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Retail in the Next 12 Months

Retail in the Next 12 Months: From Survive to Thrive

Over the last few months, we’ve seen a huge shift in both organizational and customer behaviors in response to the current crisis. What this has demonstrated is the importance of building resilient and agile businesses that are able to quickly and innovatively respond to the waves of change and adapt their customer experience accordingly. Featuring insider perspective from M&S, one of the biggest retailers in the UK, this session explores the kind of practices retail organizations should adopt to become more resilient, what trends will impact the industry and how to respond to them, and a focus on the changing nature of customer expectations.

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Hayley Ward, Head of Customer Experience, Digital and Data, Marks & Spencer
Helene Dolberg, Senior Strategist, Kin + Carta



Helene: Hi, everyone, welcome to FWD20: The Age of Resilience. It's been a really great day so far, it was some really insightful sessions. So to continue that momentum, I'm very excited to start this fireside chat with Hayley, all about "Retail in the Next 12 Months: "From Survive to Thrive." So for the next 30 minutes or so, we'll be highlighting the kind of practices retail organizations should adopt to become more resilient, trends in the industry, and the impact this could have on the customer experience. We will be doing a Q&A at the very end. So if you do have questions, just pop them into the Q&A box and we'll answer some questions live. However, due to the short time that we have, we probably will only be able to answer a few questions today. So let's dig in. So today I have with me Hayley Ward from Marks and Spencers. Hayley spent the last five years in a variety of different roles there, including head of research and most recently Head of Customer Experience, Digital and Data. Hi Hayley, thanks for joining us today and for your participation.

Hayley: Hi, Helen, thanks. Thanks for the invite. It feels like a very topical and very relevant subject. So yeah, just a little bit about me, I guess. So, as you said, I've been with M&S for the last five years in a variety of roles. Before that I was at O2, and actually before that I was at M&S. So I guess I like M&S, because I came back to work for them. I guess actually I was reflecting coming and doing this talk today and thinking about actually, you know I've worked most of my career in retail, and I love working in retail. And I think that there's a couple of reasons for that. The first is, you have to think and care about the macro factors that influence and drive attitudes and behaviours. So, we're in the midst of one at the moment, COVID, Brexit and all of these things are really important. And then you also have to understand about what drives decision making in the moment. So actually you're at shelf edge and how can you get somebody to buy the M&S ketchup rather than the Heinz ketchup. And actually what are the factors of importance from a consumer perspective? So I think for me, it's really the variety and the pace of change. And I feel very lucky to work for M&S. It's a great brand, food, clothing, fashion, home ware, loyalty, bank, there's always something that yeah, keeps you really, really interested, particularly at the moment. So thanks for having me.

Helene: Yeah, thank you for joining. Oh, it's interesting you touched upon some of those kind of the excitement around having to understand the macro factors, because as we've all seen these last few months, with what's going on, some retail organsations have really thrived and actually been able to quickly respond to some emerging needs, like catering to the vulnerable for example. But others have also really struggled due to stores closing down, supply chain constraints, lack of online presence. And I think what this crisis has shown us is the importance of building resilient and adaptable businesses and processes, and baking in agile ways of working into the company culture in order to be able to really quickly respond to what's going on. And this will obviously be more important than ever as we're about to face a huge period of uncertainty in the next 12 months with a possible recession. So in your view, what do you think will be really important going forward from an organisational point of view? What practices should retail organisations adopt?

What organisational practices should retailers start to adopt?


Hayley: Yeah, I think that's a really, really good question. And I think the first thing is, just the most important is how do you make sure that you are really listening to consumer needs and that actually you have the processes in place to be able to respond to them. You know, consumer expectations are just changing rapidly and any organisation needs to make sure that they stay relevant and that they offer, when we look back at the retail sector over the last sort of five or 10 years, you can see the businesses that aren't here today, and there's some big names on the high street. You've got HMV, you've got Debenhams is struggling, House of Fraser is struggling, all big brands, but who probably haven't kept up with actually changing consumer needs. And then I think that's the most important thing. But within the organisation in terms of structure and processes you've got to have slick decision making, less hierarchy. It's really, really important that actually we listen and get everybody's views and that people feel that they can speak up with their ideas. I think it is sort of linked into that is actually about how can we do more collaboration between teams, really breaking down organisational silos. And I think one of the things that we're really adopting now is, how can we be more outcome focused and how can we actually create teams that are focused on solving customer problems? And those teams actually probably should be made up of people from retail, from dotcom, from a CRM team, bringing in data science, analytics and research. And creating multidisciplinary teams that are focused on solving a customer problem and designing a solution. For me those would be sort of some of the key things.

