Build a better team

As their store brand programs continue to evolve in terms of breadth and sophistication, retailers increasingly are seeking out strong brand management teams that think and act much like national brand product development and marketing teams do. That reality means retailers and consumer packaging goods (CPG) companies are competing head to head more often to attract – and retain – talent. So how could retailers gain an edge here?

Identify talent
Before engaging in any costly recruitment efforts, every retailer needs to understand its private brand strategy, says Thom McElroy, principal with Deloitte Consulting LLP and the companys Retail & Distribution Human Capital leader. He adds that own-brand strategies tend to play one of three roles: to define the retailer, to provide a value alternative or to broaden the assortment.

\"All of these strategies exist as an extension of the retail brand itself,\" he explains. \"As retailers think through their talent strategies, they want to identify candidates that affiliate with and are excited by what a retail brand represents and how it can be brought to life through private label.\"

With the brand strategy as a foundation, retailers then are able to identify talent having the capabilities to support that strategy, McElroy notes. The desired capabilities – ranging from new product development, brand management and marketing to strategic sourcing, merchandising and customer strategy/analytics –will vary according to the strategy. And he advises retailers to tap into their own people first, considering talent residing in numerous levels and functions within the organization.

The retailers own data can help here, too, says Matthew Stevenson, a principal in the Talent business of Mercer, a subsidiary of New York-based Marsh & McLennan Companies. Specifically, he points to the joining of human resources system data with performance system data to identify suitable internal candidates.

\"Now all of this stuff is tracked in large systems such as SAP, PeopleSoft or whatever it may be,\" he says. \"You just need someone whos good at databases and knows a little bit about statistics.\"

After identifying and recruiting internal candidates, McElroy recommends drawing in external talent to fill the gaps, including talent developed by CPG companies.

Steve Riordan, Retail Practice leader for Beachwood, Ohio-based Kalypso, views such intermingled teams as a plus.

\"A number of leading retailers are blending internal rising stars, who know how to successfully navigate their organizations, with CPG free agents, who really understand leading practices in innovation and new product development for grocery products,\" he says.

In sourcing talent, however, retailers also need to embrace diversity, McElroy emphasizes.

\"The consumer demographic is changing, and so should the teams that focus on understanding how the brand should evolve to serve the needs of the customer,\" he says.

Seal the deal
Even the most well-thought-out recruitment efforts bring no guarantee of acceptance of employment. To seal the deal, therefore, McElroy advises retailers to emphasize to candidates the positives of the working environment.

\"Start with the retail brand and the idea of being part of the growth agenda for that brand,\" he says. \"Highlight the end-to-end ownership for the branding experience that CP[G] companies, by and large, cannot offer, and draw them in with the breadth of responsibility and the fast pace of bringing brands to life.\"

Retailers who are \"market-makers\" instead of \"market-takers\" already have an advantage on the talent recruitment side, Riordan explains.

\"Talent is attracted to store brands organizations for retailers with a strong strategic focus on innovation and differentiation via store brands,\" he says. \"Leading retailers are defining the market for themselves. They are defining the white spaces and developing brands and products to serve these white spaces.\"

Jean Forney, managing partner and executive recruiter with Boca Raton, Fla.-based Samuel J. Associates, agrees, adding that retailers that rely on third-party program management help for their private brands tend to have more difficulty in attracting top talent.

\"Folks that manage their own private label, soup to nuts, are the companies that probably find it a little easier to attract talent because the folks coming in do really feel like theyve got the ownership.\" – Jean Forney

\"Folks that manage their own private label, soup to nuts, are the companies that probably find it a little easier to attract talent because the folks coming in do really feel like theyve got the ownership,\" she says. \"They do have the ability to be creative in their roles, and they do have the ability to impact the decision-making on what products are going to go on the shelf.\"

Engage them
Attracting the right talent to the store brand team is only half the battle, of course. Retailers must find ways to retain valued team players as well.

Engagement is critical here – Riordan notes that innovation is a lure for talented executives on the store brands side, so these folks need to be given interesting work to do.

