Retail Strategy Ric Anderson

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Retail Strategy Ric Anderson

  1. 1. RETAIL STRATEGYFIND THE BEST CUSTOMER FOR YOUR BUSINESS!AND MAKE IT WORK!byRIC ANDERSON
  2. 2. COURSE OBJECTIVES: Understand the processes to create a Retail Strategy with a Customer Centric Focus Learn to analyze your business and competition from a multi-dimensional point of view. Refine your “Customer Value Proposition” Use Innovation as a Competitive Advantage Understand the power of an “Engaged Culture”2 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  3. 3. MURPHYS LAW OF MANAGEMENT STRATEGY Some people manage by the book, even though they dont know who wrote the book or even what book.3 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  4. 4. STRATEGY THE DEFINITION OF BUSINESS STRATEGY IS: A LONG TERM PLAN OF ACTION DESIGNED TO ACHIEVE A PARTICULAR GOAL OR SET OF OBJECTIVES4 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  5. 5. AGENDA: Frame of Reference Goals and Point of View Visit the “3 Stages” of Strategy Timeline & Path Breakdown “Stages” into Processes Finalize and Execute5 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  6. 6. WHAT IS THE PURPOSE OF A BUSINESS?6 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  7. 7. EVERY BUSINESS HAS A “PURPOSE!THAT PURPOSE IS TO PROVIDEA PRODUCT OR SERVICEWHERE THE CUSTOMER HASA PERCEIVED VALUE! KEY PIECE OF THE PUZZLE 7 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  8. 8. WHAT IS YOUR PURPOSE? WHAT SANDBOX ARE YOU PLAYING IN?8 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  9. 9. CURRENT STATE:Your system is perfectly designed to producethe results that you are getting today.  LESSON: If you want fundamentally andsubstantially different results, You haveto change the strategy and methodologyof how you are doing business!Insanity: Doing the same thing over and over again And expecting different results.Albert Einstein9 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  10. 10. THE “STRATEGY” FOR A RETAIL STORE IS A LIVING ORGANISM! INNOVATION KEEPS IT HEALTHY! RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR10 BUSINESS!
  11. 11. ANDERSON’s 10 PILLARS: BUILDING A FOUNDATIONA 10,000 FT POINT OF VIEWO CUSTOMER CENTRIC FOCUS INTEGRATED STRATEGYE MULTI-DIMENSIONAL SOLUTIONSL COMPETITIVE & INTERNAL INTELLIGENCET SUPREMACY THROUGH COMPETITIVE ADVANTAGESH ABILITY TO SYNTHESIZE HIGHLY QUANTITATIVE AND QUALITATIVE DATA INTO A LOGICAL CONCLUSION. CONTINUOUS INNOVATIONA ENGAGED CULTUREA COMMUNICATION11 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  12. 12. GOALS: HIGH LEVEL Evaluate multiple “Solutions” to your Strategy. Build a Strategy that can create growth, is profitable, sustainable, scalable, integrated, defendable, and has competitive supremacy. Can easily be communicated12 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  13. 13. GOALS : POINT OF VIEW  Profitable “Market Niches” Growth  High ROI  “Best in Class” and “Top of Mind”  Innovative Customer Touchpoints.  High Productivity Revenues Channels  Flexible  Smooth Transition  Least Risk RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!13
