Posted 24. 09. 2021
Almost a thousand of key retail players met this week in person at Retail Summit 2021 in Prague Congress Centre. It was one of larger events of this year´s congress season. It turned out that retail not only got over the shock and unprecedent market fluctuation, it has been preparing for a new reality.
Will the customers be buying more food online since they got used to do so with other categories? When will they return to brick-and-moral stores and restaurants? How will they look like and what innovation will they offer? About 80 speakers were searching for a response on these questions at Retail Summit this year. Shock and the response on it were the most frequently mention words within last months. Number of companies in the Czech Republic were coping not only with maintenance of basic life functions. Despite the savings and preventive arrangements number of companies in the Czech Republic managed to move into the adaptation phase and introduce innovations.
Even though the date to be held was postponed, Retail Summit 2021 experienced high attendance and strong representation of top management and owners of companies, both among the speakers and in the audience. With almost thousand participants present at the venue, Summit is one of the currently biggest retail conferences in Europe. After months of restrictions, people clearly start to appreciate possibility to meet colleagues in person and want to share experience. Unfortunately, due to capacity limits, not all the people interested the participation could attend the event, organizers announced full-house a week before the conference. Next 28th edition is set, unusually, on April 4 – 6, 2022. Registration will be opened during the autumn.
Innovator Tomáš Čupr from Rohlik Group was a keynote this year. “Covid proved that online is indispensable in future. Food is last bulwark of retail which has not fallen to online yet. But it will come”, Čupr predicted and encouraged colleagues in the hall to invest more into online food retail to move whole market forward. Change in customer behaviour will not come just like that if services are not perfect. There is only 4 % of food sold online in Europe. In South Korea it is quarter part of the market. Great Britain, the strongest online player could reach this in four years already.
Rohlik Group expects to double its revenues this year and increase the European share by expansion to France, Spain, Italy and Romania. “With current rhythm of innovation, the brick-and-mortal will not change dramatically within next 10 years, maybe we will not be paying at cash desk only. However, online might experience greater changes within this time.” Čupr said. The current state when customer chooses products and courier delivers it, if there are sufficient capacities, can evolve into a system with the guarantee of exact delivery or service which chooses your food and you just confirm the order. According to Čupr, next step could be a fridge that is supplied itself.
Online sales increased due to new customers, 14 % of Czechs had first experience with online shopping during the pandemic. Third part in open to continue with it, 48 % prefers return to brick-and-mortar stores, Helena Horská, chief economist of Raiffeisenbank, specified.
Other speakers confirmed the indispensable role of brick-and-mortar and digital transformation. Today, artificial intelligence is able to predict visit rate development thanks to data from sensors. Flying Tiger chain earn 2 million Czech korona monthly with Pygmalios and Xovis solution. “All successful companies will be technological,” said Miguel Martins da Silva from Dr. Max.
High potential for digitalization in retail is connected especially with supplier chains. Implementation of new interconnected systems bears food in terms of increased efficiency to whole process. This brings both savings to companies and decreased negative impact on environment. To the latter, customers are paying more attention continuously.
“The changes in logistics and manufacture caused by covid may be opportunity similar to lack of butter that created margarine consequently. Today´s emergency solution may convert into profitable inventions,” Martin Tesař from Deloitte stated and proved on other parallels from history that “the world after covid” does not face so much to revolution as to accelerated evolution of phenomena hundreds of years old. For example, instead of markets, we have “marketplaces” as Amazon today. These get stronger and soon the most of the shopping will be happening there, including the companies´ ones. Sooner we realise that we have entered to new normal, sooner we can start to adapt to it.
Plzeňský Prazdroj may be an example. The company faced to 30 % of decrease of whole catering segment which equals to -104 billion CZK during the lockdown. Prazdroj particularly did not sell 111 million of beers. Company managed to maintain its direction by division into two groups. One group was managing the everyday changes while another focused on market “megatrends” as circularity or carbon neutrality until 2030. Another positive example how to survive hard times was story of Siko company. This is able to reach savings in everyday water consumption. “if you have the right innovations which is able to solve problems of all, you can have customers on all the continents and in more than 50 countries within few years,” Ondřej Sochor from Swiss Aqua Technologies, part of SIKO group, explained.
Accent on health and healthy eating increases, as Karel Týra from NielsenIQ company confirmed. Almost 65 % of consumers find mental and physical health more important since covid appeared and 36 % want to buy healthier alternatives. According to Tomáš Prouza from Czech Confederation of Commerce and Tourism Czech customer is literally in love with high quality food and cares about the food composition. However, the Czech reality is that we export raw material and import final products. “The path towards prosperity is not in state regulations but in cooperation among whole market and also in ability to see the world by customer´s perspective.” Prouza said, adding that implementation od initiatives as EU´s Green Deal or Farm to Fork will be more complicated in Czech Republic than in the rest of Europe.
Trend of healthy products preference was confirmed by Rheingold Institute research created by TCC Global company especially for this year´s Retail Summit. The healthy products offer should be accompanied by convenience as it is in case of ready to eat meals. The quality is important especially for young consumers tending towards western values, but also for older down-to-earth generation in case of fresh meat offer. Different loyalty programs can encourage customers to buy healthy alternatives. Customers search for loyalty program, at the same time, they demand transparency. They expect to gain from their collected credits corresponding reward. Kaufland Card of Kaufland company has reached 1,8 million active users, half of them use the application instead of a physical card.
Traditionally, gala evening is accompanied by Mastercard Retailer of the Year awards, including a special category Innovation of the Year – New Retail Reality. About this, the audience of Retail Summit decides. Lukáš Němčík from Coop with E-COOP and COOP Box projects won this prize. These innovations turned the smallest countryside stores into points to pick up online order. What is interesting is the importance on regional products from local warehouses. The winner of Sustainable Retailer prize was Kaufland. By O2 Digital Retailor prize Rossmann was awarded for the implementation of digital solutions for both on shop floor and customers. For them, free WiFi is available, to be informed about up-to-date offers and loyalty program.
Basic information about Retail Summit 2021
Contact: Jan Patera, Blue Events
Partnership: Štěpánka Hrdá, Blue Events
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