Retail Unwrapped from The Robin Report

A Store Is Not a Fulfillment Center

Chris Niesen — Tue, 17 Feb 2026 05:01:00 +0000

Many of today’s retail leadership decisions are smart, timely, and grounded in real customer behavior. They respond to competitive pressure, unlock new revenue streams, and make sense on management dashboards. The challenge is not the decision strategy itself. The challenge is the consequences when those decisions reach the store level.

The Risk of Quiet Erosion

Across big-box, specialty, and dollar retail, store operations and customer experience are quietly deteriorating. Store formats are not keeping up with the pressure of executing additional strategies. The teams aren’t failing, but stores are being asked to absorb a growing level of complexity without the physical space or operating models required to support it. New initiatives are layered onto formats that have not meaningfully evolved for decades. Store leaders and associates are asked to do more with less. Over time, the physical environment, operational execution, and customer experience all begin to fray.

This is the cost of asynchronous decision-making when strategy advances out of step with the store and operations designed to carry it. The impact of this disconnect is rarely dramatic. Stores do not collapse overnight; instead, erosion sets in gradually.

Do high-level strategic decisions always make retail better? And the answer is: When decisions are asynchronous, operations at the store level can implode.

Supporting the Retail Ecosystem

A store is a living system. Design, operations, labor, and experience are interdependent. When one system changes independent of the others, pressure builds. This may sound like a retail fundamental, but in practice, it is increasingly ignored. Strategy teams launch initiatives, operations teams adjust processes, store teams absorb the changes, but the physical box stays largely the same.

As complexity accumulates, many stores stop feeling intentional. Visual clarity diminishes, stores become cluttered, and service thins. Customers may not consciously recognize the problem, but they feel it. Shopping takes longer, and finding help becomes harder. Experiences that once felt intuitive now feel compromised.

Retail leadership can no longer treat store design, labor, and operations as downstream considerations. When space, staffing, and execution are misaligned, even good strategies become counterproductive.

Solving One Problem, Creating Another

Flexible fulfillment illustrates this tension clearly. Drive-up, order pickup, and same-day delivery fundamentally reshaped retail convenience. For many brands, including Target, these programs drive loyalty, frequency, and trust. They have become table stakes; the business impact is real and necessary.

Inside the store, however, the consequences are increasingly visible. Selling space has been repurposed for staging. Carts, bins, and coolers interrupt the front of the store. Key destination categories are pushed deeper into the building. What was once a clear shopping journey becomes a hybrid environment, part showroom and part distribution hub, without being fully designed for either.

For shoppers, this creates friction. Pathways are less intuitive. Visual storytelling is compromised. The store feels busier but less engaging. For associates, the challenge is greater. They are asked to maintain service standards, support fulfillment, and manage additional tasks with fewer labor hours and without additional space. Flexible fulfillment efficiency may have solved the transaction, but the store absorbed the operational burden. The issue is not that fulfillment can live and operate successfully inside the store; the issue is that the format and operating model did not evolve alongside it.

The Cost of “Yes”

This pattern is not isolated. Michaels offers a timely example of how additive strategies compound inside a fixed box. Following Party City’s bankruptcy, Michaels moved quickly to expand balloons, party goods, and in-store celebration offerings. Strategically, the move made sense. Demand shifted rather than disappearing. These categories drive traffic and align with existing customer missions.

Soon after, Michaels acquired key intellectual property from Joann Fabrics and reintroduced fabric, sewing, and yarn through its Knit & Sew Shop. Again, the logic was sound. The customer overlap was real. The category demand existed.

Individually, these decisions were smart. Collectively, they created strain. Each addition brought new fixtures, replenishment cycles, training needs, and service expectations. Balloons require labor-intensive fulfillment, yet most stores lack dedicated service space. Customers wait in the same old checkout lines, slowing the journey for everyone. Seasonal transitions take longer as the store struggles to flex between celebrations, craft, and core assortments. More than one colleague shared their frustration from this experience with me and described waiting more than 30 minutes to get a few balloons filled with helium.

The result is not a strategic failure. It is operational overload. When store teams prioritize speed over polish, service becomes inconsistent. The environment feels crowded rather than curated. The experience suffers not because the ideas were wrong, but because the system was never redesigned to support them.

When Stores Become Catchalls

Retailers consistently underestimate how quickly complexity compounds at the store level. Every new initiative brings operational weight. When these are layered without subtraction, stores become catchalls for strategy rather than expressions of it. This directly affects customers. In-stocks soften as backrooms strain. Visual clarity disappears as adjacencies blur. Associates are harder to find because they are fulfilling, resetting, or troubleshooting. The shopping journey becomes fragmented.

This is not an argument against innovation. Retail must evolve. Categories will expand. Services will change. The risk is not ambition. The risk is accumulation without editing. Too many retailers add without asking what must be removed, what deserves dedicated space, and whether labor and operations can realistically support the change.

What It Looks Like When It Works

Some smart retailers are proving that complexity does not have to degrade experience. Dick’s Sporting Goods is an example. The House of Sport concept is not just about size or spectacle; it is about intentional design and operational alignment. Dedicated zones allow shop-in-shops and brand partnerships to thrive without disrupting the core format. Customers are clearly directed to go for what is new. Store teams execute major resets when stores are closed, reducing friction and improving quality. New concepts integrate seamlessly into the broader environment rather than competing with it.

Alo Yoga demonstrates similar discipline in far smaller spaces. Seasonal transitions and color shifts happen quietly and cohesively. The store never feels in flux, even as product focus changes. The experience remains calm, intentional, and thoughtfully curated. This doesn’t happen by accident. Thoughtful assortment decisions curated for the space, space planning transition plans that are highly organized, and the team is deployed at the right time bring this to life flawlessly every time.

Walmart offers another instructive example. Through its Store of the Future initiative, the company redesigned up to 650 locations last year. These remodels expand pickup and delivery capacity, modernize pharmacies, widen aisles, and reconfigure checkout and service zones. Crucially, operational functions are pushed back of house rather than spilling onto the sales floor. By evolving the format and operating model alongside new strategic priorities, Walmart protects the customer’s experience while enabling associates to work more efficiently. This thinking supports where the business is headed, not where it’s been.

These retailers share one thing in common: they redesigned the system, not just the strategy.

The Discipline Retail Needs Now

Retail is entering a phase where the hardest work is not ideation. It is editing. Winning retailers will not be those who launch the most initiatives, but those who decide which ideas deserve physical expression and redesign their stores and operating models accordingly. That means making explicit tradeoffs, investing in space where service is required, and aligning labor models with the reality of execution.

The store is where strategy becomes real. If it cannot absorb decisions cleanly, those decisions are incomplete. The future of physical retail depends less on what brands say yes to, and more on how intentionally they build environments and operations that can sustain those yesses every day.

