HAI Chief Executive Annemarie Harte reports from the Fifth Global DIY Summit held recently in Berlin. Delegates heard that Amazon will soon be market leader in the German home improvement sector and artificial intelligence (AI), robotics and the internet of things are part of a new industrial revolution that is shifting buying power more and more to the consumer.
The Fifth Global DIY Summit kicked off in Berlin on 8th June with a recognition of the changed world order since it convened 12 months earlier. We were there to see ‘A new era – a glimpse into the future of home improvement’ which translated into two days’ worth of trends and technology that will continue to transform the industry but the implications of Brexit and President Trump’s election reflected the reality that disruption was not just limited to retailing.
Leaving the past?
The economic times we are living in were acknowledged in the first presentation. It was followed by the morning keynote session given by Sergio Giroldi, CEO of OBI, the largest DIY retailer in Europe, and the third largest in the world, behind Home Depot and Lowes. The presentation, “Leaving the past, to live the future”, was refreshingly honest and open for a man in charge of over 42,000 employees and revenues greater than €5.7 billion in 2015. He acknowledged that Amazon will soon take over market leadership in DIY/home improvement in Europe and that the speed of change is dramatically different. It’s not about where your store is located but about whether you are on the first page of Google’s search results. He predicted that within one to two years Amazon will be the market leader in Germany and this is down to technology and its focus on customers’ wishes.
While many retailers and merchants are catching up with the ‘click generation’, that demographic is now already transforming into the ‘voice recognition’ generation and ensuring that the customer is put first. Sergio said that people in Europe don’t have needs but wishes and that Amazon epitomises a customer-centric company by understanding and fully realising customer wishes. He told the Summit that OBI’s Innovation Centre was called OBI Next. Adopting the slogan,“the human digital companion for home improvement”, OBI Next’s only key performance indicator (KPI) was customer satisfaction.
The next presentation was titled “The fourth industrial revolution – the transformation of our industry” and was given by Steve Collinge, MD of Insight Retail Group. As part of Steve’s company’s services, he delivers the weekly Insight DIY email newsletters (www.insightdiy.co.uk), well worth signing up to if you’re interested in keeping an eye on the latest news and developments in the UK.
Steve discussed the impact of industrial revolutions: steam and mechanisation; electricity and mass production; and digital and the internet. He summed up the current industrial revolution by quoting Professor Klaus Schwab, who said in 2016: “We are witnessing profound shifts across all industries, marked by the emergence of new business models, the disruption of incumbents and the reshaping of production, consumption, transportation and delivery systems. The changes are so profound that, from the perspective of human history, there has never been a time of greater promise or potential peril.”
Steve continued by defining the features of the revolution we are living in:
- artificial intelligence – sharper forecasting tools, improved stock availability and a reduction in returns rate, chatbots replacing humans in online interactions (predicting and anticipating customer needs);
- 3D printing;
- driverless vehicles;
- robotics is revolutionising retail, Tesco has already made its fir
st UK delivery by robot; - cloud computing – evolution and adoption of technology;
- internet of things – buying power has shifted.
The lines between offline and online buying and shopping experiences are blurring and the journey is becoming more complicated. Customers want inspiration and ideas not aisles and aisles of product, queues at the till and helpless sales advisors. The customer is now at the centre of the experience, the customer is put first, Steve noted.
