Issue 60 - February 2018 THE RETAILER
Tailoring retail for consumers STRATEGIC SCOPE
CONTENTS Issue #60
Ask your customers to press CHQ or SAV toget cash out and avoidATMfees.
Features 14 WHY SMALL RETAILERS NEED TO BUILD A BRAND ONLINE AND OFFLINE The benefits of omni-channel retail in a post Amazon world 16 STRIKING A CHORD WITH CUSTOMERS THROUGH MUSIC New commercial music apps are creating memorable and effective in-store experiences for consumers, increasing dwell time and sales
22 PERSONALISE YOUR PURPOSE How to successfully personalise cross-selling strategies to grow revenue
REGULARS 04 From the Executive Director 06 Retail news from across Australia 10
STRATEGY 08 Relationships are complicated: but not in retail 12 Retail gets up-close and personal in 2018 26 An experience your customers won’t forget 30 Why an omni-channel experience is key for retail customers 38 Surviving and thriving amidst disruption 44 Shopping not shipping: the art and science of in-store retailing 48 Are you connected? 50 Four shopper stats that make website personalisation a must IN-STORE 20 Creating memorable experiences for travelling customers 32 The Supercheap Auto vision store 36 Driving delight through your brand’s experience
eftpos is a great way to give your customers added value with their everyday purchases. The more cash they get out from your store, the less cash you will have on the premises, helping to reduce the cost and risk of doing business.
NSW gift card regulation producing more harm than good
18 Employment relations overview 2018 28 Service: the common thread for retail success
The future of retail feat. chatbots
34 Getting back to the basics 40 From 2D to 3D: retailers embracing new technology 46 Maximising convenience for consumers
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Copyright Contents may not be reproduced in any form without permission from the Australian Retailers Association and then only with suitable acknowledgments. 2017 Australian Retailers Association ISSN: 183404720
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Grow your business with Commonwealth Bank’s finance options
FROM THE EXECUTIVE DIRECTOR W ith a new year comes new opportunities, and the Australian Retailers Association (ARA) are
Although the pre-Christmas period is a crucial time for retailers, post-Christmas trading is also one of the biggest trading periods for retailers with the ARA and Roy Morgan predicting a 2.9% increase in post-Christmas sales from December 26, 2017 to January 15, 2018. The ARA will be gathering the final figures around Christmas trade and will develop a Retail Debrief with key insights over this vital trading period. And finally, a quick update on our new website which launched earlier this year. This new and improved website is not only visually appealing, but perfectly optimised across all mobile devices, making it easy for all our members to access member benefits and resources, and the Retail Institute’s training and development courses on the go. Another great 2018 initiative is the digitisation of The Retailer. This quarterly magazine will now also be available as an interactive digital resource online for member convenience.
very excited for 2018 along with the potential relief it will bring the Australian retail industry. This year we will see many retailers focus their efforts on maximising the customer experience, both in-store and online, to create a holistic brand experience for the consumer. We will see retailers take customers on a shopping journey, creating a personalised shopping experience for the customer, regardless of the platform through which they choose to shop. This year’s first issue of The Retailer delves into how retailers can develop a consistent brand identity across all shopping platforms. We explore the benefits of in-store atmosphere, visual merchandising and artificial intelligence. We dig further into consumer experience online; enhancing customer convenience through seamless integration and business optimisation. With various retailers already incorporating some of these personalisation strategies during last year’s Christmas trade, this issue of The Retailer provides tangible examples of customer experience excellence. As we head into the new year, the ARA will start to analyse last year’s Christmas trade, as the ARA and Roy Morgan predicted Australians would spend $50 billion in the lead up to Christmas. We have since received positive feedback from our members, and are confident that the industry will reach close to this $50 billion figure.
THE AUSTRALIAN RETAILERS ASSOCIATION COUNCIL
President Roger Gillespie AM – Bakers Delight
National Councillors Robyn Batson – Sussan Group Graham Dear – Leading Edge Group Ralph Edwards – Bright Eyes Mhairi Holway – Pandora Jewellery Steve Plarre – Ferguson Plarre Bakehouses Mark Daynes – Jeanswest
Now, without further ado, I will let you enjoy this first edition of 2018, and wish you all a healthy trading year ahead. Best wishes,
The Commonwealth Bank offers Australian Retailers Association members flexible, competitive finance options for your business needs, including:
• Business Overdrafts – Provide coverage for seasonal or unexpected expenses with flexible lines of credit • Better Business loan – Fund your business growth with a loan that offers the flexibility of fixed or variable interest rates
• Market rate loan – Manage your cash flow and take advantage of current interest rates, with flexible finance linked to transparent market rates • Business line of credit – Ensure funds are always available to finance your business expansion or investment
Anthony Wilson – Wilson Retail Rowan Hodge – Battery World Toby Darvall – Ishka Andrew Ng – Lagardère Travel Retail
Russell Zimmerman Executive Director Australian Retailers Association
Commonwealth Bank has a range of finance options to suit your needs and help keep your business moving.
