LFRA Gala Award Winners Interview Series: Baby Bunting, Large Format Retailer of the Year

Today Unwrap speaks with Matt Spencer, CEO and Managing Director of Baby Bunting. Baby Bunting was awarded Large Format Retailer of the Year at the LFRA inaugural Gala Awards.

This award recognises a Retail member who has demonstrated customer engagement, increased market share and innovation in the Large Format Retail sector.

Established in Melbourne as a family-owned business in 1979, Baby Bunting is Australia’s largest specialty maternity and baby goods retailer and have been supporting new and expectant parents in the early years of parenthood for over 40 years.

As a specialist retailer, Baby Bunting provides parents with the greatest range in prams, car seats, carriers, furniture, nursery, safety, babywear, manchester, changing, toys, feeding, and much more. They also offer a wide range of services including car seat installation, hire services of essential items like capsules and breast pumps, a furniture assembly service, as well as personalised ways to shop like their Helping Hand over the phone service.

Thanks for joining us today Matt.

 

For those who could not join us at the event, can you tell us a bit about Baby Bunting’s 40th anniversary and the launch of the new brand?

Baby Bunting was founded by Arnold and Gail Nadelman in 1979 with the opening of their first store in Camberwell. Their vision was to be the one stop baby shop supporting new and expectant parents with the widest range of products and expert advice.

Fast forward 40 years, and that mission has not changed.

Now with 60 stores nationally, our team members remain passionate about supporting our customers during a most joyous and often overwhelming time in their lives.

In our 40th year, we unveiled a new more contemporary brand which reflects how parental needs have changed. The way in which our customers shop has changed dramatically over time but their need for support and advice has certainly not changed.

We have worked hard to deliver a brand which reflects the modern parenting experience whilst retaining the warmth and friendliness that we deliver with our teams.

Our messaging and our visual brand is warm and supportive across all communication channels and we have adopted a consistent tone of voice that supports our marketing strategy.

Consistent branding reinforces our identity and purpose of supporting the new generation of parents.

This is a brand that will stand alongside other national and international brands as we expand across different formats and new territories.

Through our brand, we aim to forge closer relationships with our customers supported by a new loyalty offering and expanded in store services, providing customers with a more personalised experience.

 

Nobody predicted anything like COVID-19 to happen. How has Baby Bunting responded to the pandemic?

As a provider of essential goods and services, our stores and our online offer remained open throughout the pandemic. This enabled us to support families nationwide, every step of the way on their parenting journey to ensure each family had safe access to the things they needed.

Our number one priority has always and will always be the health and safety of our Team Members and customers, so, like every other business, we had to modify our operations and ways of working.

Our Support Office and Customer Care Team Members adapted quickly to working from home, while our Team Members in our stores showed resilience in working in a challenging environment.

They adapted to the initiatives we introduced during COVID-19 such as offering safe ways to shop like contactless Click and Collect, contactless car seat installation, and our Helping Hand service.

Our fantastic Team Members in our Distribution and online fulfilment Centre worked very hard to ensure our customers and stores received their items as quickly as possible. This was made all the more challenging as we implemented the best possible COVID-Safe plan to protect our Team and customers.

Online sales for the first half of FY21 were up 95.9% and our click and collect sales for the same period was up 218%.

The dedication and resilience of our teams across the business enabled us to grow during a year that brought enormous challenges to families and businesses across the globe.

While adapting to the restrictions dictated by the pandemic, we were fortunate to open three new stores, 1 in Victoria and 2 in New South Wales.

We also commenced selling to New Zealand consumers via our online store and are in the final stages of rolling out our new brand livery across our store network.

Alongside this we are about to move into a new 24,000 m2 purpose-built Distribution Centre and Support Office in Dandenong South.

We also launched a new recruiting platform LiveHire, implemented an automatic replenishment tool called RELEX.

In December we launched the first phase of our new loyalty program, ‘Baby Bunting family’.

To finish the year the way we did in a difficult environment reflects the strength of the brand and the unbelievable perseverance of our Team.

 

 

Despite the challenges of COVID-19, Baby Bunting has seen a positive momentum in sales growth during FY20. What changes in consumer behaviour did you notice?

During the early stages of the pandemic, we did see some changes in sales mix.

Strong sales growth was experienced in the baby essentials categories such as nappies, feeding and consumables as a result of panic buying.

In lockdown, we saw an increase in s nesting related products like cots, bedding, manchester and nursery furniture.

As travel was restricted through the national ‘lock-down’ period, our travel related categories consequently declined including the sales of car seats, and travel strollers. However, these categories quickly rebounded as restrictions eased.

We also made a conscious decision to encourage consumers to shop differently to avoid unnecessary crowding in store and to meet all the appropriate safety guidelines.

Our customers responded positively with Click & Collect and Click & Delivery growing.  However, during the lockdown periods, we still had around 85% of transactions involving customers coming to store – either as an in-store visit or for Click & Collect purposes.

This highlights the importance of our multi-channel retail offering, where online and our network of stores complement each other.

With over 6,000 new babies born each week, we focussed on growing market share, and the destination large format locations suited customers as the stores are big enough to allow the customer and our Team to operate or shop in a COVID safe way.

 

Baby Bunting launched its Baby Bunting Live Series in 2020. Can you tell us about that, and can we expect more episodes in 2021?

In March 2020, the pandemic highlighted the need to find alternative ways of supporting our customers by offering information and advice when new and expectant parents most needed it.

Like many businesses during this time, our team quickly adapted to ensure customers still had access to the information, parenting advice and support they would receive in-store from our team members.

Together with our suppliers, our marketing and merchandise teams devised a plan for a series of live events on social media to provide a channel for providing advice.

We ran episodes ranging from product demonstrations to parenting advice.

The first season of the Baby Bunting live series launched in late-March, airing over 24 episodes covering various topics, including product information delivered by product specialists, health professionals talking about parent and baby health issues and many more exciting themes.

Our core purpose at Baby Bunting has always been to support new and expectant parents through the early years of parenthood.

Season one of the Baby Bunting Live Series on Facebook and Instagram presented our audience with an easy and convenient way to seek the product information, parenting advice and general guidance required to feel prepared and supported every step of the way.

Season two commenced in November and shared the same purpose, to inform parents and help them prepare for both the precious moments and the more challenging parts and decisions of the parenting journey.

Since the series commenced in March 2020, the live series has had close to half a million views on Facebook with over 50,000 people engaging with the content.

The customer sentiment has been overwhelmingly positive, with customers messaging the page and commenting on the videos with how helpful the information has been.

We understand that our audience is continually trying to seek information, not just about baby products, but about pregnancy and parenting in general.

The Baby Bunting Live Series has enabled us to bring that information to people’s homes, during a time where typical resources may not have been as readily available.

 

The Large Format Retail industry has performed exceptionally well compared to other forms of retail during COVID-19. What do you think this year has in store for the sector?

When in crisis, people tend to shop with brands they trust, and this is exactly what we at Baby Bunting strive to be for families Australia-wide.

Destination Large Format Retail provides consumers with easily accessible stores at great locations and that is something that was really important in the last year and will continue to be so in the years to come.

I think there is still a high degree of uncertainty about the year ahead, although I am hopeful that the uncertainty will reduce as the COVID-19 vaccination program is rolled out.

At Baby Bunting, we will be focused on the customer and continued market share growth through our new store expansion program and our investment in digital.

We have a network plan of 100 plus stores throughout Australia and we are only around 60% of the way there.

Looking ahead, I am optimistic about retail and the sector more generally and look forward to some exciting times ahead.