From Tel Aviv to São Paulo to New York City’s Garment District, the onset of the pandemic in 2020 forced widespread change and innovation across the retail ecosystem. From big retail chains and brands to technology enablement and alternative payments, CEOs across the globe were forced to adapt to a new reality – one in which being able succeed online moved from being essential to absolutely mission critical.
But improved digital performance wasn’t the only outcome that can be traced back to the pandemic. Amid these strong headwinds, retail industry analysts have marveled at the pace of innovation that permeates the sector and the forward-thinking leaders that are pushing the entire sector into the future. After canvassing the globe and evaluating scores of disruptive retail CEOs unafraid to upset the apple cart, it was clear to me that the 21 innovators and risk-takers called out here deserve to be earmarked and watched as 2021 unfolds. These leaders rethink longstanding business practices, experiment with new ways of selling and distribution and drum up completely new business models. Some run startups, others established brands; what they share in common is imagination, vision and pragmatism in building businesses that are in synch with today’s demanding consumers.
[callout]Younger consumers want more out of their brands, which should be all about trust, transparency and doing right by society.[/callout]
- Pressing Fast-Forward on a Digital Brazil: Frederico Trajano, CEO, Magazine Luiza (Brazil)
Magazine Luiza, or better known by its affectionate nickname Magalu, is one of Brazil’s largest retailers with over 1,200 stores spread across 22 of Brazil’s 27 states. (In Portuguese, magazine, as in the French magasin, refers to a retail department store.) Over the years, the company has grown to include an array of related businesses including a finance and credit arm, an insurance and warranties business, and a host of other affiliated brands and services. Founded by the influential Trajano family which includes former company CEO Luiza Helena Trajano – often rumored to be a possible presidential candidate in the upcoming Brazilian 2022 national elections – the Magalu group of companies is a force to be reckoned in this top ten global economy.
But it\’s Luiza Helena Trajano’s son, Frederico Trajano, the company’s top executive, who has emerged on the center stage as one of the global retail industry’s most forward-thinking and disruptive CEOs. He made worldwide headlines last year by launching and defending a controversial diversity initiative aimed at addressing structural racism in his company by announcing that Magalu’s prestigious trainee program would only accept applicants of color. But that’s not all; as Covid began to take hold in this country of 211 million, Trajano accelerated plans for rolling out \”Parceiro Magalu\” (which roughly translates as ‘Magalu Buddy’), a digital platform aimed at onboarding Brazilian small and medium size retailers that had yet to develop a significant ecommerce business – something that proved to be a lifeline as traditional physical commerce was forced to shutter. By providing desperate retailers an array of easy to manage yet highly sophisticated tools, Trajano is enabling physical stores to swiftly migrate onto a digital ecommerce platform complete with store building tools, payments, fulfilment, and logistics support, leveraging off of Magalu’s backend scale and sophistication. In doing so, he is adroitly placing Magalu at the center of a burgeoning ecommerce ecosystem. Trajano not only saved thousands of Brazilian SMB retailers from going under, but in short order created one of the country’s biggest retail marketplaces, in line with the young CEO’s mission to “Make Brazil Digital.”
- Retail Optimized for 5G: Hiroshi Mikitani, CEO, Rakuten (Japan)
Japan, when compared to almost every other industrialized country, has been slow to embrace ecommerce retail. As recently as 2018, only 7 percent of transactions were online according to government statistics, but Covid proved to be something of a boon to ecommerce retailers in the archipelago and famed ecommerce visionary Hiroshi Mikitani was not one to let a good crisis go to waste.
The founder of Rakuten – which means ‘optimism’ in Japanese – is best known in the U.S. for its quirky TV ads that have led a rebranding effort aimed at supplanting the previous U.S. brand, ebates.com. But back in Tokyo, Mikitani’s moves have been anything but whimsy; the Japanese entrepreneur has been quietly plotting the next generation of ecommerce – one that will likely reverberate far beyond Japan. In 2018, the e-commerce giant shocked the local telecom industry when Mikitani revealed plans to spend nearly $6 billion to enter the cellular telephony market, building a fourth mobile network using 5G state-of-the-art technology; now in late 2020, Mikitani’s master plan is coming into greater focus: creating the first retail platform optimized for 5G.
