Retail Insider the magazine, Volume 3 Issue 1

Page 1

Transforming Retail Experiences with AI How technolocy is changing traditional customer service and engagement pg. 30 Pressures Mounting on Canadian Grocers A slow economy and cautious consumer wreaking havoc on Canadian grocery sector pg. 38 Retail Insolvencies on Alarming Rise Increasing cost of doing business blighting retailer efforts for success.pg. 42 VOLUME THREE ISSUE ONE Amachris: delivering world-class retail spaces for 20 years

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Volume 3 Issue 1: Examining the state of the retail industry

One of the most fascnating things about covering the retail industry is having the opportunity to witness all of the highs and the lows, while experiencing firsthand the innovatiomn and evolution that keeps the retail wheel turning. With this in mind, volume 3 issue 1 of Retail Insider the magazine attmepts to hone in on the current state of the industry, while identifying some of the impediments to success and opportunities for growth.

Industry expert and President of consultancy Bottom Line Matters, Stephen O’Keefe, contributes an article that provides a glimpse into the challenges faced by retail loss prevention teams, offering the ‘connected loss prevention ecosystem’ as a way by which brands can enhance the efficiency of processes and the safety and security of the their environments.

Salesforce Canada’s Michelle Grant shares her perspective on technologies that are driven by artificial intelligence and the ways retailers can leverage them to transform the traditonal retail experience.

We speak with the ‘Food Professor’ Sylvain Charlebois about the current grocery landscape in the country in which a slow economy and a cautious consumer are mounting pressure on the purveyors of food in Canada.

Lingering pressures from the pandemic, combined with inflation and the rising costs of doing business, have had a devastating impact on a

number of Canadian companies. We dive into the concerning statistics concerning the rising number of insolvencies occurring across the country.

We also sit down with online retailing guru, David Nagy, to discuss retailers’ current digital and ecommerce perfrormance, while identifying some of the trends and challenges to online growth.

And, in order to provide some inspiration when it comes to the pursuit of success within the industry, we celebrate an incredible 20 years of business for retail construction specialist Amachris. We speak with the company’s Founder and President, Franco Pignotti, about the company’s humble beginnings, rise to the top, and current trajectory that is solidifying its legacy as one of the top luxury retail builders around.

We hope that you and your teams enjoy this jampacked issue of Retail Insider the magazine and look forward to feedback concerning the content we create.

Sincerely,

therimagazine.com | 3
UPFRONT // PUBLISHER’S DESK

Volume three, Issue one

16 // Brand Profile Amachris: 20 years of delivering world-class retail spaces

Maintaining a focus on the customer, and remaining dedicated to core competencies and beliefs allows leading Canadian retail construction build specialists to continue growing.

22 // Loss Prevention Positive friction: the connected loss prevention ecosystem

Loss prevention professionals across the country are enhancing safety and security, while increasing efficiencies, through the use of cutting-edge technology.

30 // Artificial Intelligence Transforming retail experiences through the power of AI

Salesforce Canada’s Michelle Grant reveals how artificial intelligence and machine learning are helping to transform the traditional retail shopping experience, and the impact it has on customers.

38 // Food & Grocery Slow economy and cautious consumer increasing pressure on grocers

Reduced consumer food budgets and escalating costs requiring grocers across the country to adjust in order to remain successful.

42 // Retail Economy Retail insolvencies on alarming rise across the country

Financial burden brought on by the pandemic and the increasing cost of doing business blighting retailer efforts for success.

48 // E-Commerce The state of e-commerce: it’s time to get better in the face of adversity

Friction within an oversaturated online market leading to the need for retailers to truly differentiate themselves from competitors.

4 | Retail Insider the magazine | Volume three Issue one IN THIS ISSUE //
16 30

52 // Store Design Nearly two years later, unique Sephora store design still turning heads

Luxury retail construction specialist, Amachris, helps world-renowned cosmetics brand elevate the in-store shopping experience it offers its customers.

PUBLISHER

Craig Patterson

ASSOCIATE PUBLISHER

Dustin Fuhs

EDITOR-IN-CHIEF

Sean Tarry

GRAPHIC DESIGN

GBC Design

CONTRIBUTORS

Michelle Auger, Isabelle Godin, Shelby Hautala, Kelly Higginson, George Minakakis, Stephen O’Keefe, Mario Toneguzzi

HEAD OF SALES AND SPONSORSHIP

Darryl Julott darryl@retail-insider.com

EDITORIAL OFFICE

100 Bloor Street West, Toronto, ON, M5S 3L3

Retail Insider the magazine is published four times each year by Retail Insider Media Ltd. therimagazine.com

therimagazine.com | 5 03 Publisher’s Desk 06 Insider Insights 08 Main Street Matters 10 Evolution of Retail 12 Voice of Retail 14 Food for Thought
//
MASTHEAD
Departments 38

Canadians love BOPIS

According to data recentlly released by eMarketer, the number of Canadians leveraging click-andcollect options to make purchases continues to rise. It estimates that more than half (50.7%) of all digital buyers in the country used the form of fulfillment in 2023, with more gains expected in 2024.

What CEOs are saying

Expected 2024 growth:

51.4% of digital buyers are expected to use the option at least once

PwC recently released its 27th annual Global CEO Survey, which probes executives around the world for their take on the challenges and opportunities impacting business growth today and into the future. Here’s a snapshot of what Canadian CEOs are thinking heading deeper into 2024:

25% expect economic growth will improve this year 36% have adopted generative AI within their organizations 14% think generative AI will decrease headcount

3.7%

increase in digital buyers leveraging click-andcollect options

Sizing up the grocery shopping experience

In an effort to gain deeper insights into the hearts and minds of the Canadian consumer when it comes to their attitudes concerning today’s grocery shopping experience, Canadian Grocer teamed up with EnsembleIQ to develop the 4th annual Grocery IQ Study: Taking Stock of Grocery Shopper Attitudes and Behaviours, revealing some intriguing data.

54% regularly leverage discount grocery stores 82% say price is their number one consideration

60% think their primary store is doing an excellent job 19% are completely satisfied with their primary store 69% are enrolled in a loyalty program, 93% of whom state satisfaction

68% say redeemable points are the best loyalty reward

UPFRONT // INSIDER INSIGHTS
6 | Retail Insider the magazine | Volume three Issue one

Organized retail crime on the rise

$5 BILLION

Retail Council of Canada (RCC) claims that organized retail theft is an industry that generates somewhere in the region of $5 billion every year, costing retailers across the country crucial potential revenue. In addition, the retail association says that retail crime impacts more than 87% of independent businesses, adding that the continued rise in retail theft is leading to an alarming increase in related violence against employees. RCC recently partnered with the Toronto Police Service and Toronto Crime Stoppers to raise awareness of the growing concern. For more information about the costs of retail crime, visit ItCostsUsAll.com.

Big purchase!

A recent survey conducted by payment network, Affirm, reveals that the majority of Canadian consumers are looking to make major purchases in 2024, despite the turbulent and uncertain economic climate. In fact, the survey of consumers from across the country, indicates that many are ready and willing to make major purchases in a number of different product categories, providing opportunities for retailers that are willing to make it worth the consumers’ engagement.

82%

plan to make a major purchase within the coming months

45%

94%

of Gen Z consumers are planning a big purchase

41%

29% are planning to splurge on a vacation getaway

expect it to be difficult to stay on budget in 2024

believe the Canadian economy will improve throughout the year

The future of commerce

64%

of Gen Z respondents believe their finances will improve this year

Square’s 4th annual Future of Commerce report was recently released, uncovering trends and market shifts set to impact retailers across the industry. For restaurateurs, the future is shaping up to be much more tech-enabled.

100%

say they expect to expand their businesses within the next 12 months

89% say they’ll experiment with non-core offerings like meal kits, subscriptions, and events

44%

belive the use of AI could help solve staffing challenges

56%

plan to increase their spending on technology and automation tools

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Protecting your small business against credit card fraud

More susceptible to fraud than their larger competitors, small business owners must be diligent when it comes to safeguarding their stores

You’re standing at the checkout line. When it’s your turn to pay, you reach for your credit card without thinking twice, tap, and you move on with your day. Transactions like these happen millions of times a day, and we don’t think about it. Unfortunately, scammers do, and Canada’s small businesses are increasingly becoming a target of credit card fraud.

Prevalent challenge

In Toronto, credit card fraud was among the top five fraudulent activities within a recent sixmonth timeframe, according to Toronto Police As a small business, you can be very susceptible to fraud, and it’s important to be able to recognize and take proactive steps to protect your business. CFIB data revealed that a cyberattack costs small businesses $26,000 on average, including the value of lost time.

Chargebacks

For a small business owner, one of the most common and most expensive types of fraud is called chargeback fraud. Generally, chargebacks happen when a customer makes a purchase using their own credit card, receives a product and later files for a chargeback. A chargeback takes place because of a processing technicality, a customer

dispute or fraudulent activity. Customers can ask for a chargeback when they didn’t receive a product or service, didn’t recognize the charge on their credit card statement, when they were billed twice or were a victim of fraud, or when they believed the product or service was damaged or not as described. A chargeback fraud, on the other hand, has an ill intent behind it from the start.

While business owners will try and follow all the rules set by payment processors (such as customer verification, clear refund policy, following Payment Card Industry (PCI) rules, ensuring credit cards are signed, adhering to security standards, etc.), chargebacks continue to happen. Merchants do not have many options when it comes to fighting back against chargebacks and often feel that the process is biased against them.

Targetting point-of-sale terminals

Break-and-enters have a new target, too – businesses’ point of sale (POS) machines. Earlier this year, the Toronto Police reported an increase in break-and-enter crimes, with thieves stealing debit machines from small businesses. Once criminals steal a POS machine, they can issue

8 | Retail Insider the magazine | Volume three Issue one UPFRONT // MAIN STREET MATTERS

themselves thousands of dollars in fraudulent refunds. More than 300 small firms had their terminals stolen last year. For retailers with a brick-and-mortar store, whether in Toronto or elsewhere in Canada, that’s also something to be mindful of.

