How to become a cutting-edge retailer

Last week I attending an absolutely fascinating workshop on future trends in retailing.

Cate Trotter the founder and Head of Trends at Insider Trends was the speaker, and had an impressive knowledge of the key issues affecting on-line and off-line retail business.

Here are my notes from the information packed two hour session:

What are the main trends that will affect retailers over next two to five years?

Trends are like ocean tides an cannot be controlled, but if you recognise them you can ride them to success.

There is now a more sophisticated and more connected customer base than ever before.

Segmentation for individuals – more tailored products and stores

* Alton Towers’ Sleepover Suite (sponsored by Superdrug) for teenage girls
* Blends for Friends – an online tailored tea store – unique flavours and labels
* Elemis Skinlab – technology to assess skin leading to tailored products

Co-creation such as product modification.

* Nokia phone covers – an early example
* Nike iD range of shoes (choose from 60 shoes and select design of each element) – not a new service, but sales up 20% in last year
* Zazzle – uploaded designs printed on thousands of different products – recent sales surge
* and

Concept development and product development

* BMW – asking for ideas for new cars with online voting for favourites
* Denham – store designed around what the customer wants

Use SurveyMonkey – to find out what your customers want, or how about a coffee morning discussion. Much more than just a focus group asking for opinions.

Changing family structure leads to convenience trend

–          more singles than married in the UK by 2020
–          more single person households in the UK – impacts how people shop – from weekly shop to convenience shopping.  Growth from 19bn 2000 to 41bn 2015
–          Asda have bough Netto
–          Easier payment – Visa PayWave system
–          Debenhams – mini-wok is most popular item
–          Dinner for one packages
–          Waitrose – small stores with fresh food, warm bread, deli
–          Reprise of the milkman – –


Two types of retail – Online vs Offline

–          strong advantages
–          price and value
–          convenience – to your door

–          needs to compete with online success by expanding on…
–          experience
–          relationships

Don’t get caught in the middle – if you are on the high street, don’t try and compete on price or you will fail

Online Retail
–          Moving onto portable devices and digital television
–          Growing at 20% a year – more people online – more confidence shopping online
–          Brand loyalty reducing online – one click away from a competitor + price comparison engines
–          Small business shouldn’t not be drawn into price competition – e.g. with Amazon
–          Make shopping easier for your customers – one click shopping – PayPal – and (for Facebook shopping).
–          Move to ‘right first time’ e.g. Levis curve fit
–          Problem of home delivery – 10% of deliveries fail first time
–          Example of can deliver to home or to a local store (later hours than local Post Office). Makes returns easy with label and convenience store, with post paid if wanted.

The more unique your business the more loyalty you will get from your customers.

– online personal shopper who makes a commission on clothes bought.
–          Plan B Salon – Skype interviewing
– – create a paper watch which generates facsimile of their designs.

– – watches on your wrist
– – Portobello Road market in her house – a new photo each week. Also collaborates with designers

Growth of mobile retailing
–          Expected to double in next four years, but is still a tiny fraction of sales
–          Will use phones to find out about products so website must include phone capability
–          Phone apps will grow, but might be out of the reach of small business.

Offline Retail

–          Abercrombie and Fitch – more of an experience than shopping – all five sense are covered – loud music – A&F scents –
–          The Brand Showroom – e.g. Disney Stores – putting the experience before the product
–          J Crew (share of life retailing) – a range of products for a particular segment of the market / customer
–          Monocle Stores – London, New York, Tokyo, Zurich – sell their magazine plus accessories for readers of the mag
–          Mellow Johnny’s in Texas – bicycles, café and related
–          Lomography Gallery, London – retail and support services

Lomography Gallery London

Competition now comes from other experiences instead of other retailers

e.g. kids, shopping, theme parks

ROBO shopping – Research Offline – Buy Online

Maximise sales by
–          selling closer to the time of need –
–          selling closer to time of consumption
–          exclusives
–          charge for stocking goods – in the East End
–          own label products – e.g. Apple – use stores to promote products – don’t mind if customers buy online
–          Own label – – Dyson have tried a pop-up store


13% of stores are now empty – lower rate in the South East

Increasing demand for accessible / high street stores

People losing trust in big name brands – moving to local stores and farmer’s markets

Authenticity and localness – you don’t want to be located in a mall

Choose you neighbours carefully – think about pairing up with a like minded business.

Example of A Gold (UK produce) and Verde’s (European produce) in Brushfield street in Spitalfields.

Attention spans on the web are shortening over time.