In late 2020, Mikitani made two key announcements. First, in coordination with KKR, he announced plans that he was taking over Walmart’s Seiyu chain of supermarkets, a bold bet on the comeback of in-store retail. A few weeks later, Mikitani announced a tie-up with the Japanese postal service to develop joint initiatives across logistics, cashless payment, and mobile phone services. Although the big picture has yet to be fully revealed, it’s clear Mikitani sees his 5G network as the backbone of a next-generation physical and digital commercial enterprise aimed at revolutionizing retail. And his opening of a second HQ in Singapore has signaled that he plans to expand this new business model across Asia and possibly beyond.
- FOMO Marketing: Jeremy Segal, CEO, Proozy (USA)
Segal has been hustling since his teens when he took the haul from his Bar Mitvah and invested it in golf equipment to start a wholesale business headquartered in his parents’ garage. Fast forward 20 years and Segal now sits atop Proozy.com, one of the nation’s fastest-growing B2C online retailers. Segal’s special sauce – and the reason that so many competitors follow what his company does with near religious fervor – is his mastery of ‘FOMO (Fear of Missing Out) Marketing’ – the ability to use highly intelligent data analysis and machine learning to pinpoint not only exactly what products to serve up to customers, but how to position each deal in a way that activates their brain’s so-called happy chemicals – adrenaline, endorphins, serotonin, and dopamine – to give his customers a rush. To date, Segal has been content to use his tech to hawk name brand apparel, shoes, and some athletic accessories, but the Minneapolis-based entrepreneur has plans to expand into home goods, kitchen, electronics and beyond.
- Purpose-driven Profitability: Charlie Youakim, CEO, Sezzle (USA)
The red-hot, “buy now pay later” (BNPL) space got its start in overseas markets where traditional credit markets were less developed than in the U.S. Installments-based payments apps have since taken off stateside in large part because they cater to millennial and Gen Z shoppers, fearful of traditional credit card companies and wary of taking on debt. Although the U.S. BNPL space is filled with an array of overseas competitors such as Afterpay, Klarna and SplitIt – all offering similar programs aimed at providing consumers the opportunity to pay for purchases using zero-interest installments – Youakim’s stroke of brilliance was realizing that younger consumers want more out of their brands, which meshed well with his view that Sezzle should be all about trust, transparency and doing right by society. In 2020, Youakim converted Sezzle into the sector’s first Public Benefit Corporation (PBC), giving it purpose beyond simple profitability. Consumers and merchant partners have responded in droves, attracted to the company’s guiding principles of environmental sustainability, social accountability and inclusivity.
- Fashion & Diplomacy: Esther Rotter and Gabriel Rotter, co-CEOs, Castro (Israel)
Israel, or the various names that throughout history have been applied to the swathe of land stretching from the Golan Heights down to the Red Sea and across to the East end of the Mediterranean, has been an essential trade route for millennia. The geopolitics of the 20th and 21st century severed those trade routes, but now with Israel inking a series of historic peace treaties with several Arab counterparts in the region – most importantly with the United Arab Emirates – the region is once again positioning itself as major gateway into the rest of the Middle East. No one knows this better than Gabriel Rotter, the CEO of Israeli fashion label Castro – perhaps best known by Westerners as the brand that helped propel the career of Wonder Woman herself, Gal Gadot. Rotter’s fashion brand has 180 stores with locations in Israel, Germany, Russia, Switzerland, Thailand, and Ukraine, but it is now looking at making a serious expansion into the Arab world – namely the UAE. Rotter believes that recent peace deals across the region will make the Israeli Red Sea port of Eilat a new major trading hub as Israeli products are shipped to Dubai for rerouting across the Arab World. Co-CEO Gabriel Rotter has been one of the first Israeli executives helming large-scale companies to hold meetings with Emirati counterparts, looking to shore up aggressive expansion plans to sell Castro products into multi-brand department stores in Dubai and Abu Dhabi as soon as the pandemic subsides.
