Deep Dive: Modern Retail Summit Live October 2020

Modern Retail Summit Live

In the volatile world of 2020, retail merchants are scrambling to adjust to consumers’ rapid changes in shopping behaviors. Today, brands are developing new strategies to grow loyal customer bases by meeting consumers where they are — both online and offline. These strategies pivot on the evolution of everything from products down to their brand voice. 

As the world moves forward into the new normal, brands are evaluating what’s worked (and what hasn’t) to decide which temporary measures should become permanent, long-term strategies.

Modern Retail’s Deep Dive: The Modern Retail Summit is a collection of videos and key takeaways from our event that provide valuable tips and key insights around the new landscape of modern retail, wherein an omnichannel strategy is not optional. Below you’ll find key takeaways, quotes, and stats, as well as videos from our recent Modern Retail Summit event.

The big picture

In March, the pandemic forced both consumers and retailers to rapidly adjust to a vastly different world. Retailers who couldn’t flex into new sales locations, delivery styles and methods of communication found themselves floundering. From marketing to product hand-off, the 2020 retailer has to be willing to throw out the traditional playbook.

During 2020’s global lockdown period, the gentle upward trend of e-commerce penetration took a massive leap forward. Retailers’ e-commerce programs accelerated at the clip of five years, according to a report from IBM. Consumers were ordering everything online (including groceries) to avoid exposure to the virus by shopping in-store. Even since lockdown lifted, shoppers still haven’t gone back to their old habits: COVID has shifted consumer habits permanently. 

As a result, brands must now figure out where their customers are. They need to be where the customer is searching for their products, whether that’s on social media, search or in-store. More importantly, the pandemic proved that the modern retailer cannot afford to rely on a single channel. Digital channels can change their algorithms at any time, new digital channels can attain mass popularity nearly overnight and physical channels are no longer a guarantee. 

As Alexis Nelson, social media manager at Bark, put it: “We all have to be constantly meeting our customers where they are and grow and change in a way that still stays true to our branding, but that also stays true to the constantly changing nature of the internet.”

We all have to be constantly meeting our customers where they are and grow and change in a way that still stays true to our branding, but that also stays true to the constantly changing nature of the internet.
Alexis Nelson, social media manager at Bark

In light of the upending of traditional consumer packaged goods (CPG) distribution models, brands must now focus on infusing their brand storytelling into every step of the customer journey to drive a connection across platforms. Pernell Cezar Jr., co-founder and CEO of BLK & Bold, said that brands instead need to use their stories to demonstrate how they fit into shoppers’ lives and communities. 

Finally: retailers need to be prepared to roll with the punches. The pandemic shifted not only buying locations but also product choices. For instance, consumers dropped work attire purchases almost completely in favor of items that suit a stay-at-home lifestyle. Lena Calabria, founder & COO of Bellroy, a brand that has historically created items to help their customers explore the world, mentioned that her brand has taken the time to understand what products the pandemic shopper needs. “We’re wanting to develop some additional products into the spaces that are resonating for us in the market,” she said. “For us, that’s small carry bags.” 

This new retail landscape comes with its own set of upsides, despite all of its challenges. Camille Rose, founder & CEO of Janell Stephens, has found the pandemic to be a time of great growth. “COVID-19 gave us a chance to expand our brand and get to know our customers,” she said.

With an ear to the ground and the flexibility to pivot quickly, retail brands will find that consumers still need them as much as ever.

Here’s what you need to know.

01
How the pandemic accelerated the shift to e-commerce

For the past decade or so, e-commerce penetration growth hovered around 1% or under. Now, more companies have been forced to adopt as people have been trying to buy all of their items online. E-commerce, in fact, grew by over 30% in the third quarter this year, according to eMarketer. At the summit, companies like Clorox and Bacardi spoke about how they dealt with this huge shift. 

BOTTOM LINE

E-commerce channels, both brand-owned and via online retailers, are no longer nice-to-haves. They are a requirement for any brand to succeed in the 2020s. Even heritage CPG brands like Clorox are learning how to navigate the space of online selling. Online shopping habits are also shifting traditional buying periods forward, so brands must adjust.

  • Lorran Brown Cosby, vp of digital commerce for Bacardi, North America, said that Bacardi’s online sales are up 800% since March. Because of the pandemic, the importance of a brand’s e-commerce presence has skyrocketed. Nearly everyone who spoke at the summit mentioned they were focusing resources on their e-commerce websites, despite previously viewing it as a secondary channel.
  • Julian Mintz, head of West & Central sales at Roku, said that nearly 60% of consumers are planning to buy online during the holiday season as they avoid shopping in crowds. Mintz also mentioned that consumers are looking to begin their holiday purchases earlier than ever this year (as early as September, in fact) as another strategy to avoid exposure to holiday shopping crowds. 
  • While brands’ websites have grown, multiple business leaders also mentioned the key role their Amazon storefronts have played in their pandemic success. As e-commerce has grown in the past few months, so has Amazon. It is currently driving as much revenue for brands as traditional retail channels.
02
How retailers are being proactive

With the onset of lockdown, most brands lost the well-known discovery channels — where they could discover products passively on a retailer’s shelf. Simultaneously, consumers lost the ability to find products while perusing, as well as to handle objects before they purchase and to speak to a sales associate for advice on how to solve a problem.

