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Real life representationKrystina in the snow
The New Digital Retail Organization
The New Digital Retail Organization
Running a retail organization will mean running a tech company
The New Digital Retail Organization
OO
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Most popular jobs in retail
2013 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Salesperson Logistics Specialist Marketing Specialist IT Support Specialist Operations Specialist HR Specialist Business Strategist Software Developer Business Analyst Consultant
2017 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Salesperson Logistics Specialist Software Developer Marketing Specialist Operations Specialist HR Specialist IT Support Specialist Business Strategist Consultant Business Analyst
The New Digital Retail Organization
The New Digital Retail Organization
The New Digital Retail Organization
The New Digital Retail Organization
New titles will emerge at the most senior levels
The New Digital Retail Organization
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Percentage of Fortune 1000 companies with a Chief Data Officer
70
53
68%
35
18
0
12% 2012
2018
Source: NewVantage Partners, https://newvantage.com/wp-content/uploads/2018/12/Big-Data-Executive-Survey-2019-Findings-Updated-010219-1.pdf
The New Digital Retail Organization
Only 35% of top grocery retailers have a Chief Data OďŹƒcer 65%
Source: Groceryshop Analysis
35%
The Transformation of the Retail Industry
The Transformation of the Retail Industry
Industry stalwarts will go under, creating new opportunities
The Transformation of the Retail Industry
The Transformation of the Retail Industry
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Department Store
Grocery Store
The Transformation of the Retail Industry
The retail real estate market will continue to evolve
The Transformation of the Retail Industry
Average retail lease length
Source: CoStar Portfolio Strategy
*Retail leases between 1,000 and 10,000 SF
The Transformation of the Retail Industry
Advances in Store Layout and Design
Advances in Store Layout and Design
Retailers will no longer use cookie-cutter designs
Advances in Store Layout and Design
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Median square footage of grocery stores 50,000
40,000
30,000
20,000
10,000
0
1995
2000
2005
Source: Food Market Industry, https://www.fmi.org/our-research/supermarket-facts/median-total-store-size-square-feet
2010
2015
OO
Advances in Store Layout Design and Layout Design
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Median square footage of grocery stores
Source: Food Market Industry, https://www.fmi.org/our-research/supermarket-facts/median-total-store-size-square-feet
Advances in Store Layout and Design
Store success will be measured in experiences per square foot
Advances in Store Layout and Design
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Advances in Store Layout and Design
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Advances in Store Layout and Design
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Advances in Store Layout and Design
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Advances in Store Layout and Design
Next Generation Ecommerce and Omnichannel Retail
Next Generation Ecommerce and Omnichannel Retail
Pickup options will become more diverse and widespread
Next Generation Ecommerce and Omnichannel Retail
21% of grocery retailers offer “click and collect” 79%
Source: Progressive Grocer, https://progressivegrocer.com/techinnovations-become-major-grocer-investments-annual-report
21%
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Next Generation Ecommerce and Omnichannel Retail
Next Generation Ecommerce and Omnichannel Retail
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Shoppers using grocery click and collect
50
+56% 38
46M
25
13
30M
0 2018 Source: Coresight Research, https://coresight.com/research/us-online-grocery-survey-2019/
2019
Next Generation Ecommerce and Omnichannel Retail
Next Generation Ecommerce and Omnichannel Retail
Next Generation Ecommerce and Omnichannel Retail
Mobile-enabled shopping experiences will play a bigger role in stores
Next Generation Ecommerce and Omnichannel Retail
Next Generation Ecommerce and Omnichannel Retail
Technologies Creating New Retail Experiences
Technologies Creating New Retail Experiences
Every aspect of the store will become more intelligent
Technologies Creating New Retail Experiences
Technologies Creating New Retail Experiences
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In-store retail tech annual global funding history
2X
Amount of Funding ($M)
$2,000 $1,500
$1,000
$500
$0
$1,073 2014
$1,163 2015
$1,220
2016
$1,857
2017
$1,936
2018
Source: CBInsights, https://newsroom.mastercard.com/wp-content/uploads/2019/05/Start-Path-CB-Insights-Future-of-Commerce-Series-Retail-Report-FNL.pdf
Technologies Creating New Retail Experiences
Technologies Creating New Retail Experiences
Cashierless checkout will become far more common
OO
Technologies Creating New Retail Experiences
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23%
Technologies Creating New Retail Experiences
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Selected frictionless checkout offerings, by region
North America
Europe/EMEA
Asia/Pac
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Technologies Creating New Retail Experiences
Leveraging AI and Machine Learning
Leveraging AI and Machine Learning
Shoppers will rely on AI to make product recommendations
Leveraging AI and Machine Learning
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Percentages of people in the US following specialized diets CLEAN EATING
62%
38%
INTERMITTENT FASTING GLUTEN FREE LOW-CARB KETOGENIC OR HIGH-FAT DIET PALEO DIET WHOLE 30
Source: Food Insight, https://foodinsight.org/wp-content/uploads/2019/05/IFICFoundation-2019-Food-and-Health-Report-FINAL.pdf
0%
2%
4%
6%
8%
10%
Leveraging AI and Machine Learning
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…to Customer-Focused 20 20
! esh Fr So
