Organizations are looking for ways to learn from 2015 and set themselves up for greater business success in the future. For retail stores, wholesalers and manufacturers alike, the focus is on meeting growing customer demand and optimizing their business processes to guarantee satisfaction.
It’s no mystery that customer shopping habits are shifting with increased reliance on technology, moving from frequenting brick-and-mortar stores to making purchases online and through mobile apps. In fact, according to the National Retail Federation, e-commerce sales were at an all-time high in 2015—nearly double that of just five years ago. And with some brands offering next-day and even same-day delivery, consumers expect to receive packages in an increasingly short amount of time. With the growth of purchasing channels, or omnis, retail stores have their work cut out for them to continuously meet customers’ expectations of arrival of their purchases on time and at the best price.
More Channels, More Challenges
In today’s highly competitive and time-sensitive retail and consumer product landscape, being able to provide on-trend, timely and smartly priced merchandise can be the difference between success and failure. And, in order to obtain these business objectives across omnis, brands and retailers must face these challenges head on by achieving:
- Increased understanding of consumer demand.
- Skillfully planned and developed product mixes.
- Improved collaboration across channels.
Companies can successfully meet these objectives by achieving real-time visibility into each omni, coupled with dynamic merchandise planning, forecasting and inventory. To meet the demand, retail and consumer goods companies are turning to next-generation omnichannel solutions.
Maximizing Mobile Mania
One way retailers are increasing omni visibility is with mobile. Mobile apps can provide wholesalers and retailers with greater insight into customer demand. One example of mobile mania is the trend in value-added apps, or those that provide a customized customer and brand experience. Some retailers utilize these apps as another way to reach their customers and offer lifestyle gains, and entice customers with incentives, such as coupons or offer promotions, when they are close to a store. Some even create targeted recommendations based on past purchases, demographics or trending items. These apps can help retailers push purchases if a product is overstocking the shelves or when seasonal items need to be moved quickly in anticipation of new trends.
In turn, these apps provide an additional layer of data points for retailers to leverage—from views and purchases to returns and reviews. This information can be analyzed in preparation for meeting customer demand during the next season or promotion, ensuring processes throughout the supply chain run seamlessly during the busiest seasons.
Right Product, Right Time, Right Price—the Omnichannel Solution
Omnichannel planning solutions provide a powerful, comprehensive set of tools to manage and drive merchandise planning, forecasting, brand management and inventory control requirements. Each aspect of omnichannel planning technology enables a more robust and flexible infrastructure to improve individual channel plans—ultimately ensuring retail brand orders are fulfilled, and consumers receive their products at the right price and at the right time.
One of the many benefits of omnichannel planning solutions is the ability for retailers to see an aggregate view of demand and inventory. In turn, companies can develop product purchasing plans to meet demand across all purchasing channels, rather than sourcing goods piecemeal to satisfy different distribution points. In addition to this, assortment planning capabilities enable retailers to plan for specific product categories using historic point-of-sale data, enabling cluster planning and forecasting on a style by style basis down to the stock-keeping unit (SKU) level. Store-level plans can be developed from these cluster plans and easily adjusted on an individual account basis to improve forecasting based on actual sales to date. With access to historic purchasing data, retailers can ensure they are prepared to manage the customer demand for each brand they support throughout the various purchasing channels.
And, as omnis continue to grow and shipping turnaround times shorten, picking and packing of single units is becoming increasingly important. Advanced omnichannel technology is empowering retailers to keep their competitive advantage by fulfilling individual items direct to the retail store for a specific consumer. For instance, let’s say that a customer needs a new pair of sandals as the seasons change. While he can opt to order the sandals online and ship them to his home address, many consumers are ordering online and picking up their merchandise in stores in an effort to reduce delivery time. Forrester reported that 50 percent of consumers prefer this method of online shopping, also known as click and collect.
While the trend of click and collect continues to grow, many retailers are still struggling to keep pace. In fact, Forrester also found that 10 percent of retailers that offer in-store pickup of online orders cannot fulfill those orders due to inaccurate store inventory. And, we saw evidence of this in the 2015 holiday season—according to one survey—60 percent of click-and-collect orders ran into problems. It goes without saying—by not fulfilling orders, the customer experience can be severely affected. But with real-time inventory data via omnichannel merchandise planning solutions, retailers can circumvent issues with click-and-collect shopping.
With real-time visibility into demand and inventory, retailers that leverage next-generation omnichannel technology will see the greatest success year-round. They will know exactly what demand to anticipate, what stock they have on hand and where it is located, allowing for more accurate merchandise planning and management, fulfilled orders and, most importantly, satisfied customers.
Paul Magel is the president of the business applications and technology outsourcing division at CGS.