Gaming the K-Shaped Economy

Retail Unwrapped — Fri, 13 Feb 2026 05:01:00 +0000

There is widespread confusion about the popular and overused K-shaped economy meme. General understanding oversimplifies consumers into “haves, have-nots, and have-everythings,” when the reality is far more nuanced and fluid. If retail executives make million-dollar decisions based on an incomplete understanding about the K-shaped economy, it’s going to cost them. Join Shelley and Katie Thomas from the Kearney Consumer Institute as they challenge conventional wisdom about the economy that’s leading retailers to misclassify customers and fail on pricing, assortment, and messaging. Katie reveals that the middle class isn’t disappearing but rather is pragmatic and surprisingly mobile, selectively reallocating resources across all categories that makes traditional good-better-best models look obsolete. Listen and learn about the real crisis facing retailers; it isn’t about hitting price points; it’s about the growing price-value mismatch that risks losing loyal customers who have more options than ever in a marketplace where luxury brands have overpriced themselves and cheapened products at the bottom create an inevitable race to the bottom.

Special Guests

Katie Thomas, Lead, Kearney Consumer Institute (KCI)

Transcript

Curate or Get Curated

Rich Honiball — Thu, 05 Feb 2026 05:01:00 +0000

We live in an age of abundance: more information, more options, more products, more channels, more noise. On the surface, this abundance appears to be a gift—greater access, freedom, and personalization. But beneath that promise lies a growing tension: complexity fatigue.

Choice as No Choice

Consumers are surrounded by choice, and increasingly exhausted by it. They download dozens of apps but use only a handful. They fill closets with clothing but rotate through the same limited number of familiar pieces. They buy groceries with good intentions, only to discard a third of what they bring home. They scroll endlessly, browse extensively, and yet often procrastinate before committing to a decision.

These are not isolated behaviors. They are signals. Signals that challenge the long-held retail assumption that more choice equates to more value. These signals also suggest that the future of retail is not about expanding selection endlessly, but about refining it intentionally. These are signals that point toward a deliberate focus on curation.

Is customer value in retail unlimited choice and abundance? And the answer is: Curation wins loyalty and relevance, aligns customers’ wants and needs, and diminishes complexity fatigue.

Complexity Fatigue

The average smartphone today holds roughly 80 installed apps. Yet only about nine are used daily, and fewer than half of those 80 are used even once a month. The rest sit dormant, available and irrelevant. Consumers don’t delete them because they no longer provide value, but because it requires too much effort. Whether busy, lazy, or overwhelmed, we all naturally seek the path of least resistance.

The same overabundance issue appears at home. The average American single-family house now exceeds 2,100 square feet, yet daily life typically takes place in a small fraction of that space. Entire rooms exist only for occasional use. Space is abundant; its utility is not.

Closets tell a similar story. Studies consistently show that people regularly wear only 50 to 60 percent of the clothing they own. The rest sits untouched. Many garments are worn fewer than ten times before being discarded, oftentimes with regret. The flip side is the upcycling apparel market, but it still doesn’t solve the habit of over-purchasing.

Often, aspirational buying doesn’t align with real behavior. Across categories, ownership exceeds usage and wants exceed needs. This is a mismatch between human psychological reward-driven yearnings and the conventional assumption that more is always better.

What Research Has Been Telling Us for Years

This wants and needs tension is nothing new. Behavioral science has been studying it for decades. One of the most cited examples is the well-known “jam study,” conducted by psychologists Sheena Iyengar and Mark Lepper. When shoppers were presented with 24 varieties of jam, they were more likely to stop and sample. On the other hand, shoppers presented with just six varieties were far more likely to stop and make a purchase.

That finding became a cornerstone of what later came to be known as the “paradox of choice,” a concept explored extensively by psychologist Barry Schwartz. His research demonstrated that excessive choice increases anxiety, regret, and decision paralysis. People fear making the wrong choice, so they delay making any choice at all. Subsequent studies reinforced this across many categories: retirement plans, consumer electronics, apparel, and even healthcare decisions. When options proliferate beyond a manageable threshold, satisfaction declines, confidence erodes, and conversion is sidelined. For years, marketers and the CPG industry have been aware of this research, but too often they continue to march in the opposite direction.

The Endless Aisle

Digital commerce unlocked the paradox of choice on steroids. The infinite shelf space of endless digital aisles became a competitive advantage. More SKUs delivered a broader reach and theoretically higher odds of appealing to individual preferences. For a time, this worked. Search was an exercise in discovery filtered by algorithms that promised personal preference relevance at scale.

But scale brought its own problems. As assortments ballooned, discovery became more opaque. Search results expanded beyond comprehension. Comparison shopping turned into an exercise in fatigue with cart abandonment and surging returns. Too much choice transformed into supply chain nightmares. Add to that, a significant percentage of shoppers now cite “too many options” as a reason for abandoning purchases, particularly in categories like apparel, beauty, and consumer electronics. What was once framed as an empowerment tool has increasingly become a burden. The conversation requires a shift away from “endless aisles” to curating “best aisles.” The goal is to no longer offer everything, but rather to offer the right things, replacing maximum choice with meaningful choice.

Technology Is a Steward, not a Substitute

While many frame AI and human curation as a tug-of-war, the real opportunity lies in partnership and harmony. Technology serves as a powerful retail steward—managing redundancy, detecting assortment drift, and supporting complexity at scale—but it cannot decide what matters. There is a critical distinction: AI and predictive analytics excel at forecasting what might happen based on the past. But the past is not always a prelude to the present, and often what worked in the past is no guarantee of what will work in the present. When it comes to curation, default prediction is high risk. The pathway to innovation isn’t to simply anticipate trends; it is to set them. This requires the human expertise—instinct, cultural nuance, and emotional drivers—that dashboards cannot replicate. Curation is a retailer’s foundational skill; waiting for a perfect technology to streamline that process is an abdication of leadership. Technology and specifically AI should be viewed as a partner to human judgment, with tech as a tool, not a proxy for human beings.

The Human Touch

Perhaps most importantly, curation re-humanizes retail. Historically, retail thrived on trust. Loyal shoppers return not for endless choices, but because the selection makes sense. The modern practice of curation is supported by data, scaled by technology, and guided by human judgment. The irony is self-evident. When consumers have access to everything, they increasingly reward those who offer fewer choices, provided that fewer is better. Healthy retail will not be decided by those who carry the most. It will be led by deft curation, because in a world overwhelmed by abundance, relevance wins.

The implications are clear. Retailers that continue to compete primarily on product breadth risk becoming background noise. Availability doesn’t equate to value. Curation isn’t a niche strategy reserved for luxury brands or personal shoppers. It is becoming table stakes for relevance in a crowded, fatigued marketplace.

Aldi: The Robin Report Retail Hit of the Week

Warren Shoulberg — Sat, 17 Jan 2026 05:01:00 +0000

Hard to believe but Aldi has been in the American market for 50 years this year. And it’s even harder to believe that when this year closes out it will have almost 2,800 locations in the U.S. en route to its goal of 3,200 by the end of 2028. That will put it neck-and-neck with Kroger and trailing only Walmart in the number of stores in this country. People talk about Amazon trying to disrupt the grocery business, but the true disrupter is Aldi which has a low-cost, tightly edited merchandising plan that consumers are responding to big-time. These are the guys Walmart and Kroger should really be worried about.

Why Chief Storytellers Are a Bad Idea

Thaler Pekar — Thu, 08 Jan 2026 05:01:00 +0000

Story is an emergent communication tool that taps into the experiences of your customer. This is crucial in retail. When you share a story with your customer, you will spark a story in their mind. A story that has your customer thinking, “I see myself in this brand!” Or, better yet, has them aspiring to experience something similar, imagining, “I’ll be a hero when I use this product!”

