PROFILE

Ananda Chakravarty

Retail Thought Leader
Ananda is a retail thought leader. Currently Ananda is Director, Global Retail Lead & Software Strategy at Diebold Nixdorf, the premier firm in European retail and progenitor of the ATM. Ananda also served as Director, Retail Omnichannel Solutions Strategy at Oracle. Ananda was a senior analyst at Forrester advising c-level leaders on digital store, digital store technologies, retail enablement, digital in-store analytics and Digital Grocery. Prior to Forrester, Ananda served as Director of Enterprise Digital Strategy at The Hartford and executive and product roles at Staples, Talbots and Monster.com. Opinions reflect those of the author only. Ananda holds an MBA from Northeastern University, a Masters in Electrical Engineering from University of Massachusetts, Lowell and a Bachelors in Electrical Engineering from Clemson University.
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  • Posted on: 03/05/2021

    Regional retail chains have the highest rated loyalty programs

    I would think easy to participate, easy to understand and easy to see the benefits drive the best retail loyalty programs. Some of the capabilities around tech, special treatment, etc. contribute to these three factors. No reason smaller businesses can’t be just as adept at these as larger ones. Consumers perception of loyalty programs is usually in the peripheral, until it becomes easy for them to engage, it’s typically ignored, but a good program will quickly do exactly that -- build loyalty.
  • Posted on: 03/03/2021

    Will a third-party marketplace step up and give Amazon a run for its money?

    Retailers are looking to expand assortment and expand their brand, not compete on price and fulfillment when it comes to online marketplaces. From a competition with Amazon standpoint, retailers are more interested in offering customers a curated experience of their store, service, and unique product set. The pure merchandiser who only buys and sells with no added value is unsustainable. The marketplace can serve as an immense value-add, but less so if it’s generic. The marketplace play on customer personalization and store culture plays more to customer loyalty than new customer acquisition -- which almost always costs more.
  • Posted on: 03/01/2021

    Automated checkout ‘will be everywhere’ sooner rather than later

    Spot on Paula. Adjacent tech, much simpler to support and less costly, may end up covering checkout “friction” in the store.
  • Posted on: 03/01/2021

    Automated checkout ‘will be everywhere’ sooner rather than later

    The pandemic has accelerated contactless POS more than automated checkout. The interesting thing about the survey is that so many have not experienced the Amazon Go store yet still believe it will be successful. This powers the suggestion that checkout is still a drudgery for most customers. If anything, the pandemic has reduced the checkout traffic in stores, with less frequency to stores, shorter, faster lines and more self-checkout. I don’t believe the auto-checkout experience is ready yet, and more important, customer haven’t been able to compare it to their typical checkout experience to notice a dramatic difference. Expect only nominal change until that happens.
  • Posted on: 02/25/2021

    Are Americans ready to do some good old-fashioned ‘revenge shopping’?

    According to Alvarez & Marsal’s recent report on the Covid impact, there is a shift in consumer view of retail and new loyalties are being developed for retailers. The concept of "revenge shopping" is tied to the expectation that things will be normal -- however we have a new normal. Does this mean customers will continue to stay in their homes? No, but they will be more selective and companies that have established themselves as solid partners during the pandemic will see loyalty advantages that others will not. Per the report, customers will be continue focus on essential spending and there has been a readjustment in priorities for what matters in how customers engage. TJX may have already seen a bump in their home goods and decrease in luggage products, and increased ecommerce spending, but the real test will be in the store experience and whether these resonate with the customer’s new expectations.
  • Posted on: 02/24/2021

    Can making deliveries once a week make e-commerce sustainable and more profitable?

    This is a great idea. It addresses the last-mile delivery challenges, reducing costs and carbon footprint. However the real play moves away from apparel to cardboard packaged goods such as electronics, home goods, DIY or packaged foods. I'm not sure I would be picking up a sweater in a cardboard box from the store. The value from the apparel side is primarily in returns. Despite the focus on sustainability, retailers with tight margins will have difficulty coughing up 10 percent for sustainable delivery. They would need to see increased volume and increased basket sizes. The returns side will still need management. Consumers will be open to the concept, especially for products that are not urgently needed. If done properly, customers might even think of it as garbage pickup or newspaper delivery -- possibly replacing subscription boxes.
  • Posted on: 02/22/2021

    Should suppliers help fund retailers’ omnichannel investments?

    They already do in some form or another. The supply chain is always in motion and smaller suppliers unwilling to adjust to these added prices will find it hard to compete against vendors who do. As mentioned this works with the larger retailers and can be a challenge with smaller ones. Whether they call it infrastructure fees, omnichannel fees, increased slotting fees, or loyalty credits doesn’t really matter- they’re increasing the cost to the supplier. Combine this with delivery constraints and you have a real squeeze on the supplier. Net effect: increase product prices passed on eventually to the consumer.
  • Posted on: 02/19/2021

    Are current supply chain bottlenecks a bigger deal than normal?

    Other than a drop in air freight, the bottleneck at U.S. ports does not reflect extreme conditions, just higher than normal. About 5 to 10 percent of air flights are freight only, but with the reduction in air travel almost all airlines have resorted to shipping cargo with their planes, even to the point of refitting planes. The current scenario is temporary and we’ll find ways to move goods out of ports quickly. Transportation hubs have been a lifeline for the economy and will continue to operate with automatic adjustments. For retailers, this may translate into carrying higher safety stock or earlier sourcing of product to ensure goods make it on time. It will place importance on the logistics and reduce reliance on certain shipping options.
  • Posted on: 02/18/2021

    Is Joann’s IPO success all sewn up thanks to the pandemic?