Helene: Yeah, that's really interesting. I guess, do you have any kind of examples of some of those teams that have been set up within M&S and how quickly you're able to kind of set up those teams?

Hayley: Yeah, and I think what this crisis has shown actually is the, when we put our minds to it, we can actually achieve amazing things really, really quickly. So, a great example is the food boxes. So we created, got that to market really, really quickly. It was a lot of work from lots of different teams who pulled together and there was a clear goal, a clear outcome and something we needed to achieve. Also our partnership with Deliveroo as well. That's probably been talked about for a while, but this just accelerated it and kind of just made it happen. And so I think that those are two great examples. And one of the things that we're doing from an internal perspective is it's under the umbrella of "never the same again." And actually, what are the lessons that we've learned through this crisis that we don't wanna go back to? And how can we make sure that actually as an organisation we're learning from this, we're not gonna repeat the same mistakes and that actually we're gonna make sure that we retain all of the positives. I think that's really important. And another thing that we've introduced, we introduced it pre-COVID, but it was one of our values and that's very much about how can we talk straight? And M&S is a really nice, great place to work, and talk straight isn't suddenly about being rude in meetings or being able to diss other people's ideas. But actually it's really, really important that you speak up. If you've got a different point of view, actually that's great. Let's hear it and let's have that debate, have that conversation. So, hopefully whilst this crisis has been terrible in some ways we need to be able to take some of the positives from it as well.

Helene: Yeah, definitely. And I think it's really interesting that you talked about kind of businesses reacting faster than ever before, just because they need to. And retail has always been an industry that's changed very fast, but I think now it's having to evolve at an unprecedented speed. And this obviously comes with big challenges, like having to probably make some tough trade offs, but it also introduces some really exciting opportunities to invest in areas where we're seeing kind of emerging growth out of this. And this means that potentially certain work streams, I think that probably would have been deprioritised in the past will now take on a greater importance, such as the role of kind of mobile services, or the acceleration of omnichannel. I guess I'm interested to hear kind of with that, what key trends do you think will shape the world of retail within the next 12 months?

The future of retail


Hayley: Yeah, I think you touched on it there for us and for all of the sector, the digital transformation has just been accelerated. So that was a trend before, we were all talking about it. And now it's just been accelerated so much. I mean, some of the stats have just surprised me in terms of six million banking apps were downloaded in the first week of COVID. Joe Wicks, I think he had over a million YouTube subscribers and sure lots of people who are listening to this are doing his 9:00 a.m. classes. And actually we saw the older demographics increase their spend buying food online by 94%. So, there's just been some seismic shifts in consumer behavior in such a short period of time. Usually we would have expected that to have taken a long time and that's not gonna go back. So I think that plays, you touched on it, mobile first, absolutely has to be a first premise. Actually, what's the role of stores? For us at M&S we've got a really large store portfolio, and it's making, and for some that's a strength, so we need to see it as an opportunity as well. But what's the role of the store going to be and how can we make sure that actually it's going to be fit for purpose and meeting consumer needs? And how can we actually leverage digital technology to design experiences for our customers that are seamless from an omnichannel perspective, and that actually would use efforts and increase inspiration. So I think that that's the most important trend from our perspective. I think that there's also ethical consumption. So before COVID we saw this as well and people were buying less clothes for instance. People were saying, "I don't need as much stuff anymore. "And actually the things which are really important "to me is experiences with my friends and family "and creating moments that matter." And, I think that this crisis has taught us even more that those we really want to protect those relationships. And actually those will be the things that we want to spend our time and money on. I think mental wellbeing is a big one, local and community and actually inclusive society. And I'm sure everybody on this call has been sort of shocked by the events over in America, from George, his awful death. And actually the time is now to speak up. And brands and the industry has a huge role to play in terms of making sure that we are speaking up, we are inclusive and that actually we're doing the right thing for actually all of our communities across the world.