To find out how the Commonwealth Bank can help your business, contact ARA on 1300 368 041 today.
Important Information: Full conditions of use will be included in our Letter of Offer. Applications for finance are subject to credit approval and the suitability of the asset. Commonwealth Bank of Australia reserves the right to require finance arrangements to be made with any Commonwealth Bank of Australia subsidiary. Bank fees and government charges may apply. Australian Retailers Association may receive a fee from the Commonwealth Bank of Australia for each successful referral. Referral Fees are not payable on referrals from existing relationship managed Commonwealth Bank customers. This has been prepared without considering your objectives, financial situation or needs, so you should consider its appropriateness to your circumstances before you act on it. Commonwealth Bank of Australia ABN 48 123 123 124, AFSL and Australian credit licence 234945.
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RETAIL NEWS FROM ACROSS AUSTRALIA NEW ELECTRONIC SHOPPING CART FOR BUSINESSES AND CONSUMERS
REGULARS | NEWS
2018 TREND PREDICTIONS FOR RETAILERS A successful Christmas season has set retailers on a strong foot for 2018. Azoya predicts the top trends for Australian retailers and what we can expect in-store this year. The first is that online marketplaces will continue to disrupt the retail market in 2018, as another sales channel for retailers and brands to reach a broader, global audience. Therefore, it’s important for retailers to explore the current major marketplaces that exist. Retailers this year will be using data to drive customer experience. Success is no longer about offering the cheapest price as consumers also want value for money. Their evolving expectations will push retailers to redefine fulfillment. This year, customers will become more attracted to cross-border e-commerce. Technology innovation and efficient logistics will ease the path for e-commerce solutions this year. This continues to drive a flood of international entrants into the local market, as well as entice local retailers to expand their customer base across borders. Omni-channel strategies will remain important for retailers, as rising costs have forced online brands to search for new opportunities like pop-up shops. But make no mistake, bricks-and-mortar retailers will continue to expand their online operations this year to meet consumer demand. ABOUT AZOYA Azoya is a turnkey e-commerce solutions provider, which endeavors to help overseas retailers break into China via cross-border e-commerce. With its all-encompassing services and dedicated specialist team, the company has won trust from more than 35 overseas retailers in 11 countries. For more details, visit azoyagroup.com
T he recent market correction has put more pressure on e-commerce sites to be even more profitable. It is vital for retailers to implement the correct technology to help adapt to the changing retail environment. The DS Smart Cart is a portable check out station that allows users to scan and weigh items as they shop, calculating total costs, and optimising their shopping experience. DS Smart Carts use a variety of features to make shopping simpler and more efficient. Aside from being a portable check-out station with included scanners and scales, it also is equipped with monitors that can connect to the store’s inventory as well. Retailers can search stock availability, the location, and view sales as well as advertised specials on the cart’s monitor. The DS Smart Cart also has an interface that accepts multiple payment options, eliminating checkout lines for the customer and any further complications for the retailer. On screen, retailers have the ability to display and advertise coupons, specials and sales directly to customers whilst they shop. Technology is revolutionising the way the world shops and how businesses operate. Consumers can now save time while they shop and retailers can see increased profits and watch their business grow. ABOUT DS SMART CARTS DS Smart Carts are electronic shopping carts equipped with several scanners and scales. These electronic carts allow the customer to ring up items as they are placed in the cart and track the grand total. For retailers they can use the Smart Cart for inventory management, as well as a platform for advertising promotions and specials. Learn more at dssmartcart.com
COURIER PROVIDING ‘POST AND PICK UP’ IN MAJOR SHOPPING CENTRES.