Store payback time 5-7 years on average

Example – using trolleys to keep store fresh use projected displays in store – others use LCD displays

Liberty change signage fonts and colours

Could use posters

Fast moving stock – Zara has 11,000 new products a year

Temporary retail spaces – pop-up-stores – now hitting the mainstream

Toys R Us open up 200 pop-up-stores for seasonal sales

The Secret Restaurant and now The Secret Market (food fair) –

Retail trucks – Adidas pop-up truck – can use Twitter to announce where you are

New mobile app and widget to take credit card payments – – 3% charge

How? (including marketing)

Less brand loyalty than in the past

Customers more inclined to listen to each other than conventional advertising – people buy goods and post comments online – leads to discussion

High satisfaction leads to word of mouth and social media

So concentrate on quality delivery rather than low price

Happy customer vs unhappy customer – £600 vs -£400 – Research by a mobile phone company

Nudging customers to promote your products or services

Example: - customers get points for registering in store  and – social media element
–          Be interesting –
–          Tell stories – your customer might want to share – newsletter in every pack
–          Educate customers – Editions de Parfums Frederic Malle – sealed chambers
Apple store free workshops
–          Make business more interactive – – furniture designed by members of the public with votes to decide
– in New York, customers design their own burgers online and save recipe, with 25cents for each one sold
– – records purchases and shares online
–          Uniqlo’s Lucky Line for every 26th customer who joined the line – massive social media coverage


Growth rates predicted for next 18 months

Offline 1% – existing £263bn

Online 39% – existing £11bn

The future is customer centric so think P2P Retail – human interactions

–          Be human!

–          Celebrate your smallness

–          Who is your service going to be tailored to?

–          What do they like?

–          How will you adapt to them?

–          How will they change and how will you move with them.

–          Be authentic – with innovations which will benefit your customers – connect with your local community

–          Be conversational – put the relationship before the sale

–          Finding out  what your customers think and how to trigger them to promote you.

On a personal note I would strongly recommend signing up to the Springwise newsletter and looking at the Trendwatching website.

Drink Shop & Do – a new kind of consumer experience

Many thanks to a colleague for recommending this newly opened venue, located just around the corner from my office. I popped over last week for a nose around and ended up buying lunch and having a long chat with co-founder Kristie.

She explained how the idea for Drink Shop & Do came from wanting a place like this for Kristie and Coralie and their friends. As with so many entrepreneurs when confronted with the frustration of the lack of a product or service, the light-bulb went on in their heads and they saw a business opportunity.

The potential they spotted was for a destination for what I would describe as maturing mid-twenties young people. Those who have become bored by the late nights, heavy-drinking and loud music –  nightclub lifestyle. As the father of a 20 year old young woman, I am very much looking forward to the time she reaches this calmer stage of life.

Kristie and Coralie have chosen a beautifully light and airy building, which was a Victorian bathhouse in a former life. This is a delightfully surprising find, located close to what was previously one of the grottier part of Kings Cross.

The founders can explain their thinking better than I can:

We are Kristie and Coralie. We met 13 years ago on our first day of secondary school and have been friends ever since. About a year ago we discussed what would really make us happy…

Kristie hoped for a place where tea was served in beautiful teapots, cakes were sticky, and where if she felt like it she could play a game of scrabble!

Coralie wished for all of those things too, but she also wanted to be able to display local designers crafts and products so that people coming into the shop had the chance to see not only pieces of art but handmade designs that they could buy there and then to take home.

We wanted to create a fantastical looking place, that was open to the community where everyone could feel free to come and make crafty things at any time of the day, and perhaps drink a delicious cocktail at the same time!

After having been open for only eight weeks they are still on a steep learning curve, and suffering from the traditional startup’s lack of sleep. They have a long to do list they are starting to work through, including putting a location map on their website and starting a blog. Although they do have a presence on Facebook with over 500 friends. And have had some excellent reviews from bloggers (Drink, Shop and Do Reviewhandnamade)

More importantly, they are both relishing the experience of developing a unique service.

It was interesting to hear the positive impact of their idea to make everything in the shop for sale. On a slow day recently for food and drinks sales, a customer wandered in and ended up buying a £600 sofa, which made for a good day’s income overall.

I like the way they are having fun with what they do. Kristie explained how she had always wanted to run a traditional sweetshop as a child (in common with many), and had created something of a mini sweet emporium in her bedroom at home. Needless to say the opening of Drink Shop & Do gave her the opportunity to fulfil this dream, with a corner of the building dedicated to Flying Saucers and the like.

On a final note I want to say how delicious the Salmon, Dill & Creme Fraiche tart  I bought was, and to wish Kristie and Coralie the best of luck with their innovative  venture.

Update 12 October
Great to see an excellent article on the shop in last night’s Evening Standard.

Food, family business and fun: In conversation with Oliver Peyton

As part of our Cooking Up Success month in the Business & IP Centre on Tuesday evening 13 July Oliver Peyton, founder and CEO of Peyton and Byrne, came to the Library to give a talk to aspiring restaurateurs.

