Re-tales is an interview series featuring experts in retail, commerce, and technology. In our augural post, we speak with Dave Hartenstein, Senior Director of Omnichannel at NewStore. Dave is a seasoned retail operator, having spent two decades at Modell’s Sporting Goods and Michael Kors before joining NewStore. He talks about how his job has changed with the times, why retail is all about the customer experience, and what app helps restore his calm.
Prior to NewStore you worked in retail operations. Tell us how you got your start in retail and how you got to where you are today.
My first job out of college was as an Assistant Manager at Modell’s Sporting Goods. In my mind, it was a temporary landing place until I figured out what I wanted to do. However, I quickly saw there was so much to do at the company – training that could be improved on – and Modell’s was open to change. That’s when I thought to myself, “Maybe this retail thing isn’t temporary – there’s a career path here.”
The real sticking point for me was customer experience. Shoppers are always going to want to buy and retailers will always have things to sell. But its the customer experience that makes it positive or negative for both. Once I realized this, the customer became my laser focus – figuring out how to make the customer experience better, either through technology or training or better product knowledge.
Omnichannel has been in your professional title since 2014. What was omni then and what is it now? Why are we still talking about it?
Well, before we were talking about omnichannel we were talking about multichannel. There were a lot of multichannel conversations in 2014 when bringing digital to the store started to take off. For me, it made sense because my background was brick-and-mortar. My first big project was installing a new POS system in 150 stores, and training employees how to use it to improve the customer and store experience.
After training, I became the Manager of Retail Operations then Director of Innovations. That title really was the culmination of my previous roles: physical selling, understanding how the website worked, understanding customer needs, introducing new and innovative tech. Then we took over the website because it made sense to have someone run it with various touchpoints. From there I ran Ecommerce Operations and that’s when the idea of omnichannel came about – we wanted to offer digital customers inventory in a store and vice versa. My career has really been a build up to omnichannel – very similar to how it’s come to be in retail.
“As much as we want to say this is a retail revolution, it’s an evolution. [The cultural shift is] going to take time.”
How can today’s retailers build a modern omnichannel culture? You were tasked with this at a previous company. What are your tips for today’s retailers?
My number one tip is to have a plan. Once you know what that plan looks like, it will force you to redefine what success looks like – because when you become an omnichannel retailer, things that weren’t important or were looked at as negative, become positive. For example, returns. A return might be perceived as negative but from an omni point of view, a return is another service. Look at it as how many incremental opportunities did I just gain to sell?
My second tip is ensuring the culture shift happens at the top. If you say, “A sale is a sale, I don’t care where it happens” – you actually have to believe it. The other thing to realize is, as much as we want to say this is a retail revolution, it’s an evolution. It’s going to take time. There are a lot of small wins that can be leveraged to show value, but those won’t happen overnight – or without senior-level buy-in.
The C-Suite needs to break down the boundaries that exist between teams. If you’re going to be omni you have to remember customers don’t see in channels. Top level decision makers need to also remind reports that it doesn’t matter: A sale is our sale, and we will do whatever it takes to keep a customer happy.
“You have to have an open mind because there is no right way to do omnichannel. It’s ever-evolving so share what you’ve done, take feedback, and then iterate.”
You have a background in fulfillment and in-store services. What is the key to successfully implementing these programs, which are so critical to omnichannel?
There has to be the proper foundation, which is the culture set at the top. As for execution, the key is having quick and small wins – things that will have a large impact but aren’t necessarily hard to implement. Take endless aisle. Most retailers are doing endless aisle but with broken approaches. Instead, they can take the process and streamline it into four taps in an app. The key is to start off with something you know you’re going to succeed at and get that quick result.
The other important thing is to talk about the good things you’re doing. You’re going to have to do a lot of internal marketing. After that, educate your peers. I’ve found people want to listen; they want to know what you’re doing and why. While you’re talking – and this was hard for me – remember you’re not the subject matter expert, you’re enabling the functionality. A planner, allocator or store manager might have a phenomenal idea about how to make something better because they live it every day. You have to have an open mind because there is no right way to do omnichannel. It’s ever-evolving so share what you’ve done, take feedback, and then iterate.
What implications do services like buy online pickup in-store (BOPIS) and ship from store present for the wider retail industry? Will store formats evolve specifically to accommodate these capabilities?
The biggest implication is inventory accuracy and data integrity. Inventory accuracy is the backbone of omnichannel success. And very few retailers have it. What I learned in both a $500 million chain and a $500 billion chain is that the same problems exist. Human errors, theft, varying stock room sizes…all of these things impact inventory. Yet, the systems used to track inventory (with the exception of RFID which is just starting to take off) have not evolved. Retailers are trying to maintain inventory accuracy with the same systems they used ages ago.
It all comes down to customer service. You need to understand how bad a customer’s experience is when you tell them you have something but you don’t. If you can fix this problem, your customer service is going to skyrocket.
As far as store formats, we are seeing smaller stores. Even big-box retailers are scaling down or offering smaller versions of their stores. That’s because they don’t need to carry as much inventory in their physical stores – it’s available in other locations and there are many means to deliver it.
What are the recurring themes you hear in retail industry conversations today? Could you share one roadblock and one breakthrough?
The two big buzzwords I hear are “retail apocalypse” and “experiential retail.” The retail apocalypse isn’t going to come to fruition. People have been buying and selling stuff for thousands of years, it’s not going away. You just need to be willing to change to what the customer wants. The retailers not willing to experiment and innovate are doomed.
The biggest roadblock is legacy systems. From working on the retail side to now working on the vendor side, it is clear to me. You hear far too often, “I can’t do that…my system won’t let me.” Typically, the system they’re talking about has been there for many years and trying to rip and replace it is like doing a sharp right turn in a freight train. It just doesn’t happen that quickly.
As far as a breakthrough, I believe (no coincidence of where I work) that consumer trust in mobile – especially at the associate level – has grown. It used to be, “It’s really cool that you can do that.” Now, “I’m glad you can do that.” That’s one of the biggest breakthroughs we’ve had in retail technology in a while.
We’ve talked a lot about the changing nature of retail, do you expect the rate of change to slow soon? What is your prediction for retail 3, 5, 10 years from now?
As long as people are shopping, the pace of change will only increase. There are more and more innovation labs than ever before – retail incubators, digital agencies, and even big tech companies investing in the future. Where are we going to be in the next few years? I don’t know exactly, but I do know it’s going to look a lot different from a customer experience perspective than it does today.
Think of it this way: You’re walking the floor at the NRF BIG Show. In five minutes, can you recap everything you see? Probably not because there’s so much going on in. Even if only 10% of what you see becomes reality, we’re going to be in a better place as an industry.
What mobile apps can’t you live without?
I have three: MyFitnessPal, ESPN and Solitaire (I play a couple of games when things get crazy, then I’m good to go.)
What’s the best piece of advice you’ve ever received?
Always be honest and tell the truth, because then you don’t have to remember what you said.
What does your ideal weekend look like?
Spending time with my family – my two kids and wife – and my friends.