Disruption brings opportunity in the retail space

Author Georgia Morgan-Wynne
July 12, 2019

Lawyers working within the retail industry must help their business leaders in an ever competitive landscape and evaluate their role in the delivery of change. This was the core of discussions from a roundtable of General Counsels with some of the UK’s most high-profile retailers. The event was hosted by global legal recruitment specialists Taylor Root, at London’s South Place Hotel.​

Chaired by Sarah Aziz, Deputy General Counsel at L’Oréal, the event discussed ‘Transformation of the retail sector and the considerations for legal teams’ and featured a superb panel from across the FMCG and Retail space; Yani Davies, General Counsel of Refreshments and Retail at Unilever, Hannah Hullah, Legal Director at John Lewis Partnership and Lucy Burch, Legal Director at eBay.

The panel opened with observations over the last 12 months, both within their businesses and the industry more generally. Of course, there have been several administration announcements and the majority of retailers are having to focus on consolidation rather than ambitious expansion. The squeeze on the industry means that understanding customers is critical and brands are looking at how to best engage with online consumers as well as how to attract higher footfall into stores. The message was simple; retailers need to stay relevant. Those that have great customer experiences, smooth omnichannel marketing and create personalised shopping experiences will survive. Those that fail to innovate, be creative or deliver good customer service simply won’t. Several examples were shared of how brands are leading the way with unique instore marketing, strategic partnerships, simplifying the return process and taking instore consumer experiences to a new high.

It was noted that the retail landscape is changing dramatically with the impact of smaller, challenger brands being able to grow successfully without traditional marketing and having the ability to respond faster to consumer needs. For example, eBay, as an online retailer can help these brands target the right consumer at the best time in a customer journey in order to secure a purchase. eBay also provides the smaller brand with access to a huge customer base, meaning they are able to target a huge customer base with minimum work, which allows both eBay and the brand to benefit. 

Retailers must embrace change, be pro-active and look beyond the ‘traditional’ high street. 

Established companies such as Unilever and L’Oréal’s approach has been to adopt the agility of a start-up and identify emerging brands to either acquire them or, seek to learn from them. The rise of forceful marketing which smaller brands can, in particular, fly under the radar more easily with regulators, is proving a challenge for larger retailers. Several brands shared that regulation in the industry has changed a lot and that the regulators are struggling with the volume of complaints, which has led to strained relationships between regulators and brands. Lucy Burch from eBay offered advice around being ‘pro-active’ in building relationships with regulators and trying to educate them on your business.

Sarah Aziz from L’Oréal asked the group ‘Are your brands utilising social media influencers to get an edge’ and almost 80% of attendees at the event acknowledged their brand is. Social influencers can on the one hand have an undoubtedly positive impact for brands but on the other hand, from a legal risk perspective, expose brands to potential reputational issues as a result of being a relatively new and evolving phenomenon where regulation is being built up. As well as this, several attendees shared stories of marketing teams bidding for the same influencer, sky-rocketing their fee, due to there not being a centralised process for contracts in place.  The panel and wider group discussed ways in which to navigate this new area of law and how best to position contracts with influencers to ensure brand values are upheld, costs are at an appropriate level and reputational risk for the business is avoided. 

Leading change within the legal function in order to reflect business needs is crucial; it requires asking the business for honest and anonymous feedback about the legal function. Both the John Lewis and L’Oréal legal teams have found it an extremely useful exercise and were even pleasantly surprised with some of the feedback. 

The panel also discussed how the role of an in house lawyer has changed and key themes that arose included the importance of partnering with the business, being visible at the senior level and offering creativity with solutions so that lawyers are not only consulted towards the end of a project, which can then potentially result in them being viewed as blockers. The group debated how to avoid ‘becoming project managers for the business’ as lawyers naturally have ‘common sense’ and are ‘organised’ so the role can often fall to them, which can detract from the core legal work they should be utilised for within the business. Yani Davis at Unilever, who operates in a global role, expressed the importance of ensuring local, regional and international teams are joined up and working together – “Communication is key and as a lawyer you can’t be involved in every conversation. You need to foster great relationships with your business partners and build up trust to enable a light touch legal approach to ensure the key risks are addressed while enabling creativity and growth”. Over half of the attendees were currently driving legal operations in some form and it is clear that this a fast growing area for in house lawyers and it isn’t just about technology. Sarah Aziz stated that it is about ‘people, processes and technology’. General Counsels need to structure legal teams effectively, have processes and systems in place and then start to look at where technology could enhance the legal function’s success. This will in turn increase the legal team’ s value and perception in the business which drives positive change. 

Closing remarks of the panel emphasised that leaders of legal teams within retail must ensure they are aware of changes in the competitive landscape, take a proactive approach with the industry regulators, drive efficiencies through legal operations that does not just involve technology and as summarised by Hannah Hullah try to ‘think like a lawyer, act like a human.’https://indd.adobe.com/embed/e273e8c4-6e7e-49d4-94b2-89f75614ddcc?startpage=1&allowFullscreen=true