We’re lucky enough to be in NYC for the fourth consecutive year at the National Retailer Federation’s Big Show. The first day here featured talks from Aussie/Kiwi export Greg Foran (who’s running Walmart US), Eataly US’ CEO Nicola Farinetti (the founder’s son), Macy’s CEO/Chairman Terry Lundgren and astronaut Scott Kelly.
It’s an intense conference, where we always learn a huge amount – so here’s our round up from day 1…the three things we learnt that we want to pass on:
- It’s not about the product, it’s about people. Sounds logical but this idea was repeated again and again. The only way to differentiate a business is through its people and the values they embody. Product is an outcome of the people…as is profit. This was perfectly summed up in the opening address by Kip Tindell, Co-founder and Chairman of The Container Store. A business built on purpose and values – they talk about themselves being an organisation with heart, designed to help everyone associated with it thrive together. Anyway, Tindell is a believer in the 1 = 3 principle. Where one great person can do the work of 3 average people – but that requires looking after them, and investing in them through training, pay etc. For example, The Container Store average 250 hours of training a year for new employees when the industry average is 8 hours. As he said ‘great people make a great business’. It’s an important point, we all know what it’s like when we visit a beautifully designed store, but the service is sub-par.
- Understand the context you operate in…from the customer point of view: We were blown away by James Rhee – ex. high school teacher and private equity guy…and now the CEO and Chairman of Ashley Stewart. (As a side note you can read about the turn around he drove in HBR here). During his interview Rhee said: ‘We’re not scared of competition, I don’t want all of her (Ashley Stewart’s customer) time and money spent just with us’. He’s right, that would be entirely unrealistic and fundamentally show that they misunderstand their customer. He has made the brand about more than clothes but about self-esteem and understanding their customer’s community, and as such they focus on customer loyalty over sales. He sees sales as an output to loyalty.
- Aim for the stars, but have a plan that’s manageable small steps: This idea came not from a retailer but from the Astronaut Scott Kelly. Kelly is an American who spent 340 consecutive days on the International Space Station in 2015, this was part of an experiment to understand the effects of space on the body (he’s the perfect specimen as he has an identical twin brother). Kelly explained that he took a big risk becoming an astronaut – he was not a great student but he set himself a goal and then broke it down into small steps to get there. It’s important to note (and I’ll quote Kelly on this) ‘If you’re going to fail at something, fail at something that’s really really hard’. He’s right, retail needs courage and daring not incrementalism.
That’s a wrap for the day, we have 2 more days full of talks – you can stay tuned by following us on Twitter or just looking at the #nrf17.