AUD TRANSFERS FOR AUSSIE AMAZON SELLERS G lobal digital payout provider Hyperwallet, is supporting international seller disbursements from Amazon’s new Australia-based marketplace. Their multi-currency payout solution enables Amazon Marketplace sellers from across the globe to quickly and easily accept payments to their bank account across a wide range of local currencies. Hyperwallet is offering sellers the ability to login with Amazon on its website to register for their self-serve payment portal, providing a simplified on-boarding process for global sellers. It then provides and ensures fast, convenient payment to sellers' local bank accounts through its global network of banking relationships. Amazon has long been recognised as a pioneer in the world of e-commerce usability, and Hyperwallet finds their passion in working towards that same frictionless experience to the supply side of marketplace transactions, streamlining the on-boarding and disbursement process for independent sellers. Brent Warrington, Hyperwallet’s CEO said, “Supporting international payments for Amazon sellers is just another way that we can help improve payouts to the international freelance community.” ABOUT HYPERWALLET Hyperwallet’s payout platform provides growing organisations with a frictionless, transparent and reliable way to manage payments and enhance the payee’s experience almost anywhere in the world. Trusted by enterprise, e-commerce and on-demand platforms, Hyperwallet makes it easy to pay up to 7 billion people in a singular payment environment. Learn more at hyperwallet.com
A ustralian online shoppers now can pick up and return their online shopping purchases in 31 major shopping centres across Australia, with a partnership between CouriersPlease (CP), Westfield, and Stockland shopping centres. The service works by allowing online shoppers to redirect their parcel delivery to a shopping centre parcel locker (called a POPStation) during the goods transit process, if they will not be home to sign for it. After ordering through a selected CP-partnered online retailer, shoppers will receive an email or SMS notification when their goods are on their way, giving them the option to activate the redirection. POPStations can also be used to send parcels, after consumers book and pay for their delivery online through the CP website. During the past Christmas season, customers found the efficiency of purchasing gifts and sending them off in the one place a huge convenience. Market research has shown 48% of shoppers collect parcels from flexible delivery locations because they are not home to receive the parcel, and 29% choose delivery collection points for convenience. As customers and retailers alike are migrating online to meet the growing demand for convenience and choice, consumers can now combine their enjoyment of online shopping with the bricks-and-mortar retail experience. ABOUT COURIERSPLEASE CouriersPlease (CP) is a courier and freight service that offers a network of POPStation (Pick/Post your Own Parcel) lockers, comprising more than 3,500 lockers in 50 locations. With more than 600 POPShop retail outlets, CP enables consumers and businesses to pick up or post their parcels more securely and out of hours. Learn more at couriersplease.com.au
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REGULARS | POLICY
STRATEGY | PERSONALISATION
RELATIONSHIPS ARE COMPLICATED: BUT NOT IN RETAIL With a myriad of personalisation tools available, retailers need to ensure they’re delivering an individual experience, rather than coming across like ‘big brother’.
BY ROD MOYNIHAN [ZENDESK ANZ]
ersonalisation continues to be the buzzword of the customer service world as Australian retailers hunt for ways to use current and new technologies to build customer loyalty and win trust - in order to stand strong against the influx of new competitors that are entering the market. For customers, personalisation at its core means being seen as an individual. And doing this in an omni-channel environment is made even harder in the faceless digital world - but more important than ever before. Surprisingly, a poll taken during the Shop.org Digital Summit global conference in 2017 revealed that nearly half of marketers (49%) described their marketing efforts as ‘one-size-fits-all’. Increasingly, customers expect personalisation whenever they shop. They have been given a taste for personalisation and now there is no going back. They are not interested in blanket marketing spam, and you will no longer get away with it. However, there is a fine line to tread between ‘delighting a customer’ and being intrusive. Like an in-store shop assistant that won’t leave you alone. Here are three ways to get personalisation right the first time: 1. CONTEXT IS EVERYTHING Retailers are falling short on personalisation because they can’t put the data they have collected into context. The key is to send fewer, more targeted messages rather than taking every opportunity to engage. Zendesk helps retailers such as Cotton On, Tony Bianco and Forever New to achieve this by enabling them to personalise their interactions. For example, Zendesk’s Outbound solution helps companies send messages based on the actions a customer has taken on their website or app, such as adding something to their cart or making a purchase. The retailer can then use the properties of those interactions to further personalise the messages they send. This means that if a customer purchases a Google Pixel phone, you could send them an in-web push message about accessories they might be interested in or tips and tricks to make the most of their new phone. P
The goal of personalisation is to interact with your customers in a meaningful way based on their behaviour. Before you send another pop-up, ask yourself why. If you can’t provide solid contextual justification that you think will benefit your bottom line, hold off. 2. DON’T PLACE PERSONALISATION IN A SILO Personalisation should be fully integrated into your customer service technology. Ultimately what you should have is a profile of every customer, in one place. For example, if a customer signs up for something new, you should reach out to them to demonstrate how to get the most out of that service or product. If they then encounter a problemwith what you recommend and contact you for help, but your help centre isn’t aware of what’s transpired, you’ve already done more harm than good. Personalisation must be part of a single view of the customer. 3. CONSISTENCY IS KEY Once you’ve introduced personalisation tools that you know are hitting the mark, it’s important to maintain consistency. For example, if you use a customer’s name on an email and when they come to your website the page isn’t tailored to their profile or buying behaviour, they will know straight away the relationship isn’t genuine. It’s crucial that any personalisation tools are captured in a centralised contact history and applied across devices and touchpoints to create a truly integrated experience. For many retailers, personalisation is a moving target. It’s hard to get right and involves some level of trial and error to find what works for your brand and your customers. By following these basic rules you will be in the best position to create truly meaningful customer relationships that will move the loyalty needle.
Started online, purchased in-store, AND WAS AMAZING THE WHOLE WAY
CREATE A SEAMLESS CUSTOMER JOURNEY WITH A SINGLE COMMERCE PLATFROM.
Deliver innovative brand experiences with a unified commerce platform – SuiteCommerce. SuiteCommerce unifies point-of-sale, call centre, ecommerce, inventory and order management to create a seamless commerce experience. With one unified system, you will empower your sales associates, exceed customer expectations and inspire loyalty.