\"The younger folks these days need real purpose in their work. Address this need by linking their work to a higher cause – the consumer.\" – Steve Riordan

\"The younger folks these days need real purpose in their work,\" he adds. \"Address this need by linking their work to a higher cause – the consumer. All the research shows that consumers now expect to find exclusive store brands at good, better [and] best price points.\"

McElroy echoes the importance of engagement, noting that Deloittes TalentEdge 2020 survey found that employees value meaningful work over any other retention strategy.

Remaining challenged within a role is critical to talent retention, too, Forney says. The establishment of a clear path to growth opportunities also is important, as is recognition for a job well done, she adds.

McElroy, too, believes recognition is vital, especially considering that innovating into new product areas will bring setbacks and mistakes. When a new product does \"click with the customer,\" retailers should recognize that achievement in a meaningful way.

\"The other big component, in my opinion, is the ongoing ability to continue learning and training,\" Forney says, pointing to educational opportunities ranging from academic programs to trade-shows and share groups.

Although the most talented employees do relish a challenge, theyd prefer that the challenge fall outside of mundane tasks, Riordan suggests.

\"Give them the tools and technologies needed to do their jobs,\" he stresses. \"Too many retailers still run their businesses on spreadsheets, home-grown software and/or outdated product lifecycle management software.\"

And retailers should consider using their available internal data to glean information that would enhance retention efforts, Stevenson says. He points to a data-based project his company performed for the financial sector in which it was asked to look at compensation and its impact on employee retention.

\"We found out that pay actually had a very minor effect on retention compared to the retention of supervisors,\" he says. \"If someone lost their supervisor, they were much more likely to leave than someone whose supervisor stayed. So our advice to them was, [Instead of spending] all of this money on paying people above market, you should use that same money to retain ... the layer above them.\"

That said, the most crucial component to talent retention likely begins well before employment.

\"Remember that retention begins with who is recruited in the first place,\" McElvoy stresses. \"Someone who quickly jumps companies for financial gain is likely to do it again. But growing talent from within that is committed to the retail brand will yield a longer-term commitment of individuals who will grow as the business grows.\"

Avoid common blunders
To hire and retain the best talent for their store brand teams, retailers also will want to note and avoid some common mistakes.

One of those mistakes lies in focusing on the \"who\" before strategy and capabilities, McElroy says.

\"Remember that strategy drives capabilities, and capabilities drive the talent agenda. Talent should be organized around that.\" – Thom McElroy

\"Remember that strategy drives capabilities, and capabilities drive the talent agenda,\" he says. \"Talent should be organized around that.\"

And dont create an imbalance in terms of talent acquisition between the creative and executional sides, he adds.

\"When shifting to private label, many retailers make the mistake of first focusing on hiring creative talent; however, it is the sourcing and supply chain talent that will execute on private label with the high quality and standards that reflect the brand,\" McElroy says.

In setting goals, Riordan says, dont give new talent \"a runway that is too short.\" Leaders coming in from the outside, in particular, need time to succeed, he adds, noting that most significant efforts to enhance store brand programs require three years to do so.

And dont paint a misleading picture of the corporate culture and the private brand teams role within in, Forney emphasizes.

\"In most companies, the people who are responsible for private label have to play in other peoples sandboxes,\" she says, adding that own-brand teams often must collaborate closely with employees such as category managers – and the partnerships here arent always ideal. \"[Provide] a clear picture of what that culture looks like so there arent any surprises down the road.\"

Finally, dont look externally hoping to adopt a ready-made solution to retention, Stevenson says.

\"Usually the people youre looking at think that theyre broken, too,\" he says.

Although an internal focus could help to improve efforts here, forget about drawing from exit interviews, Stevenson adds. Why? Because employees will share only socially acceptable reasons for leaving, with the most socially acceptable reason being related to pay.

\"Some of the best organizations we work with do what we call stay interviews.\" – Matthew Stevenson

\"Some of the best organizations we work with do what we call stay interviews,\" he notes. \"Instead of asking people who are leaving why they are leaving, they ask people who stay why they stay. The whole point is that you get a different perspective, and its not colored by the fact that this persons already left.\"