Starbucks CEO Howard Schultz spoke in a keynote interview at the National Retail Federation’s convention in New York City and he had some insights about the future of retail and the potential for getting left behind.He talked about the future of brick-and-mortar with a sense of serious urgency.
“It has never been more challenging for a brick-and-mortar retail merchant to succeed in an enduring way,” he said.
“We are witness to a seismic change in consumer behaviour,” said Schultz. “And that seismic change is linked to technology.”
Social, digital, and mobile are fundamentally changing the way consumers buy things. Most companies already know this, but have been slow to act.
And now, we’re at the point that retailers have no choice but to play catch up. It’s a race against the clock.
“Any company sitting here today that embraces the status quo as a business proposition … is literally facing a collision course with time,” said Schultz.
But that doesn’t just mean that you can throw up a Facebook page and think everything’s going to be fine.
To do this, companies have to make an investment — spend money on both technology and talent. It’s “mission critical” and can’t be an “afterthought,” said Schultz.
And right now, it’s more important that ever for companies to embrace this, since there are other headwinds to worry about too.
For instance, there’s a lack of trust in public institutions that must be overcome.
“We have probably never lived in a time where there has been such a low level of trust in companies,” he said. But, in turn, that leaves the door wide open for companies who can build trust with people. And with effective use of social channels, you can create a “significant cause of effect” on a business, said Schultz.
And the crisis of consumer confidence, which Schultz said is being brought on by D.C. lawmakers.
“I think there is a greater threat than what we can control inside and outside the four walls of our business,” said Schultz. “The dysfunction of Washington D.C.”
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