Rod Moynihan is the director of sales at Zendesk ANZ, with more than 20 years of experience in sales, retail and technology. Zendesk builds software for better customer relationships. It empowers organisations to improve customer engagement and better understand their customers. Learn more at zendesk.com
1800 638 784 | infoAPAC@netsuite.com
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FEBRUARY 2018 | RETAILER 9
REGULARS | POLICY
NSW GIFT CARD REGULATION PRODUCING MORE HARM THAN GOOD Another case of the Government creating non-existent issues, costing both retailers and consumers in the long run.
BY HEATH MICHAEL [ARA] M oves to regulate the sale of gift cards have been excessive in New South Wales (NSW), with the Government regulating a popular product for retailers which had no serious issues. In October last year, the NSWGovernment introduced a three-year minimum expiry limit for gift cards issued in NSW. There has been some suggestion that if an attempt was made to fine an issuing business in another state (particularly one that was not aware of the new legislation), there would be a basis to legally challenge the legislation. On behalf of our members, the Australian Retailers Association (ARA) have suggested the obligation be removed for interstate businesses issuing gift cards, as this obligation would be inoperable. If not, this raises the possibility of jurisdictional issues and Constitutional challenges based on restricting trade and commerce between States. Interestingly, while proposals to regulate gift cards have been around for some time at State and Federal levels, the Government has ultimately decided to regulate this low-cost scheme which will not only provide little benefit to consumers, it will increase non-redemption, breakage rates and the retailer’s financial liability. Therefore, we are confused as to why the NSW Government have gone down this path. This is a
similar misstep to when the same Government imposed lock out laws, greyhound racing bans and introduced a badly crafted container deposit scheme. In the case of gift cards, we clearly have an ambitious Fair-Trading Minister who thinks
Forcing retailers to notify consumers of
Fair Trading has proposed this raft of changes, so soon after the legislation was initially passed, because as it stands, it clearly would not work. Certain exclusions for specific gift card categories (such as cinema vouchers), a meagre six-month transition period, and forcing retailers to notify consumers of the changes during the short transition period is not only confusing for retailers and consumers but extremely impractical. Although these regulations are frowned upon across the industry, we are grateful we were able to successfully reject the original proposal - which included no expiry date - which would have seen retailers carrying the financial liability forever. The ARA maintains the overall view that best practice for regulating gift card sales in NSW is to abandon this complex and unnecessary legislation and to implement an industry-backed Code of Conduct. The ARA sees regulation as a serious impediment and additional cost to small and medium retailers issuing gift cards with
major retailers, potentially incurring significant red tape costs and having no choice but to pass these on to the consumer. There is a worrying trend amongst Governments to increase red-tape and regulation to keep every minority stakeholder happy. The Government needs to realise that endless regulations ultimately costs both retailers and consumers; who are both key stakeholders at the fast- approaching State election.
the changes during the short transition period is not only confusing for retailers and consumers but extremely impractical.
keeping consumer rights advocates happy will win votes for a traditionally conservative, pro- business political party. The ARA, on behalf of the NSW Business Chamber (NSWBC), Australian Sporting Goods Association (ASGA), Franchise Council of Australia (FCA), Pharmacy Guild of Australia (PGA), and Restaurant and Catering Australia (RCA), all disapproved of the proposed reforms to NSW gift cards, as previous Federal Government inquiries into the operation of gift cards have found no associated consumer benefit to altering the regulations. The ARA have gathered substantial evidence from previous consultations on this issue, which indicated the breakage rate was a remarkably low 3%. A key driver for gift card redemption is the
12-month expiry period, as shorter redemption periods drive consumers to use their gift cards in the first fewmonths of issue. This evidence suggests longer redemption dates may cause consumers to forget about cards, which increases breakage rates. The ARA have recently made a submission to NSW Fair Trading’s (Fair Trading) consultation on amendments to the recently passed legislation for gift cards, suggesting further changes and exemptions. As ARA members still hold a significant amount of gift cards in stock, whose terms and conditions will soon be rendered outdated, the ARA are concerned retailers will have very little time to sell these products before 31 March this year.
This early implementation date means Fair Trading’s changes will need to be rushed through Parliament in February - just three months after the legislation was passed, and weeks before it commences - leaving very little time or detail on how it will work for retailers. With the implementation date fast-approaching, the ARA are concerned the six-month transition period will not allow retailers enough time to offload non-compliant stock, and will be pushing for a more reasonable 12-month transition period.
The ARA works to ensure retail success by informing, protecting, advocating, educating and saving money for its 7,500 independent and national retail members, which represent in excess of 50,000 shop fronts throughout Australia. Learn more at retail.org.au
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RETAIL GETS UP-CLOSE AND PERSONAL IN 2018 Leveraging customer information to deliver the ultimate personalised shopping experience delivers online retail success.