- Black is Beautiful: Mary Dillon, CEO, Ulta Beauty (USA)
Mary Dillon, who helms Ulta Beauty (a 2020 Robin Report Retail Radical) – the largest beauty retailer in the U.S. – knows that her brand’s massive physical and online presence provides a unique opportunity to lean in on diversity in a big way. At Dillon’s direction, the company recently committed to investing over $25 million to support an array of initiatives focused on promoting products by and for women of color, adjusting merchandise assortments so they are more visible to historically underserved customers, promoting Black voices and creating a more welcoming in-store experience for customers and workers of all backgrounds. The biggest move among these efforts was appointing Black-ish star Tracee Ellis Ross to serve as the brand’s diversity and inclusion advisor. Ross’s charter from Dillon is not only about cheerleading and inspiration; the daughter of iconic soul diva Diana Ross is joining Ulta to drive accountability and ensure that the company’s diversity efforts lead to meaningful change, not just press release pablum.
- Science-based Fashion: Aman Advani, CEO, Ministry of Supply (USA)
You don’t often hear much about high-tech clothing, but Ministry of Supply CEO Aman Advani is building a fashion brand predicated on the notion that science and technology can make clothing scientifically better. And if the company’s recent growth – buoyed by aggressive marketing efforts during the pandemic – is any indication, he may be on to something. The Boston-based high performance business wear men\’s and women\’s fashion brand was the brainchild of Advani and a group of fellow MIT students who thought it would be cool to use some of the same temperature regulating material in their clothing that NASA employees in astronaut suits. What Advani and his team of engineers will drum up next is anyone’s guess.
- The Blue Light Blockers: Neil Blumenthal and David Gilboa, co-CEOs, Warby Parker (USA)
No eyewear brand has made more of a splash over the past few years as Warby Parker, the brainchild of a few MBA classmates at University of Pennsylvania’s prestigious Wharton School of Business. What started as a unique online store for on-demand eyewear has now mushroomed into a network with a physical store presence in nearly all major U.S. cities. But where the on-trend eyewear purveyor is set to really make a difference in 2021 is with the burgeoning blue light blockers eyeglasses category. As the average amount of adult screen time has skyrocketed since the onset of the Covid to well over 13 hours a day, according to a joint study by Nielsen and Eyesafe, the main technology firm providing blue light blocking materials to computer makers such as Dell, Lenovo, and HP. As a result, consumer demand for glasses that block the dangerous blue light emitted by digital devices – a light form that has been linked to an array of serious health concerns – is set to skyrocket in 2021. Warby’s head start in the space evidently created a sense of FOMO by other trendy purveyors of eyewear such as BonLook and Eyebobs – both of which are following Warby Parker’s lead in placing their bets in the blue light blockers category. And all this activity is happening just as major health insurers like UnitedHealthcare and others begin taking preventive measures to ward off the future impacts of blue light, Warby Parker finds itself well positioned to surf the blue light wave, having already captured the loyalty of millions of Gen Z and millenial shoppers.
- Reimaging Sales-based Lease Agreements: Jay Norris, CEO, Guesst (USA)
Jay Norris could be the man disrupting one of the biggest cost components of any physical retail operation – the lease agreement. As in-store shopping begins to remerge as the pandemic comes under control, many analysts expect both retailers and landlords to be looking for new cost structures that minimize risk by entering into variable lease agreements that consider retailers’ monthly sales performance. In the past, property owners have been leery of such arrangements due to limited access to verifiable sales reports, but Jay Norris and his band of tech disruptors at Guesst are making such arrangements more feasible with software that enables property owners to gain reliable insight into their tenants’ retail sales performance in real time.
