Future of retail – how COVID-19 has accelerated the speed of change
Jon White (Finance Director - Retail, Pets at Home) and Daniel Bobroff (Founder of Coded Futures, Retail Tech Evangelist & Advisor) joined our collaboration forum to discuss ‘The future of retail’. Listen to the session recording to understand how COVID-19 has accelerated the speed of change and the role of the high-street.
Meet Our Inspiring Speakers
Jon White, Finance Director - Retail, Pets at Home
Jon White had notable experience in large industry and external audit financial management. A large part of his role has been on emerging issues in the financial accounting and corporate governance landscape. In 2014, Jon joined Pets At Home, the UK’s leading pet care business where he leads Retail which provides pet owners with everything they need to be able to look after their pet – from food, toys and bedding right the way through to services such as veterinary care and The Groom Room which offers dog grooming micro-chipping.
Daniel Bobroff, Founder of Coded Futures, Retail Tech Evangelist & Advisor
Daniel is the founder of Coded Futures, a creative technology advisory firm focused on the future of retail, and formerly the co-founder of ASOS Ventures. He has spent over two decades as an innovator, entrepreneur, mentor and investor, and is, today, a leading voice in the world of retail and fashion technology. Daniel is acknowledged as the pioneer of in-game advertising – “selling Sonic to admen” - starting an advertising medium that is today a multi-billion-dollar market. He established one of the first digital advertising agencies and used gaming to create interactive campaigns for numerous global brands.
Retail and technology – ‘now is the time to get married’
Retail businesses have been through a lot in the past year: some have closed forever, and others have grown beyond all recognition. But in amongst the chaos of the past 12 months, some interesting opportunities have emerged. Protiviti welcomed former ASOS executive Daniel Bobroff, and Pets at Home finance chief Jon White, to explain more.
There is a famous quote, attributed to Russian politician Vladimir Lenin, which reads: ‘there are decades when nothing happens, and there are weeks where decades happen’. His words have been linked to the experience of living in exile, prior to the Russian revolution at the beginning of the 20th Century. But 100 years later, they have also been widely used to describe what’s happened to businesses during the Covid-19 pandemic.
“In the past 12 months, retail has experienced weeks when decades have been happening,” said Daniel Bobroff, founder of Coded Futures and a former executive at online retailer ASOS. “I believe this period has changed our outlook quite fundamentally, towards technology, for the better. Retail businesses have been dancing with technology; we’ve got engaged with it, but now is the time to get married.”
When the first lockdown struck the UK in March 2020, pet care retailer Pets at Home was one of many retailers that had to move quickly. Once it had been granted permission to stay open as an essential service, the business experienced a rapid increase in the number of online orders. It saw two years of growth almost overnight, and the 450 stores that stayed open, became places where customers could collect what they had clicked.
In the year to 25 March 2021, in which the business traded through the eye of the storm, its turnover grew by 10 per cent and underlying pre-tax profit increased by a similar margin. In the words of Jon White, finance director of the retail business: “We delivered record sales in the retail space, and if you’d have said that to me 14 months ago, I genuinely wouldn’t have believed you, such is the rate of change.”
“The role pets play in people’s lives has never been more important, and we’ve got a bigger overall market to address,” he said. “We’ve also got more ways to get products to customers, which were rapidly developed last year, and these have given us confidence in our agility. But there are also parts of the population that are now comfortable with online shopping. Previously, the ‘grey pound’ – which refers to the spending power of older people – would have been wedded to bricks and mortar shops. But that has changed.”
This trend, which has been replicated across society, has meant that retailers are grappling with how best to serve their customers. While it has been easier for online brands to keep growing, and much harder for high street brands to survive, it’s not only a story about who has shops and who doesn’t. As Jon explained, Pets at Home stores can still act as “fulfilment centres” and not every service can be delivered through an app, for example. As a result, everyone is focussed on ‘customer experience’: online, in stores, and everywhere in between.
“My very first job was working in a sports shop,” said Daniel Bobroff. “I came to learn that the busier it was, the more I enjoyed it, because there’s nothing worse than standing in a store with no customers. You go into retail because you love to serve the public and you love that interaction. I think retailers need to empower their people and put technology in their hands that allows them to offer a range of customer experiences.
“On the digital side, I’m not satisfied with the state of ecommerce in 2021,” he added. “I find it like a catalogue that doesn’t go much beyond a big list. I often use video games as an example, which have set the high watermark for digital experience. Retail is essentially an industry based on theatre, and it’s not using the techniques and technologies that are already out there, and have been for years.”
At Pets at Home, Jon White explained that the team was working on a project to help solve this challenge. It was focussed on understanding the different ‘life journeys’ that people take with their pets; not whether they shopped in store, or online. Once they had developed these ideas, viewing owners as ‘pet parents’ nurturing their animals through their lives, the business would be able to serve its customers better. He said that physical stores and technology would both play a role in delivering this vision.
“I think understanding these journeys is more important than ever online, because by design, there will be some rigidity built into that process,” said Jon. “We’re focussed on the customer, but we want that knowledge in the hands of colleagues as well. We’re partnering with a company that will allow customers browsing the web to have a video chat with a Pets at Home colleague in the moment. We want to bring some of that theatre that Daniel describes into people’s front rooms.”
In the future, both Daniel Bobroff and Jon White can also see a role for greater collaboration between retail brands and other sectors of the economy. As retailers focus on customer experience, there will be new ways to take products to market, and new people to help them do it. Jon described a Pets at Home store in the Northeast of England, which sits within the larger footprint of a Tesco Extra supermarket. Daniel also said that the platform model of business – think Uber and Airbnb – will become more important for retailers to explore.
“I think this idea that we are in it together, much like the past year, should be present for the sector,” said Daniel. “It’s not just about the community of our customers; it’s also about our suppliers and technology providers, as well. I don’t believe retailers now look at their in-house tech teams and say, ‘that’s all I need’. In the case of cyber security, they’ll need to look externally for experts in the field. These are all signposts towards a more collaborative relationship with others.”
He added: “One of the really interesting shifts online, which is linked to the theme of collaboration, has been the platform business. Customers interact with the ultimate sellers, whether you are looking for a place to get away, or a taxi, for example. You create the value together and Airbnb sits on the side and monetises that. It’s the same for Uber. That’s a very different approach to a marketplace, where the retailer lists a load of products. The platform business is about empowerment, enablement and your role among other tenants. And I think it’s fascinating for retail to think about.”
Daniel Bobroff and Jon White were speaking on Protiviti’s weekly Collaboration Forum, which is now in its fifth series. Click here to find out more about the event.
Click below to view the entire series