BY CHRIS STOLKE [PRONTO WOVEN]
S ome of the monumental technology shifts that have occurred in online retail over the last few years will continue to be highly influential in 2018. Early adopters are already benefitting from their investments in the areas of marketing and sales automation, customer journey mapping, integrated systems such as Enterprise Resource Planning (ERP), big data and machine learning. The challenge now is the gap between technology and personalisation. Closing this gap will help retailers of any size build a strong competitive advantage. FOLLOW THE DATA TRAIL FOR INSIGHT The channels consumers use, such as social, web and mobile furnish retailers with massive amounts of data about their customers. When that data is overlaid with the demographic and psychographic information, deep connections can be made about the cause and effect of buyer behaviours. The key question retailers need to keep top of mind is: How can this data become foresight that helps engage the right customers, with the right product, at the right time?
MAKE IT PERSONAL TO SEAL THE DEAL Fuelled by these actionable insights,
Software for marketing and sales automation, fully integrated ERP for operations, supply chain and CRM, supported by sophisticated business intelligence is helping retailers do just that. Powerful and tightly integrated solutions enable retailers to engage more directly and then draw insights from each interaction with the uber- informed, online customer. These tools also enable an omni-channel approach, helping to gather and consolidate information from a myriad of sales channels (physical and
generation and sales as these targets are already highly engaged (or sales ready) and therefore
Chris Stolke is the Manager and Head Digital Strategist at Pronto Woven, a unique one stop digital marketing solution provider for everything including integrated e-commerce solutions. Chris is passionate about guiding businesses of all sizes towards a sensible and innovative approach in terms of managing their Digital Strategy. Learn more at woven.com.au
personalisation is expected to reach the next level of sophistication through the use of deep learning technologies. The creation of predictive models about customer preferences, habits and behaviour is something that would not have been available using traditional methods of market research. It unlocks enormous value in personalising customer journeys across all retail sales channels. With data and the right integrated tools, successful retailers are creating a
more likely to be interested in the information the retailer shares.
Seamless integration between platforms is allowing retailers to build a more holistic picture of their target markets and create a deep understanding of why customers buy and what they buy. +
Fully integrated systems also enhance operations in traditional bricks-and-mortar sales channels. When a consumer is shopping in-store, they may make use of complimentary Wi-Fi, which can identify them as a regular customer and tie their presence in the shop together with interactions they may have had on other channels such as social and offer them relevant promotions. The next 12 months will be a period of consolidation, as retailers learn how to capitalise on innovative solutions and the new growth opportunities they enable. Powerful technologies such as CRM, marketing automation, integrated ERP and BI solutions will help retailers get up-close and personal with their consumers so that they can gain a sustainable competitive advantage.
conversation with a retailer’s bot who will ‘know’ their entire sales history, location and buying preferences, right down to their taste in colours, favourite brands and size. This is something even the most well-trained or experienced retail assistant would struggle to achieve. The bot can then present the customer with relevant items, helping them find the best options quickly – and then complete the purchasing transaction with the customer. Another avenue is social selling or the use of social networks to locate, connect, understand and nurture sales opportunities. By doing so, sales and customer service teams can supply offers and promotions that are incredibly personalised to reflect the customer’s specific needs. As a result, this can accelerate both lead
virtual) used by consumers. This seamless integration between platforms is allowing retailers to build a more holistic picture of their target markets and create a deep understanding of why customers buy and what they buy. This understanding is then ready to be funnelled into sales forecasts, product design, marketing messages and personalised communications to further fuel your business growth.
completely new standard of customer engagement. They go the extra mile to personalise interactions, they make a customer feel valued and they generate positive associations with the brand. One such experience is a personal shopper bot with a conversational user interface (CUI). A customer can have a
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FEATURE | OMNI-CHANNEL
WHY SMALL RETAILERS NEED TO BUILD A BRAND ONLINE AND OFFLINE
The retail landscape shift is a big
opportunity for smaller retailers to set themselves apart in 2018.
The benefits of omni-channel retail in a post Amazon world.
BY BEN PFISTERER [SQUARE AUSTRALIA] T There is no doubt that Australia’s retail landscape has changed dramatically over the past decade with the continued rise of e-commerce. Now, we have large retailers dominating the online retail market, shipping instantly and worldwide, which has in turn triggered some cause for concern among smaller sellers who are trying to shift their focus to play catch-up in the online world.
strips, then when large coffee chains scaled up to compete with small cafés. Although there is an immediate impact to the market and a great deal of consolidation, smaller businesses can not only survive - they can thrive. Australia has more than two million small and medium-sized enterprises (SME)s, and it is unfeasible that they should all be able to compete with the online retail giants on price or speed of delivery, but they don’t need to. The retail landscape shift is a big opportunity for smaller retailers to set themselves apart in 2018. Instead of focussing on one channel, retailers should be focussing on an omni-channel approach to selling. Multiple sales channels used to be the domain of larger corporate businesses with big budgets but the rise in do-it-yourself technologies and affordable business platforms means that now everyone, big and small, has the opportunity to meet their customers everywhere they want to shop. NEW INCOME STREAMS Omni-channel retailing allows you to create new revenue streams by providing your customers more flexibility in where and how they can shop. Small retailers can easily save time and make more money by adopting digital business tools to help them accept payments in person, online or even over the phone.
