Walmart CEO Greg Foran Highlights Collaboration at GMA Forum

Jim Dudlicek, EnsembleIQ

8/1/2016

Grocery retailers and their suppliers need to more closely collaborate on solutions that drive sales by truly address the needs of shoppers who can easily take their dollars to other channels.

That was one of the key takeaways from the Grocery Manufacturing Association’s annual Leadership Forum this past weekend at The Greenbrier in White Sulphur Springs, W. Va.

Conference programs touched on topics including transparency, data analytics, online sales and driving store-level growth. PG was able to sit in on several of these sessions.

Keynoting the first afternoon’s general session was Greg Foran, president and CEO of Walmart U.S., who offered some insights on how the mega retailer aims to drive its topline growth and refocus its direction after some soft performance as traditional grocers have held their own in markets where their compete against the superstore chain.

“Now is not the time for Walmart to pull punches,” Foran said, noting that the company would close any underperforming store or format, such as its retreat from more than 100 Express stores.

Walmart remains “absolutely maniacal about costs” in its supply chain and aims to provide a seamless consumer experience as the retailer continues to explore online sales. “We need you to innovate,” Foran told CPG companies. “As we invest in change, so should you.”

The Impact of Digital on Center Store

This panel discussion included Mark Baum, SVP of industry relations and chief collaboration officer, Food Marketing Institute; Benno Dorer, CEO, The Clorox Co.; Tom Furphy, CEO, Replenium Inc.; and Josh Goldman, SVP, digital retail practice, Nielsen; and was moderated by Thom Blischok, chairman and CEO, The Dialogic Group.

With evolving technology changing the status quo of center store shopping, panelists explored how traditional retailers could preserve or recapture sales of products that consumers are increasingly buying through subscription services.

Goldman said retailing has transformed from creating a point to buy things, to curating an experience. “The fundamental change is rethinking the job we’re being hired to do for the consumer,” he said. “The store’s not going anywhere. The way we think of its role is changing”

Furphy said center store “has to become automated” in order to free up shoppers’ time “to spend in the perimeter, with the dietitian, with the pharmacist.”

Baum said “replenishment services will become the norm” for center store products. “Food is tactile, preferences change,” he said “When I walk into a store, I want an experience – make the place come alive for me.”

Baum urged retailers and suppliers to create “a new model of collaboration – retailers need to be more transparent with their data.”

“If they don’t collaborate on new platforms,” Dorer said, “we’re going to really be in trouble.”

Furphy advised retailers and CPGs: “Don’t think about yourselves as trading partners, think of yourselves as serving partners.”

LeaderShift 2020: Recruiting the Next Generation of Talent

This panel discussed how companies should be creating an organization structure and culture for Millennials entering the work force.

“The biggest challenge is up-skilling the entire team,” said Kenneth Keller, president of Wrigley Americas at Mars Inc. “We want to make sure we have a place where everybody is reaching and growing.”

Todd Tillemans, EVP and president of customer development at Unilever, said “diverse teams perform better,” citing survey data showing most global companies correlate diversity with innovation, and that most believe a diverse work force improves their ability to attract and retain talent.

“What we really want is diversity of thought,” Keller said, “different backgrounds, different experiences.”

The industry also needs to shake the “Big Food rap” that may repel some candidates who are looking for work with a lofty purpose. Keller said companies need to tell better stories about “how we’re responsible to the environment and how we’re giving back.”

Navigating the Last Mile

This panel looked at ways retailers can most effectively provide order fulfillment of online sales. The group included Brent Beabout, SVP of e-commerce supply chain for Walmart; Derek Mansfield, chief revenue officer for Relay Foods; and Ryan Quinlan, head of product operations for Google Express.

Beabout said Walmart is experimenting across the spectrum, from click and collect to home delivery, with fulfillment from stores as well as dedicated fulfillment centers. Google Express is partnering with multiple retailers and experimenting with curb service as well as different delivery windows. “Customers want one thing overall: make things easy,” Quinlan said.

Mansfield said Relay Foods focuses on being the main shop of the week versus a fill-in, aiming to help consumers who “want a reduction in mental energy” when shopping.

The panel reviewed survey data showing that stock-ups of center store products are increasingly being satisfied with subscription services, while fresh and frozen foods are still a logistical challenge. And while consumers value speed of service, they may not be willing to pay for it, depending on the extent of delivery charges.

Getting Smart About Smart Label

Following an update on GMA’s SmartLabel initiative from Senior EVP Jim Flannery, this panel discussed the crucial nature of transparency to grocery industry trading partners.

Transparency is really important for our brand story,” said Brendan Foley, president of global consumer business at McCormick & Co., who along with J.M. Smucker’s Julia Sabin said their brands use videos to explains to consumers the origin of their ingredients and other aspects of their products. “We have an opportunity to tell the story of our brands,” said Sabin, VP of government affairs and corporate responsibility.

Unilever’s Tillemans said SmartLabel is not the solution but the tool for enabling the access of information. “The pendulum is swinging – growth will not come without transparency,” he said. “The game-changer is the ease of use.”

Flannery said: “Retailers understand the importance of transparency as well,” noting that retailers can access SmartLabel information housed on the Global Data Synchronization Network.

Industry Drivers in a Changing World

This panel explored the industry’s challenges and opportunities. The group included Albert Carey, CEO, North America, PepsiCo; Drew Facer, president and CEO, Idahoan Foods; Mars’ Keller; Christopher Policinski, president and CEO of Land O’Lakes; and Carolyn Tastad, group VP, North America, Procter & Gamble.

“You no longer have to be a billion-dollar brand to compete,” Policinski said, urging companies to return to the basics of segmentation and differentiation.

“Transparency is the one way you can build trust,” Keller said. “The more we’re perceived as not willing to put things out there, the more consumers will wonder if they can trust us.” Keller also urged companies to improve their social media activities to ensure “our voice is in the conversation.”

Policinski said transparency “presents an opportunity to engage in a dialogue with consumers. We have great stories to tell … We need to sell what we do every day. We feed people – this has been the key to attracting talent.”

“Your biggest enemy is complacency,” Facer said. “You have to drive a culture of inquisitiveness. You should always be asking where you need to be next.”