As the Story Goes

If “People want to be engaged, not told; serviced, not sold,” then story – the sharing of an experience – is a communication tool in deep service to your omnichannel retail strategy. Through story, you’re inviting your customers to understand, experience, and resonate with your brand. You’re enabling them to feel confident about the decision they’re going to make to buy your product. You’re helping your customers become the hero.

An increasing number of companies are adding “Chief Storyteller” roles to their C-suite rosters. Glassdoor currently lists 156 “Chief Storyteller” jobs, and LinkedIn lists 167. Although the roles vary in responsibility, they incorporate elements typically found in the areas of brand, marketing, merchandising, communications, public relations, media relations, and sales.

Having a Chief of Storytelling is an attractive proposition: we all love a good raconteur. And we crave clarity instead of chaos. Retail (and life) is moving so fast that people may feel confused about the story they’re navigating. Having one person confidently state the parameters in which we’re to operate can be reassuring. And as we’re already overloaded with information and increasingly grappling with artificial intelligence, we’re craving authentic communication. Story brings things closer to a human scale.

In addition to Chief Storyteller, another popular trend is the buzzy “brand narrative.” Although overused and misunderstood, the truth is that brand narratives are constructed from distinct stories. A useful analogy is one of a mosaic, which is made up of individual tiles to form a whole image. Or a constellation, which is made up of stars. In this analogy, your stories are the stars, your narrative is a constellation (and your culture is the galaxy). The point is that myriad stories about products and people are joined in narratives to provide transmission of your business’s overarching values, underlying beliefs, and collective meaning in the marketplace. The greater the number of small stories you enable to be heard and understood, the richer, more authentic, and stronger your big narrative will be.

I’ll add a nuance that makes a remarkable difference in how you strategically communicate with your customers. As a professional communications coach, I prefer the term storysharing, rather than storytelling. “Telling” assumes a spectator and references an old economy in which brands maintained strict control over their messaging. “Sharing” is modern, inviting collaboration and engagement, plus it recognizes the truth of the marketplace. “Sharing” recognizes tactical communication that is both speaking and listening.

Effective retailing demands that we enable people to find, believe, and share their own stories. And to do so enthusiastically, without hesitation. They shouldn’t have to face distrust and wait for vetting by a Chief Storyteller.

Storysharers

The role of a Chief Storyteller was first embodied by Nelson Farris at Nike back in the 1990s. Farris attempted to humanize the company, making its rich heritage relevant to the larger corporate culture. “Our stories are not about extraordinary business plans or financial manipulations,” he said. “They’re about people getting things done.”

Today, however, Farris has long retired, and the function is dispersed throughout the company. As it should be. The most resonant, highest-impact stories emerge only when story is woven throughout a retail culture, not siloed in one C-suite executive.

Story should be democratized. Everyone involved in your retail business — customers, vendors, teams, and other partners – is already sharing stories about you. In a decentralized, polyvocal retail space, brands aren’t telling stories; people are telling stories about brands.

This means acknowledging today’s co-creative marketplace and thinking beyond testimonials, social listening, and contrived advertising campaigns featuring user-generated content. You want to fully support the organic sharing of stories. Not squash it. After all, people are the new media. People believe their own stories, and word of mouth is the most persuasive communication of all. Add to that, people trust most what they’ve heard from multiple sources.

Storytelling Redefined

Effective retailing demands that we enable people (including our frontline sales ambassadors) to find, believe, and share their own stories. And to do so enthusiastically and without hesitation. They shouldn’t have to face distrust and wait for vetting by a Chief Storyteller. If, as author Patti Digh said, “the shortest distance between two people is a story,” triangulating through a Chief Storyteller creates great separation. Stories, in fact, scale at little to no cost. Think of the seminal Nordstrom Tire Story, in which the customer service-centric retailer accepted the return of tires even though they didn’t sell them, repeated now for nearly five decades.

Stories from your people and your customers are your inclusive and exclusive content and bring significant competitive advantages. Because the stories are coming from your customers, you know they will resonate with your customers. One person, even with a team, cannot surface, listen to, and amplify the sheer volume of stories likely being generated about your retail business. This is another reason why the siloing of story is a terrible idea. The elicitation and sharing of stories should be normalized and made accessible throughout your retail business.

Even (especially) small stories can have profound meaning and deep impact. Small stories – think of pebbles and colorful sea glass instead of diamonds – offer colorful glimpses into the meaning of your brand and the daily lives of your customers and team members. Small stories are more likely to resonate and be compelling to customers, prompting them to engage with your brand and products.

Authentic Brand Stories

When I first started working with Kiehl’s, I attended a charity gala and told the gentleman sitting next to me about my new client. He replied, “I know one thing about Kiehl’s. And that’s that whenever I get my wife a gift from Kiehl’s, it’s a winner!” That story bubbled up and out and was often efficiently shared with shoppers by Kiehl’s Customer Representatives.

You want stories to percolate throughout your retail business. For example, your leadership team needs to share stories that make strategy tangible. They must connect the stories of the past, present, and future to create meaning. Your HR team needs to listen to stories to create a people-first organization centering on connection and trust. Junior staff need to see themselves as part of the story and make it their own, adding to and internalizing the culture. Think of the annual Zappos Culture Book, filled with employee stories.

People are telling stories all the time. Rather than subduing this innate skill, it should be more fully developed. Rather than isolating the skill in one hierarchical Chief – or even in your CEO — your retail business should be developing the narrative intelligence of all your team members. From buying, logistics, merchandising and operations to the sales floor and customer service, explain, prove and leverage the power of story through expert workshops. Coach leaders in finding, refining, and sharing their stories. Coach them, too, in asking for and listening to stories from each other and from customers.

Your CEO should model narrative intelligence as a core, equally distributed organizational commitment. This means recognizing stories, sharing stories, asking for stories, and creating the spaciousness necessary to listen to stories. It’s as easy as asking, “Tell me about a time a customer made you smile.” And “Tell me about a time YOU made a customer smile.” Ask and listen to stories about when people have felt most connected your brand. Also ask about moments when people felt disconnected.

Narrative Intelligence is a competency, and storytelling is not a department. If you want to create a culture rich in stories and foster narrative alignment, you need to invite everyone, not anoint someone.

What on Earth Happened to Retail in 2025?

Deborah Patton — Mon, 05 Jan 2026 05:01:00 +0000

Key Retail Realities Heading Into 2026

Common sense strategies worth repeating:

Expect uncertainty with continued government reversals, regulations and changes in policies
Plan for disruption from new entries in retail markets and desperate moves from struggling existing players
Diversity your supply chain to protect your operations from unexpected, externally enforced change
Rethink whether overstimulated environments in-store and online are too much for overwhelmed shoppers
Don’t ever forget who your real customers are…and don’t chase the ones who will never shop with you
Your employees are your single most important asset and must be treated that way

The biggest surprise is that the economy is still chugging along as strong as it is. You’d think that the consumer would be shutting down with higher and higher prices. You’d think this Christmas would have seen a lot fewer goods. And it didn’t happen. Americans are still shopping until they drop.

To cap off a tumultuous year for retailers (many profited, many faced serious challenges, and all had to negotiate the impact of tariffs on their businesses), we gathered four Robin Report contributors to weigh in on what happened and how 2025 could influence retail in 2026.

