Insights

Working Toward Recovery in Retail: An Executive Conversation Part 1

Gorilla Group and Adobe sponsored a virtual event with candid discussion around retailers coming back from the disruption of Covid-19 and learning how to quickly adapt to a digital first strategy. We welcomed John Stockton, Senior Director of Product for Adobe, Ryan Noel, Chief Growth Officer for Gorilla Group, and Christopher Strong, Vice President of Marketing at the leading retailer, Watson’s. Below is part one of two of their conversations around lessons learned during the crisis, the evolving role of digital commerce, and what the future of retail may look like.

__________

RYAN NOEL: We’ve been working with Watson’s, with Magento and Adobe, for about three years and we’ve been on quite the journey together. The last several months have really amplified that journey and have been some interesting times for us and Watson’s. Chris, tell us a little bit about the story of your experience with Watson’s over the course of the last couple of months.

CHRIS STRONG: Watson’s is a family-owned home recreation and home furnishings retailer. We have 12 stores, primarily across the Midwest, three of them are corporate and the remaining are franchisees. Our heritage has really been in above-ground pools, outdoor furniture, and home recreation. The last few years have seen a lot of accelerated diversification in our portfolio of products, especially in our flagship store in Cincinnati. We like to think of it as everything under your roof: water, home rec, indoor living, outdoor living, chemicals, accessories, etc.

We are primarily brick and mortar, but our digital evolution is a journey that we’ve been on for the last three years. We are always intimately focused – pre-pandemic – on the experience of a customer in our showroom and getting those customers into the store because that’s where a lot of our products shine best. As a business, we also encounter some interesting nuances as an online retailer that makes it difficult to retail online.

RN: Obviously the impacts of Covid have affected organizations in a number of different ways. One of the reactions was everything seemed to happen so quickly. Can you share a little bit about the impacts that Watson’s has experienced?

CS: During the pandemic, we tried to plan for what we thought was going to happen, and inevitably, a lot of what occurred was driven by chaos and confusion. When you’re a brick-and-mortar retailer like we are, not all states operate the same in terms of shutdowns. What’s essential in one state is not in the other. There was a lot of uncertainty and inconsistency, and we had to try to thread the needle to be able to ensure that, from a communication standpoint, we make that clear and concise in order to support all of the various locations we have across the landscape.

The other thing that we really saw right away – related to marketing – was if you’re getting shut down, do you turn off all your marketing? What do you do? Are you going to be able to fulfill orders? Do we have the products? Are we going to get the products? If we get the products, when are we going to get them?

As a seasonal business, in many senses, pools and outdoor furniture [sales] take place at a certain time of year. When a pandemic is starting when your biggest move is being made, it’s very challenging. The initial impact forced us to question what we were going to do to ensure that we could sell through this and continue to drive business day in and day out the best we could in order to come out of this on the other side as strong as possible. Messaging shifts, media shifts, just making changes as quickly as we could. It was a lot of those pieces that stood out right away and it became an around-the-clock job, being nimble and being fast.

RN: That was something we recognized that you did very early on, which was to understand the landscape of what could be in front of you and move quickly to try to address that. As we’ve gone through the last several months, everyone I’ve spoken to and all of our clients know they need to do something to better equip their businesses — not only to emerge from a post quarantine, post-Covid world, but to improve their businesses. But I don’t think everyone actually knows what that something is.

Some are going to be coming out of the crisis in better shape than others. There’s still some trepidation on making a misstep because they don’t want to place their chips in the wrong basket. With so many potential levers to pull, we see clients get overwhelmed and they don’t know how and where to invest. You took some very decisive actions, made some very intelligent investments, and shifted your organization to meet your customer needs and expectations. Frankly, some of those expectations didn’t even exist three to four months ago.

CS: To your point about making decisions and making changes, we had to accelerate the use of core parts of our technology that may have been underutilized before this massive push. A lot of that was scaling up and bringing people along very quickly to capitalize on continuing to engage the consumer because we weren’t going to sit there and not do anything.

RN: As an organization that relies so heavily on in-store traffic, when brick and mortar shut down, you did some really interesting things. If you could, talk a bit more about that.

CS: Within that period of time, we made poor decisions around what media stays on and why. Then you look at what you’re doing with the business. It was the elements of buy online, pick up in store, we were not doing that previously. We had to accelerate a race to get there and quickly identify a solution for franchise stores that could enable them to be efficient and empowered to fulfill the needs of those localized customers.

We really chose to quickly lean into virtual consultations, providing any and all channels that would allow a customer, from the comfort of their couch, to engage with an associate. We had to make it a 24/7 scenario. This meant using new tools and new technologies in the virtual space. Live chat became something that we doubled down on very aggressively. What we saw through the challenges that were in front of us was that people were willing to take risks with commerce. Those were a few of the things that we really tried to hone in on and as a business that has really tried to work hard to establish a relationship with our customer base that is long-standing. We began to use our emails in different ways as well to merchandise our product lines and increase communication frequency.

RN: John, I’d love to get some of your thoughts on how you’ve seen people shift their strategies over the course the last couple months?

JOHN STOCKTON: Everything that Watson’s has experienced has been repeated across our customer base. We’ve seen a huge increase in order volumes across the board. Ecommerce in general is up about 50% and specifically the use cases around curbside pickup and buy online pick up in store are really trending up. Wherever customers have the capacity to do that,having the flexibility in your ecommerce platform to support that is a big advantage. We’ve also heard a lot of customers like Watson’s where their sales associates are valuable assets and add a lot to the customer experience. Even helping with curbside pickup, we have customers who will assign a rep to go out and meet them at the door or deliver the goods at the door when the customer picks them up. There’s a lot you can do to still maintain that really high touch, high quality customer experience.