I am grateful to my colleague Maria Lampert for writing this report on the evening:

In a session moderated by Matt Thomas from Oliver spoke of his arrival in the UK from the west coast of Ireland and of working his way up in the business world. He spoke briefly about his experiences running nightclubs in the early 80’s and how having made a great success of those he turned his hand to restaurants. He had, he told us, made and lost a fortune and then made it all back again.

Oliver is passionate about London (a big plus as far as I am concerned), about Britain and about using only British Produce. ‘British meat’, he said, ‘is the best in the World’ (being Vegan I can’t comment one way or the other on that statement!)

He had some great tips for would be restaurateurs, café or deli owners:

First and foremost he said be aware of the value of your intellectual property, Oliver referred to ‘your trademark’ and ‘your brand’ and said he was very firm in clamping down on anyone who copied any of his products. He has, Oliver told us, no problem with people being influenced by Peyton and Byrne products, but he would not tolerate anyone copying them without permission.

When choosing premises he advised that you check out the landlord and well as the premises and no matter how attractive the premises may be if the landlord appeared in any way untrustworthy or dodgy consider walking away. Also read any tenancy agreement very carefully, some contracts can apparently include for example a clause which allows the landlord to raise the rent at an exorbitant rate very quickly or other such clauses that end up costing you more than you actually make.

Once you have found your premises, Oliver said, don’t be tempted to spend lots of money on expensive décor or furniture, the clients won’t notice it and, in truth, if the food is rubbish the fancy décor will not matter (I must be honest I don’t think I have ever read a review by food critic Jay Rayner where he said a restaurant was worth visiting because of the décor alone!) Better to have decent décor and furniture and great food. Oliver mentioned that when he first opened one of his restaurants he commissioned well known artists of the time to produce works of art for the walls of his restaurant, it cost him thousands of pounds and the diners didn’t even notice.

He realised he could just as easily have had a trendy poster on the wall for all the difference it made. The other point Oliver made relating to décor etc. is that you might spend a lot of money on your restaurant to draw diners in, but if you are successful you will find that competitors will come into the area, set up a cheaper version with the same offering, charge lower prices and lure away your diners.

Choosing staff and dealing with seasonal changes in demand was another subject he touched on. When he employs someone Oliver doesn’t just look at the position they will be filling he considers the whole team he will be slotting them into.

The other tip he gave us regarding staff was to be aware of which parts of your business might be affected by the changes in season. As an example, Oliver said, take the Peyton and Byrne restaurant in St James Park, very busy in the summer, very quiet in the winter. Rather than take on part- time staff he moves staff around so in the winter some of the staff from St James Park would be moved to indoor venues which are busiest during the winter months and visa versa.

To my surprise he said that deli’s are never profitable unless they are attached to something! This is apparently because of the very short shelf life of their product. At the end of each day a lot of the pre-prepared fillings etc have to be thrown away, hence a lot of money is wasted. Deli’s attached to department stores or eateries tend to have a bigger turnover due to greater numbers of people passing through or by.

All in all it was a very enlightening evening with plenty of good advice for all the would be restaurateurs who attended from someone who had been there, done that.

City Business Library – Under One Roof with guest speaker Jo Fairley of Green & Black’s chocolate.

Wednesday 1 November 2007

Jo_FairleyWhat an inspiration Jo Fairley is. Not only did her partner found the Whole Earth but when he refused to sell chocolate because “it contains added sugar”, she set up Green & Black’s the worlds first organic chocolate.

Here is a snippet of their ground-breaking story:

It all started back in 1991 when Craig Sams, founder of Whole Earth – the pioneering organic food company – was sent a sample of dark 70% chocolate made from organic cocoa beans. His wife, environment columnist for The Times and confirmed chocoholic, Josephine Fairley, found the half eaten bar on Craig’s desk and sampled some for herself. The intense flavour was unique and unlike anything she had tasted before. Jo was convinced other chocolate lovers would appreciate it in the same way she had and they set about making the world’s first organic chocolate. The final product was a high-quality, bitter-sweet dark chocolate bar, packed with 70% cocoa solids – enough to make chocolate fans sit up and take notice..

FairTrade_logoAs the brand began to gain a loyal following, Maya Gold was added to the range in 1994 – the product of a holiday Jo & Craig made to where they discovered cocoa farmers were being penalised, as some larger confectionery companies tried to drive cocoa prices down. They agreed to pay the farmers a fair price for their crops and created the flavour of Maya Gold to capture the taste of the rainforests where the cocoa is grown. This way of doing business didn’t seem different to them – it was what came naturally but it subsequently earned them the UK’s first Fairtrade mark.