have the data to support it. Quite lucky that we worked really closely with GWI and they’re kind of a global partner of Publicis. So we've been working with them to look at consumer buying behaviors and kind of to get some predictions of the future. I mean, most consumers that were interviewed as a part of the most recent survey in May are basically saying that they don't see any kind of rapid return to normality. So I think they're, you know, the reality of the fact that, you know, coronavirus is here to stay and that it is going to be, you know, impacting people's lives for six months or more, has really landed with people. So the latest data says that, I mean, here in the UK, more than 50% of people are seeing that as a reality for more than six months, Japan is starkly pessimistic.
Andy Halliwell: So I mean, you know, the Japanese data that we're seeing says that up to 75% of people just see this being a long-term impact for six months or more. And the same thing with, you know, France, Australia, Italy, Singapore, wherever you look, people are now realizing that this is going to last, I'm going to be potentially working from home until the end of the year. You know, the impact of this is here to stay. And, and it's, what's really interesting is that if people are pessimistic about what's happening at home, they're even more pessimistic about the global outlook as well. So, you know, most people seem to believe that their own country is dealing with the crisis better than the rest of the globe. And the rest of the globe is going to have an even harder time of it than they are at home, which, you know, doesn't correlate. So, you know…
Hilding F. Anderson: I can say that most people in the U.S. do not believe that if they've read any news at all, at some percentage, I mean, it's Texas thinks the crisis is over. Some of the leadership here has said, said that in so many words in this time to just move on and we don't need to get into that. But I think that the, you know, the proof will be in the, in the data over the next couple weeks.
Reva Bhatia: Is that trickling into, Hilding, and Andy, is that trickling into consumer behaviors, right? Like the more the governments are coming out and saying, this is behind us and let's all peter back to a normal, are we seeing trends that indicate that consumers are also reacting as such?
Andy Halliwell: So I mean, the, the data that we're looking at at the moment basically says, no, right. People think there is a huge impact on their finances. There is going to be a huge impact on their country's economy. And there's going to be a global impact on global economy. We are currently looking at probably the biggest recession or even depression of, you know, the last, and when certainly my lifetime. So certainly the last 40 years or so, maybe longer, maybe looking back even to the great depression in the early 1900s. And that's going to definitely impact people's buying behaviors, how they spend, what they spend on those kinds of things. There's just no two ways about it. We're going to see sustained behavioral shifts into things like bulk buying and sort of more Costco style stores and formats. We're going to see category changes as well, right?
Andy Halliwell: People are suddenly going to be super concerned about sanitation, hygiene. They're going to be looking at things like healthier foods. If you can make it to the salads outbreak early in the two thousands, we saw big spikes in healthy foods like yogurts, for example, those kinds of things, because people had a perception that probiotics were going to help them defend their body against external influences. And also because of lockdown, we've seen a big spike in things like do-it-yourself at home, right. So do it, you know, they are white dinners, people baking bread, hence that I'm assuming the big surgeon egg and flour buying maybe. And you know, so there's, there's going to be some really interesting shifts like that. I think, you know, from my perspective though, it's what it's really done is it's accelerated the shift to online. The shift that was already coming as Holding was saying earlier.
Andy Halliwell: I think it's just accelerated that and not in my personal belief is that people will try it. They're going to recognize that this is a part of the future and that there will be no going back. I just don't see people moving away of it away from it. And with that is going to come some interesting considerations around substitutions, rejections, the value of a delivery slot, the value of subscriptions, and just guaranteeing that products are going to come to you. I think people have been scared by the lack of product that they've seen in their local stores. And so, you know, the, the value of actually getting stuff delivered to you guaranteed week on week, month on month, I think, you know, we're going to see, that's going to shift people's perceptions around the value of delivering and actually getting stuff delivered to your front door and getting what you actually ordered.
Hilding F. Anderson: So I think Europe generally is a, is a different environment than the North America. And I think there is a set of set of people in a, you know, that's obvious statement, but the set of people here there is absolutely a group that has just has not experienced it. We experienced COVID-19 in the same way that Europe has, and they're not going to change their behaviors as dramatically. But I think broadly I do agree that you know, that there's going to be this shift. It's just, I think it's a question of degree. And I think that it here, it is going to be less accentuated than as it is thanin certainly in the major cities versus kind of middle America and the, probably the less, basically the less dense, more suburban type of environments.
