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The Kiwi retailer in the age of Industry 4.0

The Kiwi retailer in the age of Industry 4.0

The Warehouse Group CDO Michelle Anderson and CMO Jonathan Waecker on how the retailer is leading through ‘the perfect storm of technologies’ impacting every business

Credit: TWG

Be transparent with how you are using data

Michelle Anderson, The Warehouse Group

“We are in the midst of the 4th industrial revolution,” declares Michelle Anderson, chief digital officer at The Warehouse Group.

“We are in a digital age and devices being more connected,” she says.

“It is bringing companies and consumers together like they have never been before.”

This, she points out, can be seen in daily activities, such as using Google Maps to determine the fastest route to one’s destination or getting personalised recommendations from Netflix. 

“It is the perfect storm of technologies that is disrupting every business, and every industry across the group that we have to deal with.”

“As retailers it affects us as much, if not more,” states Anderson.

“Consumer expectations are rising as they expect frictionless experience with the brand as in Uber. And it is happening at a whirlwind unprecedented pace.”

Credit: Photo 114499240 © Semisatch - Dreamstime.com

Customers don’t see channels, they see brands

Michelle Anderson, The Warehouse Group

Anderson, who was the keynote speaker at the recent Salesforce Basecamp in Auckland, shares further challenges in the near future.

Over the next year, she says consumers will be spending time with digital media than all other channels combined.

“As marketers, the future for us is personalisation. It is the tool within our toolkit that we need to learn how to use and optimise. But it is complicated, and we need to be able to capture the information and use technology to really drive these customer experiences. That is what our customers expect, that is table stakes.”

She notes that there are estimates that by next year, there will be 50 billion connected devices in the world, equivalent to 6.6 devices per person.

“The opportunity to contact and talk to customers is bigger than it has ever been before.”

It is not without investment and complex challenges, she adds.

Another challenge, she says, is the continuous growth of data - with 2.5 quintillion bytes of data created every day.

The world runs on data,” she says, on a critical component of this initiative. “Data is a tool you can build trust with.”

Thus, she stresses: “Be transparent with how you are using data.”

She points out, “When you listen to and respect the customer and gain consent appropriately, you have the ability to power the most incredible end-to-end customer experiences across channels.”

 The rules of personalisation

Being merchandising and product-led has been a pretty standard way of operating for retailers, says Jonathan Waecker, chief marketing officer at The Warehouse Group.

“We buy lots of things, stock them and wait for people to buy them,” he explains. “But that is not going to work in the future.”

Credit: TWG

Our unified vision: Enable our customers to shop with us - however, whenever and wherever they want

Jonathan Waecker, The Warehouse Group

Read more: Retailers need advanced analytics to compete in digitalised marketplace: Gartner

“We have to know what the customer wants,” says Waecker. “We have to start acknowledging what customers are looking for and becoming ready for them, and helping our customers make choices.”

He says at The Warehouse Group, they organised their staff around this unified vision: “Enable our customers to shop with us, however, whenever and wherever they want.”

This entails a seamless blend of digital, physical, and voice; and also utilising their digital footprint.

He adds that they also simplified their customer engagement centre. Instead of having three teams, four platforms and five brands, it now has one single team and one Salesforce Service Cloud platform for the five brands.

Read more: ​Customer-obsessed leadership is now the new standard: Forrester

“We simplified that so the customer will be the centre of every one of our conversations,” he says.

For any retailer, this is complicated, he says. “But applying this to the Warehouse means starting with six front facing brands.”

Credit: Dreamstime

When you listen to and respect the customer and gain consent appropriately, you have the ability to power the most incredible end-to-end customer experiences across channels

Michelle Anderson, The Warehouse Group

As Anderson notes, “Our retail groups grew up in the brick and mortar world and then online became a thing, so we had to launch this transactional website.”  

They used to have two separate teams - for the physical and online environments.

In the current environment, however, “Customers don’t see channels, they see brands,” she explains.

Taking on this perspective is important, because when customers interact with across channels, they become more valuable, she says. “They shop more, they spend more, and their lifetime value is greater.”

This is their experience at The Warehouse Group and also of overseas retailers such as Target, Walgreens, and Macy’s.

“So, it is not about getting customers to choose which channel. It is about delivering that seamless customer experience and removing friction.”

“For example, customers want transparency, control, visibility, and consistency when you talk to them,” she says. 

We are focusing on optimised experience, stresses Anderson.

She cites that for their click and collect service, “We communicate with customers where they can pick up the parcel and how to help them as they come into the store.”

She also advocates “using technology to create utility.”

“It is not creating a chatbot just because a chatbot is cool,” she says, as an example. “We want to create a chatbot that works with everything else, it is a better way to help the person.”

“We had a chatbot once, a cul de sac chatbot,” she discloses.

“The team built as a prototype. it was an excellent prototype, but  because it did not plug into an ecosystem, it was a standalone, so it was not useful. What we have done is we plugged it into another version with Salesforce and now it is useful.”

Credit: Noel Leeming

Waecker explains that one of the group’s recent initiatives, Nola, the digital human for their Noel Leeming Group, was also created with this approach.

“We were building a new store from the ground up so we could create an innovation hub, a store that is built to show what the future could look like. 

“Nola fits into that experience,” he says, on the digital human that is being used in their newly-opened store in Auckland’s Newmarket. “It wouldn’t have felt right a year ago.”

Anderson says a use case for instance, is a customer is looking for headphones. Nola can show the customer a map where to find the product. If a customer needs help in picking out a gift, Nola can ‘ping team members to tell them you are looking for help in the store’.

“Nola serves a purpose, she is connected in the store, not just a shiny thing in the corner.”

Waecker shares further lessons learned as they transform the customer experience across channels.

Majority of their customers come to their website first.

“Our online sites are quite literally the most important parts of our brands,” he adds.  “They believe if it is not on our website, it is not in stock, it does not exist.”

Credit: Nila Sivatheesan (Flickr)

Optimise for the metrics that matter

Michelle Anderson, The Warehouse Group

“Our customers want to be able to see what is in our store before they go there,” he states. “We have to treat them like they are 100 per cent of our sales because they are a window to our stores.”

“We now look at everything the same way, online and instore together. If there is a promotion online, it shows up in the store.”

“We are a traditional company and a traditional business, but taking risks that are right for the future,” he explains. “It takes a lot of education and we are lucky our executive team is really supportive of taking calculated risks.”

One of the results of those calculated risks is their e-commerce venture TheMarket,  an online shopping platform that brings some of the best local, international, and niche brands together in one place.

Anderson ends with a call for organisations to adopt a “test and learn approach”.

“Put things into the world, learn what works, what doesn’t work,” she states. “Optimise for the metrics that matter.”

“Focus on optimising the customer experience across the journey,” she says on a key lesson from their experience.

“If it doesn't matter to the customer, it doesn't matter.”

Adopt a ‘test and learn approach’: Jonathan Waecker and Michelle Anderson of The Warehouse Group deliver the keynote presentation at Salesforce Basecamp in AucklandCredit: Salesforce
Adopt a ‘test and learn approach’: Jonathan Waecker and Michelle Anderson of The Warehouse Group deliver the keynote presentation at Salesforce Basecamp in Auckland

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Tags retailprivacychange managementsmartphonebig dataanalyticse-commercesalesforcealgorithmsonline shoppingchannelAIconnectivitytrustomnichannelchief marketing officercustomer focuschief digital officerIoTpersonalisationcxCIO and CMOdigitalisationthe Warehouse groupFourth Industrial revolutionDXCIO50Industry 4.0martechSalesforce BasecampCIO to CDOmobility

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