PROFILE

Franklin Chu

Managing Director, Azoya USA
Franklin is a member of RetailWire’s Brain Trust and often contributes to leading retail trade publications including Apparel Magazine, Chain Store Age, Retail TouchPoints, SmartBrief and WWD. Additionally, Franklin serves as President of Sage Capital Group Inc. a private equity and investment management firm. Franklin is a graduate of Yale University and Harvard Business School.
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  • Posted on: 08/15/2017

    Should Walmart buy Birchbox?

    Buying Birchbox would further strengthen Walmart’s e-commerce strategy to compete against Amazon by helping Walmart attract younger and higher-income consumers. Walmart’s world-class fulfillment and operations could strengthen the awareness and reach of e-commerce brands like Birchbox. Walmart could also help brands expand their omnichannel experience, including in-store pick-up and ship from store.On the other hand, the retailers’ core audiences differ significantly. Loyal Walmart customers who value the retail giant’s Everyday Low Price strategy contrast with the relatively young, trendy and tech-savvy shoppers who buy from Birchbox, Modcloth and Bonobos. While buying Birchbox would expand Walmart’s reach, how Walmart will manage the massive traffic from different customer groups remains a challenge.
  • Posted on: 08/08/2017

    Are retailers squandering store traffic?

    One of the major differences between shopping online and offline is that customers will inevitably leave trails when they shop online: e-tailers know their home addresses, phone numbers and email addresses. Retail companies even know which products shoppers browsed yet didn’t buy.By contrast, physical retailers lack the capacity to keep track of their customers. When shoppers enter the store, pick up items and pay by cash, retailers do not capture any detailed customer profile data. In response, retailers with physical stores should monitor customer conversion to understand their silent customers and adjust their service accordingly. They can start doing this by equipping their stores with technology, including headcount devices and mobile payments. Most importantly, physical stores should take advantage of the richer, multi-sensory customer experience they can provide and embrace technology to offer personalized customer service.
  • Posted on: 08/07/2017

    Will talking about pain points make Babies ‘R’ Us the go-to retailer for parents?

    Yes, I think this approach makes Babies "R" Us stand out as a trusted resource because the retailer is not only selling products -- it is selling solutions.New parents often feel overwhelmed, anxious and even competitive with other parents. Babies "R" Us’s approach makes the retailer seem like a wise, trusted friend who deeply understands parents’ needs. The campaign embraces the fact that unexpected things will happen and reassures new parents they will be okay even when things aren’t perfect.This messaging strategy makes Babies "R" Us seem authentic, relatable and trustworthy -- qualities that Millennials appreciate. Today’s new generation of parents values honesty and wants to feel cared for and understood; this realistic campaign shows that Babies "R" Us offers empathy and relevant solutions to help overwhelmed parents relax and savor this special period of their lives.
  • Posted on: 08/02/2017

    Will Gen Z demand a new level of collaboration?

    Gen Z consumers expect and reward authenticity. They select brands and retailers that reflect their own identity, including their values and lifestyle. This trend represents an exciting opportunity for niche brands and retailers to align with Gen Z consumers by being relatable and relevant to these young shoppers.Gen Z also relies on peer recommendations rather than traditional marketing, so many retailers and brands now collaborate with opinion leaders who Gen Zers trust.These shoppers also want to be heard and receive a timely response, so retail companies should put more effort into adapting to consumer feedback to improve the shopping experience and collecting flattering customer reviews to earn consumer confidence.
  • Posted on: 07/27/2017

    Do mini makeup studios make sense for Sephora?

    Sephora’s new trial is a great example of offline to online marketing. To offer clients an omnichannel experience, retailers should think beyond content marketing and selling, and embrace unique, memorable service. Offering makeup courses to neighborhood customers is a great idea to create an exclusive, loyalty-enhancing membership experience, and it is also a valuable service for customers. However, I still think 2000 square feet is too big for a mini makeup studio. Automated shops and gyms in China take up only 100 square feet. Is 2000 square feet too extravagant?
  • Posted on: 07/27/2017

    Will dropping prices on cosmetics drive traffic to department stores?

    Dropping the price of cosmetics will certainly drive more traffic to department stores; however, it is not a sustainable, long-term strategy. In China, there is already a generation of young shoppers who can live without physical storefronts because they can always find cheaper prices online. For many young female consumers, in-store cosmetics counters are simply places to test the products and verify their authenticity. Consumers who visit department stores are no longer just looking to buy things. On the contrary, they are searching for new tricks, new experiences, and opportunities to learn more.
  • Posted on: 07/11/2017

    Can an app know a customer better than a personal shopper?

    Apps and algorithms can make better recommendations to customers and increase the chances of a sale. Retailers with big ambitions in the China market should also realize that, with more players on board, the ability to make relevant, effective product recommendations can potentially help them stand out from their competitors. What retailers can do is to provide as much consumer feedback as possible to enable such a recommendation system to work. Working with platforms that already have data on customers and similar products can also save a lot of trouble. More importantly, retailers will need an experienced local partner that understands how these technologies make the customer experience more pleasant and convenient.
  • Posted on: 07/11/2017

    Is inept forecasting holding back online fulfillment?

    The ability to see the stock level in real time is very important to planning e-commerce sales events. When customers come to an e-commerce site from different channels, the last thing they want to see is that the products have been sold out or – even worse – receive an email saying their order’s been cancelled.Being able to forecast accurately is a core capability for running a successful e-commerce business in China. Retailers would know when and where to market, and allocate a sufficient budget for each promotion. This capability can be only built upon trusted data analytics, as well as a good understanding of both marketing channels and their own supply chain capacity.
  • Posted on: 06/29/2017

    What will a Nike/Amazon deal mean for the brand and other retailers?

