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State of retail report: retailing in a connected world

As the Dixons Retail and Carphone Warehouse merger moved closer to becoming a reality last week, with shareholders of both companies backing the £3.7 billion deal, there was a lot of talk from the two businesses about the importance of "connectivity".

In their respective announcements to the stock market, Dixons CEO Sebastian James said the convergence of the mobile and electricals markets showed the "connected world becoming reality", while Carphone boss Andrew Harrison suggested the "connected world presents us with exciting opportunities".

James mentioned phones that control music systems, tablets that transfer photos to TVs and smart watches that track an individual's fitness goals as examples of the changing marketplace and evidence for why a Dixons Carphone brand can thrive.

But the concept of 'connectivity' arguably runs deeper for the wider industry.

Senior industry representatives who gathered at Planet Retail's head office in London for European retail show RBTE's 2015 steering committee meeting, on 2 July, spoke of an alternative "customer connectivity" that is required for successful retailing: understanding consumer requirements and ensuring this is part of everything a company does.

Retailers present at the event discussed the potentially "confusing" message that traditional customer service tests like mystery shopping can offer, with shopper feedback prompts printed on receipts viewed by some as a "better" provider of insight.

Concerns were raised about how retailers can better understand their customers without impacting operations.

Addressing the delegates – which included representatives from Asda, Marks & Spencer and Waitrose – Timpson Group non-executive director Stephen Robertson posed the question: "How do you get the customer voice into the business in a digital world?"

For online retailers that operate without physical retailing space, it is crucial to be proactive in seeking customer feedback because there are limited opportunities for them to meet their shoppers face to face. Kerry Okikiade, commercial director at gifts and gadgets e-tailer Firebox.com and RBTE steering committee member, described honest feedback from shoppers as "invaluable", adding that the business is also in the early stages of developing a consolidated customer contact system for managing consumer relationships.

She noted: "Excellent customer service with a personalised touch is a core strength for Firebox. As such we are always looking for ways to improve the consistency and cohesiveness of customer contacts. There are so many ways for customers to interact with the business – email, voice, social channels – that maintaining this consistency of our voice and brand across them all can be a challenge.

"One way to achieve this would be to integrate all channels under one system; providing a much better customer experience because we have their history at hand regardless of how they choose to contact us, can see if they have used multiple channels to avoid multiple responses and can better prioritise any issues."

In addition to actively seeking customer feedback and engaging with shoppers to shape business strategy, retailers have plenty of other avenues to investigate for inspiration. The so-called move to a "connected world" has spawned a host of new digitally-led businesses, helping shape a fresh way of thinking.

There is a trend among some of the UK's leading retailers, including Tesco, John Lewis and Shop Direct, to work with start-ups in the tech space and learn from some of the newest technology companies entering the market. John Lewis, for example, recently launched its JLAB tech incubator scheme, which sees five innovative start-up firms competing to develop a retail system that might ultimately be adopted by the wider industry.

Kash Ghedia, technology manager at Dixons Retail (picture above), suggested to delegates at the RBTE steering committee that there are a number of processes established companies can learn from forward-thinking start-ups.

"Small businesses and start-ups are very agile, and many of them have some great innovation to tap into," he explained.

"Some of what the smaller players are working on is making us larger retailers sit up and think differently about the way we are operating."

Ian Woosey, senior director at professional services firm Alvarez & Marsal and former Carpetright IT director, agreed that as retail becomes increasingly commoditised, "innovation is key" to driving the industry forward.

"The commercial teams are focused on product innovation, IT leaders should focus on customer service and proposition innovation, eliminating pain points, improving convenience and crucially shifting the board IT discussion to be around innovation rather than IT capex spend and the like," he explained.

"Smaller IT companies are often the most innovative, IT teams should understand this part of the market better and proactively educate the board on current trends and opportunities."

It is clear there is plenty for retailers to consider as the world becomes increasingly digitalised, and maintaining a connection with customers remains a key goal.

RBTE 2015 will aim to highlight these key challenges and provide best-practice examples of how to solve them during its two-day educational conference programme, which takes place at London Olympia next March.

Legend Exhibitions, the company behind RBTE, which is set to run from 10-11 March 2015, is developing a conference programme that will cover the most relevant issues affecting today's European retail industry, focused on five key streams: Omnichannel Strategy; Retail Leadership, HR & Skills Development; Technology, Innovation & Data Strategy; Marketing & The Customer; and Payments.

RBTE would like to extend a huge thank you to the members of its 2015 steering committee members for their forward-thinking approach and for offering their precious time and integral feedback. Their enthusiastic contribution showed that retailers are hungry for an event rich in fresh content, ideas and innovation, to help inspire them in an increasingly challenging business world.

Click here to read the first article based on discussions at RBTE's steering committee meeting, published in Essential Retail last week

RBTE Steering Committee members are, as follows: Ian Woosey, Senior Director, Alvarez & Marsal; Geri Gray, Senior Innovations Manager, Asda; Aumit Bagchi, Projects & Innovation Manager, Burberry; David Grant, Global IT director, Clarks; Laura Philips, Programme Manager, David Lloyd Leisure; Kash Ghedia, Technology Manager, Dixons Retail; Kerry Okikiade, Commercial Director, Firebox.com; Sarah Pavlou, President, International Women in Business; Richard Mader, President, Mader International Consulting; Richard Jenkins, Head of RFID Programme, Marks & Spencer; Neil Sansom, eCommerce Director, Moss Bros; Helen Slaven, Managing Director, Planet Retail; Mark McMurtrie, Director, Payments Consultancy; Rob Abington, Senior Director IT EU, Ralph Lauren; Chris Hughes, Consultant, Retail Automation Consultancy; Jevern Partridge, Professional eCommerce Leader, Ridge Solutions; Jonathan Wall, Group eCommerce Director, Shop Direct; Gavin Sullivan, Group Buying Manager, Tesco; Charles De Clerck, Customer Relationship Manager, Waitrose; Robin Phillips, Director eCommerce, Waitrose; Julie Price, IT Director, White Stuff; Stephen Robertson, Non-Executive Director, Timpson Group, and former British Retail Consortium Director-General.

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RBTE

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