Retail News & insights

With Amazon due to land in Australia this year, retailers need to take the old adage “innovate or die” very seriously. Australian retailers are notorious for lagging behind on the innovation front, compared to more innovative counterparts in the US, Europe and the UK.

In last year’s Australian Financial Review’s Most Innovative Companies list, only two percent of entrants were from the retail industry, suggesting that Australian retailers have not been implementing many noteworthy innovations. Indeed, retail was one of the most poorly represented industries in the list itself.

There are several areas where retailers can look to improve their innovation efforts, ahead of Amazon’s arrival

1. Give those outside of head office a voice 

Retailers often rely on their head office teams to generate innovations that will be pushed out to customers. By doing so, they are ignoring one of their most critical assets - front line staff. Retail staff that are in bricks-and-mortar stores everyday are in an ideal position to truly understand what is frustrating customers, and therefore, identify rich opportunities for innovation. Front line staff need to be given avenues to share their perspectives and insights, in order to help retailers become more in touch with their customers.

2. Don’t expect people to be natural innovators – it’s a learned skill

While retailers invest in millions of dollars of sales training for staff every year, training staff in the skills to innovate remains rare. However, we know from research that innovation is a skill that can be taught and improved significantly. Innovation training, for example, frequently results in an uplift in innovation skills and behaviours of over 50%.

Teaching staff the skills to outthink competitors is critical for survival. Retail leaders need to investigate options for helping their staff get better at identifying innovation opportunities, generating breakthrough ideas, and acting on those ideas.

3. Crush some assumptions

In the retail industry, many assumptions exist about how retail works. For example, one assumption is that consumers prefer to purchase high involvement large items such as mattresses from bricks-and-mortar stores. In 2014, US-based company Casper flipped this notion on its head and created the world’s first online direct to consumer mattress company. Casper was featured on Fast Company’s 2017 Most Innovative Companies list for changing the way consumers buy mattresses - all through crushing a very fundamental assumption.

Australian retailers need to question assumptions that still govern their business and business model, and start thinking outside of the fundamental parameters they have operated by for many decades.

And for Australian retailers that are truly pushing boundaries, entries of the 2017 AFR Most Innovative Companies list are now open. Enter this year’s list here. 

 

 

Dr Amantha Imber is the Founder of Inventium, the innovation consultancy that assesses and compiles the AFR Most Innovative Companies list. 

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