If there were a single word to define retail in 2025, it would be uncertainty. What began as a year that looked fairly stable devolved into something somewhat out of most retailers’ control. In a wide-ranging conversation, contributors Mark Cohen, Warren Shoulberg, Phil Lempert, and Jasmine Glasheen made the case for retail’s 2025 fragile business model. There was also a consensus that we may be experiencing a return to essential and nonessential retailing in terms of consumers’ ability to weather their own economic situations. Our experts are pragmatic realists, trained skeptics and objective analysts of the retail industry. They identify the high-level early warning signals, both economic and consumer behavior-related, that retailer executives should be paying attention to. Here are excerpts from their conversation. You can watch the entire webcast here.

Tariffs Redefining Retail

Mark Cohen set the tone early on: “So 2025, as the year opened up, looked like it was going to be a pretty good year. Unemployment was low. Inflation was seemingly increasingly under control. There was the expectation that it would be another year of recovery from the 2020-2021 pandemic that we all struggled with. But then in April, the president dropped his trade war bomb, which evolved into a worldwide catastrophe. It’s Covid Redux as far as I’m concerned.” The conversation detailed that what retailers experienced in 2025 was not a normal cycle, but a rolling crisis—rules changing “every hour and a half,” vendors frozen in place, and CEOs unable to forecast even a quarter ahead. The April escalation of the administration’s trade war didn’t just rattle supply chains—it paralyzed businesses’ ability to effectively plan.

Phil Lempert added, “Never in the 25 years that I’ve been covering supermarkets have retailers been this uncertain. Everything from CEOs getting thrown out and tumult about the tariffs to uncertainty about the supply chain. And then we had the report that California is suing 11 major CPG companies for unhealthy processed foods. And that’s going to have a major effect on retailers because 70 percent of the products that are in a supermarket are ultra-processed foods.” Warren Shoulberg called 2025 a year of suspended animation: “I characterize 2025 as Waiting for Godot. Everybody was sitting around waiting for 1,400 shoes to drop.”

And how are next gens responding to all of this? Are they really as miserable as everybody and all the media reports? Jasmine Glasheen explained, “Well, are we talking about miserable or overstimulated? Because I think those are two different things. Young consumers (78 percent of them) are telling retailers that they’re overstimulated by the in-store experience. Because of that, retailers should be creating low-stimuli, more tranquil lighting environments, like Walmart is doing between 8:00 to 10:00 AM. But instead, we’re seeing Urban Outfitters rolling out brighter, more aggressive physical store spaces.”

Surprise, Surprise

When asked what the most surprising thing was that they observed this year, Lempert said, “I think it’s probably the reaction to the GLP-1 drugs. Just take a look at how quickly companies like Nestle and Conagra have rolled out GLP-1 food products. Circana just released a survey that said that by 2030, 35 percent of all food and beverages will be consumed by users of GLP-1. We also saw Kroger come out with their line of high-protein foods that are designed for GLP-1 users. It’ll be interesting to see now that the Wegovy pill form is approved and more people go for the pill than the injectables, how that’s going to change the food and beverage industry.” Shoulberg added, “The biggest surprise to me was that the economy is still chugging along as strong as it is. I would have thought that the consumer would be shutting down with higher and higher prices. I really thought this Christmas we’d see a lot fewer goods out there. And it didn’t happen. Stores were promoting like crazy. And Americans are still shopping until they drop.”

Glasheen was surprised by how American Eagle and Gap are visibly fighting for consumers within the retail industry by battling with cultural memes. Cohen said, “What surprises me is how much of a struggle the luxury sector has been in all year long. You would think that with the extraordinarily exuberant stock market, that sector would be able to shrug off the kind of price increases that they’re slamming consumers with because of tariffs. But then, of course, there’s the move down market that actually is not a surprise because it occurred in 2008 and to some extent in 2020. Business at Walmart is booming, and business at TJX, Ross, and Burlington stores are all doing great. And I don’t know if it’s a surprise or not, but the degree to which consumers are embracing buy now, pay later, which is just another form of subprime lending is disconcerting.”

Advice to CEOs

We asked the experts what they would do right now if they were retail CEOs. Lempert responded, “Well, number one, it’s to know your shopper and their needs, because I think that’s the problem that so many retailers have. They really don’t understand their shopper. Number two is to get into your stores. You know, I can’t tell you the number of grocery executives that I talk to haven’t been in one of their stores for a while. They don’t walk the stores and talk to people. Look at Danny and Colleen Wegman, who are really working the stores; if they see a piece of paper on the ground, they stoop down and pick it up. They’re the retailers who really, really get it. And then the third, related to next gens being overstimulated, I would kill retail media networks. I think that whether it’s the overstimulation or the greed to get more money from the brands, you walk into some of these supermarkets and they’ve got 50 to 100 screens assaulting you.”

Cohen asserts, “Well, there are two issues. One, if you’re a private company and another if you’re public. The biggest challenge is protecting the viability of your enterprise financially. You have to plan, like it or not, if you’re the CEO of any organization. And you have to be extremely conservative and careful, not knowing what to expect as this craziness spills over into next year. And in planning for next year, I would say you have to conserve your investment and inventory. You have to protect your associates to the degree that you hold onto your best people. You have to be very, very careful that your financial geniuses don’t cut selling, maintenance and operational issues that customers come into contact with. You have to assume that business is going to be very tough. So, get yourself into the bunker, get your people ready for disruption, and stay very close to them.”

Glasheen advocates for next gens and says as CEO, she’d be protecting associates. “Organized retail crime is on the rise. And the violence of retail crimes is also on the rise. So, I would understand that the in-store associates are really who dictate the experience that consumers are having with a brand. I’d focus on recruiting, retaining, and creating a decent working environment for those associates, because that’s how you stay accountable to your stakeholders.” The consensus was that at the end of the day, you can’t expect sales associates to be your loss prevention team. It’s not fair. It’s not effective. And it’s completely unreliable and unreasonable.

Shoulberg speaks about the supply chain that experienced a year of relentless whiplash. The long-heralded “move out of China” proved illusory. “As a CEO, I’d try to diversify where I’m getting product from. The stampede out of China has been remarkable. But the irony is that a lot of suppliers have moved to Vietnam or other places. So, anybody who’s thinking that this is some saving grace is just not realistic. Likewise, anybody who thinks that production is coming back to the U.S. is just being foolish. There are lots of examples of people that are trying this that are failing. And I’ll give you a great example; All-Clad frying pans and cookware are great products made in Pittsburgh. They should be flying, but they can’t find enough workers because nobody wants to work in a factory. I’ve talked to a lot of companies that are that are going slowly and are not quite turning their operations upside down until they get a better read on what’s actually happening. Ironically, a lot of the companies who were trying to move their production out of China are staying in China because China is not so bad compared to Switzerland, let’s say.”

And what’s the one key question a retail CEO should be asking him or herself right now to lead their brand to prosperity? Shoulberg advocates that retailers be more precise about what their stores are and represent, “I think so many companies just don’t have a description of what their store should be. They’re all over the place.” Lempert would ask, “How do I navigate and protect my organization between today and January 20th, 2028?” Glasheen says, “What’s my core customer’s ideal shopping experience?

