PROFILE

Ken Morris

Principal, Boston Retail Partners

Ken was CEO and President of LakeWest Group and founder of CFT Consulting and CFT Systems, a retail software company. Earlier in his career, he held retail information technology executive positions at Lord & Taylor, Filene’s (Macy’s), Talbots, Stop & Shop Supermarket Company, and Sears. His experience is with strategy, selection development and deployment of retail management systems and processes.

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  • Posted on: 05/23/2018

    Best Buy’s Geek Squad is now available by subscription

    Consumers have embraced the subscription service model for many services from buying memberships (Amazon/Costco) to video/audio streaming, and even printer ink cartridge refilling. Subscription plans make services easier and more accessible. The Total Tech Support subscription service plan should be a valued offering for many consumers, as technology can be very frustrating and knowing that you have a single number to call for trusted support will help alleviate some of consumers’ frustrations with technology issues. The value proposition for the recurring revenue facet of the Best Buy strategy should be very attractive to the investment community. Some retailer make essentially all their profit from the membership aspect of the business and break even on what they sell. If Best Buy takes a page from that book it would allow Best Buy to lower prices and compete with the online pure-plays who don't have the overhead of a store-based infrastructure. This will positively impact consumers’ opinion of Best Buy and it might inspire them to shop more frequently at Best Buy. Other electronics retailers will likely follow the leader. It will also be interesting to see which other retail brands will offer subscription plans for their products and/or services. It is a hot trend that will continue to expand into other segments.
  • Posted on: 05/23/2018

    Choosy marries AI and social tagging to disrupt fast fashion

    Choosy is taking the Zara business model to the next level by designing and producing garments (in as little as two weeks) that are inspired by styles worn by celebrities. Zara responds quickly to feedback from its store managers around the world, who feed daily updates to a 600-strong design team in Spain on what is selling and what isn't, which drives new style designs that are refreshed every two weeks. What is unique with Choosy’s model is that everyday consumers can now wear the same styles as their favorite celebrities as soon as a couple weeks after they spot a garment they admire. The on-demand production approach eliminates some of the biggest costs for apparel retailers: markdowns and inventory write-offs. The most challenging aspect for Choosy to execute will be to design and produce each new style within 48 hours. This is a tall order. If they can keep up with demand and execute within the promised delivery times, they could be wildly successful.
  • Posted on: 05/21/2018

    eBay asks consumers what they want

    As a consumer, I don’t mind retailers asking me about my interests and preferences, as long as it will help improve the relevancy of special offers and recommendations. Many retailers have relied on browsing data and transaction history to predict user interests, which is very helpful but could be more precise. eBay’s direct approach of asking consumers what they like is a smart strategy, as it makes personalization more accurate by taking some of the guesswork out of the marketing process. I expect that we will see more retailers begin seeking customer opinions on interests to create a more personalized shopping experience. With increased insights about your customers, you can provide better customer service.
  • Posted on: 05/18/2018

    Will store-within-a-store concepts make Hy-Vee’s more attractive destinations?

    As physical store continue to try new strategies to drive more foot traffic, store-within-a-store (SWAS) concepts have been a hot new trend. With the right brand and product mix, these SWASs can attract shoppers more frequently and consumers who might not typically shop at your store. The upside for SWAS partnerships for Hy-Vee is the increased margin per square foot and potential increase in sales of grocery items by driving more traffic to their stores. A couple of potential downsides to monitor is the potentially lower total margin dollars (space rental vs. revenues for products that were previously in that space) or alienating some customers that feel that your product mix of grocery items is too limited now. My guess is that it will be a net positive strategy for Hy-Vee and others who choose this approach. The idea here is to innovate and create excitement at the store. Grocery, from a recent BRP survey, still has 89% of all sales made in store so anything you can do to extend that unique stat is a winning strategy.
  • Posted on: 05/17/2018

