For more from NRF 2018: Retail’s Big Show on January 14 – 16 in New York City, visit the official recap.
NRF 2018: Retail’s Big Show kicked off its second day with a series of inspiring female executives who are affecting transformational change in retail and beyond. Beth Comstock, former vice chair at GE (above), drew from her nearly 30 years of executive experience, providing helpful insights on how the right culture and team structure can drive real innovation. In a separate discussion, Helena Foulkes, executive vice president of CVS Health and president of CVS Pharmacy, shared examples of how CVS is working to better connect with customers and using lessons from its retail experience to improve health care.
Both Comstock and Foulkes noted the unprecedented pace of transformation and disruption in the industry. “[There’s] a tremendous amount of change going on in retail, and that’s why I love it,” Foulkes said. Comstock shared a similar insight, saying that “transformation means you’re never done … volatility is the new normal.”
So what will determine who succeeds in this changing world? “The battle is about getting into the head of the customer,” said Comstock — far more important than whether interactions occur online or in-store. Foulkes also touched on this point, saying that CVS focuses on seeing the typical customer and “mak[ing] her shopping experience as great as it can be.”
The conversations revealed four essential strategies retailers need to consider in order to win this battle.
Helena Foulkes on stage
Sell vision and community
Comstock highlighted the need to know and segment customers in order to sell them a vision for new, transformational products and services. She noted that retailers should consider including customers during the design and testing phases to win early community buy-in and justify further investment.
During her talk, Foulkes also announced the launch of CVS Beauty Mark — a new watermark to certify that a product’s imagery hasn’t been digitally modified — which CVS believes will connect with a community of women and advance a vision for more positive, healthy notions of beauty. “This is a reflection of what consumers are saying,” explained Foulkes, who also noted that 80 percent of CVS shoppers are women. “[CVS] made a conscious effort a long time ago to design with a woman in mind.”
Embrace the value of partnerships
Both speakers hit on the increased value of partnership. Explaining the Beauty Mark decision, Foulkes said she was impressed with the level of support she has received from partners since the announcement. She noticed that their brand partners shared the same views on evolved expectations by women in the marketplace.
Focusing on a different set of partners, Comstock advised retailers faced with disruption not to avoid those new entrants, but rather to “go deep into discovering what’s new … getting to know these disruptors.” She noted that companies can then partner with these new companies to develop bold new ideas outside of their own core competencies.
Bring customers in on the innovation journey
Though size and history are often seen as barriers to innovation, Comstock stressed that legacy retailers shouldn’t discount the value of their existing assets, like a well-established brand and expertise in merchandising and supply chain. The key, she said, is to innovate, while keeping in place what customers love about you.
For example, Foulkes said CVS will use its merger with Aetna as an opportunity to evolve the in-store experience to improve health care in the United States. This innovation journey will build on the success of CVS Minute Clinics and habits of repeat customers, turning stores into “health hubs” with expert concierge service to help core customers — mothers, or the family’s “Chief Medical Officer,” as she put it.
Test, learn and experiment
Retail stands still for no one. Comstock noted that retailers should be “constantly learning, testing and experimenting,” including with innovation labs to develop, iterate, prove and then pass off new concepts. More diverse teams, more use of medium-term metrics and a single digital language for all team members can all better support an experimentation mindset in the organization. As an example, CVS has tested and is now rolling out new store formats, including one focused on beauty and health foods, one focused on value and one focused on the Hispanic community.
Overall, both speakers presented a similar vision of the transformational retail leader: an innovator who can integrate the digital and the physical while never losing sight of the customer. These four strategies, recommended by two leaders at the industry’s cutting edge, can guide success in what has become a perpetually evolving retail landscape.
For more stories from NRF 2018: Retail’s Big Show, visit the official recap page.