An interview with Chieh Huang, Founder & CEO, Boxed
What do you think it takes to be a High Velocity Retailer in today’s climate?
Everything in today’s retail environment revolves around the shopper – from product supply, to fulfillment automation and technology, to payments, to distribution. Consumer demand and preferences are constantly shifting, so every company must pay close attention to their customers and be able to act accordingly. Modern retailers need to be responsive by developing a carefully curated product selection, maximising fulfillment efficiency through automation in the supply chain, and drastically speeding up shipping. The brands that excel at becoming a High Velocity Retailer create a better overall experience for consumers.
What does High Velocity Retail mean for you and your business? How does this translate into your forward strategy?
We are able to offer great value, convenience, and an all-around simpler wholesale shopping experience. Boxed is a technology company at heart, so we have leveraged our merchandising, engineering, and in-house robotics teams to develop products and solutions that meet the needs of today’s on-the-go consumers. This includes a mobile commerce platform, our beloved private label brand Prince & Spring, popular group ordering and Smart StockUp features that make the shopping experience easier, as well as full warehouse automation that increases efficiency and fulfillment capacity.
We’re excited to continue to grow each of these areas and expand across all departments of the company. We will continue to innovate and improve fulfillment efficiency – putting more capital toward ramping up automation, increasing Boxed’s national footprint, and finding new ways to create additional value for our customers.
When you think of High Velocity Retail, which businesses come to mind and why?
Industry giants like Amazon and Walmart are obvious choices, as they have continued to move at breakneck speed and define what it means to be a modern retailer. But, traditional grocers and retailers are also beginning to see the value in improving technology and introducing innovation to their business models. For example, we’ve been approached by established brick-and-mortar brands like Century 21 looking for help to digitise and engage with customers through the channels they are using most. It’s this kind of customer-first focus that will keep even the most traditional retailers agile, relevant, and competitive in an ever-changing industry.
Retail is being transformed and reshaped by our High Velocity world. But to be a retail winner you have to understand your relevance to consumers, how are you doing this in your business?
Boxed has a very diverse customer base, catering to everyone from busy parents to college students, urban dwellers, and even senior citizens. We acknowledge that today’s shoppers have a rapidly shifting list of wants and needs, so we take careful steps to gather feedback and make business decisions that continue to improve their experience with the brand. We work hand-in-hand with CPG vendors to diversify our inventory, often fostering partnerships that bring exclusive product launches or pack sizes – from the likes of Martha Stewart Wine Company and Century21 – to our customers. Our private label team also evaluates market trends to develop popular items that are high quality and introduced at a more affordable price point.
Additionally, we focus on forming real connections with our customers by building trust and a culture that compels consumers to shop with Boxed. We want them to feel our personality throughout the entire experience, which is why, for example, we made a commitment to absorb the costs of the Pink Tax – an unfair upcharge on women’s hygiene products that is not applied to male-equivalent items. We also pay for our employees’ children’s college tuition and provide up to $20,000 for life-changing events, like weddings or family emergencies. Consumers who know that a brand that does right by its employees will do right by them.
How is your business being relevant in the High Velocity Retail world?
When I founded Boxed six years ago, we bet that the entire grocery industry was going to make a massive transition into online and delivery. Luckily, this bet paid off, and it has allowed us to stay ahead of other industry giants that haven’t yet figured out the right ways to innovate and keep up in the digital era. I think we have successfully established Boxed as a changemaking disruptor by simply offering convenience and a seamless, omnichannel experience that meets our customers where they already are.
We have also begun to license our technology and services to other brick-and-mortar grocers, traditional CPG brands, and DTC companies, opening a new line of business. This year, we partnered with Lidl, the international grocery store chain, to provide a platform for express grocery delivery in a handful of local markets. In addition to our technology solutions, we can provide CPG companies with speed-to-market advantages, as well as valuable customer feedback and purchasing data, which inform their future product decisions.
What is the biggest challenge you’ve had to overcome in your company over the last year and how did you do so?
I think the same thing that makes Boxed unique is also a challenge of ours – keeping up with the modern consumer. In retail, shoppers make the rules, so demand and preferences evolve at a rapid pace. We constantly try to predict the future needs of our customers, and we’re always looking for new ways to anticipate those changes. They certainly keep us on our toes, but we have an incredible team of innovative minds on our side dedicated to this specific issue.
Which innovations within the industry are you most excited about? How do you think they are taking retail forward?
When Amazon acquired Whole Foods, it sent ripples throughout the retail industry because it set an ensuing precedent for grocery delivery. Major incumbents like Kroger and Walmart introduced their own services, which forced many other brands to adapt and follow suit. I’m excited about the overall trend that this behaviour signals – a completely omnichannel experience. Consumers will soon be able to do all of their shopping on one central platform.
Along those lines, the level of overall efficiency is also increasing throughout the shopping experience – from the supply chain to delivery. Technology has become crucial in retail, with brands either developing in-house solutions, purchasing licensed software, or partnering with third-party companies. In addition to automation, the Amazon effect has made two-day shipping standard across the industry. Soon enough, the same will be true for same-day delivery, as consumers continue to expect their goods to be delivered faster.
Lastly, retailers are putting more thought into product and brand selection than ever before. Private labels are continuing to grow, and today’s consumers want a carefully curated assortment, rather than spending time sifting through categories with too many options. They have a desire for simplicity, which I believe is a concept that often gets lost in a crowded, highly competitive marketplace.
Describe retail in one sentence.
Retail is the business of making genuine, lasting connections with customers and creating the best, most curated shopping experience possible for every shopper.
Chieh Huang will be speaking at World Retail Congress 2020.