Helene: Yeah, there's definitely some really interesting things that you said, ethical consumption, inclusivity, the role of digital. So how can organisations then position themselves to kind of take on the year ahead with all of this in mind?

Hayley: Yeah, I think, yeah, it's a million dollar question really, isn't it? To me I think the most important thing is how can you make sure that your brand remains relevant? And for me that's about understanding the culture, understanding the world that you live in, making sure that you understand your customer needs. And actually that's the main starting point. And that's when you start to design experiences and to meet those needs. I think the other thing is, how can you start to build relationships with your customers? Data is so, so valuable and within the retail sector, there's varying degrees. We've got a loyalty program, which is great, because it allows us to build a relationship with our customers. And we want to really focus on how we can do that and do that better through doing things like personalisation and really using the data in the right way to help us understand our customers better. And design therefore better and more relevant experiences, solutions, products for them.

Helene: Great, yeah I think what's really interesting as you started talking about there is certain kind of the data and how we're seeing obviously changes in customer habits, change in customer spending. I guess I'd be interested to see based on the kind of data that you have, but also your perspective of what's going on, how will customers expectations kind of change within the next 12 months?

How will customers expectations change in the next 12 months?


Hayley: Yeah, I think that's a good question. And there is only one constant in life and that's change, which I think is that famous saying. I think that the greater convenience and relevance is just going to continue. And again, people understand we want the data to be able to surface and give them more relevant emails and offers and targeting. And they're okay with that as long as you use it in the right way. And I think that there is the increasing expectation from consumers of businesses to do the right thing, whether that's through social with that data and things like that. So I do think the holding businesses to account will become even more important again over the next 12 months.

Helene: And with all this kind of data and as you're saying, using data for the right purposes, what are the most important things then that should we consider using this data when designing kind of new experiences or new products for customers, and then optimising kind of current experiences and products, what should we consider and kind of think about?

How should we use customer data when designing new products or experiences?


Hayley: Yeah, I think that's a really good question. And you know, ultimately, and I remember when I was reflecting on sort of why I got into research, so my background as a researcher. And I used to work for Registered Social Landlords, which was sort of kind of council houses and shared ownership. And I remember that when it first clicked, my love for it was you use data to ultimately make things better for people. And I guess that's what still drives me today is, my whole thing is actually how can we use this data to help make experiences and things better for customers? What's going to make their lives easier, and what's going to make their lives richer? And because ultimately my philosophy is, you do that and you retain your customers and you keep them coming back continuously and you have customer love. There's so many studies written about it. So yeah, I guess my advice for anyone looking at thinking about sort of designing a journey is, really think about the end to end experience that would almost be, what would be the wow factor for customers? And there's a great Airbnb podcast that I'd encourage everybody to actually have a Google. I can't remember the name of it now, but it's brilliant. And they talk about how they designed their proposition based on something called the 11-star thinking, and actually design the experience to be that 11 stars, the rockstar experience. And then, yeah, maybe you'll end up like number six but you will certainly have stretched your thinking from number three. So I think that's always a good philosophy to take.

Helene: And you mentioned that wow factor, so what we also know is this kind of rising expectations from customers for kind of seamless and connected experiences. So what can retail businesses do to respond to that and ensure that they're delivering that?

How can retail businesses deliver seamless and connected customer experiences?


Hayley: Yeah, I think that's a great question, and one that we've really been struggling with, and everybody knows M&S, which is good and bad sometimes. I don't like to tell everybody I work for M&S, because I get a long list of stuff that we need to do to improve, but actually we've got lots and lots of stores, and we've got people that walk in to our stores and they might not buy, or they might buy with cash. And essentially that means that we're blind to that transaction. And that means that actually we don't have a holistic picture of their interaction with us as a brand. And that's why for us having a single view of the customer becomes really, really important, because for us to make sure that we're really relevant, then we need to actually understand how they're shopping with us, what they're coming on to browse, how often they're buying, what kind of products they're engaging with. So for me, that's kind of the most important thing is how do we build that picture of the customer up as best we can?

Helene: Yeah we've definitely seen that with some of the retail partners that we work with in terms of. In order to be able to deliver on that kind of personalisation that customers are asking for, you need to be able to create that single view of the customer. And I guess from your point of view then, what are some kind of things that M&S are doing in order to be able to create that single view of the customer? What advice can you give to businesses on how to get started on that?

How can retailers begin creating that single view of customers?