Some of the ways retail businesses can protect themselves from credit card fraud include:

•Creatingawarenessandtrainingtheirstaffto recognizefraud

•Knowingtheirrightsandresponsibilitieswhen acceptingdebitandcreditcards

•Lookingintoe-commercesolutionsthatprovidepropersecurityforonlinetransactions

•Requiringcustomerspickingupproductto provideIDorthecreditcardthatwasusedto authorizethetransaction

•SettingupnewpasswordsonPOSterminals

•AlwaysensuringtheirPOSsystemsarechip-enabled.Businessescandothisbycontactingtheir acquirer/paymentprocessor

The federal government should also play a part in addressing the unfairness in the credit card industry by:

•ExpandingtheCodeofConducttoinclude guidanceonensuringdisputescanbechallenged bymerchantsinafairandsimplemanner

•Workingwithcreditcardcompaniestoincreasethesecurityofpaymentsinordertoend costlychargebacks.Thisincludesclearguidance onwhatmerchantscandotoavoidreceivinga chargeback

•Ensuringthatcreditcardcompanies/processors abstainfromimposingachargebackifamerchanthasbeenfoundtohavedoneeverything correctly

Fee reductions arriving

Credit cards may be handy for consumers when it comes to a convenient way by which to make purchases while shopping, but they come at a high price for small businesses. The good news for those establishments accepting credit cards is the fact that fee reductions are coming later this fall. CFIB has long been fighting for fairness and changes in Canada’s payments industry, so we were pleased when the federal government acted on one of our long-standing asks and worked with Visa and Mastercard to lower credit card fees for small firms.

Now, under the newly introduced deal, small businesses with up to $300,000 in annual Visa sales and $175,000 in annual Mastercard sales will qualify for a 0.95% average interchange rate for in-store sales and a 0.1% cut in e-commerce fees.

We continue to encourage Ottawa to expand the agreement to additional credit card providers and to review size thresholds to benefit more smalland medium-sized businesses.

Being fraud aware

Credit card fees in Canada are one of the highest around the world. Lower rates could lead more business owners to accept credit cards or encourage their customers to use them, so being fraud aware is that much more important.

To report a fraud, contact the Canadian Anti-Fraud Centre, the RCMP or your local police department.

Michelle Auger is a Senior Policy Analyst at the Canadian Federation of Independent Business (CFIB), Canada’s largest association of small and medium-sized businesses with 97,000 members across every industry and region, 22,000 of whom are operating in retail.

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Redefining retail: raising capital in the age of artificial intelligence

As the world around us continues to undergo an accelerated digitization and technological advancement, retailers must adapt to succeed

Navigating the retail landscape has grown increasingly complex in recent years. In the aftermath of a global pandemic, and amid rising inflation, and climbing interest rates, consumers are adapting, seeking out savings and efficient ways to manage their lives. The industry has been in constant flux for two decades, with the advent of the internet, e-commerce, mobile technology, and digital marketing shaking the foundations of traditional retail - mostly for those in denial of change. These technological advances sparked an unexpected surge in consumer adoption, driven by a desire for greater convenience - a trend that continues to challenge retailers today. They also created massive losses as a result of business failures for those not picking up on the demands of consumers and a digital world.

The previous two decades will pale compared to the transformative changes that are currently on the horizon, which will be ushered in by barrier-breaking technology that forges new paths. Fusing artificial intelligence with the tangible world will revolutionize sectors across the board. The retail domain is no stranger to this wave of change, as it braces for continuous disruption and is poised for the profound shifts AI will bring to consumer behaviour. Investors and financial institutions also look at the retail sector and ask where and how to invest.

The role of AI in retail is expanding, with companies like NVIDIA, which has supercomputers and OpenAI, setting the pace with GPT technologies that are becoming as ubiquitous as the internet itself. Others, such as Figure.AI, leverage sophisticated robotics and GPU supercomputing to pioneer new retail frontiers. These advancements herald a pivotal change for physical retail spaces and their operations.

With all this complexity, imagine being on a video conference call to convince investors and financial institutions of the big ask: capital for your startup. The decision-makers, on the other hand, take your business plan and send it through a platform that’s able to access all their historical data, with queries sent to a GPT system. In seconds, they are told the plan is either strong or weak in comparison with similar investments they have made.

Who will get the nod?

Future-focused startups recognize the necessity of a technology-first approach. The traditional business plan now requires a digital-first blueprint to secure investment, as physical storefronts

10 | Retail Insider the magazine | Volume three Issue one UPFRONT // EVOLUTION OF RETAIL

must prove their relevance in five critical areas: 1) the unique allure that draws consumers, 2) the brand’s compelling narrative, 3) the store’s commitment to innovation and ROI, 4) its contribution to data-driven consumer engagement, and 5) its adoption of AI for forecasting trends.

The stakes are high, as each year sees the downfall of businesses and the eroding of entrepreneurial life savings due to poor planning. Investors and financial institutions lose billions. The challenge of raising capital is set to intensify, demanding a reimagined vision for retail. A proactive approach is to develop and validate operations in a digital omniverse before launching physical and e-commerce platforms. This approach allows businesses to refine their brands and strategies, bolstering their cases for funding and literally having tested their brand theories before they launch in the real world.

Inevitable change

As the retail sector stands on the cusp of change, it’s not a question of if, but how rapidly it can embrace the inevitable evolution. Integrating AI and digital twins isn’t a speculative future; it will be the reality for a resilient, thriving retail industry. Entrepreneurs must champion these technologies, pushing beyond conventional boundaries to innovate and lead.

Lenders will have little time to waste on untested ideas in a landscape where technology-first brands will overwhelmingly dominate. We must embrace a world where we can test risks and opportunities against the historical experiences of other brands within a digital twin of what we want to create in the physical world. Once launched, we can continue to test our theoretical strategies against all of our data within the confines of this digital lab.

The journey forward

The future beckons to those ready to rethink retailing, to imagine a symbiosis between brick-

and-mortar and e-commerce as digital twins, where AI and data-driven insights craft superior consumer experiences. The journey forward is more than just embracing new technology; it’s about cultural adaptation, where agility, innovation, and consumer focus are at the heart of every strategy. As consumer behaviour trends towards voice assistance and personalized AI services, the signs of this paradigm shift are already surfacing. Technology-first brands can create instant videos for customers looking for specific products and prompt them with unique messages. This level of consumer engagement is unprecedented and will only proliferate going forward. If we were to invest our capital in the retail sector, it would be with those who are further ahead with delivering technology-first brands.

The future doesn’t just arrive; it’s shaped by visionaries who dare to redefine the retail experience.

Are we ready to join them?

GeorgeMinakakisistheCEOofInception RetailGroup,authorofthreebooks,andkeynote speaker.

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Image by EtiAmmos

Canadian retail industry united in defiance against crime

Key takeaways from the 2024 Retail Secure Conference

What drives over 300 retail loss prevention experts from across North America to meet in one location? The answer: The 2024 Retail Secure Conference. Hosted by Retail Council of Canada (RCC) on March 21, 2024, in Mississauga, Ontario, the event was a defining moment in our joint efforts against retail crime. As RCC’s Loss Prevention Advisory Committee Chair and Regional Loss Prevention Business Partner at Giant Tiger, I felt a surge of energy and commitment from my peers, all determined to address the retail sector’s evolving challenges.

Retail’s landscape is shifting rapidly, along with the demands of loss prevention. Our responsibilities now stretch beyond the store, covering omnichannel strategies, supply chain risks, and advanced technology. Even more concerning is the increase in retail theft, organized crime, and violent incidents threatening employees and customers across the industry. As we move forward, adaptation and training are essential for teams to manage these challenges effectively.

Celebrating excellence

The day commenced with the inaugural Retail Secure Legends Awards, a fitting tribute to the exemplary individuals who have set benchmarks in our field. Awardees were In-Store Legend

Amir Anvarizadeh from Blackbird Security Inc, Leadership Legends Sean Sportun of GardaWorld and John Smith of Sporting Life, Emerging Legends Shahab Rahim from Best Buy and my colleague Robert Barnes from Giant Tiger Stores Limited. Their achievements not only inspire but also set a high standard for what we strive to achieve in loss prevention.

Keeping people, property, and assets safe

A series of enlightening sessions were delivered throughout the day. Dr. Larry Barton, supported by Gap Inc., shared his insights concerning ways in which to create safer workplaces. He emphasized the need for us to widen our perception of loss prevention roles – it’s not just about shrinkage but about the human element in theft and violent theft. The increase in retail violence, primarily driven by physical confrontations, demands a rebranding and reconsideration of the responsibilities of our roles and a focus on training, agility, and educated strategic thinking.

Diverse perspectives concerning several retail loss prevention and asset protection issues continued to be explored throughout the day. In

12 | Retail Insider the magazine | Volume three Issue one UPFRONT // VOICE OF RETAIL

Uniting Police, Justice, and Retail Against Crime, Superintendent Greg Watts (Toronto Police Service), Deputy Chief Mark Dapat (Peel Regional Police), Vincent Paris (General Counsel, Ministry of the Attorney General, Ontario), and Tony Hunt (General Manager Loss Prevention at London Drugs) shed some light on collaborative crime-fighting strategies and the need to look at the total impact of retail theft and crime, including longer term impacts on communities.

Sharon Bauer (Bamboo Data Consulting) addressed privacy and surveillance concerns during her session, Securing Trust, during which she highlighted the fact that retailers must be sure not to compromise any privacy laws as part of their efforts to keep their employees and stores safe, lest they be subject to significant fines.

During the session, Mitigate Loss and Enhance Visibility in Supply Chain Operations, Stephen O’Keefe (Bottom Line Matters), Jeff Yeats (Lion Guard Security) and Amir Hoss (EAIGLE) shared their perspectives concerning the need for new metrics to track loss within the entire retail supply chain, in addition to the ways by which to measure the split between distribution centres and stores, the role of AI, and the impact of optimized loss management.

In Behind the Crime: A Deep Dive into Cargo Theft, Detective Mark Haywood and Detective Constable Steve Lancia provided insights into organized crime, demonstrating retailers’ vulnerabilities during the transportation of goods.

The final session of the day, Combatting Workplace Violence, was especially powerful as Chris Nelson (Gap Inc.), Michael Lamb (Kroger) and Michael LeBlanc (Retail Council of Canada) shared examples of workplace violence and effective strategies meant to deescalate and prevent potential tragedies.