A Cultural Reset

The numbers have come out that the top 10 percent of American households are responsible for 50 percent of all spending. And then it drills down to one percent of our households that are responsible for 33 percent of spending. There’s clearly an economic inequity going on in terms of the American consumer. What’s happening with this economic asymmetry in terms of how it’s impacting retail? Shoulberg weighs in, “It’s been building, and you look at the disparity between CEO salaries and basic employee salaries, you know, they’re up by a factor of 100 in the last two decades. My math’s not quite right, but it’s close. I think the loss of the middle class of America is one of the greatest tragedies that we’re seeing in our country right now.” Cohen adds, “Well, the asymmetry is not new, but it is explosive in its ultimate effect on our lives and if you look toward the future. About 70 percent of Americans live paycheck to paycheck, even people with high incomes. At the end of the day, where does this take us? We have become increasingly a society of haves, a few haves, and a whole lot of have-nots. And that’s why there is this discernible migration down market into the Walmarts, Dollar Stores, and off-pricers.” Lempert adds, “Dollar Stores are doing really well. And we’ve seen private label really capture more than ever before. And it’s not just about price; these retailers have upped the game from a quality standpoint. Then on the other end you’ve got the retailers like Erewhon, who are just killing it with their $22 smoothies. And now we’re starting to see other retailers like Whole Foods with their daily small shop format; operationally, they don’t have to have as many employees, they don’t have to have as much rent or costs; smaller stores are efficiently run.”

Return on Experience

Return on experience is a metric that stands adjacent to ROI. As a former retail CEO, Cohen is pragmatic and practical: “Well, how about clean, neat, and friendly stores? You don’t necessarily need the theatrics. You don’t necessarily need the techno presentation by way of screens, sights and sounds. I mean, those are gravy if you can align them with your customer base. But neat, clean, and friendly stores that are safe, fully stocked, and priced correctly. And if you can do that, every time they visit, you’ve got them. If you disappoint them, they won’t come back, because they don’t have to come back.”

Glasheen echoed with practical advice. “I think retailers need to ask themselves if they want to be held accountable to their stakeholders or their solution providers. Because the solution providers are the ones telling retailers to invest more and more in tech without actually looking at the level of debt that the human brain can take in before it starts to feel scandalized and alienated from that retailer brand. So, when actually looking at the customer journey, how much data are you feeding them? Is that obscuring their path to purchase? Are they leaving your checkout because of pop-ups that you think are going to get them to buy more?” And Lempert adds, “And I think what retail really needs to do to grow and survive is produce a great experience for people. Number one, know your shopper and create that experience for them, because not every shopper wants the same experience. Let’s put our heart back into retail.”

A Look Ahead

When predicting what’s to come for 2026, Shoulberg says, “I think the word of the year will be bifurcation. And we’ve all said that the bill for tariffs is going to come due sometime. It has to. So, at the risk of being crass, I think it’s all about to hit the fan in the first or second quarter for the retail business.” Lempert adds, “The price of food is still going to go up. And part of it is tariffs, but the bigger picture is really climate change and the environment. We can’t grow our food the way we used to, so we’re going to need some heavy investments for more vertical and indoor farming. Until we can get climate change controlled, our food prices are going to continue throughout our lifetime.”

Glasheen observes that “Retailers can’t compete based on price alone anymore, because too much is uncertain. So that’s why we’re seeing retailers like Shein, Mango, and H&M doing lifestyle. And I think that that’s as much about branding that resonates with the customer base, as it is about the merchandise. I think marketing is going to continue to be more subversive. We’re going to see more creep out in goth type of tropes because it’s getting harder to capture consumer attention and harder to show consumers that you’re on their side. And we’ll see more low-sensory environments in-person and online catalog experiences where customers can shop and feel good and calm again. Making retail calm again would be my resounding statement.”

Cohen takes a skeptical view of a bleaker future. “I hate to be the Grinch, but I think in Q3 we will be in a full boat recession. And as we move into the election midterms in Q4, we’re into wholesale chaos, maybe the likes of which we haven’t seen in the United States since the late 70s, when there were all sorts of civic breakdowns, looting, people burning parts of the city. I mean, we’re going to be looking at a very, very challenging time, which will coincide with a reckoning that America is going to have to face. There’s no resurgence of manufacturing. We’re looking at a terrible, deep mess that is not going to be easy to reconcile, predict, or foretell. And of course, retailers are on the front line of any and all of this kind of behavior.”

Getting It Right

Not everything is gloom and doom. Our panelists identified the retailers that get it and are doing it right as role models for others in the industry. For Lempert, “Whole Foods. In the past two years, the whole image of Whole Paycheck has changed. Whole Foods has come up with new formats, lower prices, and new private labels. And number two is Aldi.” Glasheen says, “I was really impressed by how Gap responded to the situation created by American Eagle with their Kat’s Eye campaign and also denied awareness of the cultural moment in so doing. So, I’m going to go with Gap for this one.” Shoulberg declares, “I’m calling Walmart the retailer of the year, just in terms of all the right things that they’ve done. And what a remarkable transformation they have accomplished this year. And I give an honorable mention to Dick’s.” Cohen completed the list with Costco, Dick’s, Walmart, and Apple. In that order.

Key Takeaways

You may not be able to anticipate the next round of regulations, tariffs and changes, but you can be prepared. Uncertainty drives resilience in how you respond to conditions you cannot control. Pragmatism is an essential tool to manage in a disruptive marketplace and pays off better than clinging strictly to a codified strategic plan. Placing your customers above all operational and leadership agendas is an essential strategy. Protecting and developing your employees strengthens the infrastructure and foundation of your enterprise. And having a North Star for yourself and your organization ensures principled decision-making and building a business with purpose. To thrive in an ongoing uncertain marketplace with uncertain customers, you need to matter.

Cornered: Retail CEOs in Succession

Warren Shoulberg — Mon, 29 Dec 2025 05:01:00 +0000

The hiring of a retail CEO runs the gamut from agony to ecstasy. You need look no further than the recent corner office changes at Target and Walmart to see the extremes. But there’s more to the story: Retail saw a surge in CEO changes during 2025, reportedly with 41-43 exits, which is a significant jump (over 100% increase) from 2024.

No matter where a company’s search leads them, those searches have clearly gotten more frequent over the past few years. “The rate of CEO turnover from 2024 versus 2025 has risen 116 percent, which is astounding,” said an industry consultant with an insider’s perspective on the process, adding, “It began 25 years ago at the inception of ecommerce and the retail world’s reluctance to embrace and invest. So, what I am saying is that since 2000, the retail business has accelerated at such a rate that even the most adept of leaders has a hard time running when what is required is an Olympic sprint.”

Over the past year or two, we’ve seen just about every permutation of the hiring process by big retailers in the country, with the end result that one size does not fit all. Still, looking at the S&P 500, which includes many public retailers, over the past few years, promoting from within is clearly the preferred choice for boards in selecting a new leader.

The most highly visible hires in the retail world over the past few months have been at Walmart and Target. Both boards chose insiders to take over for CEOs who had led each company for more than a decade. Yet the contrast in the reaction within the industry couldn’t be more different.

Succession: A Brief History

Succession at the top of a company is a fraught process, often with very poor probabilities of success. Here’s a brief, selective reminder.

