Linking Cannes 2017, Retail, and Flourishing Disruptive Technologies
"What a tough industry (retail), the consumer has changed more in terms of their demand preferences in the past three years than they have in the past thirty years." - Home Depot CFO Carol Tome
For the past two weeks, my youngest son was in France attending the latest edition of the Cannes Film Festival.
As part of an extended university project, he participated in a week long "producer's workshop." By the end of the week, he was instructed to throw away all his notes for the era of major studios driving the movie industry is over.
All over Cannes was the buzz of new entrants such as Netflix, Amazon, and Hulu disrupting the traditional cinema production model. "During a press screening of “Okja”, Netflix’s logo was met by a smattering of boos." Cannes 2017 confirmed that another industry sector is being disrupted by the digital revolution.
Wake Up Retail, Your Digital Nightmare is Just Starting
"The U.S. is still considered overstored. Shopping center space per capita in the U.S. is about 24 square feet. That compares with 16 in Canada, 14 in Europe and 11 in Australia." New data points to a record year of store closures.
The Pace Of Retail Change is Accelerating
"The new crop of online fast-fashion retailers is proving highly adept at rapidly responding to consumers’ increasing demands for immediacy and constant newness, in turn driving their rapid sales growth and success.
Boohoo.com, ASOS and Missguided are now able to produce merchandise in 2–4 weeks, compared to 5 weeks for Zara and H&M and the 6- to 9-month cycle for traditional retailers."
The new business models respond faster to evolving consumer tastes. "Ultrafast apparel retailers operate agile supply chains to quickly match inventory supply with changing demand and strictly control inventory to create a balance between undersupply and markdowns."
The Secret Retail Weapon to the Smart Store
This year marks the 10th anniversary of the first iPhone. In that short time period, just look at the history of industries disrupted by this seemingly simple hand held device.
As consumers we are addicted to the smartphone and spend a substantial amount of time staring at that little screen. Brazil, you win the gold medal as the most obsessed smartphone country.
The smartphone is the gateway to the smart store. Having done our digital research, as consumers, we are walking into stores typically smarter that the associate in front of us. We can instantly change our mind on whether to buy a specific product in your store or on a competitor's website.
The Screaming Signals of the Digital Retail Revolution
A great chart that I saw recently in a Johnson Controls' presentation inspired this post.
Technology's evolution is driving disruptive changes across all industry sectors including retail. Aggressive explosive adoption of lower cost sensors, video leveraging more bandwidth, cloud solutions for faster new application deployment, more data analytics using that increased processing power, and a connected store that improves customer experience are the foundational elements.
Fully agree that retail has dramatically changed in the last three years. Stop booing the problem as this is not a movie. The challenges will not go away. Heed the screaming signals of change and lead the new digital retail revolution.