Andy Halliwell: Yeah. I think that's fair. I do think that regardless of online versus in-store, you're going to see some really interesting responses to some of the physical store problems. So social distancing, I think, is going to remain in place certainly across Europe and in places like Australia and the far East for a little while, because there is a heightened concern around the health and hygiene in public. So I think you're gonna see some really interesting store changes. I think you're going to see the continuation of reduced ranges and reduce promotion, certainly over the course of the next three months or so just while stall start to right size. And they start to come back a bit.
Hilding F. Anderson: Yeah. I mean, I think this whole issue, one of the key issues that certainly we're seeing is as you drive into, into more digital, it, profitability becomes an issue and that's driving a lot of innovation that's happening, right. And we're seeing, you know, everything from robotics to returns optimization to, you know, we're just having these great conversations with clients around supply chain and really, really thinking through, you know, how do you use and even anticipate some of the orders—you better demand planning—all of those kind of core back-office solutions. Now that we've had the technology for, now we find are certainly moving on people's roadmap up significantly. I'm curious if that's kind of what you've been seeing, Andy.
Andy Halliwell: Yeah. I mean, I completely agree. The big shift in people's perceptions in most of the grocery companies anyway, is how do I need to be thinking about technology as it relates to supply chain— specifically intense signaling and what does that mean for, for how I'm sort of, how am I forecasting and how am I allocating product? So I think that's one area. Looking at assortments in general, looking at sort of demand looking at how can you, how can you sell an advance of stuff arriving into the warehouses? So, I mean, you know, I've talked about this a lot. Hilding, I know this is one of your favorite topics, but I mean, data is going to be absolutely critical to this and the leverage of that data using artificial intelligence, machine learning, you know, so you've got these continual improvements that are positive feedback cycles so that you can be constantly adjusting what your supply chain is doing and how you're moving products around and how you optimizing products in your network. It's just so critical right now. And it's a, you know, as we've talked about, right, it's supply chain is an area that people are under invested in over the fall over the last few years.
Hilding F. Anderson: Well, but just on the customer data piece, I think the role of kind of personalization and some of these machine learning models is actually accentuated as this buying behavior shifts, because you can take into account some of the recent activity and browsing activity and other things that are a bit different that you wouldn't as a merchandiser, maybe think of a, to link and use these data signals to actually shape what you should offer. And so we're seeing on people's roadmap, that type of solutioning move up because you can, you're suddenly seeing combinations and packages that make sense that didn't make sense even a month or two ago.
Andy Halliwell: The other thing that we're seeing and we're having some conversations with people about at the moment is how do you monetize the additional data that you're getting through digital channels, because where it was like five or 6% of your sales previously, it was, it was not a significant data set and it didn't allow you to really infer too much. But now that it's 10, 12, 15% of your, your, your kind of total sales, there is much more value to be gained from mining that data and frankly reselling it. So how do you monetize that and resell that through to, you know, your partners?
Hilding F. Anderson: And not only that, but your partners need it more than ever because, you know, they have seen demand drop 30, 50% and the demand that they have, they're trying to say, okay, well, how do we drive more? Who are these buyers? And for a while to have, you know, CPG firms or other manufacturers, they, they haven't had line of sight, not at scale. And to your point around the, the volume has been increased considerably. So yeah. Agreed. It's a huge, it's a huge opportunity. There's a lot of solutions around supply chain and demand planning and optimization, returns optimization, inventory, staging, understanding, you know, what stores can be used as fulfillment centers in dark stores, which ones need to continue as they are.
Reva Bhatia: Yeah. And you mentioned building the proliferation now of dark stores in the U.S. is like a relatively new phenomenon. I kind of geeked out the other day when I got an email from the Whole Foods that's by DePaul in Lincoln Park, a large university. And you'd imagine with universities being closed or not seeing as high volumes and, and their email said, basically we've shut down our DePaul store to the public and it is now being used fully for replenishment. And it's incredible.
Hilding F. Anderson: Yeah. Didn't we make that call? Was it on this podcast or maybe the some… We may, at some point we made that call that retailers really have to have some percentage of their store should just straight out switch.
