The warning signs have been there for sometime in retail la la land.
In January 2020, the BRC noted there was a “seismic shift” in the workforce, with retailers needing to understand what skills they already have in their teams and what additional roles and skills they now require.
Hugely successful retail businesses that were born in the 20th Century and led by innovative leaders and entrepreneurs from the same Century are now paying the price for incremental change and falling into the trap that simply investing in more tech to reduce cost will save the future.
Let me give you something to think about.
If you had seen the following statement in October last year what would you, your leadership team and growth officers had done with it?
"The women's handbags and totes business in the U.S. is down over 20% in the first eight months of 2019, compared with three years ago, according to NPD Group's Consumer Tracking Service".
The honest answer is probably nothing - and so what you might be thinking?.
If you look closer than the headline numbers you'll see that many of these key drivers are those pesky Gen Z and millenials, along with a brands ability to 'influence' potential consumers via social media.
Re-Sale of luxury products isn't anything new, after all who wouldn't want a 'Tom Ford' suit or a 'Versace' dress at a knock down price.
What's making the difference in the handbag market has more to do with the 'I want it now' generation, combined with the constant exposure and pressure from peer groups to be accepted as part of the tribe.
Now I genuinely don't know of anyone who saw this crisis coming down the line (other than that Bill Gates Video that is) but the warning signs for all kinds of businesses are all around us.
Change in behaviour is a constant thing and as a business transformation consultant the first place I start when asked to review a company and its opportunities is to get the leadership team to answer the following 2 questions;
- Why do you think people previously shopped with you?
- Why do you think less people are shopping with you now?
What seem like innocuous questions regularly create division and confusion amongst leadership teams.
"We invested in a website and people"
"We invested in a ERP system"
"We invested in an EPOS system"
I tend to follow up the first 2 questions with 'what was your last investment in the customer and why'?
In my experience by tracking early signs in changing behaviour with your consumers will give you insights into future disruption in your business.
The expertise I bring is the ability to be able to interpret those behavioural changes in order you can reset the strategy or realign the entire business.
Which is why most companies before, during, and probably post this crisis will revert back to what they did before with marketing and paid media advertising.
Oh, that post about 'Handbag sales' I mentioned earlier in this piece;
"As spending has dipped, the rise of names such as Louis Vuitton may seem surprising. But not so much when you factor in the new options that teens have for getting their hands on these luxury labels".
Analysts say the growth of higher-end handbags can at least partially be attributed to the fact that secondhand sellers are flourishing, especially among younger shoppers.
I this behavioral change you would have picked up on?
A seismic shift in workplaces As has been exemplified during the UK lockdown, technology is helping to mobilise the workplace by providing remote working opportunities and easy ways to collaborate on tasks while automating some of the more manual jobs and responsibilities.