- Revolutionizing the African American Haircare Sector: Diishan Imira, CEO, Mayvenn (USA)
The Black hair and beauty business is one of the last bastions of retail that is still highly disaggregated, despite being a mammoth-sized sector. CNBC estimates the services side alone of the U.S. Black hair care industry at more than $2.5 billion, but that stat doesn’t include hair accessories, wigs or styling products – which account for the lion’s share of the category spend. Part of the reason that putting a gross figure on total black haircare spending is because, remarkably, only an estimated 5 percent of hair salons and stylists that cater to Black women in the U.S. actually carry the extensions and other products they use on clients’ hair. This means that 95 percent of Black women need to procure their own haircare accessories. Enter Disshan Imira, the entrepreneur who is revolutionizing the Black haircare sector. What started off as a business he was literally running out of the trunk of his car, hawking wigs and extensions, has now emerged as the company best positioned to organize and own the Black haircare market. Having raised nearly $40 million from top Silicon Valley investors such as Andreessen Horowitz, Imira now has the capital to be a force to be reckoned with in this high-growth segment of the beauty sector.
- Redefining Masculinity: Micky Onvural, CEO, Bonobos (USA)
Although Bonobos is owned by mass-market retailer Walmart, this trendy New York City-based online men’s fashion platform has made a name for itself as a quality designer and purveyor of quality men’s fashions. For most of America, however, Bonobos is perhaps best known for its controversial 2017 marketing campaign led by former Chief Marketing Officer and now CEO Micky Onvural. Entitled “#EvolveTheDefinition,” Onvural’s gambit was meant to start a conversation around the modern definition of masculinity, highlighting a platoon of men who felt that traditional the dictionary definition that used words such as ‘strength,’ ‘aggressiveness,’ and being ‘red-blooded’ to explain masculinity didn’t resonate with them. Despite broad-based pushback to the campaign, former CEO and founder Andy Dunn – whose favorite quip has been that the world would be a better place if it were run by women – liked what he saw in Onvural’s risk taking and promoted her to CEO in 2018. At the core of her leadership philosophy is fostering a culture that brings the modern definition what it means to be a man into new light. Onvural has hinted that she is planning on cranking up Bonobos’ message of social change to a new level in 2021, and we’ll see where this rule-breaker will go next.
- Serving the Youth Luxury Market: Darren Todd, CEO, Glue Store (Australia)
One retail segment that is emerging is the so-called “luxury youth” category. Sure, when Fendi sells a short-sleeve sweater for teenage girls for $770 its obviously marketing to parents with lots of disposable income. But across Australia, Darren Todd, the CEO of Glue Store, is embracing conspicuous consumption for the next-gen luxury set with open arms. What makes Todd’s youth-focused Glue Store brand disruptive is the way he is combining a unique – dare we say “underserved” – clientele and in doing so, reinventing the high-end department store experience with novel store layouts, sui generis brand collaborations and an aesthetic that is refreshing. Down under, Aussies in the 15-24 age cohort love their Glue.
- The Cloud-based Closet: Joyce Lim, CEO, Sprout Collection (Canada)
Joyce Lim knows what it is like to be a woman who stares into the abyss of a walk-in closet full of clothes yet sees nothing fit to wear. Lim’s ambition has always been rooted in her aspiration to take the fear and pain out of getting dressed in the morning. She believes that for women, getting dressed is like putting on emotional armor; a woman’s outfit can make her feel confident. What started off as a maternity clothing rental site has literally sprouted into one of Canada’s fastest growing subscription clothing businesses. As opposed to other apparel rental companies that have struggled amid the pandemic because they were born with ambition of renting out fierce workplace fashions and high-end gowns for formal events – both moribund categories amid Covid – Lim has focused on practical fashions that women can wear for Zoom calls or just hanging around the house. She recently acquired the inventory of the since shuttered Rent Frock Repeat, one of Canada’s failed high-end subscription fashion services and she is on her way to dominating the Canadian marketplace. Fashion and Tech insiders feel that Lim may make a move into the U.S. market in 2021, going open toe to open toe with big leaguers like Rent the Runway and Armoire (#18).