The day’s sessions underscored the power of collaboration among retail loss prevention professionals, police, legal experts, government

officials, community leaders, and mental health experts in creating safer retail environments.

Reflections and takeaways

The Retail Secure Conference underscored our crucial role in transforming the retail landscape. The insights gained reinforced the importance of viewing retail safety as a societal concern, not just a business one, necessitating holistic strategies. Continuous learning and training are vital, as is the compassion we show our teams. Each of us play a key role in fostering a safer retail world. I encourage active participation, whether by joining RCC’s Loss Prevention Committee or contributing to the dialogue. Every effort counts in our mission for a safer retail environment.

View photo gallery of RCC Retail Secure 2024.

Isabelle Godin is a 20+ years loss prevention veteran and is Wicklander Zulawski trained in interview and interrogation techniques.

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Images courtesy of RCC Top: Dr. Larry Barton Bottom: Shaon Bauer, Bamboo Data Consulting

From crisis to opportunity: restoring predictability in the food service industry

In order for small business, family-owned and national franchise establishments across Canada to thrive, it’s imperative that labour market and workforce strategies prioritize their needs

Dining out is about sharing laughs over shared plates, trying new dishes, and making memories with friends and family. It takes a lot to keep restaurants thriving and providing the great service and delicious food we admire them for. But the demand for labour is high.

The $100 billion foodservice industry is the fourth largest private employer in the country, with 96-cents of every dollar spent in a Canadian restaurant going back into the community and the economy. For some perspective - the often-admired mining industry represents $125 billion.

Unfilled positions

The foodservice industry is not one that can be easily dismissed. Unfortunately, the industry realities are stark; 62 per cent of operators are operating at a loss or barely breaking even compared to 12 per cent pre-pandemic. It has the highest number of job vacancies in the private-sector, accounting for one out of every six job vacancies in Canada. These openings aren’t easy to fill due to significant demographic shifts within the workforce. On average, Canadian restaurants operate at 80 per cent of their normal capacity due to labour shortages.

Currently, employers operating within the foodservice sector are able to hire up to 30 per cent of their workforce through the Temporary Foreign Worker program. Beginning May 1, this will be reduced to 20 per cent in an effort to shrink temporary residents’ share of Canada’s population. This new cap on temporary foreign worker permits will exacerbate job vacancy rates in the restaurant sector even further – there are more than 130,000 unfilled positions in restaurants across Canada.

Bankruptcies and closures

Unfortunately, this labour challenge, coupled with inflation, means many restaurants are struggling to keep up. Rising operational expenses have eroded narrow profit margins, leading to a 41 per cent increase in the number of bankruptcies, up 9 per cent from July 2023. Last year saw a record number of restaurants closing their doors. This is heartbreaking for owners and staff, and for those of us who loved dining out at these restaurants.

14 | Retail Insider the magazine | Volume three Issue one UPFRONT // FOOD FOR THOUGHT

Smart integration policies

Efforts to reverse this trend will require support from the Canadian government through targeted policy changes. In 2018, Immigration, Refugees and Citizenship Canada (IRCC) launched the Destination Employment program, facilitating the workforce integration of newcomers. It trained new Canadians for in-demand employment opportunities in the hospitality sector. Designed to support new Canadians in their job search, it connected them to well-paying, skilled jobs.

This program saw great initial success but was suspended due to the onset of the pandemic and has yet to be reinstated. However, the infrastructure required for the program’s administration remains in place within the IRCC.

Smart immigration policies offer a win-win solution by alleviating labour shortages while

also providing newcomers to the country, including refugees, with valuable Canadian workforce experience.

Keeping restaurants open and thriving

Policies that are good for restaurants are good for Canadian communities. Reinstating and expanding the program to include a broader range of hospitality positions will increase opportunities for new Canadians to build a valuable career in foodservice. Not only will it create economic opportunities for newcomers, but it will help keep our favourite restaurants open and thriving for many years to come.

Kelly Higginson is an experienced leader with more than 25 years working within the hospitality industry, serving as President and CEO of Restaurants Canada.

POLICIES THAT ARE GOOD FOR
ARE

Smart immigration policies offer a win-win solution by alleviating labour shortages and providing newcomers with valuable Canadian workforce experience.

Learn more at www.restaurantscanada.org or scan the QR code.

CANADIAN COMMUNITIES.
RESTAURANTS
GOOD FOR

Maintaining a and remaining competencies leading Canadian build specialists // By

16 | Retail Insider the magazine | Volume three Issue one FEATURE // BRAND PROFILE
Amachris: 20 years delivering world-class retail
Inside the Gucci Shoe Salon at Yorkdale Shopping Centre in Toronto, Ontario

Amachris: years of delivering world-class retail spaces

a focus on the customer, remaining dedicated to core competencies and beliefs allows Canadian retail construction specialists to continue growing

therimagazine.com | 17
Image courtesy of jamesteohart

Achieving success within any business venture today is proving to be an extremely tall order. A disruptive confluence of shifting market dynamics, a volatile economy and ever-intensifying competition has helped to create an incredibly turbulent climate for most industries to navigate, requiring businesses to build nimble strategies that allow them to operate optimally amid such adversity. They are conditions that are challenging the resolve of many, making efforts to sustain any kind of success nearly impossible. It’s a sentiment that resonates with players operating within most sectors around the world, but one that rings especially true when referring to the retail industry and its supporting partners, resulting in milestones for any company becoming extremely special and, indeed, highly unique. It’s what makes the growing legacy of leading retail construction specialist, Amachris, so compelling. The company is currently celebrating its twentieth anniversary as it continues to maintain its positive trajectory, enhancing its reputation further with each project that it embarks on. It’s a feat that’s recognized by Franco Pignotti, the company’s Founder, Owner and Managing Director, and one that he says drives him and his team to improve every day.

“I had the idea to start the company more than twenty years ago as my contract with a former employer was running down,” he explains. “And, to be honest with you, it was really spurred on by the fact that I was at a bit of a professional crossroads. I had the choice of going through a renegotiating process to earn another contract, or, going out to do business on my own. I was 42 years old at the time. I figured if I took on another contract, then I’d likely never take the leap. So, after a lot of reflection and encouragement from my family, I decided to go for it. And what can I say? We’ve never looked back. I’m incredibly proud to be celebrating this amazing milestone, and to do so while we’re still building on our successes. It’s something that everyone at the company recognizes. And we tend to use it as a way to push ourselves to continuously improve and get better for our clients.”

A specialty service offering

It’s a mindset that drives Amachris, leveraging its laurels as catapults to further achieve, rather than rest on them. However, success was not an immediate result for Franco and his team. Having previously worked for iDX Corporation, a non-compete stipulation was invoked for the first year of Amachris’ operations as a company, meaning that Franco had to grow the business from the ground up. With a clear vision for the company, a ton of dedication, and hard work to help bring it to fruition, the legacy of the leading retail construction specialist was started.

“I had gained a lot of experience working within the interior design and construction world, and noticed that there was a real need for these types of services among brands within the retail industry,” he says. “I felt as though I could start the company that caters to those clients, becoming a leader in the space. But, to do this with the greatest impact possible, I knew that we needed to specialize within the luxury brand segment. The interior look and aesthetic, and the functionality of these spaces, is incredibly important to these brands. It wasn’t long before I realized that we were really on to something. There was a significant gap within the industry. and Amachris filled it by consistently delivering positive results and the highest quality projects, on time, and with a high value proposition.”

Personalized relationships

The company, headquartered in Bolton, Ontario, boasts a healthy array of clients across the industry, including Sephora, Gucci, Ferragamo, Saint Lauren, Giorgio Armani, Urban Barn, Marc Jacobs, Abercrombie & Fitch, and more. And, the services that it provides its clients are just as impressive, including general construction services and project management. In addition, the company will also act as landlord liaison for its clients, and will often interact with leading retail architects and brand designers when coordinating and installing layout and material specifica-

18 | Retail Insider the magazine | Volume three Issue one
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Image courtesy of jamesteohart Image courtesy of Amachris Image courtesy of JD Sports Top Left: Sephora at Union Station in Toronto, Ontario Top Right: JD Sports in West Edmonton Mall Bottom: Urban Barn in Mississauga, Ontario

tions. It’s all part of what Franco describes as the company’s customer-centric approach to business. And, it’s one that he believes has helped to set Amachris apart from its competitors throughout the years.

“Everyone operating within this industry would like to think that they’re interacting with and servicing their clients in unique and special ways,” he explains. “But, as I found through experience, it’s very difficult to perform that type of job and deliver the kind of personalized service to clients while working within a corporate structure. I found that there are too many processes and procedures within corporations that actually prevent this type of service. There are also often too many layers within these organizations, especially within those that service multiple industries and sectors, holding up response times and work from being done. I wanted to make sure that our company was flat with respect to the number of layers within it, and that each and every one of our clients can reach the president if they need to, without the need to go up and down the hierarchy of our organization trying to find a solution to a problem. It allows us to remain close to

“A strong culture organically strengthens connections between coworkers, and as a result, it also helps to strengthen the relationships we build with our clients.”
- Franco Pignotti, Amachris

our partners, properly service their needs, and immediately jump into action whenever there’s an issue that needs addressing.”

Heart and integrity

It’s this personalized, hands-on way of working with clients that has clearly paid dividends for Amachris over the years. It’s something that Franco explains makes clients feel looked after and appreciated. It’s a sentiment that his daughter, and the company’s Manager of Marketing and Business Development, Alessia Pignotti, agrees with, sharing an anecdote about her father that seems to poignantly and effectively capture the spirit and essence of the Amachris brand and relationships that it’s built with partners.

“I obviously have a unique perspective of Franco given the fact that he’s my dad,” she says. “I remember when I was younger and there was talk within the family about him starting his own business. Trying to be as efficient as possible, he did something that speaks volumes to his character and the foundation on which Amachris was built. When he realized that he needed a desk for his office, rather than go out and buy one, he decided to make one with his own hands instead. Looking back on that moment in time, that simple act says a lot about Franco as a leader, and also reflects the values of the company. Conceptually, this is the level of integrity, passion, and quality that extend into everything we do for our fantastic clients.”