At Sears Roebuck, Arthur Martinez was succeeded by internal candidate Alan Lacy, who arguably had little idea how to run Sears. And then there was “Fast” Eddie Lampert (total outsider) who finished off the American icon.
The succession at Macy’s went from Alan Questrom to James Zimmerman to Terry Lundgren and to Jeff Gennette; all internal executives, some of whom contributed to the brand’s descent into mediocrity.
The succession at Kohl’s was Larry Montgomery to Kevin Mansell (outsider) to Michelle Gass (outsider) to Tom Kingsbury (outsider). Mansell coasted onto Montgomery’s efforts, and Gass was ineffective. Kingsbury, despite his success at Burlington, made some classic mistakes at Kohl’s, which was a very different business and was in poor shape when he took over. More on Kohl’s later.
On the flip side, Michael Gould successfully replaced Marvin Traub, then mentored Tony Spring, who eventually successfully replaced him at Bloomingdale’s and now (as an insider) is trying to rescue Macy’s. Jeff Bezos’ choice of insider Andy Jassy as his successor seems to be paying off.
More recently, we’ll have to see what happens at Apple. Steve Jobs brilliantly anointed insider Tim Cook, who positioned the company for the incredible success they’ve achieved. Cook’s successor looks likely to be another insider.

Inside or Outside?

In the latest wave of chief executive activities throughout the retail spectrum, the choices made in promoting from within versus going to an outsider have never been more apparent…and fraught with more risk. You have to ask, “Is the devil you know better than the one you really don’t?”

The good folks at Google’s AI tool Gemini report that so far this year, about two-thirds, 67 percent, of all CEO appointments across the S&P 500 came from inside. Still, that’s down from 74 percent in 2023 and 82 percent in 2022. But do the reverse math, and the percentage of outsiders getting the top job nearly doubled over the past three years, which it said was the result of “periods of market disruption or company distress.” No argument there.

My TRR colleague Mark Cohen says the right way to work on succession is long before it needs to happen. The last thing a company wants is to be caught in the lurch when a company is headed for trouble or when a successful CEO is going to retire. He adds, “I think the odds of success should be better when an internal, better-known candidate is selected. But this requires real due diligence on the part of the board, something that doesn’t always take place.”

Gemini states the obvious: “Large public companies, like those in the S&P 500 and Fortune 500, generally favor internal promotions as they provide deep company knowledge, cultural alignment and are often seen as less disruptive. External candidates,” it said, “are more likely to be brought in when a company is facing poor performance or needs a significant strategic or cultural shift, as they bring a fresh perspective.” No arguments there either.

A Tale of Two Boxes

The most highly visible hires in the retail world over the past few months have been at Walmart and Target. Both boards chose insiders to take over for CEOs who led each company for more than a decade. Yet the contrast in the reaction within the industry—and perhaps internally too—couldn’t be more different.

In selecting John Furner to take over from Doug McMillon, Walmart chose its number two executive, who is largely viewed as responsible for the discounter’s recent successes. Walmart has a history of choosing insiders; every single one of Sam Walton’s successors has come from within the company, many starting at entry levels within individual stores, as did Furner and McMillon. And while McMillon will stay on the board into next year, he will not have any active role in management. Some have speculated, in fact, that he has a next career chapter planned, possibly in politics or in the federal government.

At Target, the headline was similar, but the back story is very different. In selecting Michael Fiddelke to succeed Brian Cornell next year, Target also went with its number two, but arguably someone who has been at least partially responsible for its recent failures, especially in logistics and sourcing, two areas he oversaw. And Cornell will stay on as executive chairman well into 2026, presenting a difficult situation where your old boss is constantly looking over your shoulder as you try to fix the problems he helped create.

What’s especially ironic is that Cornell was the first outsider to lead Target in its history, and for much of his decade-long run, he was considered a major success keeping Target competitive with the much larger Walmart. It was only in the past two years or so that cracks appeared in the big red bullseye, and Cornell seemed powerless to reverse the decline.

The contrast in outgoing CEOs is clear: “McMillon, most importantly, knew when to get off the stage (on a high) and promote from within a well-groomed associate in John Furner. That’s opposed to the Brian Cornell fiasco, not getting off the stage after a failed strategy and still promoting someone who was a partner in that strategy,” according to our consultant.

Kohl’s Klash

When it comes to CEO selections, Kohl’s may be in a “klass” all by itself. After decades of uneventful transitions in leadership, the retailer’s more recent changes have been anything but. In 2018, it promoted Michelle Gass to CEO from her position as chief customer officer, a spot she assumed when she joined the company from Starbucks five years before. But four years later, she was gone after a rocky run marked by considerable turmoil from investors and lackluster financial results. Board member Tom Kingsbury took over on an interim basis and was then named permanent CEO. That lasted less than two years when the company announced it was hiring Ashley Buchanan, who had been president of Michael’s. Only a few months later, he was out after alleged serious breaches of conduct regarding how a particular vendor—also his significant other—had been given preferential treatment by the company.

Next, the Kohl’s board, which apparently lacked in any meaningful due diligence in selecting Buchanan during the hiring process, picked one of its own, Michael Bender, as a temporary leader. In a repeat of the Kingsbury scenario, Bender has now been named permanent CEO. That’s four presidents in the past four years, not counting the interim titles. One can reasonably argue that the company’s miserable financial performance reflects poor CEO decision-making.

Are Department Stores Different?

Over on the department store side of the retail picture, things have played out in other ways. Both Dillard’s, public but largely held by the founding family, and Nordstrom, now private and controlled by its founding family, have always put a family member at the top of the pyramid, and that is unlikely to change anytime soon. No outsiders welcome. Macy’s has also largely promoted from within; its most recent CEO Tony Spring is a company veteran. Before Belk was bought out and eventually went private, it too had been run by members of the family. Jim Boscov serves as Chairman & CEO of Boscov’s, the large, independent, family-owned department store chain, founded by Solomon Boscov in 1914.

The Ultimate Outsider

The Ashley Buchanan scandal at Kohl’s is nothing compared to probably the most famous—infamous is more like it—example: Ron Johnson at JCPenney. His story has now become retail legend. Under pressure from Bill Ackman, the notorious hedge fund leader, who thought he knew what was best for his investment at Penney, the retailer brought in Johnson, who was best known for running Apple’s retail stores, and before that, a merchant at Target. Johnson blew up the Penney business model, junking private labels, spending a fortune redoing the stores and bringing in a merchandise mix that had little to do with Penney’s largely Main Street customer base. But the worst move was to make all these changes without grooming his teams and ultimately the customers to understand and accept his radical changes.

The result, to put it mildly, was a disaster. In less than two years, Penney lost a quarter of its sales and even more of its share price. As Ackman licked his wounds, Johnson was fired and replaced by Mike Ullman, his predecessor. It took years for things to stabilize, and some would argue that although current CEO Marc Rosen (an outsider) is stalwartly trying to overcome these challenges, Penney has still not returned to anywhere near where it was before Johnson.

The Board Room

The Penney debacle and now more recently what’s happened at Kohl’s have certainly spooked retail boards that are more cautious about bringing in an unknown. An insider may not always be the best choice, but at least they know what they’re getting. That said, the lack of retail training programs like the legendary one at A&S has created a more limited retail playing field where there are simply fewer talented CEO choices to choose from. This is compounded by the negative optics of retail as a career for next gens, contributing to what can only be called an incestuous climate for picking retail business CEOs.

