The Digital Age of Retail
The Digital Age of Retail is upon us, and the evolution of digital channels has revolutionized the way people shop today. Customers are shopping across all channels and are expecting a seamless experience; most retailers are responding accordingly and prioritizing digitization and increasing their digital investments.
Whether it’s personalization, Internet of Things (IoT), mobile applications, smart beacons, new POS systems, Buy Online Pickup in Store (BOPUS), AI, or VR, retailers are making these investments and trying to understand customers’ changing shopping habits, and improve their technology and systems to provide the shopping experience customers expect across channels, and anticipate and prepare for retail’s future needs.
Looking at the Golden Business Triangle of “People, Process and Technology,” as you’d expect with “Digital,” much of the focus is on Technology. And while that’s certainly a significant part of the puzzle, some of the major challenges retailers are facing today are the People and Process elements, as they try to determine the perfect balance and implementation of physical presence and digital touch, as well as bridge digital and physical shopping experiences.
Almost all brick-and-mortar retailers are in on the e-com game to some degree, though according to the U.S. Department of Commerce, e-com sales only accounted for 8.9% of total sales in 2017, up from 8% in 2016. And while this trend will continue to grow, it begs the question for retailers how to leverage their existing stores and people, which are the bedrock of their business, while implementing new technologies and processes to remain relevant in the digital age.
This requires retailers to determine what changes are critical, profitable, and urgent, and to implement new processes and facilitate collaboration across departments to support those changes- while remaining focused on delivering a consistent, engaging customer experience across all channels.
Some of these common digital focus areas of change are related to online sales, BOPUS, in-store support, and reverse logistics:
- Where, when and how to fulfill online orders
- How to route orders, zone skipping, selecting carrier(s)
- How to align the P&L and designate ownership of inventory
Buy Online – Pickup in Store
- What is available for in-store pickup
- How to maximize the customer’s in-store experience
- How to stay competitive and exceed customer expectations
- What is the best in-store process to support service levels
- How to maintain the proper staffing levels to support the business
- How to ensure in-store inventory accuracy is maintained physically and systematically
- How can / should your store teams leverage online services to increase size of basket
- How to align the P&L to promote combined sales goals
- How to handle online only items, or SKU’s that are not assigned to return store
- How can returns be processed efficiently
The problem for most retailers is how to make these changes in the best fashion, in the shortest amount of time, to drive the greatest customer experience and profitability. And while retail is absolutely full of talent and expertise, and most retailers are certainly capable of effecting digital organizational change- it’s much more a matter of timing and degrees of success. Partnering with the Stores Consulting Group, dedicated to helping reimagine the people, processes and technologies to make the retail business more agile, responsive, digital customer friendly, and profitable, can ensure the highest degree of success as soon as possible.