ONE SYSTEM Using one integrated payments system, like Square, for a physical and an online store has many benefits. It allows you to ensure all business and customer data is stored securely in one place. It also provides you with a full overview on how your business is reporting in every location, allowing you to track sales, employees and other data easily. CUSTOMER INSIGHTS Selling from a desktop computer, a mobile device, a telephone or in person also creates multiple channels of communication for your business. These channels all offer different avenues of information that you can use to gain better insights into your customers’ purchasing habits. This can help you better manage your inventory, refine how you communicate with them and improve your overall customer experience. BRAND AWARENESS While having multiple sales channels may seem like a no brainer for lifting revenue, it’s important to ensure your brand remains cohesive across platforms. Your bricks-and-mortar store, website and social media platforms should integrate and have a consistent overall brand identity to help your customers better identify you online and in the physical world.
CUSTOMISATION IS KING Remember face-to-face interaction and
relationship building with customers is a major advantage that smaller retailers have over their larger counterparts. Buyers still value unique, handmade, high-quality and highly personalised products so don’t disregard the tried and true methods that have been working among bricks- and-mortar traders for decades. We have come a long way since the start of the internet revolution but you don’t have to choose to be online at the expense of all else. Technology has advanced in your favour. There are now more business platforms than ever to help you run social media, build a website and manage income through cloud-based payments software. This means that your business can be in multiple places at once, so take advantage of that, and the best part is you can nowmanage it all from one device. Ben Pfisterer is Square’s Country Manager for Australia. Square creates tools that help sellers of all sizes start, run and grow their businesses. Square’s free point of sale service offers tools for every part of running a business, from accepting card payments with Square Reader to online invoicing, inventory management, real-time analytics, employee management and powerful reporting. Learn more at square.com.au
Australian consumer stats are also backing this trend; in 2017 more than 79% of us said we preferred online shopping, which is no surprise given that 87% of Australians access the internet daily and spend an average of 10 hours on an internet-connected device. And in many ways, the shift makes sense. After all, online retail platforms give customers what they want - variety, low prices and fast delivery. While our retail industry is rapidly changing, it is not necessarily a bad thing. We’ve seen it before when shopping malls emerged to challenge retail
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FEATURE | IN-STORE
FEATURE | IN-STORE
in the right way. Retailers playing a Spotify playlist are inadvertently using Spotify illegally, not realising the platform is a non-commercial service. To ensure you’re providing brand fit music to consumers, retailers need to partner with a provider that can help manage in-store music, legally. Partnering with the likes of Marking Melodies provides retail stores with access to the world's largest music library specifically designed for commercial use. Recent research published in The Impact of Music in Restaurants, analysed 1.8 million transactions and 2,101 customer surveys. The results were illuminating. Stores playing brand fit music experienced a general sales increase of 6% across all product categories. Stores that played music with no brand fit – that is, a random selection of tunes – actually experienced a drop in sales of just over 4%. Services like Soundtrack Your Brand, which is backed by Spotify and available in Australia exclusively through Marketing Melodies, offers retailers the perfect, brand fit music environments designed to encourage customer dwell time and increase spending. With the right soundtrack, retail stores can become cohesive environments, creating places customers want to visit, want to return to and want to spend their money in. Brand fit music can become a key part of an organisation’s identity, rounding out the picture they present to consumers and to the world at large. With new offerings such as Soundtrack Your Brand, music is no longer an afterthought, or something that is bland and fades into the background. Music is part of an integral retail experience, just as it is in the other parts of a consumer’s life.
With over 25 years experience, Dean Cherny is regarded as one of Australia’s most accomplished DJs and a stalwart of the music and fashion industries. As the creator and managing director of Marketing Melodies, Dean is currently working with over 4,600 retail stores including Witchery, The Just Group, Grill’d, Kathmandu and Optus. Learn more at marketingmelodies.com.au
Stores playing brand fit music experienced a general sales increase of 6% across all product categories.
