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Press release content from PR Newswire. The AP news staff was not involved in its creation.

Retail CEOs Speak: Seven Imperatives for the Retail Industry

March 10, 2021 GMT
(PRNewsfoto/Retail Industry Leaders Associa)
(PRNewsfoto/Retail Industry Leaders Associa)
(PRNewsfoto/Retail Industry Leaders Associa)

WASHINGTON, March 10, 2021 /PRNewswire/ -- The retail industry revamped to meet the new demands of consumers brought on by COVID-19. New research released today by the Retail Industry Leaders Association (RILA), with support from its knowledge partner McKinsey & Company, offers in-depth insights shaped by leading retail CEOs into the imperatives that will be critical to retail success moving forward.

“Every retailer, to some degree, has long had a sense of what the future of retail could look like… But the future came early,” the report states.

“While the fundamentals are largely unchanged, customers’ expectations are now exponentially higher and retailers are rising to the challenge,” said RILA President Brian Dodge. “Leading retailers are embracing the opportunity to win new customers by leveraging lessons learned from the past year and investing in strategies to serve customers well wherever and whenever they shop.”

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Retail Speaks: Seven Imperatives for the Retail Industry was developed with the support of McKinsey & Company as a knowledge partner and identifies seven imperatives for rethinking retail.

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In reference to the changing retail landscape, Sajal Kohli, a Senior Partner at McKinsey & Company, and head of McKinsey’s Global Retail and Consumer Packaged Goods practices said, “the arrival of COVID 19 in March 2020, which shut down retailers across the country and forced consumers to change buying behaviors, rapidly accelerated the trajectory of retail evolution, leading to more transformation in a year than has been seen in the industry in the last few decades.”

The report is the result of a benchmarking survey conducted with executives (such as CFOs, chief marketing officers, chief digital officers, and chief supply chain officers) from 30 U.S. companies, augmented by in-depth interviews with top retail CEOs, as well as proprietary McKinsey & Company customer research.

Access the full report here.

Key Stats:

  • Post-COVID-19 e-commerce penetration is expected to significantly increase to 25–40% across categories.
  • E-commerce volumes grew as much in the first quarter of 2020 as they did in the previous 10 years.
  • Leading retailers plan to increase hiring for e-commerce/data roles by 70 percent through 2022
  • More than 75% of specialty retail supply chain leaders have made two-day delivery a priority, and 42% hope to offer same-day delivery by 2022.
  • 80% of retailers plan to concentrate their 2022 supply chain spending on addressing e-commerce fulfillment.
  • 80% of retailers believe company actions matter to consumers, and 64% believe those actions affect purchase decisions.
  • 6 of the 7 global companies with the highest market caps participate in ecosystems.

CEO Quotes from the report:

“For us, some e-commerce priorities that were previously five years out are now more of a three-year horizon. We need to more quickly understand how to satisfy that consumer and accelerate our timelines accordingly.” —Todd Vasos, CEO, Dollar General

“Both experiences and fulfillment are important uses for brick-and-mortar stores. We will continue to evolve the role of the store on our continued omnichannel strategy evolution.” —Mary Dillon, CEO, Ulta Beauty

“Our digital platform is the front door of our store. Customers are taking us down that path—purchasing online and using online platforms as the start of the shopping experience, even if it ends in the physical world.” —Craig Menear, CEO at The Home Depot

“Being a purpose-led brand always starts with the ‘why’ behind what we are doing. People will not only buy from but also buy into brands that stand up for their values.” — Javier Quiñones, President and CSO, IKEA US

“Corporate social responsibility covers a huge range of business activities and has now come of age. Companies now really do walk the walk in their commitment to the communities they serve, the environment, and their people; and take steps to monitor and evaluate their performance and achievements in those areas. This is now a function that is at the heart of every business.” —Alex Gourlay, Co-COO, Walgreens Boots Alliance

“The days of only one function driving any successful initiative are behind us. Everything we do requires strong coordination of cross-functional teams – from digital to store operations to merchants and more, everyone plays an integral role. And it all starts with a clear understanding of consumer expectations and the right prioritization.” —Brian Cornell, Chairman and CEO, Target

“How well you create a value proposition is the cornerstone of the brand’s ability to survive.” —Kevin Holt, CEO, Ahold Delhaize USA

“I can’t imagine anybody knowing for sure what will happen in the future—the takeaway is that our businesses have to be agile and flexible.” —Erik Nordstrom, CEO, Nordstrom

About Retail Industry Leaders Association

RILA is the US trade association for leading retailers. We convene decision-makers, advocate for the industry, and promote operational excellence and innovation. Our aim is to elevate a dynamic industry by transforming the environment in which retailers operate.

RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs, and more than 100,000 stores, manufacturing facilities, and distribution centers domestically and abroad.

About McKinsey & Company

McKinsey & Company is a global management consulting firm committed to helping organizations create Change that Matters.

In more than 130 cities and 65 countries, our teams help clients across the private, public and social sectors shape bold strategies and transform the way they work, embed technology where it unlocks value, and build capabilities to sustain the change. Not just any change, but Change that Matters –for their organizations, their people, and in turn society at large.

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SOURCE Retail Industry Leaders Association