As we lead up to NRF 2015, this week Supply Chain Nation turns its focus to trends impacting digital retail. Follow along each day this week as we explore a new topic related to retailing in the digital age.
The customer is the new King of the land. We are faced with a powerful combination of capabilities that has given the consumer the crown.
Forbes magazine coins this with the memorable acronym SMAC
This combination of capabilities gives the retail customer the keys to the kingdom. They have the ability to change the entire landscape of how they interact with the retailer and even directly with the manufacturer. Add the Internet of Things (IoT) to this landscape and consumers will be making orders that are instigated by machines and sensors. Customers have quickly and quietly taken the crown.
Retailers need to be adaptable and proactive as these forces take charge. Change is difficult, but if you reengineer your business processes to reflect the process of your customers, you will be well on the road to success. Think like they do. Deliver what they expect, and you will become their knight in shining armor.
Social media will continue to drive consumer opinions and influence buying options. You need to listen and respond to what your customers are saying about you, and about your competition. You will need to both push and pull opinions into the social network, using it as a collaboration mechanism between you and your customers. Push out your brand, your ideas, and your style boards. At the same time, listen to the chatter that is being posted about you. Respond to both the positive and the negative.
Mobile devices will enable your customers to research product information, pricing, reviews and availability anytime, anyplace. Sometimes your customers will know more about your products than your associates do. Mobile and social conversions will become very important. Your Brick-and-Mortar stores will remain the execution focal point of all of your channels and the hub of the buying experience. Excellence in customer service for both your in-store and online customers will be the differentiator in this new world.
Analytics connects the other three, and is arguably the cotter pin that holds it all together and makes it meaningful. Once the Internet of things is commonplace, data will be coming at us from everywhere. Analysis enables personalized offers to your most valuable customers. This is where you will discover their buying behaviors and align assortments, pricing, promotions
and inventory placement to what, why, where and when they buy.
Cloud enables everything to happen in real time across all of your channels. Your cloud needs to be large enough and stable enough to handle the enormous amount of data that is coming its way. The reason for the cloud platform is its simplicity. By moving to a single platform, you immediately simplify your processes, eliminate silos, and reduce integration and upgrade costs. You can increase scale and improve performance. Cloud will enable you to deliver a seamless brand experience across all of your channels and will enable your big data analytics.
All of this sounds completely logical, but it also sounds like an insurmountable task for a retail organization that already has no time to breathe.
How do you climb a mountain? One step at a time.
Be realistic in your goals. Stick to the basics and plot a series of small steps in order to make the big leap. Do your homework and honestly examine the current state of your organization. Take each of the strategies listed above and determine where your organization is across the entire end-to-end retail process lifecycle.
Identify your strengths and weaknesses, and do a gap analysis to determine where you need to focus your attention. Plot each competency against your major processes. Use this analysis to create a realistic roadmap. The roadmap should be concrete for the next 12 months, defined for the following year, and then dynamic for years 3-5.
Next, commit your organization to the journey ahead. Create buy in and support with your major stakeholders. Secure an executive sponsor. Communicate the plan to your organization, then to public, press and analysts as you are ready.
Now, create your plan of action. Break down your year-one goals into tactical actionable steps with timelines and assigned accountability. Set yourself up for success, and communicate and celebrate each success along the way. Set milestones, and as you pass each milestone, you will know you are that much closer to becoming a world class retailer.
Finally, do not be afraid or even hesitant to ask for help. JDA Strategic Services, as well as many of our partners, have proven methodologies for helping you navigate the rocky road.
Howard Baldwin, A Match made somewhere: Big Data and the Internet of things, Forbes Magazine, 11/24/2014