Reva Bhatia: Yeah. And interestingly enough, that's, I mean, I mentioned the phenomenon is occurring in the U.S., but that's been, I think, an emerging trend across the pond for quite some time, Andy. So do you have any reflections of impacts that…
Hilding F. Anderson: Yeah we’re only five years behind.
Reva Bhatia: Yeah just a little behind…
Andy Halliwell: I hate to say it, but that's actually true, right? So, I mean,
Hilding F. Anderson: It depends on the sector. In the defense of the eggs, it depends on the sector here.
Reva Bhatia: Our steak is fantastic.
Hilding F. Anderson: Our steak is better than your steak, that’s for sure.
Andy Halliwell: Oh, I, I wouldn't know. I'm a vegan remember?
Reva Bhatia: Oh, that's true. You wouldn't know. You wouldn't know.
Andy Halliwell: So, I mean, so we've had, we've had the kind of dog store format thing going for a little while, actually. I mean, it was pioneered by Tescos going back a few years now. And, I mean, the interesting thing about going to the dark still format, it doesn't solve all of your problems. You still have to restructure, change the layout of the store, you, you have to make some fundamental shifts in kind of how that store is provisioned and how do you actually get the produce in so that you can put it on the shelves so that it can then be picked. There are some interesting dimensions to how do you do that to make sure that you've got the highest level of efficiency in dark stores to actually make them as efficient as a traditional kind of like larger, you know, DC warehouse format. So we're actually seeing that the rise of the kind of hybrid stores is going to be the way forward doing some sort of economic studies.
Andy Halliwell: And so looking at kind of the cost of both bringing the product into the store, picking the product, and then getting the product fulfilled to people, it looks like the way forward. Certainly in some markets across the globe it’s going to be this hybrid store where you've got some level of automation and robotics behind the scenes, maybe using sort of a click and collect format for ambient products, but for fresh produce kind of opening up the front of store and having a kind of marketplace formats so that people can pick their own produce. But the majority of product, you know, is basically a click and collect kind of a, you know, shopping list or, you know, online collection kind of model. And just topping that up with a few bits and pieces. And of course, you know, click and collect and then heavy levels of robotics on automation in the back office just means that you get the kind of the lowest cost of delivery and the lowest pit costs. So I think, you know, that kind of a hundred percent dark stall thing is definitely a short to medium term strategy for a lot of retailers, but longer term I think you're going to see this increased investment in robotics and automation, and maybe these kind of hybrid stores cropping up a lot more frequently.
Reva Bhatia: So, you know, we've chatted in prior episodes about shipping processes and this dovetails into elements of returns management for retailers. And you guys both touched on e-commerce profitability, and it's impossible to talk about being profitable online, especially for non-grocers without talking about returns. And I feel like it's a topic we mentioned on this podcast quite often, but interestingly enough, with the pandemic, many cities are starting to crack down on how returns in general will need to be managed. For example, interestingly enough, the city of Chicago just the other day announced our guidelines for phase three reopening, which we're about to enter. And, you know, this is where I reside. And so I was paying particularly close attention to what the guidelines are and they noted that every item that's returned to store needs to be sanitized and sit for 72 hours before being put back on the floor and redeployed, and you just have to think in a world where many retailers were struggling with profits online, when, you know, folks were shipping back their returns to now dealing with a returns management and their physical stores, I'd love for you both to note any reflections you might have on what this all means for retailers, especially those who might typically turn inventory much more quickly than others. And you know, what types of technologies should, should retailers start exploring to offset some of these impacts? I'm going to start with you, Andy.
Andy Halliwell: Yeah. I mean, this is obviously not so much of a problem for grocery, but it is having a huge impact on the apparel and fast fashion industries. So, you know, we've, we've talked about returns in the past. I think, you know, as stores start to reopen, we've been looking at sort of reopening strategies and what does this mean even for things like changing rooms, for example. Can you even have changing rooms anymore? What does that mean for, for what you're doing? As more of your product is being sold through online, you're going to have a much bigger problem with returns. How are you going to handle those returns? Do you actually have an efficient sort of reverse logistics strategy? You know, these are all problems that, I mean, actually a lot of people haven't solved for right now. There have been some interesting innovations in how do you sanitize sort of clothing products?