Inside or outside, they are two sides of the same coin toss.

Gap’s Dream Team or The Nightmare Before Christmas?

Marie Driscoll — Tue, 16 Dec 2025 05:01:00 +0000

Gap is chasing relevance with beauty, handbags, and a dream team of seasoned luxury executives. But the real story is one of classic retail tension: fix the core problem, or chase the bright, shiny new thing?

Here’s a simple question with big implications: Can Gap reinvent itself by chasing relevance, or is it just distracting itself from the hard work of fixing the core business?

Gap Inc. CEO Richard Dickson arrived with a Midas Touch reputation from the Mattel and Barbie whirlwind. He played the star-studded cast card, beginning with an early 2024 hire of Zack Posen as Creative Director, to the more recent talent from Nordstrom, Coach, Tiffany, and Estée Lauder, along with bold moves into beauty and accessories. On paper, it sounds like a strategic reboot. In practice, he risks a very expensive distraction.

Sure, Wall Street investors love the headlines, but consumers on Main Street see a brand stuck in promotion hell. Walk into a refreshed Gap store, and the experience feels almost serene: minimalist, orderly, leaning into heritage and music, with markdowns tucked away and associates actually helping customers. Then open Gap.com, and you’re hit with a promo barrage: friends-and-family offers, 40 percent off here, 50 percent off there. That disconnect erodes trust faster than any new category can rebuild it.

Meanwhile, many aspirational shoppers chose their handbags and beauty brands to signal status, wealth, and a strong fashion statement. Gap has yet to earn its place as a destination for covetable apparel; beauty and handbags aren’t even on the Gap Map.

The hard truth in making bad, good is harder than making good, better. The path back for Gap is not another splashy launch. It is a ruthless focus on product and price discipline: fewer choices, better basics, less noise, more coherence. Only then will these product extensions add fuel instead of fog.

So, the real reinvention question is not, “What else can Gap sell?” It is, “Why should shoppers love Gap again?” And that answer starts—and ends—with product, product, product.

Chinese JD Moves West Into Europe

Mark Faithfull — Thu, 06 Nov 2025 05:01:00 +0000

Here’s a news dispatch from around the world. In a move that is probably no surprise to anyone watching the global headlines, the growing international ambitions of the Chinese, specifically online giant JD.com, could reshape the consumer electronics retail sector in Europe. In a recent move, JD.com has launched a takeover offer for Ceconomy, the parent company of German retail giants MediaMarkt and Saturn, in a deal valued at about $2.5 billion. The deal is expected be completed in the first half of 2026. Out of the gate, this positions JD to challenge Amazon’s dominance in Europe’s consumer electronics market.

The consumer experience is no longer defined by stores but by expectations shaped elsewhere thanks to the speed, convenience and frictionless service of digital platforms. The question we always ask is: What desire can we fulfil? It’s about experiencing electronics, not just completing a transaction.

Chinese Ambitions

Ceconomy is number one or two in 9 out of its 11 operating countries and additionally its marketplace offer is available in seven countries. MediaMarkt-Saturn serves 50 million loyalty card customers and records about 2.2 billion customer interactions annually. Its annual revenues total roughly $24 billion, making it the dominant player in European consumer electronics. As part of the agreement, JD.com and Ceconomy have pledged to retain the MediaMarkt and Saturn brands, keep its corporate headquarters in Düsseldorf, Germany, maintain the existing workforce, and retain co-decision making for an agreed-upon period

JD’s move is not just an acquisition but a bid to marry Chinese state-of-the-art digital logistics, supply chain efficiency, and data infrastructure with Europe’s largest consumer electronics retailer. It also represents a bold intervention in a retail landscape that MediaMarkt-Saturn’s Chief Executive, Kai-Ulrich Deissner, characterizes as “structurally challenged.” He adds, “Traditional retail is broken,” speaking at the National Retail Federation’s debut European event in Paris this September. “But this presents an opportunity to embrace and fix the sector rather than view it negatively.”

Brand Evolution

MediaMarktSaturn has been stepping away from its traditional product-focused identity to become what the company describes as a customer-centric service platform. Deissner has banked on innovative store concepts with high-level service, a focused assortment curated by location, and digital tools that enhance the shopping experience, notably superfast 90-minute delivery service.

The retailer is banking its future on its Lighthouse concept, designed as an experience space. By the end of the 2025/26 financial year, more than 750 of the group’s approximately 1,030 stores should have at least one experience space and there should be up to 20 Lighthouse stores in Europe. Flagship formats include live experiences, services and broad assortments that epitomize the new customer-first approach.

Looking ahead, Deissner argues the consumer experience is no longer defined by the stores themselves but by expectations shaped elsewhere thanks to the speed, convenience and frictionless service of digital platforms. “Space-as-a-service is an important strategic growth area for us, enhancing the in-store shopping experience and creating additional experiences with constantly changing themes and innovations,” he said. “Our customer experience is increasingly shaped by what people encounter elsewhere — convenience, zero patience, mobile-first solutions. The question we always ask is: What desire can we fulfil? It’s about experiencing electronics, not just completing a transaction.”

The Experiential Way

In outlining the company’s future direction, Deissner identified five growth priorities: expanding services and solutions, developing a marketplace for third-party sellers, investing in private labels, experimenting with space-as-a-service concepts, and building a retail media network. He cited the company’s Hamburg, Germany flagship, where an entire floor is dedicated to free gaming experiences, as a glimpse of the experiential future he envisions.

“We will not close stores. We believe in our investment,” he said, adding that MediaMarkt-Saturn has now delivered 10 consecutive quarters of growth in both revenue and profit. The JD transaction, Deissner suggested, offers a way to accelerate that momentum, as he described the share offer as a “complicated and sensitive process” but one that he believes will bring tangible benefits. “This means we will gain access to their supply chain. Our focus is always on what this means for the customer,” he said.

Bridging the Tech and People Gap

Deissner’s insistence that retail must be experienced rather than merely transacted hints at the philosophical shift underpinning the partnership. His emphasis on people, service and sensory engagement contrasts with the algorithmic precision of JD’s ecommerce engine and the alliance, in a best-case scenario, could bridge those worlds — bringing Chinese supply-chain scale to European main-street culture.

JD’s logistics expertise could also slash inventory costs and improve delivery speeds, while MediaMarkt-Saturn’s store network offers JD a dense network of pick-up points, showrooms and service hubs across Europe. That combination could create a model for omnichannel retail that rivals Amazon’s and could also allow JD to extend its private-label electronics into the European market, leveraging MediaMarkt’s deep customer relationships and local trust. “We have found a partner that will help us accelerate and achieve that,” Deissner declared of the potential benefits of the takeover.

Domestic Challenges

Indeed, for JD.com, the acquisition provides an instant footprint of over 1,000 stores across 11 European markets, a reach that would have taken years and billions of dollars to replicate organically. The deal also gives JD a powerful test lab for integrating its advanced logistics, artificial intelligence capabilities, and data-driven personalization into a mature Western retail network, positioning JD to challenge Amazon’s dominance in the region’s consumer electronics market.

The risks, however, are considerable. European consumer electronics is a notoriously low-margin business, dependent on promotional cycles, product innovation, and discretionary spending. Integrating technology systems, supply chains, and management cultures across 11 jurisdictions, each with distinct labor laws and consumer behaviors, will add further complexity.

