The 2019 LINK supply chain conference opened its exposition today with a keynote address delivered by Richard Johnson, chairman, president and chief executive officer at Foot Locker Retail Inc. (NYSE: FL). The keynote, “Reshaping the customer experience through supply chain,” focused on Footlocker’s efforts to appeal to retail customers and remaining relevant in a changing economy.
Foot Locker began its footwear retail operations in 1974 with one store in Industry, California. The company now has over 3,000 stores worldwide. It has 1,400 of its over 30,000 employees dedicated to nine supply chain sites.
Johnson said that Foot Locker – and by extension retail – customers are looking for a seamless experience. He outlined the company’s solutions to enhancing the customer experience through purchase, fulfillment and service.
Foot Locker customers have the option to order products online, have products shipped to their home or to pick-up products at a Foot Locker Store. The solution for customers to pick-up products ordered online at stores is part of the company’s Omni-Channel Lockers program.
Foot Locker is improving its fulfillment by adding radio-frequency identification (RFID) to its inventory management. This optimizes Foot Locker’s supply chain cost and allows employees to increase time spent with customers.
Customers are able to sample their ordered products at the store while also receiving product expertise from employees.
“I don’t think our experience is unique,” said Johnson. “Retail has to transform. Everything about our business starts with our customer. Our customer is moving faster than ever. The speed at which they access information has created a new level of expectation.”
Johnson said Footlocker is moving its supply chain service and distribution centers (known as mini-hubs) closer to stores and consumer populations. This will maximize inventory allocation to the marketplace.
Footlocker is also developing unique distribution options to create emotional connections with consumers and to encourage them to want to spend more time at stores.
Foot Locker’s “Power Store” in Detroit offers an immersive experience for customers. It hosts community-based events such as art shows and gaming tournaments. Foot Locker’s “Jumpman Store” in Los Angeles has an on-sight “flight lab” for customers to test products, a lounge to showcase local artwork and a basketball court for local school games.
Johnson also spoke of Foot Locker’s approach to increase the speed of the company’s supply chain to consumer demand. He said that Foot Locker has increased its use of mobile stores and “cube stores” which can be deployed to sporting events (predominantly basketball games).
Foot Locker is focused on inspiring youth culture through relationships, Johnson explained. The company is engaging younger customers through events such as The Hunt, in which participants can find limited edition products through a geo-targeted scavenger hunt.
Johnson said that it’s important for retailers to be constantly listening to their customers and to act on their feedback. Foot Locker changed its policy of shipping products in bags because bags were more likely to be damaged in transit. While shipping products in a box is more expensive, Johnson said increased customer satisfaction led to more profitable sales outcomes.