Much has changed in our world over the last 12 months. From worldwide lockdowns and a whole new set of hygiene and safety protocols, to phrases such as ‘social-distancing’ and ‘contact tracing’ becoming part of our regular vocabulary. But, like every other major crisis to have affected humanity, our response to the pandemic has led to a mixed bag of challenges and opportunities.

This is certainly apparent in the retail industry, which has had to change course on the move, by accelerating digitization, developing out of the box strategies, and intensifying its focus on customer experience and engagement.

As a household name in the value apparel and homewares space, REDTAG has been at the forefront of this recent evolution in retail in the Middle East. The brand’s customer focus is well-known, and one of the main drivers of its recent success.

We spoke with David Pidgeon, chief operating officer for REDTAG, to better understand the challenges that retailers faced in 2020. The conversation covered the strengths that have stood his company in good stead, David’s assessment of where fashion — and retail in general — are headed in 2021, and plans the business has for the future.

Q: By all accounts 2020 was a year that tested the mettle of retail businesses. What were the challenges you faced and what opportunities have you seen emerge, as a result?

A: It was certainly a year that required some hard decisions, with considerable changes in several areas of the business. The whole supply chain was put under enormous pressure, our buying teams have had to source their ranges without traveling to meet our suppliers directly, our logistics teams have had to cope with significant increases in freight costs, our retail teams have been unable to visit their stores. But crucially, we have been less able to directly interact with our customers.

Strategically, however, we haven’t really adjusted our long-term plans for the business. Often what is needed in difficult conditions is a steady hand on the tiller. A lot of what has worked for us had already been implemented or was already part of our plans. For instance, demographic shifts and changing customer behaviour were already driving the expansion of e-commerce, and like a lot of retailers REDTAG did experience significant growth in our online channel. However, the post-lockdown reopening of the economy has also seen a strong resurgence in demand at our physical stores as well, across all of our markets, to the extent that much of our current growth is being driven by customers returning to our ‘traditional’ bricks and mortar stores.

Q: Customer experience is something that we have often heard REDTAG take pride in. Can you expand on this a little? What are some of the ways in which you implement this approach, for your customers?

A: The jewel in our crown is our Customer Loyalty scheme, called RT Rewards, with over 14 million members across the GCC. This has enabled us to better understand our customer, what she wants, and her shopping habits and preferences. And we use this information to tailor our Customer Engagement program to the various profiles of the customers who shop with us. We know who shops with us, how much they spend, where they spend it, and on which categories they tend to buy. This is powerful information, which helps us to engage with our customers in a way that is more relevant to their specific wants and needs.

Over the last few years, we have taken this a step further with the introduction of a number of new initiatives where we hope to ‘delight’ our customers, not merely engage with them. For example, we have an Anytime, Anywhere Returns policy – with no time limits, and no questions asked. Bring it back 6 months later, from wherever it was bought, and we will still accept it.

Many early critics of this policy assumed the worse of people believing that they will take advantage and our returns would sky-rocket. This has not been the case. We chose to trust our customers, and in turn they choose to trust us; over 80% of our sales is through repeat custom. We have many other initiatives to delight our customers, including Instant Gifts in store to our large-spending customers, on the spot gifts to new customers, free home delivery, personal shopping, and many more. We believe REDTAG is one of the few value brands to provide these ‘extras’ as standard.

Q: What about emerging trends in fashion, and retail in general? What are some of the key developments you expect in your industry, in 2021?

A: Customer expectations will continue to rise across the world. People will expect better service, faster delivery times, a more engaging environment, and a seamless shopping experience, and 2021 will witness a rise in technologies that continue to enhance the customer experience. Sustainability will become more important. Subscription retail will be added to more retailers’ armoury. Yet in terms of product, ‘newness’ is, and will always be, the key to success.

Another factor that our industry will have to contend with in 2021 is an upward pressure on costs. The pandemic has upset some of the natural flows in and out of most manufacturing markets, and particularly so in China and India. As a consequence, raw material costs are rising. Cotton and yarn prices are already some 20% higher than last year, while shipping prices have risen dramatically also. All this is compounded by a weak Dollar in relation to the Chinese RMB, and so flexibility and adaptability in sourcing will be key if retailers’ margins are to be protected.

Q: What about REDTAG’s plans for the future? What is the brand currently working on, that you can share with our readers?

A: There are several new initiatives underway across most areas of the business that we plan to bring to fruition in the near future, but we are a brand that likes to deliver the successes before talking too much about them. In general terms, however, our focus will continue to be on delivering exceptional value, deepening our customer engagement, and enhancing both our in-store and e-commerce customer experiences, and with the success of our online business model in the Kingdom of Saudi Arabia, we are looking forward to giving more of our customers across the GCC access to the same convenience and services, in 2021. — SG