    Walmart drops Scan & Go tech – again

    New technologies that require consumers to learn new processes have typically taken time to change consumer behaviors. When self-checkout terminals were initially deployed in grocery, consumers were very slow to embrace the new technology and many grocers aborted the pilots. Even today, there are segments of consumers that avoid self-checkout terminals and even those that are frequent users will opt for a staffed checkout lane for complex items that require look-up or weighing or when they have a large number of items. Scan & Go technology will likely have its time as the technology gets better and consumers learn to use it at more retail brands. Another likely scenario is that scan-less checkout technology will leapfrog the self-scanning and shopping will be even more convenient. I believe RFID isn't dead and is about to make this a whole lot easier. If you eliminate the weighing by packaging and move to RFID the whole process is as simple as grab and go.
  • Posted on: 05/16/2018

    Amazon plans to become the fresh food safety leader

    Now that Amazon owns a grocery chain and is growing home delivery of groceries, food safety is an imperative. While food safety is extremely important, it is table stakes in the grocery segment. Amazon’s focus on food safety may not necessarily drive more customer loyalty, but it will help them reduce the number of health violations and food safety incidents and respond quickly to manufacturer recalls. In todays wired economy news of recalls travels quickly (I am avoiding Caesar Salad after the recent romaine lettuce scare). It is all about protecting customers and the brand so this will be top of mind for Amazon as well as their competitors.
  • Posted on: 05/14/2018

    Is an on-demand workforce heading to retail’s selling floors?

    I understand that staffing is a big challenge for retailers, however, I don’t feel that temporary on-demand employees are the answer to this problem. The quality of customer experience is already a concern for some brand and infusing temporary employees will likely have a negative impact on service. It is not realistic to expect on-demand employees to operate at the same level of performance as experienced sales associates and it could result in disappointed customers and lost sales. As we move into a guided selling, real-time retail environment, training becomes critical in the sales process and on-demand employees do not work in that model. Non-customer facing positions like stocking, put-away and BOPIS tasks would be suited to on-demand but for a majority of retail tasks the model is risky. A better approach, in my opinion, would be to better train and reward your current team to improve retention and the quality of customer service.
  • Posted on: 05/11/2018

    The importance of prioritizing high(er)-value customers

    It is great to see that many retailers are focused on analyzing and identifying the needs for their most valuable customers. The key is to modify your programs and services to the preferences of your most valuable customers. It is also imperative that you let your associates know who these customers are so that they provide them enhanced, personalized services when they visit your store. They typically leave because of bad customer moments (return hassles, rude associates, etc.) but few retailers focus on the why to lure them back into the fold. Winners focus on the why! According to our "BRP 2018 Special Report: Personalization is Key to Customer Loyalty," while many retailers can identify their most valuable customers, only 53% have a process in place to communicate this information to an associate, and of that 89% feel that the process needs improvement. What is even more telling is that 47% of retailers do not currently have any process in place to communicate most valuable customer status to their associates before the point of checkout. This is a missed opportunity for retailers to nurture relationships with their most valuable customers and it also risks disappointing them.
  • Posted on: 05/09/2018

    Dormify pops up well before back-to-school season

    While shopping for dorm furniture should be fun, it is usually a frustrating experience to find products that are right-sized for dorm rooms. Students moving away to college and meeting new students for the first time want to make a good impression. With the help of Dormify’s Style Advisors, they can choose the right products that fit the room, their personality and will make them feel confident when they start college. Parents and their students are time starved in today's world. They are busy paying for the outrageous cost of US higher education and have little time to curate these somewhat disposable solutions, so there will be high demand for this advice. Many of the big box department and furniture stores have a lot of product options that will work for students, but they don’t have the personalized service that caters to their unique needs. This seems like it fills a retail void. Retailers like Meijer with their "Meijer Mania" are tapping into this market to grab the wallet early and often. We will likely see some of the other big retailer players emulate this type of service.
  • Posted on: 05/08/2018

    Walmart associates check out customers on the floor in pilot program

    Anything Walmart, or any retailer, can do to eliminate friction in the checkout process will be welcomed and embraced by consumers, as long checkout lines are an ongoing frustration for shoppers. The importance of efficient checkout processes is critical, as validated by the consumer survey finding that 86% of consumers have left a store due to long lines. The “Check Out With Me” program is good option to add to Walmart’s checkout alternative. Each customer has their own preference for how they would like to checkout and it sometimes differs for each individual shopping visit – depending on what they are buying or how many items they have in their basket. Giving customers options of mobile self-checkout, associate mobile checkout, self-checkout terminals, RFID assisted checkout or tradition staffed checkout lines is the ultimate way to satisfy different customer preferences.
  • Posted on: 05/07/2018