Plus, the geopolitical backdrop remains challenging. Large-scale Chinese investment in critical European retail and data infrastructure is likely to draw continued political and regulatory scrutiny and Germany’s Federal Ministry for Economic Affairs retains the power to intervene on national-security grounds, even after the deal is completed.

Still, the transaction marks one of the most significant foreign investments in European retail in years. For JD, it offers a chance to showcase the efficiency of its logistics network, now among the most sophisticated in the world, within a traditional retail context. For MediaMarkt-Saturn, it promises the injection of capital, technology and operational agility needed to compete in an era when online expectations are shaping in-store behavior.

Beyond China

The move may also reflect increasing heat in JD’s domestic market. While competitor Alibaba has focused on diversifying its platforms and rolled out its own logistics systems, Pinduoduo has pushed into the market with bargain basement prices. As a result, in the upper price segment, JD is up against Alibaba, while Pinduoduo is eating away at its market share through discounts in the lower price categories. JD’s calculation is likely that in Europe, where the online share of total sales in electronics retail is still significantly lower than in China (MediaMarkt and Saturn sit at around 30 percent), it may be possible to build an advantage with technology and logistics expertise.

JD already attempted to take over the U.K. electronics retailer Currys at the beginning of 2024, an attempt that ultimately failed because of political concerns. The Ceconomy deal is its second chance to complete one of the biggest East-to-West retail deals.

The Hidden Costs of Retail Noise

Bill Schiffmiller — Wed, 29 Oct 2025 04:01:00 +0000

Noise Matters

Noise is one of retail’s silent thorns. Constant background music, overlapping announcements, and environmental clamor do more than set a mood. They wear down the sales associates. Employees in high-noise stores report greater fatigue, higher stress, and lower job satisfaction. Over time, this leads to turnover and makes hiring more difficult. Noise is not just an atmosphere issue. It is a retention, productivity, and customer experience problem that directly impacts sales. Retailers invest heavily in design, lighting, and digital engagement, but few measure or manage sound. Yet sound is the backdrop for every customer interaction and every employee shift. Ignoring it means overlooking one of the most pervasive forces shaping retail performance.

A new ASG/Chute Gerdeman + Akoio collaborative report reveals how unmanaged sound accelerates sales associate burnout, frustrates shoppers, and undermines brand value, highlighting why retailers must treat the auditory experience as a strategic asset. Download your free copy of the report here.

Noise erodes trust. When shoppers cannot hear staff clearly, misunderstand promotions, or feel overwhelmed by background clamor, frustration builds. In fashion and specialty retail, where ambiance directly influences spending, the cost of poor sound management is exceptionally high.

Noises Off

Noise is more than an irritation. It is a hidden drain on performance. At Akoio, we have identified noise risks and developed Noise in the Workplace workshops that help clients evaluate auditory environments, reduce unnecessary noise, and create conditions that improve focus, communication, and employee well-being. These sessions consistently show how unmanaged sound reduces productivity, fuels stress, and contributes to workplace dissatisfaction in offices, shared spaces, and hospitality settings.

Retail environments are complex. Stores layer music, announcements, customer chatter, mechanical hum, and outside noise into a constant backdrop that exhausts employees and often frustrates shoppers. Our study quantifies the impact of noise on staff retention, customer engagement, and brand performance. For retailers, understanding how noise operates inside stores provides a new lever to improve productivity, reduce turnover, and strengthen customer loyalty. The joint study produced results that were both expected and eye-opening and confirm what many workers and customers already sense. Noise undermines service delivery, workplace wellness, and customer satisfaction.

Employees reported difficulty focusing, higher stress, and a noticeable drop in energy as their shifts progressed
Average store noise levels often exceeded conversational comfort, making interactions unnecessarily difficult
Peak levels in categories such as fashion approached thresholds tied to auditory fatigue when sustained
Background music, intended to enhance the brand atmosphere, often competed with other sounds, creating sonic clutter that drained employees and distracted shoppers

Customer Fatigue

The customer experience is also connected to the auditory environment. High noise levels are distracting and make it harder to hold conversations, make product comparisons, or simply enjoy time in the store. The result is shorter visits, lower conversion, and less loyalty. Shoppers in noisy environments are more likely to abandon purchases, avoid specific locations altogether, or migrate to quieter competitors, including ecommerce platforms

Noise also erodes trust. When shoppers cannot hear staff clearly, misunderstand promotions, or feel overwhelmed by background clamor, frustration builds. In fashion and specialty retail, where ambiance directly influences spending, the cost of poor sound management is exceptionally high. In today’s competitive environment, where every retailer is fighting for dwell time and engagement, ignoring auditory health risks means losing ground not only to direct competitors but also to digital channels that offer a quieter, more controlled shopping experience.

Sonic Branding or Sonic Overload?

Sound has long been one of retail’s most powerful branding tools. From iconic jingles to curated playlists, sonic branding shapes identity and builds emotional connection. Done well, it reinforces loyalty and creates a memorable atmosphere. But as Joe Sauer, Founder of EmotiSphere Insights and a leading voice on sonic branding, reminds us: “Sound is the unseen architecture of retail. Design it with intent and it becomes memory and margin; leave it to chance and it becomes fatigue that taxes your brand.”

This underscores the challenge. Without intentional design, sonic branding easily tips into sonic overload. Music layered with announcements, chatter, and mechanical noise dilutes brand equity rather than enhancing it. Instead of elevating the brand, unmanaged sound leaves customers fatigued and employees drained. Despite the clear risks, very few retailers are systematically addressing noise. Unlike lighting or merchandising, there are no industry benchmarks, and almost no brands publicly report on how they measure or manage in-store sound. For now, sound remains the most overlooked dimension of the retail environment.

Noise Management

Noise in retail has long been accepted as part of the environment. Acceptance is no longer an option. The evidence is clear. Unmanaged sound drains employees, frustrates customers, and erodes brand value. The retailers who act will not only solve a problem, but also define a new standard for healthier, more profitable stores for their people and customers. The solutions are not complicated, but they require commitment:

Calibrate the Soundscape: Set standards for music and announcement volumes. Monitor decibel levels, adjust for comfort, and zone spaces with different sound profiles.
Invest in Sound Health: Apply acoustical treatments to reduce echo and reverberation. Improve speech intelligibility to support conversations. Introduce inclusive technologies such as Auracast for customers with hearing loss or sensory sensitivities.
Train Staff: Equip employees to recognize when sound hinders communication and empower them to adjust. Provide training on communicating with customers who have hearing loss or auditory sensitivities.
Align with ESG Goals: Healthier sound supports employee well-being, customer inclusion, and responsible brand practices. Addressing it is both good business and good governance.

The Business Case for Auditory Intelligence

Sound is not background noise. It is a strategic lever that influences retention, satisfaction, and brand value. Yet unlike lighting, merchandising, and digital engagement, most retailers have not begun to measure or manage it with discipline. This represents both a blind spot and an opportunity. The few who are experimenting, whether through acoustic retrofits, sound masking systems, or curated audio strategies, are outliers, not the norm. For the vast majority, sound remains unmanaged. The winners will be those who act early. By treating auditory experience as a measurable asset, retailers can reduce turnover, improve customer loyalty, and enhance brand equity. Those who ignore it risk leaving a hidden liability untouched.