Hayley: Yeah, well we launched our loyalty program, Sparks. So big shout out, if anyone's not a member, go sign up. And yeah, so we've got a loyalty program where actually we do see that it tends to be our loyal customers that sign up to it, which is great, because actually we can offer them value and benefits whilst helping in exchange for building that picture of how they interact. We've also placed a lot of investment in building a data team, because I think it's, how can you make sure that you're looking after the quality of data and that you're treating it like it's an asset. So, we would often find that even today you uncover pockets of data that sits with the team. So actually we're getting that into one platform. And that also allows us to create the single version of the truth internally as well, which means that we're all looking at the same metrics, all looking at the same numbers. There's no differences in terms of different sources and that enables almost a much better debate as well from an internal perspective.

Helene: That's great to hear that you're kind of really focusing the business on kind of this one kind of single view of the customer, that's really great to hear. And so just before we get to the Q&A, I'm really keen to know for everyone listening today, if there's kind of one thing that retail businesses should do within the next 12 months to really thrive and ensure that they're kind of responding to this, these waves of changes that we've been talking about, what would that be?

What is one thing retailers can do to really thrive in the next 12 months?


Hayley: I think it's just, retail is so big, so many different areas. It's really just listening to people, walking in your consumer's shoes and to, don't just necessarily rely on sort of an insight team or an agency to come and tell you what the customer thinks. Actually for the, go and walk. If you always shop in Tescos, go to Aldi and see why that's seeing strong grave. If you always read The Times, read The Guardian to give yourself a different perspective. If you have segments try living like one of your segments does. There's lots of different things that we can do to make sure that we understand people and understand different perspectives. And that ultimately will enable us to design better experiences, because we'll have greater empathy, which will only lead to better things. I can't believe how quick that's gone, by the way. I was like, "Oh my God, is that over already?"



Helene: Great, well I think we'll probably move on to some questions now. So, we've got two questions from the audience, but everyone obviously, if you have any other questions, feel free to pop them into the Q&A box. So we have a question from someone in the audience saying, "You talked about getting to market quickly with food boxes "and delivery partnership. "How did you manage to accelerate "the stakeholder approval process in order "to make these nimble decisions?"

Hayley: Yeah, I think that's such a good question. And I think it was just speed and it was getting the right people in the room to agree. So I think it's also about being really clear on the outcome that looking to drive and the solution, and then almost just kind of just forcing that through. In terms of us having, I mean, the burning platform enabled us to accelerate that. But I think being really, really clear on objectives, reason why it needed to happen and getting the right people in the room to agree. But yeah, there's no silver bullet for what I can see in terms of how we're gonna continue doing that. But hopefully under the new program of "never the same again" we're going to put some processes in place that's going to enable quicker decision making, because all businesses have to do that.

Helene: Yeah, I think in these times of kind of uncertainty and this kind of time of urgency, I think people adopts this more kind of test and learn mentality anyway where, "Let's just put it out there and test, "because we have to in order to kind of survive as well."

Hayley: And actually I think that's a really good point, because we've become more comfortable with imperfection. And I think that all organizations have to do that. I think it's a really good build. You've got to, it's better to get it out there 80% right. Get some feedback and learn and then make it to fully perfect to spend all of your time trying to make it perfect and almost missing the boat essentially.

Helene: Definitely, and I think that's, I can encourage that's something that we tried to kind of bring to all of our clients is, get an MVP out there, test, learn, get direct feedback from customers and then kind of build on it as you go and as you're learning. It's kind of a really good mentality I think to have. Great, so another question from the audience is, "Do you think you will need "to change your brand ethos values at all "to meet customer expectations in the new normal? "And do you envisage fundamentally shaking "up your existing strategies to do so?"

Hayley: Yeah, I think that's a good question. I think that we've had a lot of new senior leaders come in and join M&S, which has been really, really good and been really, really focused. I think that we here we have a lot of feedback from our customers about what we want to do. And I think that actually now we've got a really, really clear strategy, which is great. I think the key thing is, is just how can we execute on it quicker then we're doing, and how can we almost just increase the pace of change? I think in terms of our sort of brand values, I think our brand values kind of make us M&S, it's actually the reason why people love us. And when you talk to people, everybody actually wills and wants M&S to do well, and sometimes we don't and they're like, "Oh, poor M&S, I hope it's gonna "get better and I hope it's gonna do well." So, I think that there's definitely things that we wanna retain. The big thing I think is just how do we become more digital and more agile and just increase our pace to deliver on those transformation ambitions we have.

