Women’s Wear Daily – Retail Success Hinges on ‘Knowing and Understanding’ the Customer
March 14, 2018
Matthew E. Rubel, formerly of Varsity Brands and Collective Brands, shares his insights into what retailers and brands can do in a tumultuous market.
Matthew E. Rubel is a veteran retail and brand chief executive officer and industry thought leader who serves as an independent director at Hudson’s Bay Co. where he chairs the compensation and HR development committees as well as sitting on the retailer’s governance committee. He’s also the lead independent director at The Joint Chiropractic, which is the largest chain of chiropractic clinics in the U.S.
In 2017, he was appointed executive chairman of KidKraft, the toy and juvenile products company. Rubel also serves as a presidential appointee to the Advisory Committee for Trade Policy and Negotiations. His executive leadership includes stints at Varsity Brands (as ceo, president and board member) and Collective Brands(as ceo, president and chairman) as well as serving as chairman, ceo and president at Cole Haan. He also held roles at J. Crew Group and Revlon, and at Murjani International, where he led the Tommy Hilfiger businesses.
Here, Rubel discusses the current retail transformation, how to stay competitive and what it takes to grow a global brand.
WWD: New technologies and platform are released nearly each week aimed at helping retailers — in stores and online. How can retailers and brands sift through these and decide which are the right tools to remain competitive?
Matthew Rubel: There are currently over 5,000 solutions on the market for retailers and brands, so the task for finding the optimal solution can be daunting. However, this should not deter retailers from embracing new tools. My approach for finding new technology has been two-pronged. First, I look within my own organization and determine the most important capabilities that we are seeking to unlock, by functional area.
This targeted approach helps to simplify the process for selecting the right tool, because knowing what you are looking for is more than half the battle. The criteria for what one is seeking becomes more focused and streamlined.
Then, after the tool has been selected, the functional area is able to measure the return on investment. By gathering quantitative and qualitative data over time, the organization is able to measure the impact of the change and ultimately the payback potential. By placing rigor and a roadmap around the retail research investment process, the organization can better budget for future capital expenditures in out-years and help to determine cost and benefit analysis as the organization embarks on new investment strategies. Even if the investment was not a direct success, there are always lessons learned to be gained from an investment perspective and can be applied for the future.
WWD: The adage says, the more things change, the more things stay the same. What are some of the core strategies that are just important today as they were 25 years ago?
M.R.: Knowing, and understanding the customer, will always be a brand’s central core strategy. Everything centers around understanding the customer, and today more than ever, customers expect brands and retailers to know what they want, who they are and to recognize them across all social media platforms when they shop. Knowing the customer in today’s economy not only means recognizing customers when they enter the store, but recognizing their online profile, and then personalizing their service to offer items that they will like. This requires deep data analytics for online platforms and advanced concierge and personalized luxury services.
Above all, the customer’s desire to be connected to a brand through social interaction continues to drive product innovation, newness and brand experiences. Consumers today, just as 25 years ago, want to be connected to brands through how they make them feel, and in relation to others. Today, consumers love sharing this feeling on social media, and it is the ultimate driver of purchase intent and the marketing mix.
“Convenience” and “value,” and “loyalty” also continue to top the list of attributes that are as important today for the customer as 25 years ago; the only difference today is the framework and redefinition of how these are being delivered and understood by the customer. For example, convenience today may mean a product is delivered within a day, or even an hour whereas 25 years ago, convenience may have meant the item was available for catalog delivery.
WWD: Given notable deals last year such as Amazon buying Whole Foods, Walmart picking up Bonobos and Target Corp. acquiring Shipt, what is your perspective on this year? Do you expect to see more strategic investments this year?
M.R.: Where there is change, there is opportunity. The retail space is seeing many notable partnerships and collaborations. In some cases, legacy retailers are partnering with pure play retailers to nimbly provide a personalized service for customers. This year will continue to include both bankruptcies and innovation, but successful companies are those that are able to pivot and adapt quickly to customer needs, their behaviors, and trends.
WWD: Personalization seems to be the new buzzword for retail in 2018. Are retailers equipped to keep up with the changing shopping habits of the consumer and who seems to be doing it well?
M.R.: Personalization is here, and there is no turning back. The amount of data available to retailers today allows one to know exactly what the consumer is doing, when she is doing it, and what is trending. In order to take advantage of this level of data, one must have supply chains in place in order to offer “your product,” “your store” and “your experience.” It takes time and focus to turn this data into organizational actions.
Understanding what the consumer wants is the first step on the journey. Translating this data into real-time design, product, and in-store activations and real-time experiences is the second step in the personalization journey. This is an exciting time, as personalization will become more advanced, and retailers have only just begun on this journey.
WWD: What does it take to grow a brand globally as compared to a decade ago?
M.R.: First and foremost, building a global brand requires an exceptional, inspirational product that fits into people’s lives. For apparel brands and trend-related consumer products, selecting brand advocates that represent the brand aesthetic and tell the brand story is extremely important. Influencers are representing brands, communicating brand messaging and reaching consumers across many platforms and in new ways today.
An agile, responsive supply chain is critical to growing a global brand. Today’s consumer expects new products in stores on a 48- to 52-week cycle, so logistically the supply chain should try to accommodate this expectation, to surprise and delight the customer. Whether digitally or in-store, customer service for global brands requires great local partnerships who understand local markets, and the needs of the customers and how they shop. This understanding allows for collaboration at the regional and local level for brands to think globally to build the brand, but act locally.