Andy Halliwell: So, a friend of mine was talking about a product, which they're starting to roll out into U.S. hospitals where you can effectively flash a ultraviolet light around a room over the course of maybe five seconds or so. And it will sanitize the room and it will completely clear coronavirus off of all of the visible surfaces. So I think you're going to see innovations like that being put not only into stores but also into how do you clean product, which is either being returned or products, which is actually, you know, going into and coming out of the changing rooms. But yeah, I mean, it's, it is a massive problem.
Reva Bhatia: Hilding, thoughts from you on how retailers can manage the returns process.
Hilding F. Anderson: Yeah. I mean, I think that there's, you know, there's going to be, you know, I don't know, outside the fast fashion, I'm not sure that the 72-hour wait is gonnabe a game changing issue. You're still going to have that core reprocessing issue then in that and the cost associated with it. I think the greater issue’s on the other side, which is just, if you're seeing a doubling of your eCommerce revenues and e-commerce is returned at 50%, you're going to see obviously that flow through and, and that just, you're going to have a massive spike in volumes overall, and it's not the 72-hour pieces, it's the volume. And that is yeah, B commerce and a number of other solutions that are being looked at. So, it is no question that it's going to become a bigger, a bigger issue.
Hilding F. Anderson: And one of the ways that you manage that is there's a whole set of kind of enhancements that you can do through the digital channel to help reduce those return rates. So everything from, you know, better sizing and improved recommendations and a whole bite, like we've developed a set of 10 or 20 discreet kind of optimizations that you can do that have a meaningful impact. It's not a panacea, but we have looked at this problem. And it's, I mean, it's an interesting problem. And it's, my wife has 10 packages right now. You know, when we can't go out, you've just got a stack of stuff. And you think about where that goes, right? And it's a real problem. And it's, I think it speaks to, you know, just sort of zooming out how, where we are in the digital maturity of a lot of companies.
Hilding F. Anderson: And that is that, you know, we're still, it's crazy 20 years in, but we're still early days in some ways in terms of e-commerce being at the center of most of these companies, businesses—groceries even more so—but, but even the apparel, you know, I think it was Nordstrom that said, you know, they saw 40, 50% of their revenue and it was, of course their revenues were down 40% as well. And it just speaks to, you know, I think there are many optimizations like this that will be done over the next two years because of this crisis, because of this moment that we're in, and returns is, is one of them.
Andy Halliwell: I think one of the really interesting things around sort of returns that people haven’t looked at properly yet is an end-to-end analysis of what is the true profitability of your product when it's being returned. And what would you actually need to sell it at in order to turn a profit at the second, third, you know, fourth time, potentially that you're, you're trying to sell it through, right? Because if a product gets returned more than once, is it truly profitable to you anymore? Or actually, you know, unfortunately, is it going to cost you money to then sell it, put it into packaging, post that over to somebody. And then there's still that risk that, you know, 40% of your product is being returned, a risk it's going to come back to you again and again. So, you know, I think there is a, there's a really interesting challenge that retail is going to have to solve for, which is looking at the end to end profitability of your product.
Andy Halliwell: And then looking at the kind of the end to end of your supply chain and working out one of the right ways in which that product should be returned to you so that you can try and maximize that profitability. So, for example, if there are ways to influence people to not send it back to you via the post, but to drop it off in a effectively a postbox at their nearest store when they're commuting to, or from work, for example, how do you, how do you get people to do that? How do you nudge people in the right direction? How do you help people become a better, more, you know, potentially more socially conscious consumer by, you know, just making some of these little tweaks to how they might return product to you in the first place.
Reva Bhatia: Cool. Awesome. Well, to wrap our chat today, I would love for you both to again, take a peek at your crystal balls. I feel like we do that often here and predict what trends you think that have emerged during the pandemic that you think might fizzle out, and those that are here to stay. So I'm going to encourage you to really try to name some things that you think won't be here once the dust settles, quote, unquote, whenever that might be, I'm going to start with you, Hilding.
