Furner says customers are continually evolving

Print Friendly, PDF & Email

NEW YORK — At a time when changing expectations of consumers, the ongoing COVID-19 pandemic, supply chain disruptions and digital technology are causing long-held assumptions about business to be called into question, the National Retail Federation (NRF) is fortunate to have a leader focused on developing an effective response to those dynamics. John Furner, the association’s new chairman, and president and chief executive officer of Walmart U.S., asserted that in order to do so, retailers and their suppliers first have to understand the customer journey.

Speaking at NRF 2022: Retail’s Big Show at the Jacob K. Javits Convention Center here in mid-January, Furner said, “First, the customer has to be at the center of everything we do in this industry. And customers are continuously evolving. They’re learning and they’re changing, they’re getting new offers, and they have new experiences. One of the board members a few years ago said something that stuck with me — something like loyalty in retail is simply the absence of something better.

“And it’s a great way to think about it, that once a customer has been exposed to something that’s better — better quality, better fulfillment, things that save time and take friction out of their lives, better value ­— once they go and find something better — they tend to stay with it. And what’s happened in the last couple years is a pretty pre­cipitous shift in the way customers expect and need to be served.”

Relentless improvement in technology and delivery methods have empowered consumers to an unprecedented degree. With shoppers only too happy to exercise their newfound ­leverage, the bar for all retailers has been raised considerably.

“We’ve really tried to ensure that we’re focused on meeting customers where they want to be met and serving them in the way that they want to be served,” noted Furner, who succeeded Mike George, former president and CEO of Qurate Retail Inc. (whose holdings include QVC, Garnet Hill and Zulily), as NRF chairman. “And what we know now, particularly in this time period where we have another variant that’s working its way across the country, is that different consumers want and need different things.

“We used to think a lot about groups of customers and their behavior types, but with so many customers today that changes based on the day of the week or time of the month or what’s going on in life — whether it’s a birthday or a wedding or a celebration or a new pet. A lot of the changes we’ve seen in the last couple years just accelerated underlying trends that will continue to be with us.”

Furner, who took part in a dialogue with NRF president and CEO Matthew Shay, went on to discuss two other formidable challenges for the industry. The annual rate of inflation in the U.S. hit 7% in December, the highest level in four decades, while persistent supply chain glitches triggered by the pandemic remain.

“This really starts with what we see as a strong consumer market, with really high demand,” Furner explained. “We’re in an economy that basically grew between zero percent and 3% for decades. In the last couple years we’ve seen that really accelerate. With higher demand and a higher supply of money in the world, we’ve seen demand levels that have caused supply chain shortages and out-of-stocks, which have led, as we know, to inflation and rising prices.

“There are two things that we really hear from our customers, what they’re thinking most about right now — first is their health and safety, which completely makes sense given the pandemic and this variant we’re now dealing with.

“The second thing we hear about is rising prices. Our position with everyday-low price at Walmart is going to be so important for so many customers who need to be able to find basics — like laundry detergent, paper goods, products in the meat department and groceries — for values that are affordable. Those are going to be really important as we think about this year. We’re in an environment with strong demand, so those supply chain pressures will persist for some amount of time. We’ll deal with it; we’ll figure out how to be creative.”

Improving the efficiency of the supply chain will be central to that process.

“For the entire industry, we’ve got to look for ways that we can be innovative and try to remove costs from the supply chain while the prices are rising, to ensure that our customers can find value and be able to afford to take care of their families and do the things that they need to do every day,” he said.

If that array of formidable challenges weren’t enough, Furner reminded the retailers and suppliers in attendance at the Big Show that companies today are expected to make a meaningful difference in such areas as sustainability, health and wellness, and diversity and inclusion.

“For Walmart, we are able to participate in new things that can create scale to help others, help the industry and help the world,” he noted. “But this is something we’re going to have to do together. There are so many great things going on between energy and consumer products and the last mile. This really starts with each company, each organization. Like we said before, you don’t have to solve everything, but help us solve a few of these big things.”

For his part, Shay thanked George for his “exceptional leadership” at NRF during particularly tumultuous times and then sounded an optimistic note as Furner began his two-year term as the association’s chairman.

“We are extremely fortunate to gain John’s leadership at this pivotal point, as retailers move beyond the pandemic,” he said. “As we begin a new year and a new chapter for the industry, John’s extensive industry experience and knowledge will guide NRF and retailers large and small into a new era of innovation.”


BEIRES_728x90

FREUD_728x90_6-19-20

You must be logged in to post a comment Login