The retailers that survived lockdown were the ones that figured out how to proactively get to the channels their customers had moved to and altered their sales methods to suit those new channels rather than waiting to see what happened. This proactivity meant adopting new strategies like rapidly partnering with delivery services, migrating to digital channels shoppers shifted to in search of answers to their problems or seeking out resources and supply chains to support a boom in their DTC e-commerce channels. 

BOTTOM LINE

It’s now virtually impossible to accidentally achieve success as a brand. Creating a loyal customer base requires meeting your customers where they are, building the products they’re asking for and continually proving you deserve their loyalty. Companies capable of providing customers with this level of convenience have found themselves rewarded with strong sales.

  • Lorran Brown said that even as alcohol sales ticked up with lockdown, Bacardi realized its customer was rapidly developing a new definition of convenience. “For us, [convenience is] very much taking advantage of this moment of ‘now.’ I want it now. Educate me now. Show me a different experience now. Our strategies have definitely adapted to that space…and we’re ensuring we’re visible in places that we haven’t been before.” Brown said, for instance, that as consumers have begun to Google cocktail recipes, Bacardi has been figuring out how to not only serve up that recipe but also provide access to a delivery kit with all the ingredients that searchers need to make said cocktail.
  • Alexis Nelson, social media manager at Bark, said that experimentation in emerging platforms and new messaging is key to success on the web, especially in the pandemic world. “If you ever make your mind up about something on social media and then decide that you’re never, ever, ever going to change it, it may resonate for a month, a year, but eventually … it will start to feel stale,” she said. 
  • Camille Rose founder Janell Stephens said she took the time to listen to her customers as they expressed new needs in light of the pandemic. During lockdown, Camille Rose was able to launch two brand new products to meet these requests.
03
Why brands are diversifying sales and marketing channels

Developing an omnichannel experience is a well-known best practice for retailers, but the pandemic put rest to the idea of ever relying on a single sales channel again. Brands that had long relied on a variety of brick-and-mortar retailers to sell their products suddenly found themselves out of luck when the vast majority of U.S. retailers were deemed “non-essential” and were forced to close down this spring. 

Channels of all types, both physical and digital, can no longer guarantee long-term success.  Brands now need to have several thriving channels and constantly explore new ones for their next big hit. “What we want to do from a [sales] channel perspective is to be where our customers want us to be,” said Lina Calabria, co-founder & COO at Bellroy.

  • Diversifying channels does not mean simply diversifying branded channels. Calabria views Bellroy’s available channels as not just Bellroy-branded channels, but also the retailers with which the company partners. Retailers are good at curating a set of customers, she said, so take advantage of that and partner with ones who fit your brand. As these retailers learn how to successfully manage the changing landscape, they’ll bring your brand with them.
BOTTOM LINE

Channel instability is a fact of the 2020 retail landscape. To survive, brands must have strong presences on multiple channels and be constantly searching for new ones. Being early to a channel can result in massive success as said channel peaks — whether that channel is a third-party retailer like Amazon or a new social media network.

  • Multiple brands work with experts in a channel when they seek to expand. Both Camille Rose and BLK & Bold, skincare and coffee companies respectively, launched their Amazon storefronts shortly before the coronavirus hit. Both brands decided to work with an Amazon broker to help them develop well-branded storefronts that matched their existing customer experience. While both founders acknowledge a bit of luck in being at the right place at the right time, the Amazon storefronts have been smashing successes. Janell Stephens said that Amazon drives as much revenue for Camille Rose as any of the other retailers the brand works with.
  • When it comes to diversifying channels, particularly social media ones, Alexis Nelson stated that it’s important to test out the very newest platforms. “I think there is always going to be something to being in those new spaces in their infancy, and getting to learn and grow with them,” she said. Bark’s most recent channel exploration has been TikTok, which has been going well for them. They’ve been on the platform since TikTok exploded and Nelson is pleased with the results. “With how many companies are now swelling into TikTok, you know shoppability is close by,” she said.
04
When flexibility is essential

In the blink of an eye, consumers went from purchasing office attire and travel gear to baking supplies and loungewear. The companies who succeeded during this rapid shift were the ones that pivoted and stayed agile despite uncertainty.