  14. 14.   CRITICAL PATH Predetermined set of Processes and Timelines SEEK OUT, SURFACE AND RESOLVE14 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  15. 15. CRITICAL THOUGHT PROCESS THE “CRITICAL THOUGHT PROCESS” IS THE PATHWAY TO A SOLUTION! RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!15
  16. 16. THREE STAGES OF BUILDING STRATEGY: 1) Look, Listen, and Learn 2) Evaluate, Collaborate and Test 3) Assemble and Execute  16 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  17. 17. STAGE I LOOK, LISTEN AND LEARN CHAMPION A Senior Executive has to be given Authority:  Gather Data & Collect Information  Ask difficult & hard questions  Request other’s time & assets  Conclusion and Execution Requirements  Listen  Open Mind  Qualitative and Quantitative Skill Sets17 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  18. 18. MARKETPLACE Which Marketplace? What Products? Value? Channels of Revenue WHERE AND WHAT IS YOUR SANDBOX?18 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  19. 19. BRAND POSITION, CUSTOMER VALUE PROPOSITION and BUSINESS MODEL BRAND POSITION CUSTOMER VALUE PROPOSITION (CVP) BUSINESS MODEL19 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  20. 20. FINANCIAL GOALS and DATAPlans vs. Current State“Work Sessions” with Finance, Merchants Operations etc.Competitive IntelligenceWhere are the opportunities?20 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  21. 21. PRODUCT CATEGORY REVIEW MARKET SHARE FINANCIAL ANALYSIS ANALYSIS BY PRODUCT FILTERS COMPETITIVE ADVANTAGES21 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  22. 22. PRODUCT CATEGORY REVIEW MARKET SHARE MARKET SHARE BY COMPETITOR PRODUCTS Comp. 1 Comp. 2 Comp. 3 Comp. 4 Comp. 5 Womens 10.0% 8.0% 4.0% 7.0% 6.0% Mens 4.0% 6.0% 8.0% 5.0% 4.0% Kids 5.0% 8.0% 7.0% 5.0% Footwear 8.0% 6.0% 7.0% Accessories 8.0% 6.0% 5.0% 1.0% 3.0% Intimate 6.0% 5.0% 4.0% 2.0% Fine Jewelry 5.0% Home 4.0% 7.0% 6.0%22 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  23. 23. PRODUCT CATEGORY REVIEWFINANCIAL ANALYSIS SHOES 1,000,000s JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL SALES Reg $ 20 $ 25 $ 40 $ 30 $ 30 $ 30 $ 20 $ 35 $ 45 $ 40 $ 40 $ 45 $ 400 Markdown $ 30 $ 20 $ 20 $ 10 $ 15 $ 25 $ 20 $ 25 $ 30 $ 15 $ 25 $ 35 $ 270 TOTAL $ 50 $ 45 $ 60 $ 40 $ 45 $ 55 $ 40 $ 60 $ 75 $ 55 $ 65 $ 80 $ 670 GM$ Regular $ 10 $ 13 $ 20 $ 14 $ 14 $ 14 $ 10 $ 16 $ 20 $ 20 $ 19 $ 20 $ 189 Markdown $ 8 $ 3 $ 2 $ 4 $ 5 $ 8 $ 6 $ 5 $ 3 $ 5 $ 8 $ 9 $ 64 TOTAL $ 17 $ 16 $ 22 $ 18 $ 19 $ 21 $ 16 $ 21 $ 23 $ 25 $ 27 $ 29 $ 253 GM% Regular 48% 52% 50% 48% 45% 45% 48% 45% 45% 50% 48% 45% 47% Markdown 25% 15% 10% 35% 35% 30% 30% 20% 10% 35% 30% 25% 23% TOTAL 34% 36% 37% 45% 42% 38% 39% 35% 31% 46% 41% 36% 38% ADDITIONAL ELEMENTS: Inventory – Turn – ROI Sales Sq. Ft. GM$ Sq. Ft., Marketing Spend % of each element per month & year BREAKDOWN: Women’s, Men’s, Kids, Athletic, Work23 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  24. 24. PRODUCT CATEGORIES FILTERS ANALYSIS OF EACH CATEGORY Time Period Product to Market Channel/Path Marketing: Product & Channel “Purple Cow” Viewpoint24 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  25. 