A strong culture

They’re qualities that the company’s Founder and President says have been borne at least in part as a result of the fact that Amachris is a wholly-owned, family-run Canadian business. He says it’s allowed him and his team to remain focused on consistently delivering around their core competencies and beliefs. However, in order to maintain focus, he points out that a great deal of emphasis and importance must be placed on the culture that’s developed within an organization.

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“We strongly believe that an excellent culture is essential toward ensuring long-term success,” he asserts. “And, because we’re a family-run business, every employee that works for us becomes a member of the family, whether they like it or not. It’s a significant part of the reason why finding the right people to fill roles within our company is such a crucial component to sustaining our continued growth. A strong culture organically strengthens connections between coworkers, and as a result, it also helps to strengthen the relationships we build with our clients. In addition, it makes it easier for us internally to figure out what resources are needed and the ways we can pull them together so everyone in the company thrives within their roles. It’s something that we’re constantly trying to improve. That’s why finding talent who are a great fit within our culture is extremely important.”

Continued growth and success

When reflecting on the past 20-plus years in business, it seems relatively easy for industry analysts, even for the casual observer, to identify a number of projects that have helped to define

Amachris as an industry leader. Projects like its first Urban Barn build in 2005 (client for 19 years); it’s first Abercrombie & Fitch build in 2009 (client for 15 years); the Sephora “Toronto Takeover” in 2016 (client for 13 years), which included the building of six flagship stores within the city in six months; as well as builds for a number of different luxury brands, including Sephora/LVMH, Gucci, YSL, Ferragamo, and Giorgio Armani (each a client for the past 5 years), have placed the company in a category of its own, When listening to Franco, it seems that Amachris is set to continue building on its already incredibly impressive legacy.

“Looking back at the past twenty years, and all of the successful projects that we’ve been involved in, fills me with pride. But, in many ways, it almost seems as though we’re only getting started. We’ve done enough to this point to solidify our place as a leader within the luxury retail space. And our goal going forward is to continue looking for exceptional international clients to partner with, growing on the basis of honesty, integrity and hard work that we built the company more than two decades ago.”

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Image courtesy of Giorgio-Armani Emporio Armani at Yorkdale Shopping Centre in Toronto, Ontario

Positive friction: the connected loss prevention ecosystem

Loss prevention professionals are enhancing safety and security, while increasing efficiencies, through the use of cutting-edge technology // By

22 | Retail Insider the magazine | Volume three Issue one FEATURE // LOSS PREVENTION
Image
courtesy of Images Rouges

Ona busy Friday afternoon in your local retail store, there is a tremendous amount of activity taking place on the salesfloor, and behind the scenes, too. It’s not uncommon for a store’s security system to be sounding an alarm at the exit as a confused customer looks around, not understanding that it’s the result of a cashier’s failure to remove a security tag from an item they just purchased. Nor is it rare for the faint sound of a fire alarm to be heard ringing in the distance as a thief attempts to make a quick getaway with merchandise, or for other alarms to be triggered by the swaying of front-end security gates as another shopper crashes through them toward the exit with a shopping cart full of goods. And, overhead public address announcements resonate throughout the store asking for customer service representatives to go to one of the many departments where highly-pilfered goods are now locked up, requiring customers to wait patiently in order to make a purchase, sometimes turning a routine pickup into a half-hour ordeal.

With all of the alarms and whistles sounding, it’s no wonder employees aren’t able to hear the bell

for the back door ringing, alerting them to the delivery-person that’s trying to drop off a shipment of goods. Further, with all the excitement, noise and frenetic activity that’s commonplace in stores today, any brand’s claim of a frictionless shopping experience is considered a myth by most annoyed customers. And, on top of all of this, the security person that’s expected to be creating a visual deterrence to theft and responding to many of these alarms is nowhere to be seen. Instead, they’re trying to investigate activity from a day earlier, piecing together events from a host of stored video clips captured by a number of different cameras located throughout the store.

In light of this less-than-flattering description of the experience, a number of questions beg: has loss prevention, as some critics claim, truly become sales prevention? Have our security systems become so intrusive that the honest customer feels guilty whenever they walk through the front doors of their local retail shop? But… more importantly - how do we address this notion of hardening stores as a target to the organized criminal underworld that’s preying on

therimagazine.com | 23

the ease of reselling stolen goods in a ubiquitous social media era of grey market commerce?

Well, in short, all of these questions and challenges can be answered and met with the development of a loss prevention asset protection ecosystem of integrated solutions. Afterall, the success of any retailer is measured by one fundamental driving principle - that the retailer can grow their top line while controlling their expenses in order to maximize their bottom line. Simply stated, and complex to achieve, but the bottom line matters.

Enhancing

processes and efficiencies

The Ford Motor Company discovered in the early 20th century that the way by which it could increase adoption of its product among the public was to make it more affordable to the end consumer. This was facilitated by lowering the cost to produce automobiles, which was enabled through enhanced efficiencies within the company’s processes. It remains a truism today, as retailers strive to create clear and concise standard operating practices, spend top dollar to rally the troops so that every employee is aligned to

...as a retailer, you are inherently subject to a criminal element that wishes to prey upon the fact that you sell a commodity which can be traded on the legitimate market and, alternatively, traded within an underground market for nefarious purposes as well

the strategy and the goals of the company, and continuously improve processes that have been identified as deficient or instrumental in causing a loss. But there remain several unknowns that occur as evidenced by retailers’ inventory reconciliation, which are typically categorized using the terminology “shrinkage”.

Shrink and crime

The majority of shrinkage is related to criminal activity whereby employees or customers steal or defraud the retailer for personal gain. That personal gain can be as basic as shoplifting an item or two for personal use, or as felonious as outright robbery for the purpose of resale, and for any number of reasons in between.

Most retailers around the world would agree that there’s a growing global phenomenon of criminal activity currently occurring in stores. Regardless of the current debate over the validity of a “shrink survey” - which carries with it a significant amount of opinion related to the use of data that attributes a portion of the criminally-charged losses to certain categories - the fact is that, as a retailer, you are inherently subject to a criminal element that wishes to prey upon the fact that you sell a commodity which can be traded on the legitimate market and, alternatively, traded within an underground market for nefarious purposes as well. In plainer terms - loss caused by thieves is a growing concern within the industry.

There are many reasons that help explain why this is happening. Some of these reasons are within the grasp of a retailer’s control. And some are arguably completely out of their hands. Need, greed and other socio-economic conditions are difficult for a standalone store to protect itself against, as are substance abuse and mental health issues. However, what is directly felt in full by retailers is the loss caused by crime, which can result in the loss of product, loss as a result of damaged property and fixtures and, at times, the unthinkable loss of life.

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Positive friction required?

Many retailers over the past decade have been pushing for a frictionless shopping environment for their customers to enjoy. “Remove the barriers”. “Create an omnichannel offering”. “Provide a frictionless shopping experience for the customer”. These are statements, among others, that have recently been made by various retail experts at conferences across the continent, conveying the direction in which they think today’s customer wants to go. And the criminals have been all over it, promptly taking advantage of the trend. In fact, in many cases, criminals have been enjoying the frictionless experience by simply walking out of an unprotected store with as much product as they can carry or wheel out in a shopping cart.

As shrinkage has grown to levels greater than they have been in over three decades, the call is now for retailers to take back their stores, to harden themselves as targets. And this, it could be argued, suggests that perhaps a little friction

might be required in order to safeguard its product and customers. The fine balance approach, however, is more of an attitude towards positive friction. Trust, but verify!

Creating a safe and secure environment

Retail security and safety professionals are charged with the challenge of creating and ensuring a safe and secure environment for the brands they represent. In order to protect people and assets, there is a heavy reliance on technology. However, most often, the use of technology has traditionally been part of a band-aid approach to unique situations - a medley of systems by no means acting in concert with one another.

Over the past few years, solution partners (vendors and suppliers of security devices and software) have been tasked with collaborating to create a synergy of systems for businesses. One device must inform another to establish a continuity of activity that a loss preventer can deal

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Images courtesy of Motrola Motorola’s CURVE 2-way radio helps connect the entire retail security ecosystem

Motorola’s CURVE 2-way radio allows loss prevention teams to focus on keeping retail environments safe and secure

with effectively and quickly. And, these connections must be seamless, and must not impede on the fundamental reason store doors open to the public - to provide them with the goods and services they want and need, when they want to shop. Recent language has been used to describe this as a ‘loss prevention ecosystem’.

In any environment where multiple systems join together to form a network, the fundamental guiding principle is that a response is required to deal with exceptions, outliers, or anomalies. If this is not the case, then the store would simply be filled with a lot of noise. The only way people are able to respond to an event is if they are aware that the event is taking place. Motorola Solutions has been an instrumental component within some of the most successful security operations, from basic safety systems to the most complex military deployments. Distributed by Lenbrook Canada for the retail sector, radios have taken on

a critical role in the underlying loss prevention management system that preserves and protects retailers’ bottom line from erosion due to criminal activity.

How the system works

Whenever an alert, alarm, or notification is generated by the Motorola device, a signal is sent to a central hub. The central hub is a dynamic network component that receives messages depending on the structure of the individual end-user’s ecosystem, and determines how the communication network functions in order for the notification to be sent to the right person. The hub then sends an audio message to a predefined responder via direct audio link or using 900 MHz signals to the Motorola CURVE 2-way radio.

It’s important to note that these devices are the same fundamental devices that comprise the

26 | Retail Insider the magazine | Volume three Issue one
Image courtesy of Motorola

communication network for Operations in order to meet the wants and needs of the customer in a noise free environment. However, today’s units serve more as an audio email network. A supervisor can leave a message for a distribution list the day before they start their shift. When they retrieve their device and sign into the network at the beginning of their next shift, the message plays out for each person that the supervisor wants to speak to. Likewise, customer service BOLOs (be on the look-out) can be sent at any time to keep employees alert should there be a need to address a risk or threat in the area. Indeed, the Motorola CURVE 2-way radio has come a long way!

The broken telephone analogy

Most of us have fine memories of the childhood game of broken telephone. The game in which people, sitting in a circle, pass along a whispered phrase to one another until the phrase returns to its originator. And, most often, by the time the message is conveyed back to its originator, it’s become so altered that it might not have any semblance to the original message. In fact, the message is typically so diluted that it no longer makes any legible sense whatsoever.