    The Nike/Amazon deal could only happen to Amazon, the omni-mall that is confident enough to be the only digital channel for all brands. Amazon gave Nike what it really wants: the ability to control all channels, synchronize its pricing strategy and shift traffic to channels with the highest margins. However, this isn’t necessarily what Nike really needs. Angry retailers could go to the extreme to feature other brands that have better terms and offers, which could challenge Nike’s share in the market. In China, Alibaba is also doing similar things but it has yet to make progress like Amazon. It’s terrifying to think these giant marketplaces could eventually become the "sole" channels for brands and eat away at retailers’ already-slim margins.
  • Posted on: 06/28/2017

    How did mobile become the ‘glue’ in the Sephora shopping experience?

    Mobile is a significant force, shaping the future of e-commerce as shoppers increasingly adopt mobile shopping. Mobile allows shopping to take place anywhere, anytime and it allows retailers to offer online-to-offline (O2O) service to shoppers, which eliminates the layers and costs of intermediaries with more direct relationships. Sephora has adopted mobile as the interface between its stores and shoppers to provide valuable content, plus services powered by augmented reality (AR) technology to help consumers make better purchase decisions. Sephora’s mobile leadership is a smart move to attract and retain customer traffic in the competitive beauty and cosmetics market.
  • Posted on: 06/23/2017

    Will Amazon Prime Wardrobe change how Americans shop for clothes?

    Amazon's "try before you buy" program can be a real threat to other apparel companies, especially the already-ailing department stores. Customers can take their time in their private own rooms without any salesperson pressuring them to buy, which will bring comfort and ease to many shoppers.However, offline retailers and department stores are still holding their ultimate weapon: in-store service. Traditional retailers need to catch up and improve the in-store customer experience by offering exclusive merchandise, adopting digital fitting rooms and ensuring associates provide hassle-free service. Continually trying out new market channels can offer retailers a great boost, too.
  • Posted on: 06/22/2017

    What happens now that Amazon is acquiring Whole Foods?

    Amazon’s acquisition of Whole Foods catapults the e-commerce giant into the grocery sector by swiftly expanding its Amazon Go, Amazon Fresh and private label grocery offerings. It is very exciting to see the collaboration between the online giant and a brick-and-mortar leader with 400+ stores. With Whole Foods' respected reputation and passionate brand advocates, Amazon can make the grocery chain more customer-centric with leading-edge technology and data to enhance the customer shopping experience. This acquisition will be a win-win situation for both of the giants and the perfect example of omnichannel leadership. China's tech giants Alibaba and JD.com have invested heavily in offline grocery stores, making China the world's largest online grocery market, far ahead of the U.S. Pure e-commerce and offline players may face difficulties in the future as consumers’ expectations have changed and now omnichannel is the key to succeed.
  • Posted on: 06/16/2017

    Are retailers selling their souls and giving away customers to Amazon?

    Amazon can be a smart, strategic channel for certain retailers. For brands with high margins and strong control over their supply chain and distribution channel, Amazon’s online marketplace is a good way for them to quickly draw more traffic and expand their sales channels to reach their target consumers.However, medium-sized or small retailers need to be more careful in making this decision, as they will more often “disappear” under the big marketplace brands. There is also fierce competition on Amazon, which means retailers have to invest more in marketing to win consumers’ attention and sales. As a result, selling on Amazon should only be a short-term strategy for these retailers as a channel to convert traffic to their own website.Indeed, Amazon is very consumer-centric and attracts lots of traffic. Yet before retailers enter Amazon’s online marketplace, they need to consider whether all these shoppers are suitable for their brands. Also consider which types of consumers you are looking for and how could you provide the best service to keep them loyal to your brands.
  • Posted on: 06/14/2017

    Is IKEA really going to start selling on Amazon’s Marketplace?

    It’s possible IKEA will sell on Amazon because e-commerce is a new game-changing business model – and an essential for retailers’ success. Traditional retailers are working hard to embrace e-commerce to stay competitive. Overall, retailers need e-commerce to deliver multichannel service to enhance the customer experience and align with consumers’ omnichannel expectations.Expanding to Amazon’s marketplace could boost IKEA’s market share amid today’s fierce competition in traditional sales channels. E-commerce could help IKEA gain brand awareness among young shoppers who love to buy online. To succeed, IKEA requires a clear understanding of online consumers and adjust its strategies based on their shopping behavior data.It is also important for IKEA to think before selling on Amazon because it could lead to a vague brand image, as Amazon attracts intense competition among multiple sellers. Customers who buy from online marketplaces differ from in-store shoppers, which means an updated pricing and promotion strategy is crucial for IKEA to succeed in the transparent digital world of Amazon’s Marketplace.
  • Posted on: 06/08/2017

    Should Amazon buy Macy’s?

    It would be interesting to see Amazon buy Macy’s – not because Amazon would expand to more brick and mortar stores, but because Macy’s department store business could find the cure it needs to survive in the digital age. Department stores have been struggling from declining customer traffic and plummeting sales, and Amazon’s retail and e-commerce excellence could potentially bring more offline traffic and revenue.However, if Amazon simply needs physical stores for hassle-free pick-ups and returns, Macy’s is an expensive choice. Also, the chain department stores are located far away from residential areas, making offline service via Macy’s stores rather inconvenient.

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