R etail environments are designed to appeal to our senses. The touch of beautiful fabrics and fit-outs, the aromas in the air and the sight of wonderful design and attention to detail are all carefully planned to create an engaging retail environment for consumers. However, many retailers often overlook one of the most powerful of our key senses – sound. Of all our senses, sound and our response to music is one of the strongest. Music stirs memories, creates moods, it can raise or lower our energy levels, and the songs we love become the soundtrack to our lives. A designed environment should therefore take the music played within it into careful consideration. The problem is that background music has become a byword for boring, bland and insipid; it’s often something we’re forced to listen to, not something we actively want to hear. The music played in-store is an extension of your brand and songs should be selected accordingly - your playlist should not be your personal top 100. Data from the world’s largest study of background music indicated a sales increase of 9.1%where in-store music was curated to reflect the brand values, compared with playing randomly selected popular songs. Having a highly bespoke and targeted playlist for your brand allows you to play music that ‘feels’ like the brand, and because that sound is unique to the specific commercial environment, it creates a more memorable and effective in-store experience, increasing dwell time and positively impacting on sales outcomes as well as helping to build a stronger and longer-lasting relationship with customers. Importantly, ‘brand fit’ music stands in strong contrast to ‘customer-fit’ music, which is music that matches the tastes and interests of the customer coming into a retail environment. Marketing Melodies assists retailers, including The Just Group, Grill’d, Optus and Witchery, in creating brand fit music playlists within their stores, to match the brand’s personality. There is a new world of digital music and mobile apps, providing retailers with the ability to play music in-store and empowering retailers to do so
STRIKING A CHORD WITH CUSTOMERS THROUGH MUSIC New commercial music apps are creating memorable and effective in-store experiences for consumers, increasing dwell time and sales.
BY DEAN CHERNY [MARKETING MELODIES]
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REGULARS | EMPLOYMENT RELATIONS
REGULARS | EMPLOYMENT RELATIONS
EMPLOYMENT RELATIONS OVERVIEW 2018 What’s in store for retailers this year?
For more information regarding what's in store for retailers this year please contact the ARA Employment Relations team on 1300 368 041
ARA will alert members once a date has been determined.
The Fair Work Ombudsman’s annual report revealed that they conducted 4,558 audits of businesses in the 2016/2017 year and there’s no signs of them slowing down. TOP TIPS TO REMAIN COMPLAINT The start of the year is a great time to review your existing practices and ensure you are meeting your employment obligations so as to not leave you and your business exposed to significant penalties. Here are our top tips for ensuring compliance into 2018: • Understand Award entitlements
BY NICK TINDLEY [FCB]
W ith some major changes introduced by the Fair Work Commission (FWC) in 2017 affecting casual work arrangements across the Australian workforce, along with the increased powers of the Fair Work Ombudsman it is time to prepare for another big year in the in the retail industry. This month’s Employment Relations section of The Retailer will look at some of the key areas retailers should be aware of in 2018. CASUAL EMPLOYEES NOW ENTITLED TO OVERTIME While this shouldn’t be news to you now, ARA members are reminded that at the end of last year the FWC varied a number of awards to include the entitlement of overtime rates for casual employees. Until January 2018 overtime rates have only applied to full-time and part-time employees under a number of Awards including the General Retail Industry Award . However, the entitlement to overtime was extended to casual employees as of the first full pay cycle after 1st January 2018. While you have no doubt already applied the increases, below is a summary of when overtime is payable to casuals. GENERAL RETAIL INDUSTRY AWARD Overtime is payable when casual employees have worked: • In excess of 38 ordinary hours per week (can be averaged across roster period);
PENALTY RATES CONTINUE TO DECREASE
Saturday 7.00 am–6.00 pm Sunday 9.00 am–6.00 pm
The ARA would like to remind members that penalty rates for work performed on a Sunday will continue to decrease. On the 1st of July 2017 the rate decreased for the first time to a 95% loading. From 1 July 2018 the penalty rate will reduce to 80% for permanent staff and 85% loading for casual employees. Prior to 1 July 2018 the ARA will notify members when new pay guides with reduced penalty rates have been uploaded to the ERMS, which will also include the annual wage increases.
In excess of 9 hours per day (except for one day per week which may be 11 hours).
It should be noted for retailers with extended trading hours the ordinary spread of hours is increased to 11.00pm. RESTAURANT INDUSTRY AWARD & HOSPITALITY INDUSTRY AWARD Overtime is payable when casual employees have worked: • In excess of 38 ordinary hours per week (can be averaged across roster period) FAST FOOD INDUSTRY AWARD Overtime is payable when casual employees have worked: • In excess of 11 hours per day ARA members are encouraged to call the Employment Relations team should they have questions about how this applies to their business. CASUAL CONVERSION UPDATE In addition to the casual overtime decision, as part of the four-yearly Modern Award review process the FWC made a decision to insert model casual conversion clauses into a number of Modern Awards. In excess of 38 ordinary hours per week (can be averaged across roster period) • • In excess of 12 hours per day
including what allowances, penalties and overtime penalties apply and when; Regularly review wages and salaries to ensure you are meeting your obligations under the applicable Award. This is particularly important where roles or roster patterns have changed; Know your obligations when it comes to record-keeping and pay slips; Ensure business practices, such as rostering are compliant with conditions of the relevant Award; and Get advice! Australia’s workplace relations system is complex and as an employer you are faced with a number of ongoing obligations that can be challenging to keep up with.
