WHAT'S IT ALL ABOUT...
The face of retail is changing at a faster pace than ever before and it’s shaking up the retail industry more than ever before. The introduction of mobile and online channels have meant that retailers have had to move away from the traditional bricks and mortar model and embrace the world of digital.
Convenience has taken precedence in the industry. Customers expect to be able to browse on their mobiles during lunch, order online at home and then easily return unwanted purchases to their local store. But delivering this kind of seamless experience requires a great deal of agility across the supply chain.
Stock held for online sales channels is often managed in a different warehousing system to that of high-street stores, and for many retailers, unless there is close synchronisation between sales outlets, some stores will be left with too much stock, whilst others are left with too little.
On top of this, now it only takes a picture of a celebrity sporting a brand’s latest accessory on Instagram for the item to sell out in a few short days, or for a change in the weather to cause havoc to stock levels. Plus, there’s increasing pressure from online retail giants like Amazon, who continue to deliver on price and convenience.
The struggle to keep up in an ever-changing world
Such pressures have meant that some retailers simply haven’t been able to keep up, and this has sparked a domino-like effect across the industry, with mass job losses across the sector and retail giants closing their doors.
To survive, retailers now have to keep up with the ever-changing digital world and introduce synergy between their different sales outlets to produce a seamless omnichannel experience for customers.
It’s never been more important to ensure that demand planning and inventory are aligned, to make sure that sales forecasting is as accurate as possible, and having up-to-date information is crucial to ensure production decisions are appropriate.
The issue is, many retailers continue to extract critical information about their different channels from disparate IT systems, often using spreadsheets to combine and manage that data. This approach is limited, as it simply won’t give retailers a realistic picture of their business, meaning that accurate planning across all channels is unlikely.
Data Analytics gives retailers the power to harness the omnichannel experience
Data analytics bridges this gap by providing retailers with the ability to view their entire inventory in real-time, giving them a 360 view on their sales position and stock levels. Retailers can also deal with increasing expectations by monitoring shipping, improving warehouse processes and fulfilling orders through any channel. This prevents out-of-stock disasters or logistics issues and gives retailers the time to better serve their customers.
Implementing an analytics solution that’s integrated with all warehousing and point of sale systems provides a single dashboard with full visibility across the business. This enables managers to react to changes in consumer demand and forecast more accurately. By combining historical data from each channel into a single area, what-if scenarios can be carried out across all channels rather than treating one in isolation.
In addition to this, retailers can view their costs at a granular level, right down to day-by-day expenditure so that they can remove unnecessary spend and reinvest in the areas that provide the highest ROI.
Access to such capabilities is essential for retailers to be responsive to their consumer's needs, and this in-turn is allowing more and more retailers to provide an omnichannel customer experience.
The retail sector is moving in a direction where it will soon become a must for retailers to embrace a customer-focused omnichannel business model. Customers expect more than a catchy tagline boasting about customer experience and competitive pricing – they expect retailers to live this out – and to do this, implementing data analytics into the wider business strategy is essential. Many retailers are gradually beginning to understand the power of this, but those who recognise this early on have a significant advantage over their competitors.
Laura Timms is Product Marketing Manager at MHR Analytics. With a background in Psychology, Laura has carried out research into the Retail sector to reveal market and industry trends, and has managed research and strategy for business technology products for the past three years.
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