Sector 02 / Retail

Physical and online channels, and the economics of both together.

Strategy and value creation services across the sector, from large national chains through to boutique and eCommerce-driven models.

Sector overview

One sector, and a very wide range of models.

The retail sector comprises a broad range of market segments, from large national grocery chains, through to small boutiques and eCommerce-driven business models.

Regardless of model, the sector is increasingly impacted by the digitisation of customer behaviour and expectations, a shift accelerated by the Covid pandemic and restrictions on personal movement. Digitisation is also enabling greater personalisation, with the retailers best able to use their data well-positioned to offer customised recommendations, loyalty programs and tailored experiences.

The Australian market is currently experiencing higher rates of insolvency and consolidation, as households find disposable income squeezed by a combination of higher rates, rising taxes and inflation. That creates opportunities for larger players to acquire smaller competitors and expand share and capability.

Market forces

The shifts setting the agenda.

Each of these affects the cost base as much as it affects revenue, and decisions on one are usually taken alongside decisions on the others.

Digitisation of behaviour

Customer expectations set online, whatever the channel the sale closes in.

Personalisation from data

Customised recommendations, loyalty programs and tailored experiences, for those able to use the data they already hold.

Sustainability and sourcing

Customers increasingly aware of ethical consumption, with a resulting requirement for transparency on sourcing and ESG policy.

Supply chain centralisation

A long-term trend towards large DCs, promoting availability and international sourcing of high-margin own-brand product.

AI-led discovery and purchase

Customers turning to AI to find products and, increasingly, to buy through it, with consequences for the intermediary platforms in between and for how profit pools are distributed across the value chain.

Selected client examples

Corporate strategy, range review and customer research for national chains.

Named clients are withheld. Each of these ran with a team of two to four, working alongside the retailer’s own people.

Corporate strategy

Leading national convenience chain

Corporate strategy development.

Strong alignment around a clear medium-term growth strategy
Defined customer, channel, pricing and merchandising strategy
Supported a successful sale of the business to a large international corporation