This game of broken telephone, however, is not isolated to child-play. It happens in the business world every day. And, at times, it can result in catastrophic consequences. The clear and concise transfer of information is critical in order to make an educated decision about any situation. One occurrence must inform another. This is why the integrated solutions coming out of the loss prevention community are so critical. If the bad guys are organized, then the preventative and investigative technology that’s being leveraged to face them head on needs to be organized, too.

Motorola hardware and software enables such technology to expose potential incidents that could result in loss or harm. Ultimately, the message gets to the person that’s responsible for responding, and is free and clear of anything at

all resembling a broken telephone message. Lone worker and person down solution

The most common use case for these types of devices is to conduct two-way radio communication. However, the latest technology offers a highly-sought-after lone-worker solution. Since the devices are now wi-fi and long-range cell network enabled, the second device need not be anywhere in proximity to the first device. A worker in a remote environment can now be checked in on periodically in order to ensure that they are safe by simply pressing a conveniently located button on the device. Even if the person is disabled for some reason as a result of a fall, a health condition, or an attack, the radio will continue to function sending out an alert to the second device, notifying that there is a “person down”. You can connect these devices to any smartphone using the Motorola Wave App for seamless communication between all devices.

“Customer service required to the lock-up cabinet!”

Locked showcases have become ubiquitous in retail stores in an effort by retailers to protect

The clear and concise transfer of information is critical in order to make an educated decision about any situation. One occurrence must inform another. This is why the integrated solutions coming out of the loss prevention community are so critical.
therimagazine.com | 27

high-risk items from being pilfered by thieves. Critics argue that these showcases might prevent loss, but that they likely prevent sales as well. Frustrated customers often don’t have the patience to search out an employee who has the keys to retrieve the items they want, and will likely go elsewhere to shop for them. A conveniently placed “Help” button near the items has generally been the response to this problem.

However, Motorola has designed its own wi-fi enabled help button. By pressing the button, a message is activated and sent to a designated radio whose holder (the customer service responder) can then attend to the locked showcase and service the customer promptly. Pilot projects using the device with help buttons have experienced a 30-45 second response rate. No longer is it necessary to engage an overhead PA announcement blasting out a help needed message to the entire world.

Security system circumvented alert

Security systems are designed to reduce exposure to risk. For safety reasons, they are generally able to be breached. An alert of the breach is critical, and alarms are standard. However, when a system is breached, it’s critical that staff respond in the event that a crime can be prevented or important observations and critical evidence concerning the event can be collected.

Using the Motorola Hub, retailers have been designing an alert protocol whereby a designated responder is notified via their device that a breach is in progress. Since the messaging is immediate (simultaneously creating an alert when the local alarm is activated), the responder can attend to making observations of the perpetrators’ actions, even so far as obtaining a license plate number if a get-away car was used. With the Motorola Body Worn camera, some end-users even obtain CCTV footage of the criminal activity, ultimately helping to prosecute offenders.

Motorola’s personal worn devices have found

a place in today’s retail environment. With the proliferation of cell phone video usage and social media, the reputations of retailers have been put in question following the posting of short clips to online channels for millions to see. Retailers have been seeking a way to control this narrative, to record an entire event whereby a confrontation and bad act on the part of the retailer is alleged, but not true. These devices have been instrumental in diffusing public relations disasters, and helping retailers provide a meaningful defense against unfounded allegations against them while also providing evidence of a criminal act.

Beyond security solutions

Local delivery drivers have traditionally felt the frustration of a busy retail shop for generations. Standing alone at the receiving door, pushing the bell for 30 minutes, or more, is not an anomaly, but rather a standard within the industry. It’s an occurrence that has left many wondering if there’s a solution to this problem. And now, there is. Some end-users are experimenting with a wi-fi enabled bell at the back door of the store that will immediately notify the responder to open the door for a delivery, even if that person is away from the receiving area.

The human element

Security systems alone can only achieve a certain level of protection. In order to obtain a level of true safety and security, human intervention is required to respond to incidents and events. However, the effectiveness of that person’s involvement is only as good as the speed and accuracy of the information that they receive. With an integrated system, this type of intervention is easily triggered, allowing for a range of different risks to be responded to.

For more information concerning Motorola Devices mentioned in this article, please contact Lenbrook Canada Solutions at:

28 | Retail Insider the magazine | Volume three Issue one
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Transforming retail experiences through the power of AI

Salesforce Canada’s Michelle Grant reveals how AI and machine learning are transforming retail shopping experiences // By

30 | Retail Insider the magazine | Volume three Issue one FEATURE // ARTIFICIAL INTELLIGENCE

Fromsmarter shopping experiences to ethical considerations, a conversation with Michelle Grant, Director, Strategy and Insights, Retail and Consumer Goods at Salesforce, sheds light on the exciting – sometimes challenging – use of data and its effects on consumers. Grant offers insights into the latest innovations, strategies for adaptation, shopping experiences, and how critical it is for retailers to maintain the balance between embracing technology, collecting data, and maintaining consumer privacy.

New era of data strategy

Retailers are actively evolving their data strategies to use the full potential of AI, but are not completely there yet.

Grant says it has been a slow start and that more retailers could be using AI to its full potential, but that they’re beginning to pay more attention to things like collection, cleansing, using more data sources, ensuring accuracy, understanding data, and the ways in which data impacts relationships with consumers.

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Image courtesy of ipopba

“Retailers are in a transformative phase where the focus has shifted from just collecting data to truly understanding it,” she says. “With stricter privacy laws and technological advancements, the real challenge and opportunity is in how we collect, clean, and use the data to not just understand our customers better, but also to respect their privacy preferences. It is about building trust through transparency and personalized experiences.”

Due to the evolving privacy policies, such as Apple’s iOS update, which limits tracking across different websites, and Google Chrome’s plans to depreciate cookies; privacy policies now restrict how retailers collect data. As a result, Grant says retailers are refocusing on gathering data through customer interactions, whether it be online, through loyalty programs, or in-store experiences. Retailers can apply data across various functions from predictive analytics and inventory management, to implementing AI-driven per-

sonalization in marketing and customer service. Using data from these sources is required in order to tailor marketing strategies, optimizing channels and content, and enhancing the overall consumer experience, but not without challenges.

“Retailers are now navigating a new era of data strategy where the focus is no longer just on collection, but on the intelligent use of data,” she explains. “This shift is driven by the need to adapt to privacy changes, like the iOS update and the move away from cookies – pushing us towards first-party data. It is about leveraging this data to not just understand customer behaviours and preferences, but to do so in a way that respects privacy and enhances their shopping experience.”

Enhancing retail with AI-powered interactions

Grant explains that by collecting customer interactions, history, and by using predictive analytics,

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courtesy of Syda Productions

retailers can offer a more personalized and efficient level of service, and enhance customer engagement and satisfaction. Before this, however, retailers need to start understanding its collected data to be able to improve its offerings first.

“Retailers have been collecting data since the 1970s, so collecting data is not the problem,” she asserts. “Retailers have a ton of data from their apps, websites, and loyalty programs. All of this data has been built over time. It is important for retailers to start off by taking a step back and assessing what they currently have, and then develop a plan to untie it, clean it, and harmonize it. There is technology out there retailers can use to unite and aggregate all the data into one place and make it actionable, allowing retailers to take the data and improve customer service by creating a more personalized experience.”

Grant emphasizes the fact that the use of data goes hand-in-hand with respecting privacy concerns, ensuring customers trust is never compromised. These data-driven approaches also contribute to operational efficiency, including streamlining services and reducing response times, elevating the overall consumer experience.

“Data is the cornerstone of modern customer service in retail,” she says. “By leveraging insights from every customer interaction, retailers are now able to offer a level of personalization and efficiency that was previously unattainable. This is not just about resolving issues quicker; it is about creating an experience that resonates with customers individually, while respecting privacy. The end goal is always to foster trust and loyalty, and data-driven strategies are key in achieving this.”

Streamlining product feedback with AI: faster, easier, and smarter responses

AI simplifies reviewing consumer feedback and makes it easier for retailers to collect information. Grant says AI can automatically analyze large amounts of data from various feedback

channels, such as consumer reviews, social media comments, and through shopping interactions. And it can all be done in real-time, allowing retailers to respond to consumer feedback faster and adjust products if necessary.

“Say there is a production where a product failed, quality was poor, or the colour was off from the online product description,” she suggests. “You can either stop that production on that item that is faulty, or you can change the online description to reflect the product better.”

“Data is the cornerstone of modern customer service in retail. By leveraging insights from every customer interaction, retailers are now able to offer a level of personalization and efficiency that was previously unattainable.”
- Michelle Grant, Salesforce Canada

AI could also offer personalized responses, making each consumer feel heard. It has the potential to be more engaging. And, if there are multiples of the same concern, AI can detect and red flag it. Along with this, machine learning is able to predict future trends and consumer behaviours, predicting issues before they arrive, allowing retailers to adjust accordingly.

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Personalizing retail: the impact of AI and machine learning on marketing

In the retail world, AI and machine learning are not just futuristic concepts, but tools retailers use to reshape marketing strategies.

“AI and machine learning have fundamentally changed how we approach marketing,” she says. “These technologies enable us to analyze consumer data deeply, understanding patterns and preferences that were previously unnoticed.”

Going beyond basic demographics and purchases, AI and machine learning dives into subtle behaviours as well, painting a picture of each consumer:

“It’s more than just sending out a marketing email,” she asserts. “Its about ensuring the emails resonate with the recipients on a personal level.”

Algorithms actively tailor content, timing, and communication channels to match each customer’s preferences. Grant says this level of customization increases the effectiveness of marketing campaigns, meaning consumers are receiving relevant and timely messages.

Taking personalization to a new level, Grant says AI can influence product recommendations and orders. AI provides personalized product suggestions from gathered data on consumer behaviours:

“The impact of AI-driven recommendations is significant,” she says. “Not only guiding customers to products they are likely to enjoy, but also increasing their likelihood of purchasing.”

AI and machine learning can also predict demand for products, understand patterns from a consumer to predict what they need in the future, and can help identify fraud.

“We have seen cases such as Amazon, where if consumers are abusing its return policy, you

are no longer able to shop with them,” she says. “So, they are using data and analytics to do that amongst returns. And when things are being returned, how do you get it back on the sales floor again if it is sellable? Data and insights will help you do that and will tell you what products are being returned a lot.”

