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CONFERENCE REPORT


we have never been able to do before, so I see that as an opportunity. “Most CEO’s have completely


underestimated the cost of the 21st century and, if you think you can do a digital transformation on top of all the things you have been doing for the last 50 years, you’re wrong. You have to make choices, and you have to stop the things you have been doing forever. Which is the biggest challenge we have right now.” Lowe’s international president, Sylvain Prud’homme detailed the group’s digital transformation: “We have been investing for the last 12 months in Canada, building a new platform which will allow us to bring simplicity and speed to the model. We have had great success with the digital platform so far, which tells us that the customers really like and reacted well to our offer.” Ms Laury added: “From an internal perspective, probably one of the biggest challenges is the way we measure our success, and the way you reward your team being just about what happens in store. I don’t think that’s relevant anymore... I’m not thinking it is all just going to disappear, but we have to review the business; the way you need to reward people, the way you measure success is broader than just looking at stores.” Mr Prud’homme agreed, and said: “One thing we talk too much about is the speed of that change. We all know there is major change coming up, so we have to get faster to market with a much simpler approach to it.”


Are millennials transforming the business model? “The DIY industry has normally been about people who are between 30-55


year olds who own their own house, and I think when you look at the trends, and now the relationship with ownership is completely different,” Ms Laury speculated. “As I am an optimist I do not think


this is going to kill our businesses, because, whether or not they live in houses or flats, they are going to want to have a good life, and we are going to contribute to that. I think the thing that is changing, if you compare it to previous generations, [millennials] don’t have the skills, because they haven’t been taught by the older generation. So I think, us as retailers, have a role to play in that; and digital can be a massive help in that.” Mr Prud’homme said millennials have much more access than customers have ever had before, so Lowe’s is beginning by teaching employees in store. “We are working to listen, and we also have to learn and adjust from that and I think that’s probably the biggest challenge that we have and it’s from a cultural standpoint, we used to be able to tell a customer what they would need to buy in a brick-and-mortar environment, now they suddenly have access to everything, so we need to do a better job of adjusting our offer,” he said.


What are your expectations now of your leading suppliers, both in 2018 and going into the future? Mr Prud’homme said: “We have to get over the cost, because this should be the fundamental of our creative model. But then, we can start investing in solutions. So, a solution can be seen in a lot of different ways; it could be fulfilment solution. I believe the brick and mortar will


evolve because we’re lucky, we need to support the project, and even with a new generation I don’t think it is going to stop, it’s going to speed up. So, there is a lot of need, and we also probably need to do a better job of sharing this on both sides. For years, it started with the vendor having a strong stand and then came the retailer, but we need to get over it, we need to get a partnership that actually creates solutions and creates value for both retailer and supplier. “Invest in your data, it’s so important. We need to listen to our customers so much better than we are right now, because it is evolving at a speed that will just continue, so share data on both sides.


“I would say invest in the solution,


this trend is going to speed up again, it’s moving from a basic DIY model to a DIFM/DIWM model. So, invest together in this. And finally, share risks. Risks can benefit, and I think that is also key.”


Ms Laury believes strategy to be the key element of the relationship with suppliers. She said: “Looking at DIY/home improvement stores over the last 30 years, when I’m looking at the offer, it hasn’t changed enough. And, we have to do a lot of work together to understand the customer’s needs, and find the solutions of products, so, by the end of it we can say ‘yes, this is what the customer wants.’ So it’s really about innovation, and if we compare the home improvement industry to other industries, honestly, are we good enough? I don’t think we are. “The other factor is cost because, at the end of the day, you’re looking at all of these houses – whether it’s in France, in Spain, UK or Germany


or anywhere in the world, and you can see there are so many things that people are not doing, and when you ask them why they’re not doing it, there are factors: skill is one, time is another, but the most important one is cost – because people can’t afford it. So I think, at Kingfisher, we have taken that information and we want to be the one to listen to the customer. And, I think you can do both – you can innovate and you can reduce the price.”


Transformation for Suppliers J.W. Ostendorf managing director, Jan Ostendorf began the discussion about transformation in suppliers’ businesses. He said: There are probably a lot of topics that are the same for a lot of businesses; we are facing a lot of challenges to address the things that happen through digitalisation. I would say one of the biggest areas we have spent a lot of time in is about the consumer because it’s about what can you do as a business to excite people enough to actually get them up and out of the house and go and get something. I think one thing that is really the same across all consumers is it’s very emotional because it is about your house, your home, and perhaps in DIY stores the customer is not being inspired enough.


“This also has to do with the fact that I think there is maybe not enough focus on people’s projects. So what can people do? It’s just very much product focused and this is a big area where we can do a lot better in the future and we have spent a lot of time asking ourselves the question: ‘Why not put the project people first, and try to work on what that could look


L-R: Steve Collinge, Sylvain Prud’homme, Henning von Boxberg, Jan Ostendorf 10 DIY WEEK 29 JUNE 2018 www.diyweek.net


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