Hilding F. Anderson: Well, I'm not going to answer it that way. I dropped my crystal ball, I think, on the ground and shattered, but no, I think I, the two things I had, you know, I think are going to continue to accelerate, but one is the customer data piece. We, you know, we think this next decade is gonna be the decade of the algorithm of retailer. It's a retailer that's competing and selling data as, as a primary asset. And I think in that context, we're going to see more and more activity around loyalty, especially on mobile devices and embedding in enabling that kind of engagement through a mobile device and connecting all of your transactions to a loyalty program, into a, you know, a points and type of reward structure. And that needs to be part of the offering. And even, you know, the subscription idea is another one that comes up again and again, I think will become more and more valuable as you think about the need to drive recurring revenue through digital channels, as well as to minimize some of the returns.
Hilding F. Anderson: I think there's an opportunity around subscriptions. And the final kind of piece that I, I would look to see more of is again, mobile thinking about the scan and go type of solution. You know, we did this for, for Walmart, their Fastlane technology up in, up in Canada, but we're seeing, I think a lot of interest from different, many different kinds of specialty and apparel retailers around using a, you know, that mobile tool in the four walls of the store actually doing self-checkout being able to walk out, given, given the broader economic context and the, you know, in the COVID situation. So all of that though links, and the reason it's so powerful for retailers is because it all drives a better knowledge of, of who your customer is, where they're shopping, what they care about. And that's a virtuous cycle. And I think that's going to be key to retailers surviving in the next, you know, in the next decade.
Reva Bhatia: Cool. Andy, Hilding didn't give any predictions of things that'll fizzle. So I'm going to rely on you to potentially cite things that you think might…
Hilding F. Anderson: There’s no fizzling in retail.
Reva Bhatia: No fizzling in retail.
Hilding F. Anderson: Especially now.
Andy Halliwell: So I mean, building a wall, Hilding was saying, I think the thing that we are going to see continue and is going to see… I have some things, but I think the, I think we're going to see a lot more retailers focus a lot more on this idea of service design. So I think, you know, taking what Hilding was saying around loyalty and subscriptions, I think people are gonna realize that being a retailer is not just about shifting product. It's about creating a service ecosystem that their consumers can come work through. That is not just which drives loyalty because of how people feel about buying from that brand and how people find that brand is helping them in running their day-to-day lives. I think we've seen a lot of interesting innovation come from a couple of retailers, and I think everybody is going to suddenly wake up and realize that innovation and creating service as much as just selling products is going to be absolutely critical to their survival over the next couple of years.
Andy Halliwell: So I'm really hoping that you're going to see, you know, a little bit more contingency built into things like supply chains and contingency built into people's business models, so that they've got the opportunity to test and learn a little bit more to act with a little bit more agility and to respond to, you know, fast changes in kind of market conditions. So, you know, those are the things that I think we're going to see stay and people are going to continue to invest in. Things that will fizzle out, I mean, you know, there's been some really interesting stuff that's been done like around improving salaries for frontline workers and for people working in stores. I hate to say it, that's going to fizzle out. That kind of danger money is just going to go away because retailers are not going to want to maintain that over the future.
Andy Halliwell: I think there's been a big demand for produce to come in individual plastic wrapping as well. I think that's going to go away very quickly because people are still very concerned about the environmental impact of, you know, heavy use of plastics and those kinds of things. And hey, as the snowflake on this podcast, I'm going to hold my hands up and say, I really hope it goes away because the amount of wasted plastic and rubber I've seen recently breaks my heart. But I do think that you're going to start to see the category shifts that we talked about. You're going to see some sustained category shifts over the medium term. Short term I think, you know, the thing that is going to go away is the kind of the stock piling and the big rush on certain products. I think that's just, we're already seeing that start to die away.
Andy Halliwell: And people are starting to return to some semblance of normality and kind of traditional buying habits. And there's going to be an increase in buying from grocery stores because, you know, restaurants are not opening anytime soon and people are not going to go rushing back into restaurants cause they they're just not going to see them as safe. So I do think, you know, you all are going to see that start to quickly drift away to, you know, maybe more kind of like, you know, restaurant meals at home and those kinds of things. So, you know, meals that are easy to cook, ready to cook, easy to construct.
Reva Bhatia: Awesome. Well, we are at time today. Thank you both for joining. This was a really great dialogue and appreciate you both joining me today. Cheers. Cheers. Thanks for tuning into next in retail. Be sure to subscribe. So you don't miss a beat on the future of digital and retail.