Helene: Yeah, great. So then we've got a question from another person in the audience, "So would you be able "to comment on the biggest challenges faced "by retailers regarding the current payment "and rewards experience used today?"

Hayley: Yeah, so I think by payments, do you mean just in terms of just literally paying in store? I think that's, we've been having lots and lots of discussion around payments and around actually how can we give greater flexibility in terms of how to pay through our customers, digital wallets, Prima, you've got lots and lots of options, PayPal, things like that. And then I think what was sort of really interesting and good example of how collaboration and the crisis led to increase speed of decision making was when all the banks increased the contactless payment from 30 up to 45. And so I think that that's been good. I think for customers it's about speed and ease. And I don't know if you've seen our Mobile Pay Go innovation, but essentially you can go into lots of our stores and essentially through our app, scan your products yourself, and then just walk out without actually having to go to a till. And I think that we're gonna see more and more of that innovation coming through and how can we make that better for the customers? What was the second part of the question? It was payments and?

Helene: And the rewards experience.

Hayley: The rewards experience. Yeah, I think that that's a huge space and something that we're really focused on, and actually we're sort of re-looking at it again, particularly as we know the community local and that has just accelerated in terms of the trend. And that's something that we want to make sure that we're reflecting as well. So rewards for people, but also for communities as well.

Helene: Great, and so you touched upon the Mobile Pay Go, which I think probably most people have seen, I think Sainsbury's has also launched a similar proposition. Do you think that, or have you seen any kind of early signs of increased uptake in that kind of proposition and that product?

Hayley: Yeah, we've seen some really promising. If you think about some of the hardware, that solution works brilliantly is sort of Food on the Move, and particularly for lunchtimes, it's the small baskets essentially. So it's people coming in and wanting to get out really, really quickly. So actually we've seen some really good successes in some stores where it's equal to nearly a third of total transactions, because actually that's the main sort of mission based for the store. So I think it's thinking about actually where is the solution right for, in some of our stores we've got the way you've got, in our bigger stores, trolleys, and you can scan everything as you go around. So I think it's tailoring the solution for the store and the local community as much as possible.

Helene: Yeah, and I guess some kind of in relation to that, how do you prioritize then the kind of assortment in store versus online is one of the questions?

Hayley: Yep, I think that's a great question. And I think it's kind of reflecting a little bit to what I just said in terms of thinking about actually what's the needs of the community and what's that store most useful. And actually I think it's even using different things at different times of the day. So if you think about food, how can you actually be slicker around moving islands so that you're delivering different products at different times of the day that best meet consumer needs. And then, yeah, so I think that that's all.

Helene: Great, so we've got, I'll just pick out a few, one more question as we only have a minute left. But I think there's an interesting question around, you mentioned outcome focused teams, have you had to change, break down established silos and I guess if so, how did you go about that?

Hayley: God, I'm not gonna be able to answer that one in a minute, but it's a really good question. And you know what, I'm not gonna say that we're perfect at this now, but it is where we've done it, we have been really, really successful. And, you know, actually I'd say, get one, do one in your organization, it will be successful. And then you'll be able to use that as a proof of concept and to be able to show and demonstrate the real value that having those mission-based teams can deliver. We're gonna certainly be doing more of that. And actually it's really rewarding for the people who are in the teams as well. I think it's a great thing to be doing.

Helene: Okay, well, thank you so much, Hayley, it's been really, really insightful and I hope everyone on the call has also found so. So thank you so much for taking the time to speak with us today, and also thank you to everyone in the virtual audience for listening.

Hayley: Great, thanks so much. Thanks everybody, bye.

Helene: Thank you so much. And I'm just on there, I'm just going to share some contact details. So if there are any further questions or if you would like to get in touch with us, please do so with the following kind of email address, and also be sure to listen in to any of the other talks that we've got later today. Thank you very much. We hope to see you soon.

Hayley: Thanks all, bye.

Helene: Thank you, bye.


Hayley Ward, Head of Customer Experience, Digital and Data, Marks & Spencer
Helene Dolberg, Senior Strategist, Kin + Carta

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