Bellroy, for example, developed new product lines for the stay-at-home lifestyle, but it also involved every other aspect of a brand from tech stack to voice. Even heritage brands are finding themselves needing the agility of a start-up in order to compete in the current landscape. 

BOTTOM LINE

Flexibility is a requirement in uncertain times. When consumers don’t know how the world is going to function from one day to the next, they find comfort in discovering their favorite brands faithfully meeting them at each turn. Creativity and agility are rewarded in the 2020 retail landscape.

  • Even with the perfect product for the moment, it’s important to be able to shift a company’s messaging and branding to fit what customers are looking for now. Hayley Raymond, associate director of brand marketing at HelloFresh, noted that as the tone of their consumers grew serious with the pandemic, HelloFresh chose to become more serious with them, even if it was only temporary.
  • Clorox’s VP of Growth and DTC Vivian Chang found that flexibility with the company’s technology was key to surviving the pandemic. As so many more customers were pushed to Clorox’s DTC channels either to go contactless or because of in-store outages, Clorox had to update its DTC technology. Within four months, her team built a scalable e-commerce platform that already supports three of the in-house brands in Clorox’s portfolio.
05
Why infusing experience with brand storytelling is key

In a world where people can no longer speak face-to-face, consumers are hungry for a connection. Without the option of relying on a sales associate to create that connection for you, brands must now infuse their customer journey with their brand story at every point.

Not only are customers looking for connection, they’re also looking for brands that align with their values. Brands need to talk about their values and charity work “…in many different places and many different ways, so it feels like a cohesive commitment to your customers,” said Sarah Pierson, co-founder of Margaux. 

Even more than telling your brand’s story, both BLK & Bold’s co-founder and CEO Pernell Cezar Jr. and Ocean Spray’s director of global corporate affairs Christina Ferzli mentioned the importance of amplifying the stories in your community that align with yours. Ocean Spray, for instance, was recently able to take a part in the viral story of a man whose car died on the way to work. The company gifted him a car to enable him to keep going to work, a story that closely aligns with their own brand story of hardworking farmers.

BOTTOM LINE

Brand storytelling has always been important, but now more than ever, every aspect of the customer experience needs to be saturated with storytelling to drive a connection. We live in a world where we can no longer touch our loved ones, only the products we purchase. Brands have a massive opportunity to fill the connection gap.

  • Continually test all the channels and content types available to tell your story. HelloFresh’s Hayley Raymond said, “It’s up to each individual brand to figure out what types of content work for them…but keep trying all of it.” She suggests getting extremely creative in the pursuit of telling your brand story: “We use every space of available real estate to remind people why they chose us, right down to packaging.”
  • Pierson was quick to point out that giving back this holiday season is going to be more relevant and necessary than ever. The 2020 holiday is a good time for brands to share their values and commit to charity because shoppers this year are more keenly aware than ever of the impact their purchases have.
  • Alexis Nelson said brand storytelling must be a holistic effort across a business. “The storytelling is so much clearer when everyone’s on board,” she said.
06
Overheard at M.R.S.

“We go into [a new channel] with an open mind and a curious heart and we give it our best shot. But we definitely don’t pour all our resources into it until we know it’s a space we can happily occupy.”

Alexis Nelson, social media manager at Bark

Choosing a new channel to create a presence on is a necessary gamble. Nelson said that at Bark while the company put effort into developing a new channel, it has been careful to not devote too much time and money until it knows the channel is working. Nelson also said that before she starts a brand presence on a new channel, she takes some time to do a deep dive on a personal account, so she can fully understand how users are utilizing the platform, what’s trending and how fast trends shift. She said that she knows she’s going to make mistakes when posting on a new platform and she’d rather make them on a personal account than a branded one. 

“But the [luxury coffee] product experience just kind of fell off the radar once you stepped out of those coffee shops, so our whole ethos was really, ‘How do we make it easier for people like us to be able to have access to that [luxury] coffee and not just rely on coffee shop culture?’”

Pernell Cezar, Jr., co-founder and CEO of BLK & Bold

Cezar spoke to the need for passion to drive the creation and evolution of brands. BLK & Bold recognized that the lack of access to specialty coffee for many people was a two-part issue: price-point and lack of purchase locations. BLK & Bold chose to skip selling in coffee shops to reduce overhead, thereby reducing the price of their products. The company also sold its coffees through local grocery stores to start elevating the coffee aisle to something more akin to a wine aisle, democratizing access to luxury coffee. This focus on access continued to inform BLK & Bold’s decisions moving into quarantine, as it needed to find new ways to provide access to its consumers. Ultimately, the drive to access led BLK & Bold to create more creative shipping solutions for its customers.

07
Event Videos

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