- Eliminate the Middleman: Rachel Cohen and Andrés Moda; co-CEOs, Snowe (USA)
One of legendary New York real estate baron Leon Charney’s favorite adages was “never cut out the middleman.” Snowe founders cum spouses Andrés Moda (is that the best last name for a retailer or what?) and Rachel Cohen evidently never had an audience with the late Charney. Or if they did, they certainly didn’t take his advice to heart. Snowe is disrupting the homewares market by taking a no middle-man approach, much like Everlane did in fashion. Cohen and Moda continue to break new ground in the direct-to-consumer space, offering beautiful essentials made from high-quality material, at the best factories, without traditional markups.
- Using Cutting-edge Sanitation Tech to Reopen Retail Safely: Scott Tannen, CEO, Boll & Branch (USA)
One reason mattresses are such a red-hot category nowadays is due to Scott Tannen and his wife Missy who launched Boll & Branch in 2014 by ripping a page from the Warby Parker (#10) direct-to-consumer model and applying it to the $14 billion annual mattress sector. With a low-pressure online sales platform, honest talk about real product differences, inviting at-home delivery, innovative packaging and a quality, lowish-cost product, Tannen’s company quickly developed a social media following and helped usher in not only a new format for how customers expect to buy a mattress, but played a major role in creating an entirely new category: the sleep industry – one that everyone from Ariana Huffington to a bevy of Instagram sleep influencers have latched onto. Although he doesn’t have celeb investors like Leonardo DiCaprio and Adam Levine (something his biggest competitor, Casper, often likes to boast about), Tannen has something much better: a profitable business. Although Tannen’s company has been challenged by its share of strong headwinds stemming from the pandemic, the sleep innovator is not slowing down and is eagerly eyeing a return to in-store sales. Tannen recently inked a deal with Healthe, a company with leading sanitization lighting technology, to become the first retail store to install cutting-edge light sanitization technology to increase protections for customers and employees against the spread of in-store harmful pathogens and viruses.
- Betting Big on In-Store Retail Making a Comeback: Joey Zwillinger, CEO, Allbirds (New Zealand):
Allbirds fashion phenom Joey Zwillinger has, as former U.S. Secretary of State Madelaine Albright might say, cojones. The cofounder of the sustainable, eco-friendly shoe brand just raised another $100 million in Series E funding in addition to early VC fund-raising from a who’s who of Silicon Valley, actor Leonardo DiCaprio, and former Starbucks CEO Howard Schultz. What’s all the fuss about? Made with New Zealand merino wool, Allbirds shoes promise to keep your feet warm without getting musty and also stay dry if you happen to step in a puddle thanks to the brand’s “bio-based water-repellent shield.” But what makes Zwillinger a guy worth watching in 2021 is his recently announced big bet on physical retail, just at a time when many brands are retrenching amid fears that commerce has fundamentally shifted to online amid the pandemic. Allbirds recently announced plans to use a good chunk of its hundred-million-dollar haul to expand its physical retail presence in a number of key cities across the globe.
- The Masked Hero of Retail: Max Bock-Aronson, CEO, Breathe99 (USA
While on a run on a particularly smoggy day in Singapore a few years back, Bock-Aronson had to stop atop a hill as he felt the pollution burning his lungs. He wondered why there wasn’t a face mask that could easily be worn during strenuous exercise. Fast forward to 2020 and this Minnesota native has found his line of masks that that block 99.6 percent of air particles on the cover of Time Magazine as one of the Best Inventions of 2020. Branded as Breathe99, Bock-Aronson has arguably the best consumer mask on the market at a time when masks are becoming the new fashion accessory, as commonplace as a pair of socks. At a time when retail is suffering, Max Bock-Aronson is literally retail’s new masked hero.