Retailers are also keeping up to date with marketing strategies as machine learning provides relevant and engaging information as it continuously learns and adapts based on interactions, crafting messages with a deep understanding of the individual consumer.

“Every click, every purchase, and every online interaction feeds back into the system, redefining the marketing approach,” she explains. “AI and machine learning are revolutionizing retail marketing by enabling a level of personalization we have never seen before. By analyzing consumer data, these technologies allow us to create marketing strategies that are not just effective, but are deeply personalized. We are now able to send the right message, through the right channels, at the right time to each individual consumer, making every interaction more meaningful and impactful.”

“Don’t Be Creepy”: risks of over-personalization

Grant cautions against taking AI and machine learning tools too far with personalized experiences as it could scare off consumers.

“Personalization in retail must be handled with care,” she warns. “There is a real risk of crossing a line where personalization becomes intrusive. Retailers need to be acutely aware of this balance. It is about understanding your customers without making them feel uncomfortable or watched. When personalization starts to feel invasive, it can quickly turn a positive customer experience into a negative one, leading to a loss of trust and potentially driving customers away.”

While personalization is a growing trend and

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can be effective, Grant emphasizes retailers must balance it and use broader marketing approaches. This balance, Grant says, revolves around respecting privacy, understanding and following legal boundaries, transparent communication with consumers, and building trust through ethical data practices.

“Retailers must navigate this space carefully,” she says. “We need to use data to enhance our understanding of customer needs without crossing into territory that makes them feel exposed or vulnerable. This is where clear communication about our data practices becomes critical. By being upfront about how we collect and use customer data, and by giving them control over their own information, we not only comply with regulations, but also build a foundation of trust. Ultimately, this trust is what underpins the successful use of personalization in retail. It is about enhancing the customer experience in a way that respects their privacy boundaries.”

Just as retailers need to be careful about over personalization, AI also comes with significant responsibilities, particularly in how consumer data is handled and how ethical considerations are managed.

The ethics of AI in retail: ensuring privacy and building consumer trust

In the digital retail landscape, ethical considerations and consumer privacy needs to come first – presenting both challenges and opportunities for retailers. Retailers must not only collect and use data, but also actively protect it against breaches. Grant says retailers must maintain transparency with consumers, stay ahead of privacy laws, and continuously adapt to new AI developments. Currently, Grant says only 13 per cent of consumers trust companies who are using AI. One potential risk is information linkage.

”With generative AI, you can inadvertently leak consumer data into natural language prompts just by the way you write it, which is a huge

AI in Canadian retail: a snapshot 95%

of retailers plan to continue to use AI to enhance the consumer shopping experience

90% of retailers are using AI to provide a personalized shopping experience

56% of retailers using AI comply with data standards, but see bias as a key risk

43% of retailers haven’t started detailed consumer profiles

20% of retailers claim to understand consumer data

13% of consumers trust companies using AI

concern for retailers and why many of them are nervous about using it,” explains Grant.

As AI and machine learning are continuously evolving, Grant advises retailers to use the technology carefully, avoid mentioning personal information, and collect only essential data. To ensure consumer data is not leaked, Grant suggests that retailers need to be proactive. One suggestion she provides is for retailers to create their own language models and train them for internal data. This would keep prompts within their own servers and guidelines; help them adhere to data privacy and security regulations, and follow rules for data collection, storage, and tracking. Grant says it is highly important for retailers to be

therimagazine.com | 35

cautious, stay ahead of risks, continuously update security measures, and have strategies to deal with a range of cybersecurity risks.

“Understanding it, knowing it, and then actually doing it are all different,” she says. “It is really important for leadership within the industry to understand just how important this is, not just from a legal standpoint, but also from a data and brand standpoint. Consumers don’t want to deal with data breaches, fraud or identity theft.”

To secure consumer trust when it comes to AI, Grant suggests that retailers train and prepare employees concerning its use.

“Training and upskilling employees on the use of technology is beneficial,” she says. “However, understanding exactly what to train for is presenting retailers with a number of challenges that they must overcome.”

Despite the risks associated with the use of AI, Grant says that approxinately 50 per cent of Ca-

“We foresee AI continuing to transform customer service in retail. This includes everything from more personalized assistance through chatbots to AIdriven customer support that can anticipate and resolve issues more efficiently.”
- Michelle Grant, Salesforce Canada

nadians are willing to give retailers more data for better personalization.

“Consumers are willing to provide information to a retailer as long as they receive value from the brand in return,” she says. “So, I don’t really see too much pushback on the consumer side. I think that the biggest hurdle and obstacle is privacy and keeping the consumer’s trust.”

How AI and machine learning will continue to transform the retail industry

Looking ahead, AI’s role in personalizing the retail experience is expected to grow: along with machine learning, it will continue to advance, providing even deeper levels of personalization. This means that AI systems will become better at understanding and predicting customer behaviour, enabling retailers to offer even more tailored product recommendations and shopping experiences.

“During the holidays, 17 per cent of all orders were AI influenced through product recommendations,” says Grant. “That has been a huge case for data in the retail world. Product recommendations are a huge aspect of data usage.”

AI and machine learning will also help develop enhanced customer service that is more engaging and interactive for the consumer:

“We foresee AI continuing to transform customer service in retail,” says Grant. “This includes everything from more personalized assistance through chatbots to AI-driven customer support that can anticipate and resolve issues more efficiently. This might involve AI creating hyper-realistic product images or videos, offering virtual try-on experiences, or even gathering personalized product recommendations in real-time.”

Grant suggests that the journey of AI and machine learning in retail is ongoing and will keep offering innovative solutions for the retail landscape.

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“The next few years, we will likely see groundbreaking advancements in how AI not only enhances the shopping experience, but redefines it, making it more interactive, personalized, and customer-centric.”

She goes on to offer a glimpse into the future of AI and machine learning, from the ways in which it’s being used to help develop marketing strategies to its potential to personalize customer service and experiences. AI’s footprint in retail is both transformative and expansive.

“The two big departments that we are going to see transformed are marketing and personalization,” says Grant. “Just the ability to scale all that, and test it very quickly, is going to transform how marketers do their jobs. And then the second one is customer service, there is so much better

experiences that can utilize generative AI, such as personalized messages to the consumer.”

The journey of AI within retail, with its impact on data collection, personalization, and customer engagement, suggests a path towards more intuitive and customer focused shopping experiences. As retailers navigate the challenges and opportunities of these technologies, Grant says the focus remains on enhancing customer experiences while maintaining ethical standards and privacy.

“We are just beginning to scratch the surface of what is possible. As we advance, the intersection of AI and retail is set to redefine our shopping experiences in ways we have only begun to imagine. AI could lead to more engaging service, offering more of a visual, interactive, and digital experience that’s powered by AI.”

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Image courtesy of ipopba
38 | Retail Insider the magazine | Volume three Issue one FEATURE // FOOD & GROCERY
Image courtesy of
a_namenko

Slow economy and cautious consumers putting increased pressure on Canadian grocers

A combination of reduced consumer food budgets and escalating costs requiring grocers across the country to adjust in order to remain successful

Beingone of a small group of players responsible for providing essential product to millions of people in hundreds of communities across the country is an important role to play for any business. And when that product is food – something that every Canadian requires on a daily basis – that responsibility tends to bear significantly more meaning. It’s what makes the Canadian grocery industry such a complex and dynamic one, and one that is, on the best of days, challenging, to say the least. However, considering current economic conditions and a volatile market, the job of today’s grocer is made that much more difficult. In fact, according to Sylvain Charlebois, industry expert and Senior Director of the Agri-Food Analytics Lab at Dalhousie University, those very factors are serving to place a tremendous amount of pressure on the purveyors of food in Canada.

“It’s not a set of ideal circumstances at the moment for grocery operating across the country,” he says. “Canada’s GDP per capita is shrinking. There’s less wealth. And, combined with this is the fact that consumers are spending less on food during their visits to the grocery store than they did last year, and the amounts continue to drop. The average grocery spend for individuals per month is an estimated $248, down from $270 12 months ago. So, from a grocer’s perspective, things are not exactly going in the right direction with respect to weekly and monthly consumer spend in their stores. This isn’t to suggest that Canadians are eating less. It means that people across the country are becoming creative and leveraging a number of different, sometimes unconventional, channels through which to find less expensive food. So, it’s a trading down market, which isn’t the best news for the industry.”

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When it comes to addressing these pressures, which seem to be driven and facilitated by current pervading economic factors and conditions, Charlebois says that there isn’t a whole lot that grocers can do, suggesting that, beyond providing Canadians with high-quality foods at decent prices, it’s beyond their mandate. He goes on to explain that, generally speaking, price increases and related volatility, is not often caused or created by grocers, leaving them powerless to any more affordability than they already do. It’s one of the reasons he believes a grocery code of conduct brought forward by the Canadian federal government could very well be the most meaningful way by which mounting pressures on the grocery industry, and Canadian consumer, can be addressed and alleviated.

“All banners operating beneath every Canadian grocery brand needs to be doing everything they can in order to make things easier for the average Canadian visiting their stores. And not just the discount banners. They all have to make a strong effort so the Canadian consumer can see that they actually care about their wellbeing.”
- Sylvain Charlebois

“I think that the code that’s being proposed by the Canadian government would very likely be an incredibly important component of an overall roadmap that could help provide a more stable pricing across the country. Everybody is talking about the increases in price and the need to bring prices back down, but there’s nothing more destructive for grocers than price volatility. It’s the worst thing with respect to reputation, eroding trust and respect, and ends up pushing consumers away rather than bringing them into the store. There’s currently quite an aggressive battle going on right now between grocers and their suppliers over price. I firmly believe that a code of conduct will bring discipline to the market, empowering the entire system with some mechanisms to help address litigation, creating a level playing field on which parties can talk and negotiate properly. Right now, there’s just no negotiation happening at all. Suppliers raise fees and grocers raise their prices. A code would prevent this from happening, helping everyone in the end.”

Price perspective

The grocery industry expert continues by pointing out the fact that average Canadian consumer’s perspective of recent price increases at the grocery store are actually somewhat skewed, adding to the conundrum faced by purveyors of food across the country. He suggests that it’s a perspective that’s likely being driven by inflation fatigue and an extended period of financial strains and pressures on the Canadian consumer. But, nonetheless, it’s one that is, at times, significantly detached from actual price increases.

