To survive in an ever-evolving industry, retailers need to rethink their priorities, strategies, and enabling technologies now more than ever before. In fact, according to a recent IHL study, retailers who went out of business had at least one of the following characteristics in common: they were expanding their footprint too quickly, their management or investors saddled the companies with massive debts, they refused to modernize their systems and/or had not updated their business model to reflect the modern world. So, why is embracing change the secret behind retail success?
Legacy Systems Can No Longer Keep Up with the Times
Even as we approach the second decade of the new millennium, there are still retailers relying on technology that was developed and installed in the late 1990s. Fast-forward twenty years and retailers are struggling to adapt these antiquated legacy systems to support evolving omni-channel strategies — efforts that often fail. More specifically, 72.5% of companies say their systems are still underdeveloped, or worse, absent in the quest for connecting the end-to-end shopping experience across channels, according to a report from Accenture.
Thanks to the omni-channel retailing business model, consumers are getting very comfortable with an “always on” shopping experience that delivers optimal assortments and flexible fulfillment options, regardless of the channels they use to complete their shopping journey. Retailers burdened with legacy systems are finding it next to impossible to analyze and understand customer demand and shopping and fulfillment patterns. Using modern demand management solutions with a solid enterprise core enables retailers to satisfy customer needs by having the right products at the right place and at the right time. Existing legacy systems continue to cloud the judgment of retailers, making it nearly impossible to accurately analyze customer demand and optimize assortments.
Siloed Processes Are Hurting Your Business
The traditional planning process is conceptually straightforward: identify what to sell, who to sell it to, at what price, and then ensure the product is where it needs to be on time. This is simple when applied to individual selling channels. However, with customers expecting a seamless experience across all channels, it has become very complex to deliver customers the experience they expect while maintaining a healthy bottom-line.
The siloed approach might have worked when most consumers shopped within specific channels. However, today’s consumer moves seamlessly between channels when shopping and also expects flexible fulfillment options, like buy online and pick-up in store. Retailers must plan and manage inventory holistically across all their channels in order to satisfy customer demand while meeting their financial objectives.
Find the Way to Customer’s Heart
As consumers are demanding that their shopping experiences become more digital and interactive, it’s not surprising that social media is gaining traction in the retail journey. Retailers need to innovate and keep up with the latest social media channels to meet customers where they are. Retail marketers rely on social networks to bolster their reach, using the medium to share content, deliver channel-specific promotions, and most importantly, interact directly with their loyal shoppers. According to Nielsen, 77% of shoppers say ‘social exposure’ and validation of a product is the most persuasive source of information that drives them to make more purchases. Therefore, integrating social media feeds into your website can be an effective way to attract new customers and boost sales.