2024 Columbus Consulting EMEA Retail Breakfast Briefing Brings Industry Leadership Together to Discuss AI, the Current State of Stores, Third Party Brands and More
Industry executives from Hunkemoller, PVH, Michael Kors, Ted Baker, The Fold, Suit Direct, Urbanic, The Entertainer and more gathered at the Haymarket Hotel in London for the 2024 Columbus Consulting Annual Retail Breakfast Briefing. Among the key topics discussed were: AI and Machine Learning applications, store services and experiences and 3P brands.
Hosts Charlotte Kula-Przezwanski, Managing Partner and EMEA Lead at Columbus Consulting and Andrew Jennings OBE, Global Senior Retail Advisor hosted the invitation-only gathering. Jennings kicked-off the morning by sharing insights from the latest World Retail Congress, noting the importance of change and agility within the retail industry. He shared the main themes of the conference which included: purpose-driven business, digital transformation, the need to drive topline sales, generative AI, circular retail, the importance of clean and managed data and the new retail workforce. Kula-Przezwanski furthered the breakfast kick-off by moderating the current needs shared by attendees. While many of the retailers shared similar challenges, some additional topics surfaced as being of current concern; namely:
- New market sourcing
- Customer acquisition
- Talent retention
- Change management
- Wholesale transformation/growth and third-party brands
- Real estate and physical store evolution
AI headlined many of the conversations around the table. Retailers have gotten past the definition of Generative AI and moved onto the application of learned insights. One major European brand shared their three-step approach to unlocking the benefits of AI:
- Start with Machine Learning to establish data-driven decision making through data models
- Establish cloud computing for data accessibility and agility
- Apply automation with robotics and generative AI
Short-term benefits of AI were defined as alleviating employees from doing mundane tasks and focusing them on more strategic initiatives to drive profit and efficiency. The group also discussed the application of AI in customer services—training, shopper-facing problem solving and building seamless, single-view alignment throughout an organization from vendors to field to corporate teams. Though the industry is becoming more open to expanding use cases for AI, there is collective concern among employees about job replacement and obsolescence. Leaders are addressing redundancy among roles and how to acquire, train and re-allocate internal talent. Overall, the leaders agreed that AI was not just about cost reduction, it is about cost reallocation to more effectively invest in growth and profit.
A second key theme of the morning revolved around the store, services and customer experiences and the importance of brand/product differentiation. Executives are looking at how to incorporate circular services such as resale, rental and repair, but need to consider the process, management, and scalability of these practices. With the impending digital product passports/traceability requirements, the topic is top of mind. Part of the overall experiences require consistency and alignment/balance between online and offline retail. Such brands as Rixo, End Clothing and Gymshark were mentioned as doing the practice well.
One solution to retail differentiation and expansion is the use of third-party brands. Collaborations, pop-ups, shop-in-shops, exclusive line development and new start-ups are all providing newness and merchandise breadth. Executives cautioned on the margin impact of such partnerships, so retailers need to fully consider the role they are looking to fill with 3P brands and how they will collect/share/own data from marketplace models. On the flipside, the 3P brands need to maintain their identities and not become victim to a pricing and dilution game across competitors.
According to Kula-Przezwanski, “I am always surprised a little by how consistent the needs are among retailers. While many businesses are at varying points of their maturity models, the demands of the consumer, the evolution of technology and the growing needs of a diverse workforce all present similar concerns that need to be addressed across brands, categories and channels.” Jennings further added, “Change is the only constant in retail moving forward which includes three key facets: the changing customer, the changing retail landscape and the changing the way we think about our most important asset … our talented staff.”
Indeed, the industry is becoming used to externally-inflicted pivots in business. Whether it was from supply chain disruption, inflation generated margin impact, global pandemics, or climate-driven shifts in seasonality, retailers have been going through an industry-wide transformation to safeguard and minimize detriments to business.
Another shared focus among retailers continues to be data. From data access to collection and now cleanliness/consistency and governance, retailers are investing in building a foundational data practice across their organizations. Data is the fuel for technology, end-to-end visibility and holds the key to leverage generative AI. It is also the core component to address product IDs and PLM traceability from source to shelf and resale. According to Associate Partner, Columbus Consulting, Charlotte Haynes, “mission-based retail is the focus of the future. As retailers look to become more sustainable, they are also looking into making the practice profitable. In order to do so, retailers need to start with their data, build the right hierarchy and make it accessible to vendors and third-party partners for complete transparency. Having accurate insights into textiles, factories, distribution/sales channels and ultimately into consumer closets and resale shelves is all contingent on accurate, consistent data.”
Finally, retail guests all concluded that while technological transformation and future-focused growth are topping agendas in the c-suite, everything is contingent on sticking to the basics. New retail tactics require faster, smarter, better ways of addressing product, price, place and promotion. Doing more with less, gaining speed to market and eliminating wasted time/materials along the way are the requirements going forward.
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COLUMBUS CONSULTING delivers solutions that drive true value and have been transforming the retail and CPG industries for over two decades. We are a retail consulting company of industry experts. Our approach is simple, if you do it, we do it. We are more than consultants; we are experienced practitioners who actually sat in our clients’ seats. We understand the challenges, know what questions to ask and deliver the right solutions. Columbus offers a unique, consumer-centric approach with an end-to-end perspective that bridges functional & organization silos from strategy to execution. Our specialties include: unified commerce, merchandising & category management, planning & inventory management, sourcing & supply chain, data & analytics, accounting, finance & operations, people & organization and information technology. Let us know how we can help you. To learn more, visit COLUMBUSCONSULTING.COM.