25. PRODUCT CATEGORY FILTERS: MARKET BASKETMARKET BASKET WOMEN MEN SHOES TOTAL Dresses Sport Denim JR TOTAL Suiting Sport Denim YM Work TOTAL Women Kids ATH Mens WorkWOMEN TOTAL 100% 30% 60% 40% 25% 40% 10% 30% 30% 15% 5% 60% 65% 40% 30% 30% 10% Dresses 30% 100% 40% 30% 15% 10% 8% 15% 20% 5% 1% 30% 50% 10% 7% 12% 3% Sport 60% 40% 100% 75% 40% 40% 5% 25% 30% 15% 2% 50% 60% 20% 10% 15% 4% Denim 40% 30% 75% 100% 25% 25% 5% 3% 30% 25% 10% 60% 60% 25% 15% 10% 5% JR 25% 15% 40% 25% 100% 20% 1% 15% 20% 20% 1% 40% 35% 30% 25% 5% 1%MEN TOTAL 40% 10% 40% 25% 20% 100% 40% 80% 50% 35% 50% 40% 25% 40% 30% 40% 30% Suiting 10% 8% 5% 5% 1% 40% 100% 60% 40% 20% 20% 30% 20% 20% 20% 30% 25% Sport 30% 15% 25% 3% 15% 80% 60% 100% 50% 30% 25% 40% 25% 35% 25% 40% 30% Denim 30% 20% 30% 30% 20% 50% 40% 50% 100% 45% 35% 40% 15% 30% 30% 40% 35% YM 15% 5% 15% 25% 20% 35% 20% 30% 45% 100% 10% 25% 10% 10% 25% 25% 10% Work 5% 1% 2% 10% 1% 50% 20% 25% 35% 10% 100% 30% 8% 15% 20% 30% 80%SHOES TOTAL 60% 30% 50% 60% 40% 40% 30% 40% 40% 25% 30% 100% 65% 40% 30% 35% 25% Womens 65% 50% 60% 60% 35% 25% 20% 25% 15% 10% 8% 65% 100% 60% 40% 30% 30% Kids 40% 10% 20% 25% 30% 40% 20% 35% 30% 10% 15% 40% 60% 100% 30% 45% 40% Athletic 30% 7% 10% 15% 25% 30% 20% 25% 30% 25% 20% 30% 40% 30% 100% 50% 40% Mens 30% 12% 15% 10% 5% 40% 30% 40% 40% 25% 30% 35% 30% 45% 50% 100% 80% Work 10% 3% 4% 5% 1% 30% 25% 30% 35% 10% 80% 25% 30% 40% 40% 80% 100%DEEP DIVE into multiple combinations of data 25 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  26. 26. CUSTOMER PROFILEKNOW AND UNDERSTAND YOUR CUSTOMERCurrent Customer?Analytics?Population of the Market?Filters and Segments?Preferred Customer?Alternative Customer?26 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  27. 27. CUSTOMER PURCHASING DECISIONLASER FOCUS ON THE CUSTOMER CUSTOMER TOUCHPOINTS Visual, Physical or Mental RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!27
  28. 28. COMPETITIVE SUPREMACY BUSINESS WITH THE MOST INNOVATIVE COMPETITIVE ADVANTAGES WINS! Product Price, Value, Quality etc. Business Model Customer Value Proposition Most positive Customer Touchpoints RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!28
  29. 29. COMPETITION: Competitive Intelligence WHO? UNDERLYING COMPETITORS? ANALYSIS “BEST IN CLASS” COMPETITIVE ADVANTAGES RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR29 BUSINESS!
  30. 30. COMPETITIVE ADVANTAGES  PRODUCT  QUALITY  BRANDS  ASSORTMENT  PRICE/VALUE  EXCLUSIVE  LOCATION  ETC.30 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  31. 31. COMPETITIVE SUPREMACY BUILDING COMPETITIVE SUPREMACY COMP. 1 COMP. 2 COMP. 3 COMP. 4 COMP. 5 FINANCIAL ROI MARGIN SALES PRODUCT ASSORTMENT QUALITY UNIQUE BRAND POSITION HIGH MIDDLE LOW PRODUCT CHANNEL SPEED TO MARKET GEOGRAPHY CUSTOMER SERV ICE V ALUE ENGAGEMENT RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!31
  32. 32. COMPANY HISTORY History: PAST vs. CURRENT What is driving the Business? Revenue Channels Competition: old and new Economic Status Changes in Population Demographics Technology – Innovation? Other Elements?32 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  33. 33. POWER OF CULTURE ASSETS: PEOPLE AND CULTURE ENVIRONMENT is one of trust, engagement, learning, communication, listening and cooperation! LEADERSHIP is at all levels! RESPONSIBILITY for own role! ALL SECTORS to be utilized ENGAGEMENT has to be total! CONTINOUS INNOVATION is top of mind in all sectors! RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR33 BUSINESS!
