A retailer’s fortunes hinge on its reputation, a fact that loss prevention executives should lean into, according to Brent Brown, vice president and general manager for retail and RFID at Sensormatic Solutions. At customer-facing businesses, he said nothing is more mission critical than promoting and protecting the brand, and LP plays a critical role in reputation management.
“Protecting the products and the people, and ultimately the profits and the viability of the brand, is one of the highest-level functions of any organization,” Brown explained. “It’s especially true in retail, where your brand is your calling card; it’s the marquee.”
Many characteristics comprise a retailer—products, price, customer service, store design, and more. Nothing, however, has a more profound impact on future profits than how customers feel about a retailer—what a store’s name evokes.
The Importance of Brand Equity
Brand equity—as a percentage of a company’s market value—has risen steadily. And, unlike other business risks, those to a company brand and its reputation are nearly impossible to insure against.
It’s also fragile. It can take a retailer substantial time, effort, and money to craft just the right image, to build a positive reputation, and earn the trust of customers—and it can evaporate instantaneously by comparison. From the experiences of individual shoppers to the consensus perception of a fickle public, perceived missteps can quickly do “you’re-dead-to-me” damage.
Protecting the brand has also gotten trickier, said Brown. Board of directors at retail organizations feel they are walking a tightrope, especially as social and political issues have invaded a previously purely transactional industry. Connecting meaningfully with customers over issues can build loyalty with some shoppers but alienate others. Social media puts newfound pressure on retailers to take stands, and that can have fallout both good and bad.
Which is why, when it comes to brand protection, retailers need to control the controllable. Unforced errors must be avoided at any cost. “If you keep your environment safe, if you keep your stores well-stocked, if you keep your stores well-staffed, and if you make shopping easy for your good customers without making it easy for the bad guys, then you are enabling the core mission of the enterprise to build and develop the brand,” Brown explained.
The link between security and reputation protection is clear. Keeping a company out of the headlines by preventing violence, avoiding lawsuits, and managing crises is central to protecting its good name. It was underscored during the pandemic, which put a spotlight on the direct line between store safety and business resilience, and the reliance on asset protection teams to deliver it.
On-shelf availability is an equally essential element of brand protection. When theft diminishes stock, causing disappointing in-store experiences, retailers lose more than sales, they lose the faith of their customers. “The stakes are even higher for retailers in the world that we live in now, where shrink is rising, and where crime is rising,” Brown warned.
“In order to have a great brand, you must have a reputation as a safe place to shop. If a shopper doesn’t feel safe, he or she isn’t coming back,” Brown explained. “And if they are disappointed every time they go to the store because they don’t have what they want, that’s going to kill the brand.”
Intelligence-Led Loss Prevention
Retailers need a brand-affirming protection strategy, explained Brown. “The challenge we’ve got as an industry is to move beyond ad hoc asset protection where there is little or no data to back up our strategy,” he said. “It’s the data that allows you to understand it, calibrate it, improve it, and then repeat that entire process. We need to pursue intelligence-led loss prevention, whether it’s managing inventory, or managing people, or managing safety and health, or compliance of your stores.”
Retailers hoping to build a sustainable brand, one that successfully evolves with its customers, need an effective asset protection strategy combined with loss prevention capabilities to advance that mission. The key, Brown explained, is a repeatable process built on a foundation of data. “This notion of being able to measure it, score it, manage it, and improve it—it’s not a new idea for asset protection, but it is now permeating every element of asset protection, and it is time for that idea to be the North Star of asset protection professionals in order to drive successful programs that meet the higher calling of what retail organizations need.”
Despite growing awareness of the harm that theft and organized retail crime can do to retailers and their brands, the industry’s approach to it remains largely fragmented and unsystematic. That will need to change for asset protection to play the role it needs to play in building sustainable relationships with customers.
By creating a layer of intelligence, retailers get answers to the questions they need to know to secure the brand, said Brown. “It provides visibility into questions of where’s the problem? How big is the problem? How do I make sure I’m spending my effort on my biggest problems? And am I executing on whatever response plan we devise consistent with our brand?”
Brand-Specific Asset Protection Approach
Data is a critical backbone to designing a brand-specific asset protection approach, according to Brown, noting that Starbucks and Walmart wouldn’t approach brand protection the same any more than they would adopt the same marketing program.
“The key is a protection plan that is true to values essential to your brand, and to then be able to execute your game plan, but you can’t do that if you don’t know the details or the depth of what’s happening, where it’s happening, to what extent it’s happening,” he said. “Intelligence-led loss prevention is the beginning of this next generation of asset protection.”
An intelligence driven transformation enables the asset protection function to operationally integrate with other requirements of the business, facilitates the ability of LP to succeed in its expanding roles and responsibilities, helps LP departments secure necessary resources, and allows its alignment with the core mission of retail organizations—to enhance and protect the store brand.
