Manage episode 201627613 series 1854740
"No company can afford to stand still" - we sat down with David J. Katz - a Linked In Top Voice in Retail - to discuss how technology is changing consumer demands and pushing companies into creating better experiences.
David J. Katz is here from Randa, the world's largest men's accessory company, that ships more than 75 million units of product a year.
With the ever-changing technological landscape, retail has is being disrupted with advancements made in technology, and therefore, it's important to change approaches to fit the current retail environment.
Digitizing the traditional brick-and-mortar shopping experience is essential today when customers rely on their phones for information and recommendations.
Entertainment has taken a more significant role in retail than ever before but is there a worthwhile and lucrative space for entertainment in the coming years in the commerce world?
The Most Rational, Logical Path You Can Imagine:
David recounts the journey that got him to where he is today: a journey that began with him as a medical student studying neuroscience that granted him a unique view into the psychology and physiology of human behavior.
Thanks to a bribe from his family, David took a year deferment before spending the next nine years in med school, and he ended up not going back and eventually went to business school instead.
He got hands-on experience in operating businesses that had wholesale products and selling those to retailers.
Brian points out some of David's prolific achievements, such as being named one of LinkedIn's Top Voice in Retail.
Stimulating Customer Response to Grow Your Business:
Because Randa is dominant in their market, their goal is to stimulate customer response to buy more product as opposed to getting a larger share of the market.
Phillip brings up a recent Merchant to Merchant live podcast in which he spoke to Filson about how they are combatting the vertical challenge of modern technology by going horizontal with their product line.
David illustrates Randa's strategy of increasing consumer exposure to belts by surrounding the pants sections of department stores with their products. (Can you sense some of that psychology education here?)
With their market share and their marketing spend capability, Randa can ensure that every color in every brand is always in stock.
What happens when you are shopping online? Do all the infrastructure specifications and display strategies put in place by David get disrupted?
Growing Up Technological: The Cycle of Disruption:
David takes us through the cycle of retail (from the days of the Wells Fargo wagon in fact) and how as technology advances, the retail cycle is disrupted.
Phillip brings up that he has seen some recent advances in belt technology and asks David if they are able to improve and drive technology advancement to capture those areas of the market.
"David responds with some serious pearls of wisdom by saying, "Nothing is so perfect, so ideal that you cannot reinvent, reimagine, and innovate to make it better and more relevant."
As an example of some innovations made in the world of belts, there is belt that is also a phone charger. Talk about squeezing the last bit of power out of your smartphone.
David brings up that women are typically faster at adapting to new technologies, which is why there aren't as many advancements in men's fashion as there are in women's fashion.
Brian also brings up another technological advancement in the form of RFID-blocking wallets, an advancement that prevents the scanning of your id through your wallet.
Digitizing the Brick-and-Mortar Experience: How to Recreate the In-Store Experience Online:
Brian asks David what he is investing in or working on in regards to online shopping to mirror the amazing strategies that Randa has in place in regards to their brick-and-mortar installations.
Randa is using a lot of digital technologies to dynamically display appropriate accessories to compliment what the customer is shopping for, and then they will continue to market those accessories even after the customer has finished their online shopping session.
David also brings up that even while shopping in a physical store, customers still resort to their phones for product information, so it's essential for Randa to have an online presence, even for customers that are shopping at brick-and-mortar locations.
Ever Changing Bits and Pieces: What is a brand today?
Brian brings up an article recently published by Future Commerce alumnus Richard Kestenbaum (check out his episode) that defines "ingredient brands" and asks David how he sees brands evolving.
Ingredient brands are essentially the things inside a product that make it more valuable (think Intel Inside).
Randa has invented and patented belt technologies like Exact Fit that can be considered ingredient branding that they put inside other brands.
The word brand initial came from cattle branding which dates back centuries and is found across many cultures, and we still identify ourselves as part of a "tribe" with similarly branded others which grant you membership and validation.
Brian brings up that when customers used to associate themselves with a brand, they were assured of three things: A certain lifestyle coordination with that brand, value coordinating with the cost of items from that brand, and the benefit of being identified by other because of their brand choice.
Today, with social media and online verification while shopping, you can see thousands and thousands of reviews and comments on any given product instantly.
David predicts that there will be a tiny number of influential national and global brands that still mean something valuable, but there will be hundreds of thousands of digitally native brands that are targeting specific niches of customers.
The Modern Proprietor: Big Data Knows What You Need:
The ability to target the interests of customers on such a granular level is a powerful tool that will lead to changing the face of branding itself.
David also brings everything full circle by comparing the data mining of today to the proprietors of old, both know their customers needs, interests, and wants and can custom tailor their products and recommendations to fit those needs.
New data points are being created all the time, such as data related to your body that can even further customize personal product recommendations.
David explains how they are just beginning to use AI to recommend products based on an image, essentially superimposing a belt onto the image that compliments what you're wearing.
The Shiny Factor: Not All That Glimmers is Gold:
Phillip asks if David thinks that people will follow technology into the future of if he foresees people overinvesting in technology as we see it today.
David responds by saying the situation is a double-edged sword: on the one hand, people are distracted by whatever is new and shiny that people might think is valuable, but is only just shiny (like this security robot that took a nosedive into a fountain), but on the other hand, when technology provides a better experience for your associates and peers, then it provides an incredible value.
Brian harkens back to a past episode with Sucharita Mulpuru in which she advocates the sentiment that just because you can build something, doesn't mean you should.
Are You Not Entertained?: Entertainment's Role in Retail:
What is the role of entertainment in retail experiences and does entertainment have a place in retail in the next couple of years?
David says that Starbucks is an excellent example of entertainment in retail: you spend getting your coffee, and then you spend an hour on your laptop in their store and going through their carefully curated experience.
On one of his stints on QVC, David recalls that when he was doing a bit dressed as a doctor, viewership went up, but fewer people were ordering because the entertainment factor alone did not convince people to order when the entertainment didn't show why the product was relevant.
The key factor in making entertainment work for your brand is to engage your customers in a way that helps your brand and increases conversion over time.
As always: We want to hear what our listeners think! What is the meaning of brands today, and how is that changing in this compressed supply change environment? Do you see entertainment playing a more significant role in retail in the next few years?
Have any questions or comments about the show? You can reach out to us at email@example.com or any of our social channels, and we love hearing from our listeners!