The effect of the model clause includes: • Employers must provide casual
employees with written notice of their casual conversion rights within 12 months of their commencement of employment; Casual employees, other than an irregular casual employee, have the right to elect to convert to part-time or full-time employment after 12 months of service; and An employer must consider any such request and can only refuse a request upon reasonable business grounds.
PENALTIES FOR SERIOUS
CONTRAVENTIONS With the introduction of the Fair Work
of hours on an ongoing basis which could continue to be worked in a permanent role without significant adjustment. Employers may also refuse the conversion on reasonable business grounds including where the employee’s hours of work will significantly change in the following 12 months. Although the model clause has been drafted, it has not yet come into effect. We anticipate it will be introduced within the coming months and the
The continued dedication of the Fair Work Ombudsman to ensuring compliance, means employers in the retail industry need to be at the top of their game when it comes to employment relations now and in the future. Members are reminded they have unlimited access to the ARA Employment Relations line and are encouraged to phone the team should they have any questions.
Amendment Protecting Vulnerable Workers Act last year, came increased penalties for serious contraventions of workplace laws. Although the focus of the Amendment is on employers who have deliberately and systematically chosen to be non-compliant, it is a timely reminder for ARA members to ensure they are familiar with current workplace laws and meeting employment obligations.
While this decision has the potential to have significant impact on businesses, the feedback received thus far is that in many cases casual employee elect casual employment due to the higher remuneration and flexibility. The key point to remember is that the casual employee must have worked a regular pattern
Outside of the ordinary spread of hours as specified in 27.2 of the Award: Monday to Friday (inclusive) 7.00 am–9.00 pm
18 RETAILER | FEBRUARY 2018
FEBRUARY 2018 | RETAILER 19
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IN-STORE | TARGET MARKET
CREATING MEMORABLE EXPERIENCES FOR TRAVELLING CUSTOMERS With a pre-existing business model, airpor ts have to be creative to stand out from one another and ensure they’re remembered long after their customers take off.
BY ANDREW GARDINER [MELBOURNE AIRPORT] W ith a pre-existing business model, airports have to be creative to stand out from one another and ensure they’re remembered long after their customers take off. Capturing the imagination of shoppers can be challenging at any time, even more so for airports where customers are simultaneously dealing with flight times, check-in, gate information, luggage and the behaviour and wellbeing of their travelling companions. Retail precincts within airports are conquering this challenge through a combination of architecture, access to unique dining and brand experiences by creating an environment that showcases the best elements of their home towns. The result is transforming airport retail from a necessary evil into a memorable and lasting impression of the travelling experience. Melbourne is widely known as the world’s most liveable city and as such Melbourne Airport is making a concerted effort to bring the city to life at the airport. This is evident in the airport’s recent T2 Luxury Precinct upgrade, which combines a number of key elements that Melbourne is renowned for including a culturally diverse mix of dining options, street art, magnificent architecture and of course, shopping. As soon as travellers step into the elegant luxury precinct they are treated to the same calibre of designers that can be found towards the Paris end of Collins street. After spending time shopping the latest trends in an environment that resembles Melbourne’s grand shopping arcades, travellers’ transition through to the dining precinct that features cafés and restaurants with some of Australia’s most iconic chefs and dining brands including Shannon Bennett’s Café Vue, Frank Camorra’s Bar Pulpo by MoVida and the Angele brother’s Brunetti café. Airports are often either the first or last touch point in a traveller’s journey, which is why it’s so important to deliver an experience that, strengthens a customer’s connection to a city. Almost 100,000 people fly through Melbourne Airport each day, and by 2033 this airport is forecasted to service more than 60 million travellers overall per year. In order to fulfil the needs of all travellers the retail offering must cater to a range of markets, from the Australian domestic holidaymaker and the business traveller, to the international traveller visiting family and friends.
Customers should be at the forefront of every choice and the T2 Luxury Precinct upgrade had their consumer’s interests front of mind. With two and a half years of extensive passenger research, Melbourne Airport was able to identify key consumer desires to incorporate in the upgrade process. In retail there are consistent elements that are vital to success and they include experience, entertainment and customer enjoyment. Bricks-and- mortar retailers need to ask themselves what is going to attract the right customer and keep them interested. In my experience, I’ve found that uniqueness is key. Retailers should be asking the questions; What can we deliver that is new? What can we deliver that is exciting and unique? Retailers must understand customers will buy products that resonate with them. Therefore if you can develop and execute a plan that’s unique, you’ll keep customers coming back. Andrew Gardiner, a retail industry expert with over 35 years’ retail experience in Australia and abroad. Andrew has spent 10 years in the travel retail business, as Managing Director at DFS Galleria Australia, General Manager of Retail at Sydney Airport and now Chief of Retail and Chief of Launceston Airport at Australian Pacific Airports Corporation. Learn more at melbourneairport.com.au
Roster, manage leave, simplify payroll Easy Workplace Award compliance Offer for R&CA members: Free trial Free setup
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