There are currently three major challenges in the retail industry: Multi-channel retail, mobile shoppers, and providing business flexibility. How a business chooses to deal with them could mean the difference between outstanding success and miserable failure.
1. Multi-channel retail
It is no longer sufficient for a business to operate using a single channel to market. Smartphones and tablets allow shoppers to purchase products wherever and whenever, from whomever they choose, making the concept of a 9-to-5 business redundant.
According to Econsultancy:
- In the UK, 40% of shoppers believed it was important to be able to purchase from a retailer using different channels, up nearly 10% on the figures from 2011.
- 76% of shoppers expect to be able to return an item purchased online to a local store.
“While the growth in online shoppers is clear, our data shows that there is still a robust segment of consumers who prefer to shop [via] bricks-and-mortar stores. For retailers, this reinforces that how consumers want to shop is as strategically important as the price they are offered.”
Eric Anderson, Hartmarx Professor of Marketing at Kellogg – 2012 Kellogg Shopper Index
However, for the forward-thinking business, implementation of a system which unifies all retail channels is a better investment. Known as omni-channel retailing, the idea is to provide a consistent customer experience using a single or integrated multi-channel software platform to power transactions, stock and other internal business processes transparently.
This consistent experience is attractive to consumers and helps differentiate your offering from your competitors.
2. Mobile shoppers
The practice of checking competitor prices online while visiting a store (a practice known as “showrooming”) is gaining in popularity and causing traditional retailers a lot of concern.
- 5% of British shoppers turn to their mobile when an item is out of stock
- 48 million people are expected to “showroom” during December 2012 in the US, a rise of 134% on the same period last year
- 70% of showrooming shoppers are more likely to buy from businesses offering mobile commerce websites or dedicated smartphone apps.
Customer service and in-store experience play a massive part in consumer attitudes to showrooming. Most shoppers only resort to mobile shopping when there is a stock shortage or they receive poor service.
The choice of a multi-channel software platform that allows a business to refine its mobile offerings, improve stock supplies and assist staff with providing better, targeted service will help provide differentiation in a crowded marketplace.
3. Business flexibility
Adapting to an evolving marketplace requires a business to introduce more flexibility into its business processes. For instance, the only way to satisfy customer demands for omni-channel services is for retailers to be flexible in the way that they interact with their customers to provide a consistent experience.
Again, much of this flexibility will rely on choosing a multi-channel retail software package which can be flexed and altered in line with changing business processes.
“Many leaders of big organizations, I think, don't believe that change is possible. But if you look at history, things do change, and if your business is static, you're likely to have issues.”
Larry Page, internet entrepreneur
The internet has widened the field of competition, making it ever harder for retailers to maintain or grow their market share. In order to compete, successful businesses will need to look at multi-channel retailing to unify their processes. In doing so, they will:
- Centralise and standardise processes making them easier to administer and maintain
- Create a consistent user experience across every channel
- Collect and collate additional customer data which can be used for effective marketing and promotional activities
- Differentiate their products and services from the rest of the market.
This isn't a new approach, market leaders such as John Lewis have been doing this for some time. There's a lot you can learn from how they've adapted to the changing retail environment:
Download your free eGuide today and discover how high street brands like John Lewis are dealing with the same challenges you are.