- Community-based Fashion: Ambika Singh, CEO, Armoire (USA)
Whereas Rent the Runway, a direct competitor to Armoire, was forced to scale back during the pandemic, closing brick-and-mortar stores and laying off employees, the four-year-old Seattle-based Armoire, helmed by Ambika Singh, just landed $3.5 million in new funding from some pretty serious investors including Microsoft CEO Satya Nadella and GoDaddy CEO Aman Bhutani. It’s likely that Nadella and Bhutani were impressed with some of the bold moves Singh took just as the pandemic was turning the entire fashion industry on its head. Among the smartest of her plays was plowing resources into engineering efforts to create new community-driven discovery tools – the result of closely monitoring Armoire’s social media pages and seeing how Armoire users interacted with one another. Singh saw engagement metrics immediately shoot up as it sought to recreate the virtual version of a girls’ shopping spree. These new community-driven engagements helped keep the company’s long-time members from turning off the service during Covid and actually drove new sign-ups.
- Reimaging the Virtual Showroom: Stephen Kuhl, CEO, Burrow (USA)
Burrow – oftentimes dubbed the ‘Casper of sofas’ (see #14) for its ability to sell and deliver quality sofas at affordable prices with speedy delivery times – was, like many direct-to-consumer retailers, forced to rethink its business model as Covid set in. The startup founded by Kuhl and Kabeer Chopra, a fellow classmate at Wharton’s MBA program, began as an online business, and the duo eventually moved to open a brick-and-mortar location in the heart of Manhattan. They realized that many consumers still preferred to test-drive a major expenditure like a sofa by stopping by a physical store and putting some butt-time into a showroom model. The pandemic of course, put a halt to much of the in-store test-drive market, but as things begin to open up again, Kuhl is already thinking about new ways to showcase his company’s pieces in a way that\’s safe for both customers and employees. Enter “Burrow House from Home” – a virtual design consultation service that enables prospective buyers to take a virtual test drive of its showroom, hosted by a live and knowledgeable salesperson. While Burrow House from Home has been hot during the pandemic, Kuhl sees it as a new permanent feature of his product offering – and one that has a much higher ROI than investing in more physical locations because it allows the brand\’s design consultants to connect with consumers across the country rather than just in New York City.
- 110% Sustainable Fashion: Tina Bhojwani, CEO, Aera (USA)
After a career at Donna Karan, Theory and later helming Dolce and Gabbana’s U.S. operations, Bhojwani is no stranger to what it takes to make it in fashion. Her inspired line of vegan luxury footwear, which has been written up in Elle, The Wall Street Journal and everywhere in between, overcompensates for each pair of shoes’ carbon, fresh water, and synthetic-use footprint by investing back into green and sustainable projects – a practice that has earned Aera’s right to brand itself as being certified “110 percent Sustainable” by a host of reputable third-party certification bodies.
- Buy One, Donate One: David Heath, CEO, Bombas (USA)
If you ever listen to satellite radio, you have undoubtedly heard Bombas socks pitchman cum CEO David Heath talk about his company’s pledge to donate one pair of socks to a homeless shelter for every pair sold. Heath is making the point that companies can be mission-driven, sustainable, and profitable all at the same time – perhaps a harbinger of ‘virtuous cycle’ retail brand business models of the future. Turns out consumers don’t mind paying $20 for a pair of socks if they know that in doing so, they are helping execute a valuable social mission. Heath’s “you buy one, we’ll donate one” promise has been hitting on all cylinders. After adding T-shirts to its apparel offerings, the company announced that it was making a foray into another key clothing category: underwear. The briefs and panties, also priced at a premium, offer some innovative design tweaks such as the elimination of annoying tags, but the real innovation remains coupling social good with bottom-line results.
3D Italian Fashion: Roberto Luongo, General Director, Italian Trade Agency, EXTRAITASTYLE (Italy)
Although Luongo is not a CEO per se, the Italian Trade Agency he runs green lit a bold experiment entitled EXTRAITASTYLE (an acronym for Extraordinary Italian Style) for promoting Italian retail. The effort is a unique public-private partnership aimed at celebrating the global fashion leader’s finest brands – the majority of which are still family-owned – all in a virtual 3D experience. The platform debuted with 80 different brands companies online with scores more set to join throughout 2021. If it takes off, it could spur other fashion hubs around the globe to follow suit.