  34. 34. INTERNAL INTELLIGENCE ANSWERS ARE WITHIN THE ORGANIZATION SOLUTIONS TO SURFACE IS THE ISSUE. CROSS FUNCTIONAL SUPPORT GROUPS INTERVIEWS: INDIVIDUAL AND GROUP INTEGRATED STRATEGY34 RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!
  35. 35. REVENUE CHANNELS:WHICH ONES FIT YOUR STRATEGY? STORES CATALOG INTERNET B2B WHOLESALE TV RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR35 BUSINESS!
  36. 36. MARKETING CUSTOMER REACHED? MARKETING CHANNELS? CHANNELS BEST REFLECT THE BRAND? EFFECTIVENESS BY CHANNEL? REACH NEW CUSTOMERS? INNOVATIVE TESTS SOCIAL MEDIA RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!36
  37. 37. VENDOR COMMUNITY MOST UNDERUTILIZED ASSET Vendor Conference  Products  Marketing  Logistics  Customer Experience  Competition  Innovative Solutions  Invite Cross-Functional Support members RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!37
  38. 38. STAGE II: EVALUATE, COLLABORATE, AND TEST USE OF MULTIPLE SOURCES UNDERSTAND OPTIONS ALTERNATIVE SOLUTIONS QUANTIFIABLE TESTS INTEGRATED STRATEGY RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!38
  39. 39. COLLABORATE TEAM PROJECT MERCHANDISING STORES CHANNELS CROSS FUNCTIONAL SENIOR TEAM MEMBERS TRUSTED VENDORS RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!39
  40. 40. STAGE III:ASSEMBLE AND EXECUTE REQUIRES THE SKILL OF SYNTHESISCREATE STRATEGYGATHER DATAALIGN SOLUTIONSINTEGRATE ALL ELEMENTSCROSS FUNCTIONAL SENIOR TEAMSUMMARIZEDISCUSSIONHOT BUTTONSCOLLABORATION RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!40
  41. 41. LITMUS TEST BRAND, CVP, BUSINESS MODEL IN SYNC PURPLE COW INNOVATIVE COMPETITIVE ADVANTAGES PROFITABLE SUSTAINABLE DEFENDABLE SCALABLE INTERNAL ALIGNMENT SUPPORT FROM INDUSTRY RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!41
  42. 42. PHASE III: Assemble and Execute   FINAL STRATEGY: The Core Senior Team makes the final decision. TASK: Incorporate as many of the goals from the review as possible into a seamless comprehensive and a collaborative Strategy. CONGRATULATIONS! You have completed 90% of the Goal. RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!42
  43. 43. COMMUNICATION SUCCESS TIED DIRECTLY TO COMMUNICATION DISSEMINATE ACKNOWLEDGEMENT ANTICIPATE ISSUES CHANGE MANAGEMENT RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!43
  44. 44. SUMMARY A STRATEGIC PROCESS THAT CAN BE USED BY THE ENTIRE ORGANIZATION. EVERYONE HAS CONTRIBUTED, TAKES OWNERSHIP, UNDERSTANDS AND CAN EASILY ARTICULATE TO OTHERS. RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!44
  45. 45.     Do not repeat the tactics which have gained you one victory, but let your methods be regulated by the infinite variety of circumstances Sun Tzu c. 490 BC, Chinese military strategist RETAIL STRATEGY : FIND THE BEST CUSTOMER FOR YOUR BUSINESS!45

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