RN: The people that we have worked with that have seen success are ones that have some level of a clear plan and have made some investments already. You guys were in a very good position to shift quickly and not have to worry about a new platform standup right in the middle of a pandemic.

One other thing that I felt is you guys have a really good understanding of is who your customer is and who owns the customer. It’s a critical question that we typically ask a lot of people, “who owns the customers?” And it’s shocking how many people don’t have a clear, concise answer for this, or how often you’ll get multiple answers across multiple areas of the organization. It can vary based on the makeup and the organizational construct of your company. What we’ve seen is Covid really exposed some businesses for not having clear ownership of a customer or not having a clear digital strategy. Every company needs to be a digital business. It’s not just a website, it has to be more ingrained into your organization than that. We’ve seen people that were previously deprioritizing elements accelerate digital strategies because of that importance to the company.

CS: What we experienced was that consumers were willing to take more risk. Because of the fact that we did try as best as we could to prioritize that digital journey as early as we did, we were able to capitalize on the fact that customers were thrust into a world that they didn’t even know about. Loyalty, in some cases, began to wane as we saw new people that never engaged with our brand say, “I’m willing to do this. I’m willing to take a shot on a new business that I’ve never experienced a partnership with before.”

RN: The theme of what I heard was the ability to quickly adapt. Chris, if you could tell us a bit about ‘Pool School’ and not only what that means to your business, but how you were able to adapt in the situation?

CS: We have an annual event that has been a huge part of our business for years and there’s nothing like it in the country. If I tell you the name is ‘Pool School,’ it conjures up one image of what that might be. Imagine an entire retail store flipping to provide an experience that’s built around activating the pool season. We’re lucky to have customers that come back every single year to the seminars that take place over three days in each of our stores and engage with our sales staff. We have people that come in saying, “I want to see Frank, I need Frank because he helped me for 25 years.” It’s a lot of people coming through the door across all of our retail footprints and it’s an all-hands-on-deck event and never before had we executed it in a digital fashion because we had never had to.

In about two to three weeks, we pulled off an entire execution of taking ‘Pool School’ from an in-person event, to an entirely virtual four-day event that took place across all of our stores. We really leaned into the fact that it is the nation’s largest pool chemical and accessory sale. There was a lot of support from both sides, from the Gorilla team and Adobe and Magento, because we essentially launched an entire site to facilitate this experience and put together a media strategy that had not been used in that fashion before to drive this business.

At the end of the day, we were lucky enough across our stores, to do anywhere from 90% to 95% of what we would have done in the store from a revenue standpoint and facilitate that all digitally and in ways we never had to before. It was a huge experience and undertaking, but one that we got through taking it to the next level.

It helped bubble up opportunities and identify where we needed to refine some things to get to the next level and take it further. It helped us understand how the organization needed to adjust and adapt to be able to address these types of experiences even better in the future.

RN: How have you addressed this “staycation” trend of people not going anywhere and spending more time in their houses?

CS: We have seen the individual consumer looking to invest in their home. We decided to reactivate our campaign strategy that we set up for the year around our monthly promotions and how we were going to market with those. We took our messaging right back out to the consumer, with our summer sale and our parking lot sale, to communicate to them that your home is your castle. It’s the best time to invest in your home, in your family, and in what we believe are life’s best moments.

We adjusted messaging to continue in our digital marketing and otherwise to speak to the consumer’s need to feel at home and have that peace of mind in their space — getting that message adjusted and continuing to try to find ways to make digital the first point of conversation to get them excited. If we know the consumer is thinking about investing in the home more, how do we adjust our strategy to capitalize on that? What is the tone of the marketing? And what does a platform like Facebook need to look like today to play across the variety of things that are happening on social channels? We’re continuing to try to get our products to market quicker.

RN: John, could you touch on some things that you’ve seen with some of your other clients?

JS: Across many of our clients, the product mix has shifted quite a bit. People are focusing more on essentials, basics, and supplies, as opposed to discretionary things. We’ve seen a trend in our retail clients, colors and patterns, people picking brighter, sunnier, cheerier products over darker ones.

We also have heard a lot of customers have struggles with their supply chains. There are a lot of challenges with keeping those products in stock and making sure they can deliver. They are having to do a lot to adjust their search and merchandising mix on their websites to make sure that they were promoting products that not only people wanted, but they could get in stock and deliver.

RN: What we were all anticipating being 8-10 years out, in terms of adoption, has just accelerated. What Covid really did to a lot of organizations is just amplified that they need to maintain the relationship and trust when people can’t meet face to face and actually interact. The next step that we see for a lot of organizations is making sure that you’re able to continue to operate in digital once you’ve made these investments. If you build it and they come, how will you manage it is now the question. Organizational readiness has always been critical, but it’s even more critical in the short term as people adjust to this new world.

CS: We’ve had to take a close look at various divisions within our business and where there was ability to scale aspects of supporting growth. John was talking about volume of orders and average order value and for us, larger-ticket items selling online, when it was traditionally just pool and spa chemicals. That’s one we’re still working through. It’s a shift but it’s been about closely looking at divisions and where we can scale to use people and processes differently.

__________

Keep an eye out for part 2 of Working Toward Recovery in Retail. You can also check out the full virtual event.