    Shake Shack ends cashless experiment

    While cash continues to decline as a percentage of purchases, many people still rely on cash and, in certain instances, prefer it over credit or debit cards. According to a consumer study by TSYS, about 1/3 of consumers prefer to pay with cash at fast food restaurants, while less that 20% prefer to pay with cash at a dine-in restaurant. Shake Shack is listening and responding to customer preferences. Until cashless is more accepted, retailers and restaurants will need to continue offering customers options. The same goes for self-ordering kiosks. While some like using kiosk, many other would prefer to place their order in the traditional way – with a human. It is all about options, options, options.
  • Posted on: 05/04/2018

    New Brookstone concept brings makers to the mall

    Infusing a steady stream of some of the most innovative new products from start-ups is a great way to make Brookstone more of a destination location and a store that consumers will want to visit more frequently. Brookstone has built its brand based on innovative products and introducing new products from small inventors will offer its customers a first look at new innovations. I was in a Brookstone store recently with my grandson who had only a limited amount of money to spend, but he was not able to find something in his price point. He then went to a Five Below below store where he had a wide assortment. Perhaps Brookstone should consider taking a page from the Five Below book to not only appeal to a younger audience, but also capture more of their spend. Brookstone's continuous introduction of new innovations will inspire consumers to poke around in their store to see what is new since their last visit. It is a smart way to keep customer interested in the brand. The treasure hunt lives!
  • Posted on: 05/02/2018

    Whole Foods to become a Prime perk for Amazon’s customers

    Since only 20% of Amazon Prime members are Whole Foods shoppers, it may be a perk that inspires these consumers to try Whole Foods. The 10% discount on all purchases seems significant enough to help offset the perception of high prices at Whole Foods and if consumers can double dip on discounts by getting another 5% off if they pay with an Amazon Rewards Visa card, that is even more enticing. While many mid-priced and discount grocers haven’t focused on Whole Foods as a legitimate competitor, they may need to start considering them as a worthy competitor. It will be interesting to see if the added discounts are enough to get consumers to become frequent shoppers at Whole Foods or if they feel the discount isn’t enough to make the prices on par with their current primary grocery store. The real opportunity here is to get people to eat healthy for a better price point. Whole Foods locations are in a limited set of zip codes so I'm even surprised there is a 20% overlap. This is a pivotal move for Amazon and I believe a game changer.
  • Posted on: 05/01/2018

    Is membership really what’s driving RH’s rebound?

    Since RH reports that 95% of its business is driven by its RH Members Program, it appears that the program has been a big contributor to its rebound. If anyone is looking to purchase furniture or a fairly expensive item from RH, the Members Program is a no-brainer, as you only need to spend $400 to benefit from the membership. The RH Members Program is also a great way to improve customer loyalty, as once a customer is a member, they will want to continue to “save” more by spending more at RH. With Amazon’s 100 million members and the success Costco and other retailer fee-based membership programs, they have proven that membership programs are well accepted by consumers. Walgreens is another example from yesterday’s RetailWire conversation. I suspect we will continue to see many more retailers jumping on this bandwagon. While the membership program is a great strategy, RH has innovated a truly omnichannel customer experience with high-touch in-store, catalog, call center and e-commerce experiences. Their RH Gallery stores, in premium locations, are a phenomenal experience where consumers can touch and feel the products and meet with designers to pick out the perfect furniture. But, you can’t purchase the products from the store and take it home, as the store doesn’t stock inventory. RH is a combination of webrooming, showrooming and catalogrooming. It is a winning model.
  • Posted on: 04/30/2018

    Walgreens tests lower prices, membership savings

    Drug stores are primarily selling commodity products (available at many stores, including online) that customers are not willing to purchase a premium prices, therefore, price is important. Since the product is the same as your competitors, you can only compete on price or service. The $20 membership program is a compelling strategy, as the discounts are significant and make consumers ROI very fast. And Amazon, Costco and BJ's have proven that membership programs are well accepted by consumers. The membership program is also a great way to improve customer loyalty. I'm not sure how long Walgreens can offer this 20% discount but if they can drive membership, they don't really need to make much margin on the product.

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