“There’s no question that it’s been an incredibly challenging last few years for Canadians in every province across the country,” he recognizes. “Their wallets have been squeezed and so their dollars need to stretch. They’re hyper-focused on price, and extremely critical of increases at the grocery store. However, in many cases, their perspectives are a bit off. We recently surveyed Canadians asking them how much, as a percentage, they believe food prices have gone up

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Code of conduct needed

since the start of the pandemic. The answer we received, on average, was a 78% increase. The reality is that prices have increased 23%. Don’t get me wrong, there has certainly been a significant increase concerning the price of food over the time period in question, but that 55% gap in consumer perspective and reality should be a big concern for grocers.”

Increased education and effort

He continues by suggesting that it’s a gap that actually needs to be exploited by grocers in order to start to win back the hearts and minds of the Canadian consumer. Some education, he says, to help Canadians understand that they’re offering the best deals and prices possible, earning their trust and shopping trip. However, Charlebois goes to warn that attempts to educate and inform

consumers must be supported by tangible actions reflected within their stores.

“All banners operating beneath every Canadian grocery brand needs to be doing everything they can in order to make things easier for the average Canadian visiting their stores. And not just the discount banners. They all have to make a strong effort so the Canadian consumer can see that they actually care about their wellbeing. Based on data and everything that I’ve heard, it looks as though 2024 is going to continue to be a challenging year for many. For retailers, things are going to tighten up again within their supply chains and consumers are going to continue to spend less. It’s an equation that is going to result in even more pressure on everyone involved. They are issues and challenges that will resolve over time. But, until then, it’s going to tough.”

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Retail insolvencies on alarming rise across the country

Financial burden brought on by the pandemic and the increasing cost of doing business blighting retailer efforts for success // By Mario Toneguzzi

42 | Retail Insider the magazine | Volume three Issue one FEATURE // ECONOMY
Image courtesy of Devonyu

Lingering pressures from the pandemic, combined with inflation and the rising costs of doing business, have had a devastating impact on companies throughout Canada in recent years with some alarming statistics for insolvencies.

A recent report by Equifax Canada indicated that insolvencies are mounting with many Canadian businesses facing an uphill battle, as evidenced by a 41.4 per cent surge in business insolvencies in 2023 when compared to 2022.

Simon Gaudreault, Vice President, Research and Chief Economist of the Canadian Federation of Independent Business, says the past several years have been a bit unusual for businesses.

“At the start of the pandemic, people may have expected a lot of immediate bankruptcies, but that’s not exactly how things turned out,” says Gaudreault. “Pandemic support programs, which were necessary in order to support businesses that were required by health authorities to close their doors, helped many small- and medium-sized businesses cope with the challenges. They also sort of froze the bankruptcy situation to a certain extent. Now we’re catching up. We’re

catching up because the federal government was unwilling to further extend, for example, access to the Canadian Emergency Business Account program - the flagship COVID relief program it has put in place.”

Many businesses throughout the country have the added financial burden now of having to repay that loan.

“We’re going to start seeing those firms that weren’t able to pay, that are under a lot of financial stress, face some tough choices in the next few months,” he says. “So, it won’t be at all surprising to see the number of bankruptcies remain elevated for quite some time.”

He says that those numbers are slowly catching up from the lower-than-average numbers posted in the past few years, combined now with the current raft of economic challenges. In fact, he cites a recent Business Barometer by the CFIB which found that 51 per cent of small- and-medium sized businesses are saying that insufficient demand for their products or services is limiting their ability to increase sales or efforts related to production.

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“That’s quite elevated from an historical standpoint,” he says. “We usually only reach those percentages in periods of economic slowdowns or even recessions. I’m not saying that this confirms we’re currently in a recession, but that one data point certainly indicates how tough business is at the moment. No matter the financial metric you look at right now, we can describe the small- and medium-sized business outlook at the moment in Canada as the following. You have one-third of small and medium sized businesses that say their financial situation is good or great. You have one third that are saying that they’re really struggling right now and it’s very tough, they’re in a tough situation. And you have the last third that is somewhere in the middle where things are a bit more normal. That’s the picture we have now on the financial side of things. When you think about it, the bottom third is made up primarily of small- and medium-sized businesses that are under a significant amount of pressure as a result of an elevated cost of doing business. The Bank of Canada is keeping interest rates very high. So that’s not only nipping demand but increasing borrowing costs, and slowing down the econo-

“We are looking forward to a return to a normal pace of growth but need to work with governments to ensure we can bring profitability back to the industry. Topline sales are not translating to bottom line profit.”
- Kelly Higginson, Restaurants Canada

my. If you have incurred a big debt during the COVID years, you’re still not back to full revenues. And that’s going to put pressure on your finances.”

Increasing insolvencies

According to the Office of the Superintendent of Bankruptcy in Canada, the total number of insolvencies (bankruptcies and proposals) in Canada increased by 5.8 per cent in February 2024 as compared to the previous month. Bankruptcies decreased by 0.5 per cent and proposals increased by 7.8 per cent. The total number of insolvencies in February 2024 was 28.2 per cent higher than the total number of insolvencies in February 2023. Consumer insolvencies increased by 25.2 per cent, while business insolvencies increased by 122 per cent.

“For the 12-month period ending February 29, 2024, the total number of insolvencies increased by 23.7 per cent in comparison to the 12-month period ending February 28, 2023. Consumer insolvencies for the 12-month period ending February 29, 2024, increased by 22.5 per cent in comparison to the 12-month period ending February 28, 2023. Consumer bankruptcies increased by 8.3 per cent, while consumer proposals increased by 26.3 per cent,” said the Office. “The proportion of proposals in consumer insolvencies increased to 79 per cent during the 12-month period ending February 29, 2024, up from 76.2 per cent during the 12-month period ending February 28, 2023. For the 12-month period ending February 29, 2024, consumer insolvency filings accounted for 95.8 per cent of total insolvency filings. Business insolvencies for the 12-month period ending February 29, 2024, increased by 58.1 per cent compared with the 12-month period ending February 28, 2023. Accommodation and food services, Retail trade and Construction registered the biggest increases in the number of insolvencies.”

Restaurants Canada says the restaurant industry is preparing for a tough first half of 2024. Ac-

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cording to the Conference Board of Canada, the economy’s lackluster performance in the second half of 2023 will spill over into the first months of 2024 with minimal growth expected, once again leaving restaurants to navigate uncertain times and monumental economic challenges, says the national organization.

Data from Restaurants Canada tells the story.

“62 per cent of restaurants are operating at a loss or barely breaking even – up nine per cent from July 2023 when it stood at 53 per cent,” says Restaurants Canada. “This is compared to 10 per cent pre-pandemic. This alarming statistic underscores the immense pressure on the industry. It also leads to a notable upsurge in closures in 2023, with bankruptcies up 44 per cent – the highest annual figure in a decade. One of the main factors driving this difficult environment is weak sales, which are expected to persist in winter/spring of 2024. As consumers continue to curtail their discretionary spending, the foodservice sector bears the brunt. Disposable income is a critical factor influencing foodservice sales, as customers tend to dine out more frequently when they have greater financial flexibility.”

Kelly Higginson, President & CEO of Restaurants Canada, says the survival of restaurants is crucial for community prosperity.

“When the economy is strong, the restaurant industry is strong,” she says. “We are looking forward to a return to a normal pace of growth but need to work with governments to ensure we can bring profitability back to the industry. Topline sales are not translating to bottom line profit.”

Debt-stricken struggles

The Canadian Association of Insolvency and Restructuring Professionals (CAIRP) says business insolvencies in Canada surged by 41.4 per cent in 2023 compared to the previous year, the sharpest increase in 36 years of records from the Office of the Superintendent of Bankruptcy. It says 4,810 businesses filed insolvencies in 2023, the highest annual volume in 13 years, a sign that companies

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Image courtesy of Richard Villalonundefined undefined

are struggling with higher debt-carrying and other costs. Business insolvency filings rose 34.7 per cent in the fourth quarter of 2023 as compared to the previous quarter, and more than doubled (51.6 per cent) compared to the same quarter in 2022.

“Businesses have been struggling to cope with a myriad of financial challenges over the past year, including higher input costs, wage costs, and debt servicing costs, exacerbating the rocky footing many have been on ever since the pandemic,” says André Bolduc, Licensed Insolvency Trustee and Chair of CAIRP.

He says interest rates have made borrowing more expensive over the past year and that the CEBA loan deadline put additional pressure on many businesses.

“Many businesses are already on a razor’s edge. The additional costs to service their debts will mean even less room to cover increasing costs of business going into 2024,” he explains. “Some businesses may not be able to manage the in-

creases to their monthly bills, especially if they are already finding it difficult to drum up sales. That strain, combined with any additional financial challenges or setbacks this year could force businesses to shutter.”

Jeff Brown, Head of Commercial Solutions for Equifax Canada, says Canadian businesses are facing a perfect storm of economic pressuresCEBA loan repayment, high input costs, labour expenses, high interest rates, a slowdown in consumer spending. They are all creating a challenging environment.

“These factors are contributing to a growing trend of business failures,” he says. “The sharp rise in insolvencies, representing a 30.3 per cent surge since 2019, underscores the financial pressures faced by businesses. We’re seeing struggles all over the place right now. We haven’t seen growth in insolvencies this large over the past ten years. With this mounting debt and increasing delinquencies, we’re not really seeing any signs of why those insolvency numbers shouldn’t continue to climb.”

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The state of Canadian e-comerce: it’s time to get better in of adversity

Friction within an oversaturated online market leading to the need for retailers to truly differentiate themselves from competitors >> By

48 | Retail Insider the magazine | Volume three Issue one FEATURE // E-COMMERCE

e-comerce: in the face

Itdoesn’t really matter how anyone might look at the current situation for small businesses operating across Canada, it’s not a favourable one when considering their future growth and success. And, given the fact that the majority of brands operating within the ecommerce space are small businesses, the state of online retailing in Canada is not currently being represented in the best of light. It’s something that’s recognized by David Nagy, digital pioneer and Founder of eCommerce Canada, who cites a number of different factors that are currently challenging the online efforts of retailers across the country, including a hesitant Canadian consumer, volatile economic conditions and an unpredictable supply chain. However, he also suggests that it’s during times like these when great businesses are at their best.

