By Teresa Zobrist
Thanks to the flood of online choices, today’s consumers are more sophisticated, savvy, price-conscious and picky about the purchases they make.
Confronted by this new educated consumer reality, retailers are under pressure to deliver a more compelling shopping experience to attract and retain these consumers as well as identify new market opportunities to stay ahead of both the online and brick-and-mortar competition.
This, in turn, is creating a new breed of retailers filled with hyper-individualized experiences entering the marketplace. Group buying sites are offering in-store deals that are delivered directly and automatically to a person’s smart phone as soon as they enter a store, where sales promotions on items or products are within a few feet of the customer.
In addition, we are seeing the development of a shopping experience that is bringing the personalization and customization of offline and online shopping together. Using a tablet or mobile phone, shoppers in stores will be able to access their avatar via a full-size networked “mirror” where they can “try-on” clothing, make-up and more without time-consuming trips to the changing room.
However, with limited resources and limited IT budgets, many retailers are also confronted with a larger set of old business conundrums to meet these new consumer challenges.
As in all business, financing continues to be retailers’ lifeblood to start and build growth and to stay afloat when sales are slow. Whether expanding or simply better understanding and catering to the new consumer, access to financing is the key that opens the door to new opportunities.
Financial strength of a retail business is the yardstick used to measure growth readiness. Growth requires capital to purchase additional equipment and technologies, invest in additional talent, create new marketing campaigns targeted to the individual and provide support for ambitious new operations.
Perhaps the most capital intensive investment is in digital assets. But it’s a necessary one and is key to driving growth in today’s digital era, where mobile shoppers will total 580 million consumers by 2014 according to Juniper Research. More and more retailers see the importance of a more simplified approach to both consistent and collaborative supplier interaction and seamless integration of back-end systems. Retailers know they must quickly embrace advanced technologies such as analytics not only to achieve efficiencies, but to improve the quality of customer information in order to anticipate the next wave of consumer trends.
Collaboration with suppliers, vendors and distributors on a simplified platform ensures accurate product information is shared. It also allows multichannel retailers to populate their sales media (i.e., social channels and mobile devices) with data that is in a format that is efficiently uploaded and easily consumed.
Analytics will continue to make the difference for many retailers who are leveraging the technology to uncover demand patterns, improve inventory assortment and determine how price elasticity will impact purchase behavior. Capturing insight on customer interactions, call center logs and social media connections help retailers gain a better understanding for what drives customer engagement and buying decisions.
This increased focus and investment on efficiency and supply chain visibility, combined with the mounting volume of data being generated by virtual stores and social channels provide retailers with the foresight to attract the loyalty and wallet of today’s and tomorrow’s consumer.
But in order to determine how to serve these more sophisticated and savvy shoppers, retailers need to rethink their operations to be more customer-centered, more relationship-oriented, more transparent, and more analytical.
Follow Teresa Zobrist on twitter @ZobristInc.