From Product-Focused…
Leveraging AI and Machine Learning
Over time, serendipitous discovery will become more common
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Leveraging AI and Machine Learning
Leveraging AI and Machine Learning
SSee aarrc chhe ess
PPuurc rchhaas D Daattaa see
Social Social Media Media
t t c c uu s d d s o n o n r a PPrScca S
FFaa nncc y SShhy FFoo o oow w odd
ss y y e e vv r r u SSu
Artificial Intelligence Insights Driven Product Selections
Building Brands for Today’s Consumers
Building Brands for Today’s Consumers
The number of new brands will increase at an even faster pace
Building Brands for Today’s Consumers
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Founding years for select digitally native brands in CPG categories
2009
2011
2013
2015
2017
Building Brands for Today’s Consumers
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60%
Percentage of US adults open to trying new brands, products or experiences
45%
56%
30%
15%
0%
39% 2009
2019
Source: Forrester, https://go.forrester.com/blogs/dtc-startups-signal-an-age-of-experimentation/?utm_source=forrester_proshome&utm_medium=web&utm_campaign=cmus19
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Building Brands for Today’s Consumers
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Building Brands for Today’s Consumers
Building Brands for Today’s Consumers
A growing number of brands will take a stance on social issues
Building Brands for Today’s Consumers
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Purpose-driven brands grow faster 180
135
+175%
90
45
0
+70% LOW
+86% MEDIUM Perceived Positive impact
Source: Kantar Consulting, https://consulting.kantar.com/wp-content/uploads/2019/06/Purpose-2020-PDF-Presentation.pdf
HIGH
Building Brands for Today’s Consumers
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“Woke-washing is beginning to infect our industry.” - Alan Jope CEO, Unilever
The New Era of Marketing ROI and Attribution
The New Era of Marketing ROI and Attribution
Marketing campaigns will adapt automatically
The New Era of Marketing ROI and Attribution
Internet advertising revenue $120
$ Billion
$90
$108
$60
$30
$0
$23
$26
2009
2010
$32
$37
$43
2011
2012
2013
Source: IAB/PwC Internet Ad Revenue Report, FY 2018
$50
$60
2014
2015
$73
2016
$88
2017
2018
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The New Era of Marketing ROI and Attribution
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The New Era of Marketing ROI and Attribution
The New Era of Marketing ROI and Attribution
Mass media campaigns will become less and less important
The New Era of Marketing ROI and Attribution
The New Era of Marketing ROI and Attribution
Most-watched single episode of regular series TV, by decade SELECTED US TV SERIES FINALES, 1980-2019
Millions of People
125
M*A*S*H
100
Cheers 75 50
Friends
106 80
25 0
Seinfeld
1983
1999
76
1998
Source: Axios Research, https://twitter.com/beefjervey/status/1130820229062434816
53 2004
Game of Thrones Lost Sopranos
13
14
19
2007
2010
2019
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The New Era of Marketing ROI and Attribution
Innovation Strategies for Brands and Retailers
Innovation Strategies for Brands and Retailers
Brands and retailers will strike unlikely partnerships with competitors
Innovation Strategies for Brands and Retailers
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Innovation Strategies for Brands and Retailers
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Innovation Strategies for Brands and Retailers
Innovation Strategies for Brands and Retailers
Successful digitally native startups will be highly sought-after as partners and acquisition targets
Innovation Strategies for Brands and Retailers
Half of digitally native CPG brands now have wholesale relationships Wholesale partners of digitally native brands (brick and mortar v. online retailers)
DIRECT ONLY
50%
BRICK & MORTAR
Selling structure of top digitally native CPG brands
52% 36%
BOTH
WHOLESALE/ DTC HYBRID
50%
ONLINE 0
12% 10
20
30
40
50
60
Innovation Strategies for Brands and Retailers
LL
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“Its demonstrated expertise in
brand building and directto-consumer marketing
are a complementary fit with Edgewell's strong intellectual property, best-in-class product technology, global scale and stable of strong consumer brands.� Edgewell press release, deal announcement
CC
TT
TT
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CC
OO
Innovation Strategies for Brands and Retailers
LL
OO
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“Nestlé will gain visibility into Freshly's advanced
analytics and its highly effective distribution network…" Nestlé USA Chairman and CEO, Paul Grimwood
Improving Operational EďŹƒciency
Improving Operational EďŹƒciency
Retailers will find ways to limit waste throughout the supply chain
Improving Operational Efficiency
40% of food grown or produced in the US is wasted 8%
60%
40%
16% 2% 13%
43%
FARMS MANUFACTURERS GROCERY & DISTRIBUTION RESTAURANTS HOUSEHOLDS INSTITUTIONAL & FOODSERVICE
18%
Source: Natural Resource Defense Council, https://www.nrdc.org/sites/default/files/wasted-2017-report.pdf
Improving Operational EďŹƒciency
y r e c o Gr
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Improving Operational Efficiency
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Source: Tesco, https://www.tescoplc.com/media/754423/little-helps-plan-report-2019_final.pdf
Improving Operational Efficiency
Improving Operational EďŹƒciency
Advances in scheduling and employee training tools will result in better customer service
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Improving Operational Efficiency
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Improving Operational Efficiency
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Improving Operational Efficiency
Improving Operational Efficiency
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Amy Simeri McClellan SVP, Retail Operations & Merchandising
Martin’s Super Markets
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