“When you look at it, it’s obvious that the market isn’t really super-friendly for small businesses at the moment,” he says. “There are a lot of things that owners are challenged by at this particular moment, including an enormous amount of debt that they’ve been carrying since the pandemic, a somewhat reluctant consumer, and uncertain economic climes. But it’s when facing such adversity when the very best find inspiration to get better, to improve what they do in some small, meaningful way. And, the reality is, the best have

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got to get better to succeed. There’s a lot of friction in the market at the moment, and the consequences for those who don’t get better might be more severe than they have been in a long time. So, those who continue to innovate and improve will be those who come out on the other side of this on top.”

Oversaturated online market

Part of the challenge that businesses operating online today face, explains Nagy, is the fact that there are so many competitors, both direct and indirect, to just about every single type of offering that there is. He suggests that with so many competitors, current challenges are being exacerbated, making it far to easy for some businesses to get lost in the crowd. To combat this,

“...being online today means very little unless the retailer is doing something a little differently than the thousand other online retailers that are selling exactly what they’re selling. When going online, it’s critical today for retailers to find the thing that differentiates them from their competitors and focus on that part of their offering with consumers.”
- David Nagy

the e-commerce guru says that retailers need to really hone in on what sets them apart, creating a bit of breathing room for them online.

“It’s so oversaturated online right now,” he asserts. “The barrier to entry today is so remarkably low that every business can get online with minimal investment of finances or time. And every business is getting online. They’ve been told by everyone that they have to be online or they’re going to miss out on sales, and therefor revenue for the business. However, being online today means very little unless the retailer is doing something a little differently than the thousand other online retailers that are selling exactly what they’re selling. When going online, it’s critical today for retailers to find the thing that differentiates them from their competitors and focus on that part of their offering with consumers. It could be anything from the way products and materials are sourced to the service that customers receive online. But finding that differentiating quality that helps separate businesses from all others should be on the minds of all retailers as we head deeper into 2024 and beyond.”

Pendulum shift

Nagy continues by saying that, as a result of the extreme oversaturation of retail brands operating online today, the old adage that suggests an online presence “levels the playing field between smaller retailers and their larger competitors” just isn’t true anymore. The pandemic, which brought with it an accelerated digitization of the world around us, has facilitated much of the growth in the number of businesses moving their products and service online. What this has done, says Nagy, is erode the online sales of many retailers that did not adapt and react quickly enough when the flood to online began in 2020.

“The profitability of small businesses has been kicked in the teeth over recent years,” he asserts. “The number of retailers selling their wares and services online has doubled as compared to prior to the pandemic. It’s made things incredibly chal-

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lenging for everyone. And, as we head further into 2024, expect to see an increasing number of insolvencies, because businesses across the country just can’t hold up to the financial pressures any longer. But I really believe that within industries and markets, there’s a pendulum effect that is always at play. The tenor of these times might be that of trial and adversity. But just down the road, just beyond the horizon, there are opportunities for those who don’t panic and continue to maintain focus on their differentiators and core offering. Don’t try to solve the revenue problem by throwing another $25,000 at Google ads. Lift the hood on your online operation, and look for the things that are holding you back.”

Prepare for opportunities

In order for a small business to perform a proper assessment of its online performance, it would likely want to confer with experts like eCommerce Canada. Organizations like theirs helps retailers understand the metrics that really matter to their business, and identify ways by which to enhance and improve their websites for optimal success and increased traffic and conversions. It’s an assessment that Nagy says is becoming more imperative every day for small businesses looking

to find growth and success online. And, he adds, it’s an assessment that he believes may be the most meaningful way by which small businesses across the country can position themselves to seize on a number of opportunities that may be just around the corner.

“When that pendulum shifts back the other way, retailers are going to want to be ready. In order to in this mode of readiness, they’re going to need to prepare their businesses. They’ve been rolling with the punches for what seems like a very long time now. They’ve stayed alive, keeping the lights on without any evidence of any real opportunities. But opportunities will roll around again, and when they do, those are prepared to capitalize on them will be the ones that reap the greatest benefits. Part of that preparation by retailers involves continuing to develop that deep understanding of the customer they serve, what it is that the consumer is looking for from their shopping experience, and focussing on delivering it to them by leveraging the businesses core strengths. The adversity that everyone’s facing at the moment will subside. And when it does, those that have stood in the face of it will be better because of it and ready to be one of the first around the corner to brighter days for business.”

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Nearly two years later, unique Sephora store design still turning heads

Luxury retail construction specialist, Amachris, helps renowned brand elevate shopping experience // By Sean

52 | Retail Insider the magazine | Volume three Issue one FEATURE // STORE DESIGN

Whenit comes to the retail experience, and everything that goes into it, there are few elements that bear a more significant influence and impact than that of store design and construction. Importantly, it helps provide customers with a first impression and allows brands to create the ideal environment for their guests to shop within. And, given the current intensity of competition between retailers, if executed properly, a store design and build can serve as an incredibly powerful differentiator, enhancing experiences at every turn, and elevating brands above all others. It’s the kind of impact that Sephora, along with its Canadian construction partner Amachris, have enjoyed across the country with the consistent opening of beautifully constructed stores. And, nearly two years after the brand opened its location within Toronto’s Union Station, Amachris reflects on the project and the significance that it represents for both leading brands.

“Sephora at Union Station in the heart of downtown Toronto was a unique and exciting project for us in terms of its location and connection to the consumer. We understood early on that this

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heads its Image courtesy of jamesteohart

was a particularly special project for the brand because it marked its first flagship store in a Canadian transit hub. Union Station is a large connecting route, accessible from the Toronto Transit Commission and Go Transit. Sephora has long been a brand that facilitates connection and a sense of togetherness. So, why not place it at the centre of one of the busiest transit hubs in the country? Sephora is global. But the intimate experience of a consumer encountering it on their journey made it a more personal location. Where others may see hustle and bustle, we saw an opportunity to help provide a reason for customers to take a moment, and buy that special little something, before heading off to their next destination.”

A reflection of the brand

Despite the uniqueness of the location, the Amachris team approached the Sephora Union Station build with the same dedication and commitment as it applies to every other project it undertakes. And the reason is rooted in the understanding that a store’s look and aesthetic is paramount to the appeal it might have with consumers, and the ways in which they interact with the brand.

“A store’s interior is a direct reflection of the brand itself. This is why the design and execution of a retail project is so crucial and detail-oriented. Stepping inside a store is stepping into the brand. The material choices, colours, textures and lighting create the overarching ambiance and character of the space. Coupled with the product, the design of a store shapes the shopping experience.”
- Alessia Pignotti, Amachris

“A store’s interior is a direct reflection of the brand itself,” says Alessia Pignotti, Amachris’ Marketing and Business Development Manager. “This is why the design and execution of a retail project is so crucial and detail-oriented. Stepping inside a store is stepping into the brand. The material choices, colours, textures and lighting create the overarching ambiance and character of the space. Coupled with the product, the design of a store shapes the shopping experience. This is a process that we understand, value, and work tirelessly to embody.”

Conducting an orchestra

In order to execute on a brand’s vision, and enhance the shopping experience enjoyed by visitors to its stores, there are obviously a number of considerations that need to be made by the specialists responsible for the job. It can be a daunting task for some. For the team at Amachris, however, the work that they do seems to take on characteristics that are more reflective of a flowing artform than anything else. In fact, Alessia likens the design and construction of a retail build to the composition and playing of music.

“Music must always be written before it can be heard,” she says. “We believe that pragmatism, foresight, and creativity are required when approaching a project. These lenses provide us the ability to execute a build-out much like conductors of an orchestra.”

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Incredible design and construction

For anyone who has had the opportunity to visit the Sephora location at Union Station in Toronto, the music that’s been composed can be heard loud and clear. The store spans 4,175 square feet within the station’s Bay Street Promenade and is consistent with the more than 80 Sephora stores located throughout Canada. However, as Alessia points out, there are also a number of elements within the design and construction of this particular location that serve to differentiate it from other stores, making it such a distinct success for both partners.

“Union Station’s storefront was custom-built,” she says. “Sephora designed it, and Amachris worked alongside their team of architects and engineers to determine how it could be constructed in space. A stunning combination of starphire glass, black and white metal panels, steel inlays and patterned lighting made this two-sided storefront an absolute success. It is the only Sephora storefront in Canada with lighting integration. The individually hung letters float in space intentionally, welcoming customers through the door. These unique design elements contributed to making the store location so distinctive.”

Building lasting partnerships

Although the Sephora Union Station project was completed by Amachris nearly two years ago, the incredibly flawless execution of the store design is still turning the heads of passersby through the station, and piquing the interest of local shoppers, too. It’s a project that perfectly illustrates Amachris’ commitment to its craft, helping the company to maintain the incredibly positive trajectory of growth and success that it’s enjoyed over the course of the past two decades. It’s also a testament to the quality of the work that the company is consistently responsible for delivering. However, Amachris feels the Sephora Union Station build best represents the company’s continued emphasis on building the right partnerships.

“This project, like all others, highlights the importance of our client relationships. We are proud to be a contractor in the industry that our clients can trust with their brands. We measure success not just in the exceptional stores we’ve brought to life, but also in the quality of the relationships we’ve been able to grow. Sephora, as well as many of our other clients, have grown their brand in Canada with Amachris for over a decade. In 2016, Sephora presented Amachris the honour of the General Contractor of the Year award after completing their “Toronto Takeover,” which saw six flagship stores constructed and completed in the Greater Toronto Area during a six-month period. This is the level of commitment we extend to every project. At the heart of Amachris is our integrity and our genuine relationships with the brands and the people we work alongside. As we commemorate twenty years in business, we recognize that without our extraordinary team and remarkable clientele, there wouldn’t be a milestone to celebrate.”

56 | Retail Insider the magazine | Volume three Issue one

In

the next issue…

• The Canadian Consumer

• Enhancing the In-Store Experience

• Employee Training & Development

• Canada’s Retail Leaders

Distributing June 2024

58 | Retail Insider the magazine | Volume three Issue one
Yorkdale Shopping Centre in Toronto, Ontario
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