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Highlights from NRA’s retail guru: Gary Mortimer at State of the Retail Nation

4 min read

I attended the National Retail Association’s (not to be confused with the NRA – One Nation I’m looking at you…) State of the Retail Nation update last Friday. For all of those that weren’t able to be there, I’ve compiled the key takeaways so you’re down with the latest retail updates.

Setting the scene, we had Gary Mortimer, who I would liken to a retail guru, hailing from Queensland University of Technology. We all know that retail is in a state of disruption and the Uber, AirBnB effect will slowly come into the retail sector with the imperative to adapt or die, but nothing you didn’t already know.

Here are the highlights from Gary’s speech you may not have known:

Collecting the right data

There are some great examples of companies who are maximising customer experience through their data. For example – a pharmacy that Gary works with uses the time that customers are waiting for their prescriptions to collect data about their experience. In the world of big data, it’s no surprise that retailers are becoming more aware of the effectiveness of data-driven decision making. You need to know how satisfied your customer is and how you can improve experience as a baseline.

Looking internally

One of the biggest shifts in the retail space is a greater understanding of your employee – the conversation is slowly shifting from customer experience to employee experience as your employees are your best brand ambassadors and sell your brand. Not only do you need to collect data about your customer, but about your employees.

One of the key issues employees have is with their pay. Obviously not everyone is going to be paid what they think they’re worth but taking the time to give feedback about why they’re at that pay scale is crucial and also providing a framework for the next level of pay. Be transparent and you’ll retain your people longer.


An ongoing challenge for retailers is around pricing and discounts. Advice from Gary:

  • Utilise BOGOF (buy one get one free) to more effectively clear stock
  • Use scarcity – don’t put all your sale stock out at once – put 12 t-shirts out at 20% off and let the customer think it’s a great deal, then top up once they’re gone
  • The countdown sale – put 25% of your stock, but for 12 hours – this works well with sales like Click Frenzy and online, why not try it out in-store?
  • Luck – this works best with the more expensive products that you’ve already got the customer interested in, offer them a scratchy card with a discount/promo to get them over the line. This is why Coles Little Shop worked so well
  • Link promotions to charity – this worked very well for Suzanne who raised $9M for charity – choose the charity based on what your customer wants and allow them to choose

Trends in loyalty

Your loyalty programme needs to produce some outcome and it needs to deliver both your organisation and your customer value, otherwise it’s a waste of time. The best thing about loyalty programmes is that they provide you with great data you can utilise for more personalised product selection and for more strategic business decisions.

We’re under-utilising the opportunity to push notifications to our customers like the dentist and optometrists do when it’s time for a check-up – how could retailers utilise this to remind customers that it’s time to purchase products?

Your loyalty programme needs to be your point of difference. A great example from Gary was Lululemon, who offer their customers running clubs, yoga sessions and use their programme to build a community of loyal lulu fans. Attitudinal loyalty is more valuable than building points so think about how you can utilise this to get a more engaged customer base.

You also want to drive behavioural loyalty – so thinking about the frequency of spend, the visit, the basket size. Your attitudinal loyalty is about emotional connection, stickiness, brand love and spreading word of mouth.

Customer segmentation

Many retailers don’t do this well – your customer is not a homogeneous group and if you try to be all things to all people, you’ll inevitably fail.

Why should you segment:

  • Customer heterogeneity
  • Maturing product market (Gary gave the example of the toothpaste market and a need for differentiation of product e.g. tartar control versus denture care)
  • Increasing competition
  • Economic and social drivers

The value of your stock

For our bricks-and-mortar retailers, thinking about the contribution of your stock to your turnover is important to analyse.  Inventory is the biggest cost to retailers and each square metre of your store is entirely valuable. How much is the value of each department compared to the turnover? If 20% of your store is contributing to only 10% of your turnover, then you need to reconfigure your space to more accurately match turnover to space. If you must mark down stock, don’t replace it.

Biggest pain point in retail?

This is a bonus point – asked in the Q&A and would you believe it? It’s speed of delivery and the fulfilment of goods. Customers are less focused on produce and product and becoming more obsessed with the speed of delivery. They want their products fast and this is a challenge for a lot of retailers.

There you have it – part one of our recap of the National Retail Association’s State of the Nation update. Be sure to catch the next one for relevant insight, they run in Melbourne, Brisbane and Sydney throughout the year. And for all your learning needs – you know where to find us!