    IPOs drive new cash and distributes ownership. The fact that Joann has been able to pull itself out of a debt filled rut is amazing, and Leonard Green as a private equity firm probably didn’t foresee this trend of Covid-19 impacting their business profitably. For the PE firm, this offers capitalization and an exit strategy and now is a great time to pull out regardless of whether the post Covid-19 market for Joann is sustainable. For Joann as a company, the craft market has been growing prior to Covid-19 by about 5.3% from 2015-2020 (Ibisworld). Competitors like Michael’s has been successful as well with comp store sales up ~16.3% in Q3 FY20. An IPO will transform Joann with much higher transparency and projects will be scrutinized more. Though notable, the steps Joann has taken to date won’t be enough to keep the momentum going -- they will need to put some effort into expanding their business and find new ways to grow with their upcoming cash infusion.
  • Posted on: 02/17/2021

    Should retailers just say ‘no’ to Instacart?

    Ditto for Ms. Masters....
  • Posted on: 02/17/2021

    Should retailers just say ‘no’ to Instacart?

    Instacart has done a great job with their platforms and in turn serviced a critical delivery need for retailers. Larger retailers will have the choice to build their own systems, but pushback is inevitable as many retailers need to integrate customer engagement in the store with online experiences. The natural evolution of the model will be sharing of customer information as this is the critical piece for retailers. The other factors including price hikes and delivery fees will be distributed back to the consumer over time as part of the service cost, and this will become standard. The retailer can only absorb these costs for so long. The second question of build vs buy depends on the retailer's focus on tech and size. The question for them will be "is there any advantage in reinventing the wheel?" For a few retailers the answer will be yes but, for the majority, Instacart or similar services with shared data and customer engagement will be sufficient.
  • Posted on: 02/16/2021

    Digital gains are changing how Best Buy puts its associates to work

    I disagree that more digital means less. There are strategic imperatives for retailers to change and it's not just profit taking. There will be changes based on geography, store functions and more. There is a shift for retail and they need to embrace the move towards a digital-physical future. Digital introduces higher demand for employees, especially in warehouse, distribution and supply chain. Customer service, logistics and scheduling become sought after functions. Many studies support the drive of ecommerce to increase overall employment, as in this example. A great read to understand this better is this McKinsey report. The report speaks to the inherent shift in tasking for the UK retail market specifically, but really taps into understanding automation and retailing of associates and other employees by retailers. The general trend is not all negative as first glance might suggest. In the Best Buy case, it’s not profit taking by greedy management. There is a shift to omnichannel culture- or rather no-channel culture where employees are more generalized. This process of cross training may cost more than maintaining workers given the training industry’s billing by employees structure. The good thing here for Best Buy is that they’re moving from a fixed, high turnover model to something closer to a Costco labor strategy. I expect those employees retained will not only have broader training options, but also higher comp over time because they’re more important to the company. As CEO Barry mentions: “our ... competitive advantage is based on ... differentiated experience” and the people are the delivery mechanism.
  • Posted on: 02/16/2021

    Digital gains are changing how Best Buy puts its associates to work

    The role of the in-store associate continues to evolve. Retail already has one of the highest turnover rates across most industries. The focus by Best Buy on cross training functionality allows for associates to be more versatile, takes them away from the drudgery of a repetitive task such as shelf stocking, and introduces the opportunity to engage customers in new ways. Some of this falls into how we service customers and the autonomy that is offered to employees. At the end of the day, 1 well trained, friendly, and excited associate will have greater impact than 3 bored, unengaged employees watching the clock. Moving as much in this direction will continue to change with how customers engage the retailer. Watch as those retailers with employees who are willing to change drive more impact, value, and sales than competitors. Expect to see more digital interfaces, delivery opportunities, remote engagement/customer service, drop off services at the store, and of course BOPIS enablement. We might even see functions tied to customer white glove treatment becoming more common in uncommon scenarios.
  • Posted on: 02/15/2021

    Are huge marketplace seller aggregators a good thing for Amazon and retail?

    It’s all about economies scale for the aggregators. They have the luxury of buying out smaller sellers at lower cost and bundling adjacent services, logistics or infrastructure to service more sellers together with automated or standardized services. It’s not much different than any other industry where smaller players are eaten up quickly -- except there are many more of these. If anything, this could reduce market power and influence of Amazon or other marketplaces. If the aggregator grows large enough they could develop their own delivery model and sales site and compete with Amazon directly-though I think this would only work with niche markets. In any case, it reduces the number of interfaces with sellers. What it should do over time is reduce costs for consumers and push out inefficient sellers in similar markets.
  • Posted on: 02/12/2021

    Will IKEA’s new furniture line be a winner with video gamers?

    Given the video gaming industry is on a tear and according to NPD group hit a 10 year peak, it makes sense that associated hardware such as furniture will also be in higher demand. According to Amazon, there was a 300% rise in the purchase of gaming chairs just after the Covid-19 pandemic hit. Interestingly, furniture makers like AlienWare, Herman Miller, DXRacer et. al. have formed relationships across the board with PC accessory companies like Logitech only making it more likely that the trend is not fleeting. Probably important to note is that a typical professional gamer can be sitting in a chair for up to 13 hours straight, especially during tournaments (NYTimes). IKEA’s position in the marketplace gives the company an edge in distribution and its branding can spur the furniture aspect of the video game business further. However, right now it’s a free for all as this sub-vertical in the furniture space establishes itself as the new accessories market.

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